Levi Strauss & Co.

We are the embodiment of the energy and events of our times, inspiring people with a pioneering spirit.

Tuesday 19 June 2012, by Patrick

4 inspired

A. How did you find this company?

I recently saw a documentation presenting projects of different companies in the textile industry trying to improve the sustainability of their working practices. The documentation revealed that Levis Strauss & Co. was the first multinational clothing company to establish a comprehensive workplace code of conduct for their manufacturing suppliers. Already while watching the report was I wary about to what degree their intentions were subject to marketing intentions and improving their image. This project causes a good occasion to further read into the subject and get more insight into the purposes of their activities.

B. What are the main facts about its activities?

Levi Strauss & Co. is a privately held American apparel company that was founded in 1853 by Levi Strauss. The brand is worldwide known for its Levi’s brand of denim jeans. Levi Strauss and tailor Jacob Davis received a U.S. patent in 1873 to make the first riveted men’s work pants of denim, the first blue jeans. Today, the company is still owned by descendants of Levi Strauss.

The company experienced significant growth in its business during the 1960 and 1970s as a more casual look became a world wide fashion trend which served as a catalyst for the brand. Between 1964 and 1974, the company managed to expand its manufacturing capacity from 16 plants to more than 63 plants in the United States and 24 overseas.

In 1986, the company launched The Dockers brand, which is sold largely through department store chains. Later in the 1990s, the company was facing competition from other brands and cheaper products from overseas, which lead to the closure of some of its US factories and the start of using offshore subcontracting agreements. As denim sales began to fade, it was The Dockers brand which helped the company to grow through the mid-1990s.

Today, most Levi’s jeans are made outside the United States. Only a few of the higher end, more expensive styles are still made in the U.S. It is a worldwide corporation divided into three geographic regions: Americas, Europe, and Middle East and Africa. The firm employs approximately 10,500 people worldwide and generates a net income of about $157 million. Today, their products are sold under the Levis’s, Dockers, Denizen, and Signature brand.

C. What are the Ethical challenges this company is addressing?

The company is addressing a good deal of different ethical challenges. Those challenges can be categorized in three main groups: people, planet and products.

People
Levi Strauss & Co., in partnership with the Levi Strauss Foundation, addresses different challenges concerning the people affected within and outside the company:

Worker Rights
The company approaches the ethical dilemma of cost cutting versus the human rights of its workers by their introduction of their Terms of Engagement (TOE), a comprehensive workplace code of conduct for their manufacturing supplier. Those terms specify the requirements by which all of their contract factories and licensees must abide. Those include ethical standards, legal requirements, environmental requirements and community involvement. Furthermore do they set out employment standards which specifically address issues of child labour, forced labour, disciplinary practices etc.

HIV/AIDS
Levi Strauss & Co. had begun their efforts concerning this topic back in 1982. 30 years later, they maintained persistent and in establishing best practices that they can share with other companies in the prevention, education, treatment and care for employees and their families. This program provides innovative and interactive in-person an online prevention education, while striving to improve access to voluntary and confidential HIV testing, treatment and care.

Community engagement
The company has established different projects where they show their involvement in the communities. For example full-time employees are offered up to five hours per month paid time off to volunteer at a charitable organization of their choice. Another is the Levi Strauss Foundation that provides grants to non-profit organizations where employees volunteer or serve on boards.

Planet
The company is concerned about the sustainability through the whole lifecycle of their products. Thereby they are focusing on two key phases: cotton and consumer use and to reduce the impact in four areas critical to clothing manufacture: energy, water, chemicals and materials. For the former, they are establishing education plans and running R&D projects to improve the manufacture of the cotton and the consumer usage. For the latter, they follow different commitments and projects like achieving carbon neutrality and moving to the use of 100% renewable energy in their operations, decreasing water usage and improving water quality in significant, measurable ways, minimizing the environmental impact from chemicals and becoming a zero-waste company. They are engaged in many projects which show their efforts to comply with their commitments.

Products
Levi Strauss & Co. is addressing the impact their products have on the environment. The goal of their efforts is to build sustainability into every product they make. Therefore, they started in the early 1990s to approach this dilemma by setting up different measuring regulations to improve their working practices. For example did they introduce a Restricted Substance List which contains harmful chemicals that the manufacturers and suppliers cannot use. They were also leaders in introducing jeans made from organic cotton and recycled denim that use packaging made from recycled materials. Another project is their lifecycle assessment that is aiming to reduce the greenhouse gases and to restore the environment.

D. What makes this company really inspiring to you and why would you trust it?

First of all I have to say that I do not completely trust in all of their attemps of the various dilemmas they approach. But what inspires me about the company is that they addressing the different ethical values much more than other companies in the textile industry. It is always difficult to draw the line on to what degree a company is ethical in their practices. But in my opinion, it is also important to highlight the efforts a company undertakes, instead of only criticizing and highlighting their misbehaviour. Because in the end, there is always room to do more.

I think a first important step in attempting to address ethical dilemmas is to acknowledge the limits that those efforts have. Levi Strauss & Co. is doing that fairly good by admitting the difficulties of their supervision possibilities over there suppliers as well as within their own manufactures for example when it comes to environments where corruption and different forms of regimes are at present. They admit that their resources are just too little to be able to guarantee 100% compliance with their rules and regulations.

I also find it important that a company is transparent about their efforts and the results of their attempts. Levi Strauss & Co. is doing that by composing reports together with external parties that somehow have the role of supervision.

E.What are the possible challenges facing the company in the future and how do you think this company may improve?

The company faced a huge decline in their demand over the last 20 years which lead to a huge layoff of around 20’000 people. In such difficult times, it is very hard to follow your vision and ethical principles since the focus usually shift towards their “core business” and the goal of linking profitability with ethical principles is at risk to become subsidiary. So one of the challenges the company is facing in the future is to manage and especially to recognize that those two objectives are not necessary conflicting. It will probably just require more effort than when they had more resources available.

Another challenge that the company is facing is the next level of responsibility for sustainability. It requires a long-term plan with measurable, targeted milestones, honest self- and third party assessment, thoughtful product development and innovative public policy. The company is currently working with partners to develop the next generation of global standards and goals. I think this company can improve since they have somewhat the leadership and good experience within different areas concerning ethical dilemmas and I think that it is a key factor of their mission and vision to remain and further improve their ethical standards.

Bibliography

http://www.levistrauss.com/
http://http://levistrauss.com/sites/default/files/librarydocument/2011/4/levistrauss-annualreport-2010.pdf
http://www.levistrauss.com/sites/default/files/librarydocument/2010/4/ls-co-case-study-south-africa-hiv-aids.pdf
http://en.wikipedia.org/wiki/Levi_Strauss_%26_Co.

Start a new discussion

3 Discussions / 4 Messages

  • Levi Strauss & Co. inspire me 4 October 2012 at 18:14 , by Wills

    I believe there is no purely ethical companies exist in the real world. Every company faces the ethical dilemmas as well as difficulties in business operation. It’s difficult to find a rule for every company for balancing the profitability and ethics. Nevertheless, it must not be an excuse for immorality.
    Levi’s faced these challenges during its more than 100 years operation. It has overcome those difficulties and survived. In a word, it had become more ethical than before. In China, I found that Levi’s also abide by its ethical rules. It dedicates to improve the work environment and green product. They refuse to accept polluted suppliers for making a more clean supply chain.
    I appreciate what it has done, but I feel that there is still room to improve. When I searched Levi’s add public welfare in Baidu which is the most prevalent search engine in China. I am so surprised that I totally can’t find anything relation to that subject except one.
    Levi’s started the old for new service in 2010. In this service, everyone can buy a jean from Levi’s with a 200RMB discount. The only cost is an old jean. Then Levi’s donated all the old jeans through a NGO. Many people doubted the motivation of this kind of public good. They accuse it’s not a purely public good but a business trick. But I don’t agree with those persons, I feel it is a good combination between public good and profitability.

    • Levi Strauss & Co. inspire me 27 February 2013 at 19:27 , by laura

      You comment that Levi’s meets the ethical and moral codes in China. I am disagree. I recommend you see the documentary "China Blue" directed by Mixa X. Peled (2005). This documentary shows the inhumane conditions in which they work in China for brands like Levi’s. The film shows as exploited workers and present the contrast between the salary of workers in relation to the profit percentage of jeans.
      This company doesn’t inspire me confidence and since I saw that documentary I don’t buy that brand.

  • Levi Strauss & Co. 5 October 2012 at 12:06 , by chufugang

    A recent report called Clean up the Fashion Industry, published by five Chinese environmental organizations, which alleged that 46 Chinese and international clothing brands are being supplied by textile companies that violate the country’s environmental laws. LEVIS is included.so
    when try to find out the indeed thing about the company is very difficult

    the levis’ can not always coordinate all its branches, even it has a good environmental value.The biggest problem facing these textile companies is water pollution that causesgreat harm to the environment. Putting a brave face on the issuecompany wouldspend a period of years and investseven millions ofyuan in building sewage disposal system.It is a hard push for their third country’s branches to reach their standard ALSO,for ordinary consumers, it’s hard to know how many polluting companies there are behind each of the popular fashion brands. Who will care?
    so if levis do more about controlling their branches thins will get better.

  • Levi Strauss & Co. 27 February 2013 at 17:53 , by Octavi92

    I don’t really trust those big companies, even though they a lot of good projects to be more sustainable and green. The Documentary Blue Chine shows the reality of the workers in China, and it says that a factory which obeys all the lays (China’s Law) are not profitable, so all of them are constantly breaking those rules; they produce staff for Levi’s and other textile companies so, the bottom line is that Levi’s actually breaking the rule.
    But, personally, I don’t blame only the companies; the society also. The main think is whether we will buy products more with a higher price but that are respectful with the environment and workers. Because that’s the key, of course there are some companies that do it and are successfully, but are just a small minority. Can all the companies still be successful? Would people agree to buy clothes more expensive but that respect the environment? Until all the majority of the people are willing to pay more for taking care of the environment or workers, the situation will remain.

Location: San Francisco, California (U.S.A.)

Sector: Manufacturing, Wholesale and retail trade

Official website: http://www.levistrauss.com/

Key figures:

- 470 company-operated stores
- Area served: worldwide
- Revenue: .4 billion
- Operating income: 1 million
- Net income: 7 million
- Employees: 16,700

Nbr. visits: 6408

Nbr. inspires: 4