Environmental Upgradation and Governance in Apparel Global Value Chains: A Case of Pakistan

Abstract

This thesis explores environmental upgrading in the context of the apparel industry of Pakistan through the conceptual lens of the GVC framework and seeks to fill a theoretical and empirical void that presently exists in environmental upgrading and governance in GVC and marketing literatures. The thesis examines the type of environmental certifications acquired by the suppliers, the benefits and challenges of such upgrading, and perceived changes in buyer-supplier relationships along political, social, economic, operational and technological dimensions. A cross-sectional study has been conducted through a qualitative study of suppliers, buyers, PEPA, auditors and buying houses. The interviews were transcribed, and analyzed using multiple techniques of matching data to the arguments, rival explanations and pattern matching. Findings suggest that environmental upgrading altered the political relationships in terms of monitoring and compliance mechanisms. Changes were also observed in the social and technological relationships. The study concludes that environmental upgrading does not generate eco-rents, and the mechanisms through which it is carried out strategically positions certification bodies and not suppliers within GVC. Lack of strategic intent, energy crisis and prevailing terrorism situation in the country has rendered Pakistani suppliers uncompetitive in apparel trade. Suppliers need to overcome these challenges by developing strong international linkages and implementing collective environmental solutions. It is also suggested that there is a need to formulate a universal environmental standard. Global buyers that claim sustainability within their GVC must also financially reflect it in their sourcing practices from developing countries. In the end, recommendations for future research are provided.