Whenever a crisis strikes our nation, Bangladeshis from all walks of life join hands to help those who have fallen. However, after the crisis is resolved, we seldom learn our lessons from these crises.
A culmination of factors led to the tragedy – the addition of four floors on a structure with a permit for five storeys, an inherent structural fault due to the building’s sub-standard foundation and factories operating in a non-industrialised building, amongst others.
The question that needs to be asked is who should be really held accountable for the death of these people – the government, factory owners, building owner, western retailers or the consumers of these products?
It is the government’s first and foremost responsibility to ensure the safety of its people. The RMG sector accounts for almost 75-80% of the country’s exports and about 13% of its GDP. It is the RMG exports and foreign remittance from Bangladeshi workers abroad which has enabled us to build a surplus of foreign reserves and achieve an annual GDP growth of about 6% over the last decade.
From an economic perspective a potential cut-back in garment imports from the country would devastate the economy. Hence, it is of utmost importance that the government starts reviewing the safety standards of all industrial facilities and working with the international community to enforce a more rigorous monitoring system to ensure compliance.
The lives of 55-plus innocent low-income people should not and cannot be written off as an acceptable loss.
The RMG industry is a low margin business; the only way to make profit is produce enough to make up for the low margin. Hence, it is often difficult for the local factory owners to enforce international worker safety standards, as they require some investment.
In essence, the real power lies with western brands and retailers, beginning with the biggest players: Wal-Mart, H & M, Inditex, Gap and others. These big brands and retailers need to understand and learn from the “Nike” experience.
Western brands and retailers, in collaboration with the suppliers, need to develop a code of ethics and best practices. While many of these retailers already have them in place and regular audits are conducted, these code of ethics are not practiced throughout the organisation.
A corporate social responsibility program can have some influence, but in order to be properly implemented it needs to have a buy-in from all the suppliers.
The global retailers need to understand that they just simply cannot issue a supplier code of conduct and perform regular audits. Audits are part of the solution but simply not the answer.
Change does not happen instantaneously, rather it needs to be managed. The first step would be to investigate the entire supply chain and identify areas that need improvement.
These improvements then need to be monitored in such a way, so that they become part of the supplier’s culture. If they are monitored from the outside, it will be a “one-day” thing, during which the firm follows the best practices just to pass the audit. It’s essential that these best practices become an integral part of the culture.
The suppliers and factory owners need to understand that increases in productivity can be achieved through improvement in working conditions, thereby leading to higher efficiency and profits. Factory owners need to look beyond the numbers and build links between the human element and traditional areas of measurement such as quality and delivery.
A clear business case needs to be made for investment in human resource management systems. Without a buy-in from all the stakeholders, corporate social responsibility cannot be integrated as part of a company’s day-to-day operations.
The Nike fiasco in the 1990s can serve as a great role model. For example, excessive overtime had been a problem in a lot of Nike contracted factories.
Nike commissioned extensive research and found that the reasons for excessively long work hours among its suppliers were poor application of local laws, flawed factory management approaches and upstream business processes that caused extra work.
Best practice research shows links between long hours, increased accidents and poor health, but plant managers need specific data from their own facilities showing when defects, accidents and even needle breakages occur.
For example, do workers break more needles at the end of their shifts than at the beginning, or during long periods of frequent overtime? If so, it may mean they’re tired and not paying as much attention to their work and quality suffers. On top of that, potentially productive time is wasted when changing needles.
McKinsey in its 2011 report about the RMG sector in Bangladesh correctly mentions that the contracted factories are a long way from following the international standards of work place safety. The government and factory owners need to understand that investment in human capital will come back as higher productivity gains. This kind of an investment will generate high long-term returns in terms of higher profits and increased business for the RMG sector.
Finally, consumers of these products need to realise that they are the ones who hold the ultimate power to see these injustices to an end. They did it with child labour in Nike-contracted factories in the 1990s. Consumers are smart enough to draw a line with what is right and wrong.
Consumers need to inhibit purchasing from retailers who cannot ensure that their products were manufactured under the international standards of compliance. Only then the Western brands and retailers will take compliance seriously.
Consumers need to realise that they are actively taking part in blood fashion. Kids have lost parents in the tragedy and this blood is on the hands of the end consumers.
Azfar Hossain is a freelance contributor.
