Using an institutional perspective, this paper investigates how consumers in Western developed and Southeast Asian emerging markets respond to fashion brands’ moral transgressions and how consumers’ moral rationalization tendencies vary across the two markets. The study employs multimethod analyses, including cross-national secondary data from 12 countries and experimental data from 940 German and Vietnamese consumers. In a non-transgression context, the multivariate analyses show that Western developed-market consumers embrace higher ethical standards (Study 1A), tend to seek collective action against prevalent immoral (...) behaviors in society (Study 1B), and are more critical in evaluating fashion brand ethicality than Southeast Asian emerging-market consumers (Study 2). However, in a transgression context, the moderated mediation analyses reveal that consumers largely do not differ in their direct devaluation of fashion brand ethicality and subsequent price considerations (Study 3) across six transgression scenarios (i.e., worker abuse, child labor, racist advertising, weight discrimination, climate change, and environmental pollution). Interestingly, moral rationalization processes appear to be more frequent and consequential in the Southeast Asian emerging market, while they either do not occur or are significantly weaker in the Western developed market. The results provide theoretical and practical implications for ethical business practices in the fashion industry based on market differences in regulatory frameworks, cognitive considerations, and social norms. (shrink)