Spotlight on India

Four Indian companies were included in the 2017 Cotton Ranking:

Aditya Birla
Fashion &Retail

Arvind
Lifestyle

Raymond

ITC

None of these companies have any publicly available information on policies on more sustainable cotton, uptake or traceability of their supply chain but we offer a spotlight on India as a representative example of all emerging markets with the aim of gaining a better understanding of the situation and potential strategies for improving local uptake.

context

India is emerging as one of the most attractive retail destinations in the world but domestic players face stiff competition from international brands.

Consumer purchasing choices are driven primarily by affordability and most Indian brands focus on addressing consumer needs, increasing market share and improving profitability.

policy

Indian companies do not have clear cotton procurement policies or targets. Increasing levels of vendor engagement on water stewardship, chemical management and socially responsible labour practices in tier-1 and tier-2 of supply chains are hampered by a lack of technical know-how, capacity and awareness about ethical supply chains, even among larger businesses.

uptake

Actual uptake of more sustainable cotton domestically is negligible. While the brands recognise the need to adopt sustainable business practices, most current efforts focus on manufacturing resource efficiency and social license to operate. A more holistic approach addressing the lifecycle of products and operations is yet to be widely adopted.

Traceability

While two out of the top four brands publish sustainability reports, public disclosure on actual cotton consumption is limited. Most Indian companies struggle to establish traceability in their complex supply chains.

Brand explanations for lack of uptake

Indian companies attribute their lack of uptake of more sustainable cotton to:

Inability to leverage economies of scale due to competition from export houses and international brands which make additional transactional costs associated with certified sustainable cotton unaffordable;

Lack of consistent supply at required quality specifications, volumes and price;
Lack of consumer demand.

RECOMMENDATION

Companies in Europe and the US offer similar explanations for lack of uptake. These are addressed in
the 2016 Mind the Gap report . Indian companies now have a real opportunity to:

Develop sustainable cotton policies and time-bound commitments to phasing out conventional cotton and sourcing more sustainable cotton;

Create responsible supply chains and market differentiation through sustainability; and
Build consumer awareness and domestic demand for more sustainable cotton.