It has been suggested, after a horrific fire at a factory in Bangladesh that killed 112 workers last year, that we should boycott American companies that make their brand name apparel in Bangladesh. The factory in Bangladesh was, without question, a death trap. But it appears many of the factories that make apparel for U.S. universities and outlets may also be death traps. So, why not, as suggested, boycott Bangladesh until they clean up their act?
Scott Nova, executive director at the Worker Rights Consortium (WRC), believes that’s exactly what we should do. In an interview with Corporate Crime Reporter recently, Nova had this to say:
If it were up to us, we would ask universities to require their licensees not to do business in Bangladesh or Pakistan, for that matter. But we have been asked not to do that by the unions in Bangladesh. The unions in Bangladesh are dealing with a situation in which this is the primary source of employment for workers in the country. It is 80 percent of the country’s export earnings. The unions themselves are under enormous political pressure internally. And they have opposed a boycott. So, as a labor rights organization in the U.S., we feel an obligation to act in a manner consistent with the wishes of people who actually represent workers in Bangladesh. Like other labor rights organizations in the U.S. and Europe, we have not called for companies to boycott Bangladesh. Although, if it were purely up to us, we would advise universities to prohibit their licensees from doing business in Bangladesh until the situation is addressed.
The Worker Rights Consortium budget is $1.25 million a year. Seventy-five percent of that budget comes from universities. And WRC uses that money to enforce mandatory labor codes. But it appears that the mandatory labor codes are routinely violated in Bangladesh. Nova had this to say about the situation:
The mandatory codes prohibit all sorts of violations that are probably taking place in 95 percent of factories making university apparel. We have told the universities that we cannot enforce the codes because of the way that these companies operate their global supply chains, that we are in effect powerless to do so because we cannot affect the prices that are paid and the nature of the relationship between the brands and the factories. All we can do is investigate individual factories in response to worker complaints and use the leverage we can bring to bear to try and force the owners and managers of those factories to change those factories.
The overall system continues to be one in which violations are the norm. And we have said repeatedly to universities that the only way to change that is to force the companies to radically change the way they operate their supply chains – higher prices to the supply chains, long term relationships with the factories. And until and unless that happens, it is effectively impossible for us to enforce these standards. That is something that we have publically acknowledged for years.
So, we have a system of monitoring and corrective action that makes sense and is workable if you have 1,000 factories and 900 of them are in compliance. That kind of system works if compliance is the norm and non-compliance is the exception. In an industry where the status quo is one in which non-compliance is the norm, in which the vast majority of factories on any given day are violating multiple elements of the applicable law and standards, the kind of monitoring that we were created to do — factory by factory inspections – does not work to solve the problem on a broad scale. The most we can do is identify particularly egregious abuses in individual factories and try to press for change.
Nova told the Corporate Crime Reporter ”the only thing that the factory owners in Bangladesh and their allies in the government have ever responded to is economic pressure.” So, if there isn’t going to be a boycott, how do we improve conditions in Bangladesh? Nova made these observations during the interview:
WRC and a dozen or so labor rights organizations and a dozen or so unions in Bangladesh have signed an agreement with PVH – Phillips Van Heusen – a company that is the owner of Tommy Hilfiger and Calvin Klein and other brands. PVH was under pressure to do something because of an ABC News expose about a fire that took place in 2010 that killed 30 people. It was right near the factory that burned last Saturday. We signed an agreement with PVH in March.
Under that contract, they must pay prices to their suppliers in Bangladesh sufficient to enable those suppliers to undertake necessary repairs and renovations and to operate safely. They must require their local suppliers to allow genuinely independent inspections of the factories with publication of all results and inspections and with a mandate that the factories must implement whatever repairs, renovations and changes in policy that the independent inspectors require.
And most importantly, they may not do business with any factory that refuses to implement the necessary repairs and renovations. They must also require their suppliers to allow unions into these factories to educate workers about worker safety and worker rights. This agreement cannot be implement until at least three other apparel companies sign on. In order for this to work, we need sufficient leverage over the producers in Bangladesh.
A second company, a large German company – Tchibo – signed on in August. We have negotiated for months with GAP – which is one of the biggest buyers in Bangladesh and a company which has put itself out there as a supposed leader on corporate social responsibility. But GAP has refused to make these commitments. With GAP, it has become clear that they don’t want to make any commitments that can be enforced. They will not deviate from the model of corporate self-regulation that they have employed for years, and that has done nothing to actually protect the rights and safety of the workers who make their clothes in Bangladesh.
So, our negotiations with GAP broke down two months ago. But in the aftermath of this last fire, we have called upon other major buyers from Bangladesh – GAP, Wal-Mart, H&M, Inditex – which owns Zara – Sears and Disney – to make the same binding enforceable commitments that PVH has made.
Wal-Mart Stores Inc., has made a rather interesting response to what happened at the Bangladesh factory. The world’s largest retailer has conceded that it needs to do more to control its supply chain and keep unauthorized manufacturers out. But companies such as Wal-Mart must figure out how to get more involved in the operations of factories in countries such as Bangladesh. Hoping that contact with suppliers and factory audits will suffice, thus serving to shield the U.S. companies from public scrutiny or government controls, simply isn’t enough.
But, I am not sure that the public has enough information on the out-sourcing issue described above to be interested in boycotting companies that out-source to countries such as Bangladesh. But the universities and other corporations that use these factories certainly do. But will they take any type action? We will see.
Source: Corporate Crime Reporter
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