Green business practices for competitive advantage in the international market: a study on green RMG factories in Bangladesh

Abstract

Companies across industries strive to gain competitive advantages in various ways. However, gaining a competitive advantage through green resources and capabilities, particularly for ready-made garment (RMG) companies located in major global sourcing destinations, has emerged as a new competitive frontier and a means of remaining relevant in the highly competitive fast-fashion industry. Despite this, research on the factors that constitute green business models and how green business practices contribute to the development of strategic capabilities, thereby enhancing the competitive advantage of RMG companies in Bangladesh—the world's second-largest RMG exporter—remains limited. The primary objective of this study is to investigate the relationship between the green business practices of RMG factories and their competitive advantage in the international market. It also examines how the green movement, climate change, and sustainability concerns shape the competitive dynamics of the fast-fashion industry. This qualitative study primarily utilizes secondary data from reliable sources. Data on Leadership in Energy and Environmental Design (LEED)-certified green factories were collected from the U.S. Green Building Council (USGBC), while export data were obtained from Textile Focus and the Bangladesh Garment Manufacturers and Exporters Association (BGMEA). A well-structured thematic analysis was conducted to extract insights from the qualitative secondary data. The findings reveal that sustainability, fair trade, human rights, workers' rights, animal welfare, recycling, reuse, and waste reduction are the primary drivers of the sourcing policies of major fast-fashion companies worldwide.