Bart Mroz, founder and CEO, Sumo Heavy

Several months ago, beauty brand Sunday Riley settled a case with the Federal Trade Commission after it was accused of posting fake reviews of its products to Sephora’s website for two years. To resolve the issue, the popular skincare brand has agreed not to write fake reviews in the future. Of course, that’s only one battle Sunday Riley faces; regaining the trust of its customers—and the entire beauty industry—is another. 

While publishing fake reviews is an obvious example of wrongdoing, retailers face ethical dilemmas all the time. Today, operating “business as usual” in the face of conflict is no longer bad practice—it’s simply unacceptable.

That’s why it’s crucial that brands and retailers cultivate a values-based culture, address their blind spots and carefully consider new products and initiatives. 

Be transparent with your team and your customers

In an age where data breaches and false news flood our social media feeds, it’s easy to see why consumers value honesty so much. Almost nine out of 10 Americans believe transparency from businesses is more critical than ever. Another study revealed that 96% of consumers believe that they, along with brands and the government, have a role to play in ethical responsibility. 

In response to the growing social awareness among consumers, more brands and retailers are doing more than just talking about their values. They’re building entire companies on an ethical mission, whether it be building a more environmentally sustainable shoe like Allbirds or being transparent about their pricing like clothing retailer Everlane Inc.

 While a retailer taking an ethical stance is undoubtedly attractive to customers, retailers must reflect the same values they promote to customers in every part of their business, even internally. But how can retailers ensure their business practices are up to par when they have dozens or hundreds of employees to lead? After all, one bad apple can spoil the bunch.

It starts with the company culture. Not every retailer needs to write a 500-page manifesto outlining its initiatives to solve the world’s most challenging problems. However, a business should have clear standards regarding how it treats employees and customers—and, of course, these values must be put into practice every day. If the founders and executives fail to treat their employees according to the values they’ve established or don’t make sure their employees uphold these same ideals, their decisions could damage the customer relationships they’ve spent years or decades building. 

Identify and address your ethical blind spots

Despite our best efforts, we as individuals, teams, and companies can be guilty of unconscious bias. Even worse, those few “bad apples” within an organization can wreak havoc by not maintaining the values of the company.

In 2018, Nordstrom Inc. came under fire when employees at a St. Louis location falsely accused three African American teenagers of stealing clothing. While the company was quick to apologize to the young men, the incident opened up discussions about the lack of awareness around these kinds of issues and the need for bias training.

Retailers can avoid the issues Nordstrom has faced by improving the way they address unconscious bias within the workplace—whether it’s at the corporate office or brick-and-mortar location. Here are some examples of questions founders and execs should ask of themselves and their employees:

• Does our company actively seek out people with diverse backgrounds, identities, and strengths for employment? Businesses should consider a diverse array of candidates in the final pool for a position to avoid hiring the same kinds of people over and over again.
• Does our company prioritize openly discussing its blind spots and bias? Creating an environment where team members can openly discuss any issues related to bias not only addresses the problems at hand but can help prevent future issues.
• Does our company listen to employee and customer concerns about projects and products? Does management think critically about these issues once employees and customers voice them?

Addressing unconscious bias can be uncomfortable, but investing in this analysis upfront can save a business from potentially irreversible brand damage and financial losses down the road.

Prepare, produce, and learn insights

One of the main goals of any ethical business is to improve their products and services, which is why retailers must provide their teams with the time and opportunity to learn as much information after project deployment as possible. 

However, running retrospectives and post-mortems shouldn’t just be standard practice for the sake of product development or project management. It’s an opportunity for retailers to identify the potential institutional flaws within the organization. If the same problem occurs continually after many retrospectives and post-mortems, it’s time to determine if there are any broader structural issues, or if a few “bad apples” are jeopardizing the productivity, efficiency, and integrity of the company.

It’s important to remember that making mistakes and behaving ethically are not mutually exclusive. While making errors is unavoidable, organizations should take the necessary measures to ensure they practice their values and take responsibility for their blind spots, and address the issues they face both internally and externally with integrity. 

SUMO Heavy is a digital commerce design, development and consulting firm.