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Bangladesh Factory Plans Forge Ahead

Two separate industry initiatives aimed at improving building and fire safety in Bangladesh’s garment industry are intensifying their efforts.

Putting out the fire at Aswad Composite Mills.

WASHINGTON — As the six-month anniversary of the Rana Plaza building collapse that killed 1,129 workers is marked on Thursday, two separate industry initiatives aimed at improving building and fire safety in Bangladesh’s garment industry are intensifying their efforts and expanding their reach to cover more factories and workers.

In the wake of a string of garment-factory tragedies that stopped the evolution of corporate social responsibility in its tracks, European and North American brands and retailers have come under intense global pressure to implement safety action plans.

The IndustriALL Global Union and UNI Global Union are leading the first initiative, known as the Accord on Fire & Building Safety in Bangladesh, which was unveiled in May. On Tuesday, the International Labor Organization launched a Better Works program in Dhaka to inspect and monitor factories. Bangladesh’s $21.5 billion garment export sector has an estimated 5,000 to 5,400 factories employing about four million workers.

RELATED STORY: ILO Unveils Bangladesh Program >>

This month, accord officials announced that they signed the 100th retailer and apparel brand to the five-year, binding action plan, which includes Inditex, Hennes & Mauritz, Marks & Spencer, Carrefour, C&A, Primark, Puma, Benetton, PVH Corp. and American Eagle Outfitters Inc. The accord, which covers 1,600 factories and two million workers, recently launched a Web site at bangaldeshaccord.org and released comprehensive data on the factories, such as addresses, the number of stories of each structure where a factory operates and the amount of workers at each site.

As part of the binding plan, companies must pay for renovation and repairs to ensure factories in Bangladesh are made safe. The five-year pact is a legally enforceable contract between companies and unions that will use binding arbitration to resolve disputes. It also requires a “vital role” for workers and their unions through the establishment of health and safety committees in all covered factories with worker representatives comprising at least a 50 percent partnership.

“The scope of this is so big,” Jyrki Raina, IndustriALL’s general secretary, said in an interview. “If you think of it as a [$21.5 billion] export industry with 5,000 factories and four million workers, it reveals how out of control the whole Bangladesh garment industry has been. It has grown so quickly and in an environment where the rule of law is not strong, with probable corruption and a mix of factory owners who are politicians.”

The accord’s “infrastructure” is in place, Raina said. It has appointed its executive directors and a chief fire inspector, but still needs to hire more fire and building safety inspectors, at which point it will begin conducting building-safety inspections, starting with those deemed most dangerous. The goal is to inspect all of the covered factories within nine months.

In addition, individual companies have already launched a new level of inspections at their own factories, according to Raina, and the government of Bangladesh has committed to hiring new personnel to inspect factories not covered by the accord.

“The magnitude of the task will take five years,” he said. “The good news is the brands are committed and have grown proud of the accord and want change to happen. On the other hand, they know they can’t afford another Rana Plaza for their image.”

Showing that reforms will take time, another tragedy hit the industry this month when a blaze at the Aswad Composite Mills on the outskirts of Dhaka killed nine people and injured more than 46.

Across the Atlantic Ocean, a separate coalition of retailers and brands launched their own initiative in July and named it the Alliance for Bangladesh Worker Safety. This rival group, which includes Wal-Mart Stores Inc., Gap Inc., VF Corp. and Target Corp., formed a binding five-year worker, fire and factory safety pact that will provide $48 million in funds to improve factory safety conditions in Bangladesh. The plan will also provide more than $100 million in loans and access to capital to assist factory owners in making safety improvements.

When it launched, the alliance plan said it would complete inspections of 100 percent of its members’ factories in Bangladesh within the first year, develop common safety standards by October, publicly share all of its inspections and democratically elect worker participation committees at every factory.

Ellen O’Kane Tauscher, independent chair of the alliance, who led its board on a trip to Bangladesh last month, said the alliance has made “a lot of progress in its short gestation” of 12 to 13 weeks.

“So I think we have a very comprehensive plan and have identified a way forward,” Tauscher said. “While this is a daunting challenge, there is a very significant commitment and milestones are being achieved.”

The alliance’s board has finalized and adopted its standards for fire safety and building structural integrity, shared a draft copy of the standards with the accord officials in Bangladesh and plans to share the updated version with the ILO this month.

Jeffrey Krilla, president of the alliance, said membership has grown to 23 companies and now covers 620 factories in Bangladesh and 1.1 million workers. The three newest members are Ariela Alpha International, Fruit of the Loom and M. Hidary & Co. On Tuesday, the alliance published a list of the 620 factories, including factory names, addresses, number of workers and composition of the buildings on its Web site: bangladeshworkersafety.org. The alliance said that half of these factories have been inspected thus far.

The alliance also has plans to open an office in early December in Bangladesh and has retained Elevate, a Hong Kong-based management and consulting firm with extensive experience in Bangladesh’s apparel industry, which will employ 22 people on the ground in the country and work with Krilla to achieve the alliance’s goals. It has also appointed two technical experts to its committee to help on implementation of the standards and the inspection process.

“We want to create the capacity for people in all of the various constituencies to maintain the standards [once the alliance has finished its mission],” Tauscher said. “Those are the benchmarks we are looking at — getting the standards adopted, getting a broad coalition to agree on the standards, begin to implement them and train workers so they understand what they should be looking for.”

Observers said the two action plans are a step in the right direction but warned that true reform will be difficult to achieve without more support from the Bangladeshi government.

“Both of the plans are an improvement on what is happening today,” said Edwin Keh, a lecturer at the University of Pennsylvania’s Wharton Business School.

While Keh said he expects the industry initiatives to be effective, he is also concerned that real progress will not be made until the government and unions are brought into the fold.

“Unless the government and trade unions are at the table, this will always be about doing it because the customer asked you to do it instead of because it is the right thing to do for our economy and development,” Keh said.

Richard Locke, a political science professor at Brown University and director of its Watson Institute for International Studies, said: “It is a shame there are two different initiatives. We shouldn’t be competing on stuff like this. We should be cooperating and have one big initiative. I think it is a distraction from the real issue and the real issue is ‘Let’s all get together and figure out how to make things work to improve the health and safety and working conditions.’”

Locke said until the government builds a foundation on rule of law and enforces its fire and building safety laws, he doesn’t expect to see a significant change.

“Until there is a public [government] infrastructure in place working with these private initiatives, I don’t believe we will see significant, sustainable improvement in the building and fire safety standards or in labor standards,” Locke said.