3rd Place Winner of the Writing Competition: "With Great Beauty Comes Great Responsibility" by Mohil Chaudari
Mohil Chaudari is a senior at the Indian Institute of Technology, Madras and is the 3rd Place winner of the 2020 Writing Competition for the 46th International Conference, which focused on themes related to The Decisive Decade. Below is his article on how businesses in the AF&L sector have pivoted their resources to support efforts to combat the devastating effects of the COVID-19 pandemic.
With Great Beauty Comes Great Responsibility
Mohil Chaudari is a senior at the Indian Institute of Technology, Madras majoring in Mechanical Engineering. His work experience includes ITC Limited and National University of Singapore, and he is interested in design and implementation of technological solutions to businesses. Outside of class, he enjoys swimming, reading and writing.
Since inception, humanity has encountered many diseases, but none of them have even come close to COVID-19 in terms of the devastative impact that it has inflicted on us. COVID-19, a disease that spreads exponentially and asymptotically, resulted in 3.3 million cases and 234 thousand deaths around the globe within five months of its origin. Even more shocking is that these numbers represent just the first-order implications of the pandemic. The efforts to curb COVID-19 have resulted in close to 1/3 of the global population being placed on complete lockdown in their homes, causing the largest global recession in history.
The global economy works on two pillars, supply and demand. COVID-19 attacked the foundation on which these pillars are built: the people, who are both employees and consumers. The public health crisis has thus led to a lockdown-enforced economic trap that has stalled both industries and the livelihoods of the people, all in a very short period of time compared to recessions in the past. The cash strain resulting from a drastic reduction in the demand for discretionary products has led to massive layoffs across the globe.
The apparel, fashion, and luxury industry (AF&L) is one of the worst-affected industries, with demand and supply restructuring towards consumption of essential goods and services amid COVID-19. With both retail and online sales diminishing as people consolidate their wealth to survive the pandemic, the industry has realized that they will not be able to operate their current business until the consumer confidence revives and social distancing relaxes.
The economic crisis can be revived only after the public health crisis subsides. Businesses across all industries have realized this and reassessed their duties to curb the global pandemic together. The AF&L sector mainly has been instrumental in its response with pledging funds and donations to support relief organizations and front-line programs all over the globe. Estée Lauder Companies, the American beauty giant, has established a grant of $75 million for the NYC COVID-19 Response & Impact Fund to support vital social services and community organizations in New York. Additionally, the giant has also donated millions of dollars to Doctors Without Borders, the Red Cross Society of China, the Shanghai Charity Foundation, Give2Asia, and the China Women’s Development Foundation.
In addition to the donations, multiple businesses in the AF&L industry are leveraging their functional expertise in the supply chain and manufacturing to produce and distribute medical supplies to the worst-affected regions. The French conglomerate LVMH has tapped into its global distribution network to source surgical grade masks to France. Additionally, LVMH has also modified its makeup and fragrance facilities to manufacture hand sanitizers. In doing so, the AF&L businesses have developed CSR-powered business models that are offering the multiple benefits of keeping their businesses running, providing employment, and generating cash to survive while also contributing to the global community with a purpose.
In addition to supporting public health systems to facilitate recovery, AF&L businesses have also realized the risk of virus resurfacing again. The industry is funding research in vaccine development to eliminate COVID-19 from its root. The jewelry brand Bvlgari began its efforts in understanding the virus to develop a vaccine by donating a state-of-the-art 3D high definition microscope to the Spallanzani Hospital in Rome.
The AF&L industry is continuously addressing the short and mid-term consequences of COVID-19 on their operations. However, positioning themselves for long-term sustainable growth will require them to understand the long-term implications of the virus on both consumers and suppliers of their businesses. COVID-19 will completely change the way businesses perceive risk. To mitigate risks in their supply chain, companies will have to establish high hygiene standards in their processes. End-to-end operations will be digitized to ensure high accountability and transparency to the consumer. Cutting-edge technologies and e-commerce will enable these enterprises to increase their revenues.
Adapted to the experiences faced during the pandemic, the post-COVID consumer’s expectations will be very different from their precursor. The new consumer will be morally conscious while making any purchasing decisions. The success of a business in the AF&L industry will largely depend on how their brand’s purpose connects to the consumer. More and more companies will have environmentally and socially responsible practices at their business model’s core to position his/her brand in the market.
Even though the virus has brought a significant setback to the people and the economy, it has made us reassess the importance of the symbiotic relationship that exists between businesses and society at large. History will mark the year 2020 as one of the most challenging times wherein thousands of lives were lost, millions of people endured the disease, and billions of people suffered the consequences. However, 2021 will also be the era when humanity will have entered the new normal with its sheer resilience and courage, deeply connected with the global community more than ever.
“History will mark the year 2020 as one of the most challenging times wherein thousands of lives were lost, millions of people endured the disease, and billions of people suffered the consequences. However, 2021 will also be the era when humanity will have entered the new normal with its sheer resilience and courage, deeply connected with the global community more than ever.”