For the amount of vicuña wool needed a Loro Piana to produce a sweater sold to 9 thousand dollars, the community indigenous Peruvian that shear the animals only receive $280. With the result that its members usually “work free for the richest person in the world”, i.e. the billionaire Bernard Arnaultwhich owns the luxury conglomerate LVMH Moët Hennessy Louis Vuitton, owner of the Italian luxury clothing brand for ten years. This was revealed by an investigation by Bloomberg Businessweek, which put the use of cheap labor to make some of the world’s most expensive clothing under the microscope. See the cap from baseball cashmere worn by Succession’s Kendall Roy, retailing for $600.
The indigenous community of Lucanas has been involved in the legal shearing of wild vicuñas since 1994, whose very fine wool has a huge impact on the final market, and Loro Piana is the only buyer. An international treaty on the protection of the species requires that the proceeds benefit indigenous Andean populations, but the 2,700 villagers have benefited little from the agreement, the investigation found. Also because the rate paid for raw fiber fell by 36% in the last ten years. In 2018, he adds Businessweek, a government-commissioned study found that 80% of residents felt they had not benefited. The community does not have sufficient resources to purchase the machinery necessary to directly process the fiber and create garments, so much so that none of the indigenous people interviewed by the magazine have ever worn a vicuna garment.
The investigation links the current situation to the decisions taken in 2000 by the then president Alberto Fujimori, that as his government collapsed due to corruption allegations he “issued a decree giving companies the same rights as peasant communities to shear the vicunas living on their properties.” He was the one who pushed for the turning point Alfonso Martinez, head of the government office created to regulate the new market, who shortly thereafter left office and founded a company that acted as an intermediary between indigenous communities and buying companies. In 2007, Loro Piana hired him as CEO of his business in Peru. Soon after he bought it 2,000 hectares of arid land near the community of Lucanas for $160,000 and asked for a shearing permit as well as proposed creating a 12.5 kilometer fence around his property, to prevent the animals from leaving and thus placing them in “semi-captivity”.
The permit was granted in 2010. Since then, as the number of vicunas present on the land owned by the group grew, the prices per kilo paid to the Lucanas community have dropped: from 420 dollars in 2012 to 330 in 2022 and 280 in 2023. For a process, that of capturing vicuñas for shearing, which is long and laborious, considering that the animals live in freedom and when they are stopped for shearing they kick and bite. Production, for “unclear” reasons, also dropped: from 1,877 kilos in 2012 to 460 a decade later. Doing revenues collapse from beyond 780 miles alone 151mila dollars. Then, in the Covid years, business stopped completely. At the moment, community members work for free, while outsiders can be paid, usually around $20 a day.
In the 2000s, interviewed by Telegraph, Pier Luigi Loro Piana had spoken about the relationship with the local communities, explaining that the company supported them by “constantly purchasing at around 400 dollars per kilo”. But in 2013 he and his brother sold 80% of the capital to Arnaul’s group for 2 billion. Now Loro Piana, consulted by Businessweek, responds by claiming that “since its arrival in Peru in the 1980s it has been committed to upholding the highest standards of ethical and responsible business practices,” the company said in a statement. “Loro Piana represents a fundamental economic support at the local level, protecting and strengthening the demand and value of vicuña fibre, regardless of market dynamics.”
2024-03-17 15:46:07
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