H&M Hennes & Mauritz AB

How ethical is H&M?

Our research highlights several ethical issues with H&M and its brands. These include allegations of labour abuse in Myanmar, claims that its emissions are rising despite climate targets, and criticisms for sourcing animal products associated with major welfare issues.

Below we outline some of these issues. To see the full detailed stories, and H&M’s overall ethical rating, please sign in or subscribe.
 

Environment

H&M is making positive steps when it comes to cutting emissions, and receives 80/100 in Ethical Consumer’s climate change rating. The company has stopped working with new suppliers that rely on coal, working with 21 fewer suppliers using coal in 2022 compared to 2021, according to its 2022 annual report. Other climate projects include increasing renewable energy and making its processes more circular.

The company reports on its emissions, including those from its supply chains, and has set targets for cutting its climate impacts that are in line with international climate goals.

Nonetheless, in October 2022, H&M was criticised by the environmental advocacy group Stand.earth, which stated that the company’s emissions were rising by 5.9% each year. It found that if the company were to stay in line with 1.5 degrees of warming – a crucial upper threshold for global heating agreed by world leaders – it would need to cut emissions by 7% each year. H&M did not appear to have responded to the allegations.

While it is sourcing some materials considered by Ethical Consumer to be more sustainable, such as recycled material and organic cotton, these appear to account for less than 50% of its overall material use.

People

H&M has a mixed track record on workers’ rights. The company has strong policies in place, for example requiring payment of living wage and the freedom to join unions in its supply chains. It also publishes its direct and some indirect suppliers – a vital step for transparency.

However, it has also received some criticisms for abuses in its supply chain. In August 2023, Reuters reported that H&M was investigating 20 alleged instances of labour abuse at Myanmar garment factories in its supply chain. The investigation followed a report by non-governmental organisation Business and Human Rights Resource Centre (BHRRC), which had found issues including wage reduction, wage theft, unfair dismissal, inhumane work rates, and forced overtime, in the Myanmar garment industry.

H&M told Reuters: "All the cases raised in the report by BHRRC are being followed up and where needed remediated through our local team on the ground and in close cooperation with relevant stakeholders. We are deeply concerned by the latest developments in Myanmar, and we see increased challenges to conduct our operations according to our standards and requirements”.  

Animals

H&M group has some positive policies on animal welfare issues. For example, it has banned wool that is produced using the practice of mulesing – a painful process that involves removing parts of sheep’s flesh to avoid infection.

The company has a target to source all animal products from “responsible farms that are certified to a credible animal welfare standard” by 2025. However, it exempts leather, setting a target of 2030.

H&M has been previously criticised by animal welfare organisation Peta and actor Joaquin Phoenix for continuing to source products associated with animal welfare abuses, such as feathers, mohair and cashmere.

Politics and finance

When it comes to financial ethics, H&M has a mixed track record. In 2022, the company’s CEO Helena Helmersson was paid 23,350,177 SEK – equivalent to over £1.7million, an amount that Ethical Consumer considered to be excessive.

The company also owns a number of subsidiaries in tax havens. However, in July 2021, it emailed Ethical Consumer to explain the purpose of each of these subsidiaries. For example, it stated that its subsidiaries in Hong Kong were a hub for sourcing and producing in Asia. "The purpose of these companies has not been to avoid tax”, it said.

The above text was written in July 2024, and was based on research conducted in December 2023.