In late November of 2013, Supply Chain Matters called reader attention to the news that three global groups addressing social responsibility and work standards for Bangladesh garment factories had tentatively agreed on common standards for factory inspections. The effort came after the tragic collapse that occurred at the Rana Plaza factory complex in April of last year that resulted in more than 1000 factory deaths. One of these groups was the Accord on Fire and Safety in Bangladesh which is led by mostly European based retailers
In mid-October, the safety group reported that it inspected 1106 garment factories within Bangladesh, with more than 80,000 safety issues identified. Safety hazards were found in almost all factories. According to reports, the inspections uncovered critical structural deficiencies within 100 factories that require immediate repairs. In 17 of the inspections, factory conditions were deemed to be so unsafe that the factories were ordered shutdown. Around 110 of building inspections uncovered the need for immediate actions required to bring the facility above acceptable safety levels for production to continue.
According to reporting from The Wall Street Journal, questions are still being raised as to who will pay for factory upgrades sought by international buyers. From the financial resources perspective, 100 mostly European brand retailers signed a five-year, legally binding accord that requires members to maintain garment order levels in Bangladesh factories for at least the first two years, and to assist in the cost of factory upgrades. Two-dozen U.S. based retailers led by Wal-Mart and Gap also signed a non-binding pact which pledges to invest in factory inspections and upgrades. Thus the Bangladesh factory situation remains rather frustrating. Bangladesh’s government has indicated that it will consider the establishment of a new industrial park for the garment industry.
Meanwhile, garment workers in Cambodia have been increasingly become more vocal in seeking higher wages within that country. Reports indicate that in an unprecedented move, a number of European retailers led by Hennes & Mauritz and Inditex have written to the government of Cambodia pledging to pay more to local workers. Cambodian garment workers are currently compensated an average of $100 per month, and typically work six day, sixty hour work weeks that are supposed to include overtime. In contrast, workers in Bangladesh are paid a minimum wage of the equivalent of $68 per month.
As readers partake of upcoming holiday gifts that include apparel that was produced in either of these countries, perhaps there will be a reminder that social responsibility challenges remain an ongoing significant and perplexing challenge.