Iconic brands and the ethics of luxury

Dr Jem Bendell, Today Online 17 Jan 08;

It is time to turn the question "what are you made of" onto the companies and examine what lies beneath the brand.

"What are you made of?" From London to Little India, stars of sport and screen ask us as they peer from billboards and magazines.

The watch company Tag Heuer suggests wearing their brand provides the answer: You are made of something strong, successful and beautiful. George Clooney now chooses Omega; so do actresses Ivy Lee and Kym Ng.

Luxury brands sell status. They are the highest-priced and highest-quality item in any product or service category, providing the consumer with an elite experience. Watches, jewellery, high fashion, exclusive resorts and restaurants comprise a sector worth about US$150 billion ($214.6 billion) per annum.

Working with celebrities and spending billions on advertising, iconic brands such as Dior and Prada have become a global language of luxury, influencing what people admire and aspire to worldwide. A new social order defined by brands is taking hold in Asia.

That is good news for big-name brands. Louis Vuitton and Chanel have doubled the size of their flagship stores at Ngee Ann City, while Changi Airport hosts a luxury-retailing "island" featuring Bulgari, Cartier, Fendi and Bottega Veneta outlets. There are more brand connoisseurs now, illustrated by the attendance at the Sincere Watch Academy.

Swiss luxury firm Chopard, known for adorning the stars, chose Singapore for the worldwide launch of its L.U.C Crono One watch, in October. Luxury services are also doing well, with the St Regis Singapore opening before Christmas with chauffeur-driven Bentley and personal butler service.

But all is not as it seems. In recent months, journalists have begun to question whether luxury has "lost its lustre", suggesting the globalisation of luxury brands has emptied them of their meaning. Some complain that French-labelled haute couture is made in China, with cost-cutting leading to a decline in quality.

Others question the ethics of luxury, encouraged by films such as Blood Diamond, which show how the trade in precious stones has fuelled conflict. Other problems for luxury goods companies include labour rights and environmental degradation throughout their supply chains.

It is time to turn the question "what are you made of" onto the companies and examine what lies beneath the brand.

The report, Deeper Luxury, from the World Wildlife Fund did just that and ranked the 10 largest, publicly-traded luxury companies on their environmental and social performance.

Their brands include Gucci, Yves Saint Laurent and IWC amongst dozens of others. The Paris-based L'Oréal Group, which owns Giorgio Armani and Ralph Lauren, emerged top, but only with a C+.

The report describes growing environmental awareness across Asia. Ms Issy Richardson, co-founder of Singapore's organic company Belle and Dean, said: "With increasing press coverage and celebrity endorsements of green living and eco-fashion brands, attitudes are changing".

The craze over the designer shopping bag by Anya Hindmarch, branded with the phrase "I'm NOT a plastic bag", illustrates the potential demand.

The notion of "luxury" is changing. In future, the highest quality product or service may be regarded as the one that generates the most benefit to all involved in its creation.

Some brands embrace this approach. The Banyan Tree hotel group has developed a sustainable form of luxury since its founding. In the early '90s, Banyan Tree Bintan built villas on stilts and around existing trees and boulders to protect the rainforest and installed waste-water treatment to recycle water for irrigation.

The company has adopted the United Nation's Millennium Development goals to guide its efforts. Its managing director of retail operations, Ms Claire Chiang, is encouraging others through the Singapore Compact for Corporate Social Responsibility, now with over 170 corporate members.

Such efforts remind us that the products we consume do not magically appear in malls, but rely on life. Pick any product and consider its history — the grazing cows, swaying trees, ingenious designers, busy labourers and calculating bankers.

The cooperation of millions of people and a sustaining environment underpins all that we buy. By embracing corporate responsibility, iconic brands could remind us of this deep connection between our things, our selves, our communities and our planet.

Life without shopping may not be complete, but more Singaporeans today realise that shopping is not complete without life.

The writer is director of Lifeworth Consulting, associate professor at Griffith Business School and founder of the Singapore environmental community EcoSing.com. He will be speaking on sustainable luxury at the Singapore Compact for CSR on Jan 23.