Extraordinary Endeavors in Turbulent Times: Asian Innovation, Inclusion, and Impact during COVID-19

ASIA BUSINESS COUNCIL HONG KONG UNIVERSITY OF SCIENCE AND TECHNOLOGY Esquel Group (Hong Kong) Extraordinary Endeavors in Turbulent Times Esquel Group (Hong Kong) Launching a SustainableMask Amidst a Public HealthCrisis By Winnie Peng, Pauline Yeung, Colleen Howe, and Chun Hei Hung The following case study is based on interviews with Marjorie Yang, Chairman of Esquel Group, on September 22, 2020 and with Edgar Tung, Head of Global Operations at Esquel Group, on August 31, 2020. Introduction On February 3, just as the COVID-19 pandemic was unfolding, Esquel Group Chairman Marjorie Yang received a call from a close friend. “You’re in the textile business, you should do something to help Hong Kong. You should start making masks,” he said. Yang initially replied, “We don’t know how to do that. We’re a cotton house. We make men’s shirts.” Indeed, Yang’s first reaction was that unless one was going to wrap a shirt around one’s head and turn it into a mask, she didn’t see how Esquel was going to become a mask manufacturer. Masks are made from non-woven material and are a totally different business. But Yang got off the phone and started asking her colleagues, just out of curiosity, “Do you think we know how to make a mask?” Several people said maybe. In the following days, Esquel established a team consisting of representatives from research and development (R&D), manufacturing operations, engineering, and procurement to brainstorm ideas for producing a sustainable mask. The reusable element was particularly important because as many as 129 billion disposable face masks are thrown away every month worldwide, according to a study in Environmental Science and Technology . 1 Yet this was no easy task. In Yang’s words, “We had to go through so much pain trying to make the first 300,000 masks, trying to find the chemicals and other materials. We used the interlining frommen’s shirts — talk about innovation — because the regular material was not available.” This took place in the midst of a public health crisis and at the fastest possible speed. Esquel launched its mask Asia Business Council Esquel Group Region Hong Kong Year of Founding 1978 Headquarters Hong Kong Type of Company Vertically Integrated Textile and Apparel Manufacturing and Technologies (including Cotton Research, Ginning, Spinning, Knitting, Weaving, Garment Making, Accessories and Packaging, Merchandising and Retail) Number of Employees (2020) 35,000 Total Revenue in 2019 HKD 10 billion (US$ 1.3 billion) Major Business Textile Manufacturing (including Apparel Making; Brands & Distribution; Cotton Research, Ginning & Spinning; Knitting & Weaving; Merchandising; Accessories & Packaging; and Specialty Yarn Spinning) Retail Brands PYE and DETERMINANT COVID-19 Initiatives in a Nutshell Development of a Sustainable Mask