Amid the numerous reports of COVID-19’s impact on the retail industry, one in particular has grabbed the headlines: allegations that fast fashion retailer Boohoo has subjected its garment workers in Leicester to "modern slavery" conditions.

Reports state that workers have allegedly been paid just £3.50 an hour and allegedly forced to work without social distancing measures, some even while showing COVID-19 symptoms. The retailer and its shareholders are already suffering, both in falling sales and with share prices dropping consistently since the allegations broke.

With a number of brands being implicated for similar behavior, and others facing investigation for paying workers below minimum wage, conversation is inevitably turning, once again, to the ethical behavior of the wider fashion industry.

Debates around ethical sourcing are nothing new in the world of fast fashion. Consumers may have known for years that low-cost goods may well risk having unethical sources from poorer countries with less effective worker protections. However, with the Boohoo allegations hitting close to home for UK retailers and consumers, there are suggestions that may spark a fundamental shift in consumer behavior.

Will consumers reject cheaper, fast fashion for more expensive, longer-lasting clothing from trusted companies in the face of such alleged unethical practices? In short, will consumers finally be driven by values over value? And, as we face the largest economic downturn in generations, how dramatic could any likely change in shopping habits be?

Increased polarization 

Even against the backdrop of growing social activism, this may be a very optimistic view of consumer values, particularly considering the economic hardship many UK consumers face. And as a recession approaches fast, this will only get worse.

That’s not to say that nothing will change at all, but it is far more likely to result in further dividing society. As the recession hits, and job losses take their toll, those at the bottom end of the economic scale will be less likely to change their consuming behavior and will still be very much value-driven.

Meanwhile, more well-off consumers, while continuing to show little interest in the value space, will be able to afford to worry about values. There may also be added social pressure to avoid donning flashy luxury brands with no sustainability credentials.

For those consumers who fall somewhere in the middlethe sector already driving the sustainable, anti-fast fashion trendwe may well see an acceleration in their behavior shift in response to the Boohoo allegations. Brands who share their sustainability goals and are transparent about how and where they produce ethically sourced, well-made clothes could benefit.

The reality of the market is that the vast majority of consumersparticularly the young, less cash-rich consumers of fast fashion brands like Boohoo – will be hardest hit by the ending of the furlough scheme in the autumn, the rise in unemployment and the recession. They are therefore more likely to continue to be driven by value over values.

The trouble with transparency

As with many sectors, retail is unlikely to see consumer behavior change fundamentally until legal and governmental policy changes make it necessary. The challenge for fashion retailers is how to demonstrate real transparency in quality control or labor sourcing without standardization in the sector.

Some brands have been proactive and innovative in relation to transparency and ethical practices. Since 2019, all of retailer H&M’s 47 global websites have contained extensive detail about each garment it sells, from the materials used, to the production company, as well as factory names and addresses. Shoppers can also access this information in store by scanning the label with their H&M app.

Meanwhile, each Reformation garment comes with a score for its environmental footprint (its own RefScale). Customers can sell their old clothing back to the company to earn credit for new pieces, and it publishes an in-depth, no-nonsense sustainability report each quarter.

Even Primarka brand whose merchandise has had a tendency to be considered, by some, as disposablehas launched a new recycling initiative, whereby they will reuse, recycle or repurpose any clothes from any brand that their customers bring to stores, with profits going to Unicef. For cost-conscious consumers, this move may have a greater impact than information about transparency or ethical sourcing.

But even this transparency is relative. Self-professed "transparent" brands have come under fire for leaving out important statistics, like average wages for factory workers, or creating their own code of conduct in place of the UN-recognised Fair Trade or SA8000 certifications. Consumers are also waking up to the practice of "greenwashing"when brands claim to be sustainable to encourage eco-conscious consumers to buy from them when, in reality, they’re doing little to nothing in this area.

Industry movementslike Fashion Revolutionare making efforts to hold fashion brands to account. Its Fashion Transparency Index 2020 reported that, out of the 250 brands surveyed, 40% openly published their manufacturers (up from 35% in 2019), while only 24% published some of their processing facilities and/or mills and 7% of brands published some of their raw material suppliers. Meanwhile, only 23% of brands disclosed their company’s approach to achieving the payment of living wages to workers in the supply chain while only 2% (five brands) published a time-bound measurable roadmap or strategy for how they will achieve a living wage.

It is clear that, until there is new policy or standardization of quality control that actively rewards complete transparency and penalizes non-compliance in the fashion retail industry, there is little reason for the majority of value brandsor consumersto drive this change.

Choosing your battleground

Whether through an eagerness to change, or to ensure a future level playing field, the Boohoo Group CEO is now calling for the UK Government to implement a standardized licensing scheme to protect garment workers.

However, the fact remains that until there are fundamental changes to penalize fashion retailers for unethical behavior or to reward consumers for choosing more responsible brands, there is unlikely to be a drastic change in the value-led market, especially as a recession approaches.

For retailers, the message is to choose your battleground carefully. If sustainability and ethical trading is a core part of your brand and important to your audience, then this is a conversation you’ll wantand needto be part of.

It is true that for the majority of consumers heading into a recession, getting value for their money will remain key for some time to come.

However, ignoring consumer expectations that businesses care about ethical practices and the impact it has on the world is not a long-term solution. Sustainabilityin both environment and labor—is a key issue for fashion retailers that will not go away. It may even be a huge opportunity for some consumer niches.

But it must be tackled authentically, with transparency and a thorough understanding of your audience and core value proposition, as consumers from all sectors are increasingly alert toand critical ofhollow ethical claims.

Those retailers who jump on the sustainability bandwagon without understanding the needs of their core audience, or invest heavily in making grand promises they never hope (or intend) to fulfill, do so at their peril.