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Xinjiang Sourced Cotton: The Ethical Move for U.S. Businesses

“A harvester in 2018 works a cotton field in Xinjiang, one of China’s most impoverished and isolated areas. Despite the economic benefits to the region, the cotton income has also contributed to China’s construction of a network of surveillance technologies and internment camps targeting Uighur Muslims and other ethnic minorities.” – Washington Post

By Devin Davidson / 15 September 2020

US May Ban Cotton From Xinjiang Region of China Over Rights Concerns,” is an article from the New York Times which discusses a potential move by the Trump administration to ban, through a withhold release order (WRO), some or all products made with cotton from Xinjiang amidst reports that the Uighurs, a Muslim minority, are forced by the government to help pick the cotton crop. While important for the United States to maintain its commitment to human rights both at home and abroad, this move would affect a range of U.S. based and global apparel makers whose brands rely on supply chains that extend into China.

Published a month earlier than the NYT article, a Washington Post article, “Fashion Firms Rush to Trace Cotton Provenance Ahead of Sanctions on China,” explains how Xinjiang accounts for 85% of Chinese cotton production writ large and that Xinjiang Production and Construction Corps (XPCC), a paramilitary organization which organizes the forced labor of Uighurs, produces more than 7 percent of the world’s cotton. This cotton in turn is used to supply the retailers and factories which provide staples of the American wardrobe. Given the reach of cotton supply lines from China and this cotton’s dependency on forced labor, a number of organizations such as PVH Corp. which owns the Tommy Hilfiger and Calvin Klein brands have stated that “it plans to end all business relationships with factories that use cotton grown in Xinjiang in the next 12 months.”

These two articles thus represent the benefits and haphazards of globalization and the cross-cultural contradictions yielded by doing business in other societies. A conversation centered on ethical business practices also unfolds. The situation in Xinjiang brings to bear an opportunity for corporations to define themselves amidst this business ethical dilemma. Take PVH Corp. as an example: the organization clearly illustrates the application of business ethics. In forgoing piling up profits and seeking alternative suppliers of cotton (that are perhaps less cost-saving efficient) they embrace the ethical considerations that are engrained in business decision-making processes. They are using an ethical approach called utilitarian reasoning – choosing an alternative that is ethically preferred and produces the greatest good for the greatest number of people in society. PVH Corp. also illustrates the use of human rights as a basis for making ethical judgements. Their decision to cease operations with suppliers of cotton sourced from Xinjiang is an effort to protect the rights of the Uighurs. Arguably, this is how every other organization with cotton supply lines in Xinjiang should respond. PVH Corp. sets a precedent for what is right and what is wrong and thereto establishes the ethical principles which should guide every other businesses decision to continue its operations with XPCC.

While PVH Corp. has illustrated the need for a stampede of corporations’ cotton supply lines out of Xinjiang, unfortunately some corporations are pushing back against the Trump administration’s potential ban stating that it is to difficult to trace exactly where cotton is sourced and that the decision would disproportionately affect them. Others too are hesitant that Customs and Border Protection (CBP) is capable of executing such a ban. Is it then worth the risk of losing tens of billions of dollars in U.S. textile imports that contain cotton, or even worse: a retaliatory stike by Beijing on U.S. Cotton producers who export large quantities of cotton to China as part of a trade agreement?

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