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government-trade

LEVI’S HAAS EXPLAINS U.S. FACTORY CLOSURES

WASHINGTON -- No longer willing to swim against the economic tide of globalization, Levi Strauss & Co. this year is shutting eight of its remaining company-owned factories in the U.S. and Western Europe, leaving it with just a token domestic...

WASHINGTON — No longer willing to swim against the economic tide of globalization, Levi Strauss & Co. this year is shutting eight of its remaining company-owned factories in the U.S. and Western Europe, leaving it with just a token domestic manufacturing presence.

In a speech at a national Peace Corps. business symposium in Washington on Thursday, chairman Robert Haas — who was a Peace Corps volunteer near the Ivory Coast from 1964-1966 — acknowledged that might lead some consumers to wonder about working conditions at the overseas plants from which the company is buying. But he said he believes that Levi’s can maintain its commitment to social responsibility even while sourcing from foreign contractors.

“You still get the tension between people who say that being a responsible company may get in the way of being a profitable company, which I strongly disagree with,” said Haas, whose family includes the primary owners of the 149-year-old company. “It’s an essential part of a businesses’ long-term viability.”

Levi’s held onto its domestic production as long as it could — and longer than many of its competitors — but finally succumbed to the pressure of low-cost foreign production, Haas said.

“It is a very personal” decision to close plants that affect communities, he said. “Because of that, we dragged our feet, much, much too long in making inevitable economic decisions.”

He said the company, which was being hurt by low-cost imports, could no longer be the “good guy” with Made in the USA labels.

But he stressed that he is determined to be a “good guy” overseas, by ensuring good labor and working conditions and monitoring factories around the world.

“We can’t change the fact that tariffs and quotas have been eased and therefore it’s easier to get foreign-made apparel into the U.S.,” Haas said. “What we can say is if we have to close plants here [and operate overseas], we are going to do this in a socially responsible way.”

Despite the fact that Levi’s belongs to the Fair Labor Association, which sets up monitoring programs around the world, Haas said consumers have a right to be wary.

“Despite the White House efforts and voluntary industry coalition, there really is not an effective regime to assure consumers that products they purchase were made in proper conditions in accordance with a code of conduct.”

Haas said he is working behind the scenes with others to find a multinational organization like the International Labor Organization to certify companies and provide verification.