In the mid-nineties the organic food industry, still a niche market, sought to break into the mainstream. At the time, however, consumers had little understanding of “organic.” Over the years growing concern about health issues, pesticides, potential risks of genetically modified food, environmental damage resulting from industrial farming, and animal rights has pushed interest in organic food to the forefront of public consciousness. Organic food may cost a little more money than processed industrial food, but people now understand that saving a few cents can have enormous costs for their health, the environment, and the well being of workers. Green businesses savvy enough to detect the change in public awareness have proven very successful at convincing consumers of the value of buying organic and have driven the supermarket chains and even fast food industry to join the organic food movement. Certainly a lot of “green washing,” false advertising, occurs, but over time brands that deliver more than image will gain position in the market.
When people ask me why I invest in Ethical Fashion, I often make comparisons to the organic foods movement. What we put on our bodies is just as important as what we put in them. A public that has begun to exercise their consumer leverage to force organic food into the mainstream marketplace will increasingly demand ethical options from the clothing industry. As the Ethical Fashion movement educates consumers, people become more aware of the dangers of industrial chemicals in their clothing, of environmental damages from some mainstream industrial practices, and of the unsafe working conditions and inferior quality associated with the “race to the bottom” phenomenon. As they have with organic food, people will develop a holistic approach to the idea of quality. Status, value, workmanship, ethics, environmental and humanitarian concerns all become synonymous with quality. Consumers don’t make separate deliberations for each category. They make one decision. The more people who make the choice to support Ethical Fashion, the more such choices will become the standard.
– Rob Broggi, Founding Partner & CEO of Industrial Revolution II
Peter Buffett’s op-ed in The New York Times, “The Charitable-Industrial Complex,” is a provocative essay on the obvious contradiction built into the relationship between philanthropy and capitalism. Like many others, he calls for a dismantling of the system of unfairness perpetuated (accidentally or not) by colonialism, Western capitalism, and philanthropic hegemony. Idealism has its place, but Peter Buffett’s approach of refusing to play along with a broken system while offering no sensible solutions is old news. Business and philanthropy have started to work together in a new wave of pragmatism exemplified by organizations like Industrial Revolution II. In the spirit of Bill Gates, Bill Clinton, and Peter Buffett’s own father, Warren, Industrial Revolution II knows that we must work to find practical solutions wherever we can. We cannot snap our fingers and instantly change power structures that have evolved over hundreds of years. Doing away with trade and all its impacts is an absurd notion, but we can certainly work to change the way trade functions by humanizing capitalism one place at a time. Done correctly, this can actually increase economic benefits for everyone along the chain, not just a few.
Industrial Revolution II decided to start in Haiti, one of the worst victims of four hundred years of colonialism, mercenary capitalism, and most recently, philanthropic hegemony. Generous but unsustainable and poorly allocated donations have helped alleviate some of the acute suffering caused by the devastating Earthquake of 2010, but as Haiti has sadly demonstrated for decades, charity and international aid programs accomplish little sustainable improvement by approaching chronic problems with the same impotent formulae. As a capitalist organization—a garment factory—Industrial Revolution II is uniquely designed to help Haiti build a stronger future precisely because it is unlike the race-to-the-bottom garment factories we read about in the news too often these days. Because IRII provides a safe, supportive work environment, and because IRII carefully invests 50% of profit distributions into employees and their families, many Haitians will now have the tools to build more stable communities with strong foundations in education, training and wellness, logically leading to social advancement and economic development.
Peter Buffett has a valid point: philanthropy and social entrepreneurship are rife with contradiction and hypocrisy. But if we reject everything containing contradictions, and automatically rail against all imperfect solutions to poverty and inequality, there will be nothing left to accept. Peter Buffett is not wrong to be skeptical of philanthropy’s latest incarnation and the new wave of social enterprise, but in the 21st century we need more than skepticism. We require both philanthropists and bold social entrepreneurs to help us reimagine the future sensibly. We need pragmatists who want to be judged by their results rather than the purity of their ideas.
“We are trying to create this brand in a category that essentially doesn’t exist—one that would emphasize quality just as much as social and environmental integrity. If you can offer the same quality product at the same price you are going to win a tie-breaker nine out of 10 times.”