H&M, Zara Make Commitment to Safety Reform in Bangladesh

In the wake of the recent Bangladesh factory accidents (the Rana Plaza collapse that has killed 1,127 as of today, and, more recently, a fire that killed eight), the call for labor reform in the Bangladeshi garment industry has grown louder and louder. As pressure mounts, both in Bangladesh and abroad, it seems that industry execs and government officials are finally taking the first steps towards creating a safer, more fair work environment in Bangladesh.
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Dhani Mau
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In the wake of the recent Bangladesh factory accidents (the Rana Plaza collapse that has killed 1,127 as of today, and, more recently, a fire that killed eight), the call for labor reform in the Bangladeshi garment industry has grown louder and louder. As pressure mounts, both in Bangladesh and abroad, it seems that industry execs and government officials are finally taking the first steps towards creating a safer, more fair work environment in Bangladesh.
Getty

Getty

In the wake of the recent Bangladesh factory accidents (the Rana Plaza collapse that has killed 1,127 as of today, and, more recently, a fire that killed eight), the call for labor reform in the Bangladeshi garment industry has grown louder and louder. As pressure mounts, both in Bangladesh and abroad, it seems that industry execs and government officials are finally taking the first steps towards creating a safer, more fair work environment in Bangladesh.

Today comes news that three of the world's largest retailers--H&M, Inditex (which owns Zara), C&A (a Dutch fashion chain) and PVH--have signed the Accord on Fire and Building Safety in Bangladesh after months of urging from labor reform groups, the New York Times is reporting. PVH, the parent company of Calvin Klein, Tommy Hilfiger and Izod, Tchibo, a German retailer, which had already signed an earlier version of the agreement, also announced they would be committed to the plan.

Under the five-year legally binding plan, retailers will be required to help finance fire safety and building improvements in the factories they use in Bangladesh. This will include an increase in rigorous--and independent--factory safety inspections, and the funding of any necessary improvements. This is a huge step in the right direction since, in the past, safety compliance was put in the hands of factory owners who, either from lack of funds or criminal negligence, often let potential safety hazards go unchecked. Now, that responsibility will be in the hands of these multi-billion dollar retailers.

“Fire and building safety are extremely important issues for us and we put a lot of effort and resources within this area,” said Helena Helmersson, head of sustainability at H&M. “With this commitment we can now influence even more in this issue. We hope for a broad coalition of signatures in order for the agreement to work effectively on ground.”

The move comes after intense pressure for reform from consumer and labor groups. H&M, alongside Gap and Wal-Mart have been the target of several petitions calling for better safety regulations--one of which obtained more than 900,000 signatures.

Considering H&M's recent commitment to more sustainable and transparent labor practices, the fire and safety agreement seems like a necessary next step for the retailer. It's less of an obvious choice for Inditex--which has been accused of unfair labor practices a few times before and which originally denied knowingly using one of the factories that went up in flames earlier this year. Maybe they changed their tune in order to keep pace with H&M, their biggest competitor.

Indeed, consumer and labor groups are hoping the move from H&M, Inditex and C&A puts pressure on other major retailers to sign the agreement. Gap has not signed onto the plan because, according to the retailer, they have hired their own fire inspector and promised $22 million for factory improvements. They also objected to the legally binding nature of the plan. Wal-Mart has pledged $1.6 million toward improving fire safety standards, but doesn't have any plans (yet) to sign the fire and safety agreement.

“H&M’s decision to sign the accord is crucial,” said Scott Nova, executive director of the Worker Rights Consortium, a Washington-based factory monitoring group backed by 175 American colleges and universities told the Times. “They are the single largest producer of apparel in Bangladesh, ahead even of Wal-Mart. This accord now has tremendous momentum.”

Important steps towards reform are being taken in Washington as well.

Bangladeshi officials plan to meet with U.S. officials, including Secretary of State John Kerry and Rep. Sander Levin (D., Mich.) this week to lobby for their country's duty-free benefits through the Generalized System of Preferences, which the U.S. is considering suspending or limiting in the wake of the tragedies WWD is reporting.

U.S. officials are also in talks with brands sourcing clothes from Bangladesh, encouraging them to engage with the Bangladeshi government.

So far, the Bangladesh government has said it was looking at the possibility of increasing minimum wage for workers. According to the Wall Street Journal, Bangladesh's textile minister, Abdul Latif Siddiqui said the increase would be applied retroactively to May 1. An anonymous official told WWD the move would help to improve the image of Bangladesh and hopefully discourage brands from pulling out. Meanwhile, factory owners are worried brands will pull out if production costs get much higher.

The Times also reports that Prime Minister Sheikh Hasina has promised to hire more factory inspectors and to introduce legislation allowing workers to form unions and collectively bargain for wages. However, similar promises have been made in the past with no follow-through and labor groups are skeptical.

Obviously, there's still a long way to go towards reform, but it seems like the U.S. and Bangladesh governments, as well as H&M, Inditex and C&A are (finally) making the right steps. Let's hope more retailers follow suit.