Wal-Mart, Gap Fail to Sign Bangladesh Safety Agreement

Earlier this week news broke that H&M, Zara and C&A had joined PVH, the parent company of Calvin Klein, Tommy Hilfiger and Izod, and German retailer Tchibo in signing onto the Accord on Fire and Building Safety in Bangladesh, a legally-binding agreement which requires retailers to help finance the fire and safety improvements needed in the area. And while the move has inspired some retailers to join plan, others, like Wal-Mart, Topshop and Gap, have failed to do so.
Avatar:
Hayley Phelan
Author:
Publish date:
Social count:
27
Earlier this week news broke that H&M, Zara and C&A had joined PVH, the parent company of Calvin Klein, Tommy Hilfiger and Izod, and German retailer Tchibo in signing onto the Accord on Fire and Building Safety in Bangladesh, a legally-binding agreement which requires retailers to help finance the fire and safety improvements needed in the area. And while the move has inspired some retailers to join plan, others, like Wal-Mart, Topshop and Gap, have failed to do so.
Bodies of Bangladeshi victims killed in the recent building collapse. Photo: Getty

Bodies of Bangladeshi victims killed in the recent building collapse. Photo: Getty

Earlier this week news broke that H&M, Zara and C&A had joined PVH, the parent company of Calvin Klein, Tommy Hilfiger and Izod, and German retailer Tchibo in signing onto the Accord on Fire and Building Safety in Bangladesh, a legally-binding agreement which requires retailers to help finance the fire and safety improvements needed in the area.

Since then, Mango, Bennetton, and Joe Fresh parent company Loblaw--brands whose factories were associated with the devastating building collapse three weeks ago--have all signed the accord. And last night, Marks & Spencer, Sainsbury's, New Look and N Brown, a mail order and online retailer whose brands include High & Mighty, Marisota and figleaves.com, also joined the plan, just in time to meet a deadline set by NGOs and labour leaders, the Guardian is reporting.

However, a slew of big-name retailers and manufacturers have been slow to sign the accord. Wal-Mart, Gap, J.C. Penney, Li & Fung, Sears, Next, Matalan, River Island, Sports Direct, Peacocks, Shop Direct and the Arcadia group, which owns Topshop, Bhs and Dorothy Perkins, all failed to meet the deadline last night.

Gap has said it plans to eventually sign the agreement--as long as the legally-binding nature of the agreement is adjusted. “We are 99% there as it relates to the accord,” Bill Chandler, a spokesperson for the brand, told MarketWatch. “We are six sentences away from signing the accord. Our proposal has one piece behind it to help make the accord an international agreement and not just European.”

“There is a serious gap in Gap’s credibility if it says that it only wants to sign the agreement if it is not legally binding,” Taren Stinebrickner-Kauffman, Executive Director of corporate watchdog SumOfUs.org, countered in an email sent by the organization. “Gap’s argument that it is unable to sign the Agreement because of U.S. liability rules is ridiculous. PVH, the American owners of Tommy Hilfiger and other global brands, has already proven that it is possible.”

Wal-Mart, on the other hand, announced Tuesday that it has no plans to sign the fire and safety agreement. According to Reuters, in lieu of signing the agreement, Wal-Mart has implemented their own plan of increased safety checks and improvements, which it believes is more effective.

Li & Fung, a Hong Kong based manufacturer which produces Rachel Zoe's line, among others, told the Wall Street Journal, it is "continuing to look at [the agreement]." The firm also pledged $10 million to upgrade the firefighting equipment in the Bangladeshi factories they use, according to the South China Morning Post.

In the UK, the Ethical Trading Initiative, the country's biggest alliance of businesses, trade unions and voluntary organisations, which aims to improve working conditions, has pressured retailers to sign the agreement with mixed results.

Debenhams, which is a member of the ETI, said they "fully agree with the intent of the agreement," however they have yet to sign it. The retailer said it is providing feedback to ETI and will "continue to work through the Accord agreement."

Activists protest outside a Mango store in Spain. Photo: Getty

Activists protest outside a Mango store in Spain. Photo: Getty

While Next declined to comment, the Guardian is reporting that the retailer is expected to sign the agreement later this week.

Topshop owner Arcadia group is taking a stance similar to Wal-Mart, preferring to work on safety reform independently. "We are not members of the ETI but have our own robust and comprehensive ethical trading programme and a resultant code of conduct," a spokeswoman for the brand said.

Matalan, which used suppliers in the Rana Plaza, the site of the collapse, also said it was part of a different non-binding agreement and that it would not be signing the Accord as a result.

While the Accord seems to have hit a wall of opposition with some retailers, labor and consumer groups hope that even these holdouts will eventually come around--or else face the wrath of angry consumers and activists.

"I think they are running out of excuses," Sam Maher from Labour Behind the Label told the Guardian. "No company can say they have the interests of their workers at heart if they can't sign up. If H&M, Tesco and M&S can sign why can't Next and Arcadia? They have production in Bangladesh and have just as much responsibility to invest in those factories and ensure those workers are safe. Those that have signed have proved this is not an impossible demand."

In conclusion, Maher added, "Are 1,200 dead workers not enough to make them realize something needs to be done?"

Update: WWD is now reporting that Topshop parent company Arcadia group does in fact plan to sign the safety accord, despite missing last night's deadline. The company says that it only purchases a small amount from Bangladesh, but will sign up "in order to show support for the initiative that this accord is proposing to undertake," adding that "This will be done on the condition that we understand the final costs to us, which to date has not been made clear."