Multinationals Agree to Safety Accord for Bangladeshi Factories

In the wake of the Rana Plaza factory fire in Bangladesh last month that killed over 1,100 workers in the deadliest industrial accident in nearly three decades, dozens of multinational apparel companies have joined a commitment to improve health and safety measures in the country's garment factories.

The Accord on Fire and Building Safety in Bangladesh asks companies that source goods from Bangladeshi factories to agree to establish a fire and building safety program for a period of five years. Signatories have also agreed to allow the International Labour Organization help implement and enforce the new safety standards.

At least 24 garment and retail brands sourcing from Bangladesh, including H&M, Inditex, PVH, Tesco, Marks & Spencer, Carrefour, Helly Hansen, Next, Loblaws, and Sainsbury's have agreed to sign the accord.

"We recognize the commitment that these companies are making towards ending the cycle of factory disasters in Bangladesh," said Jyrki Raina, general secretary of IndustriALL, a global union federation that has spearheaded the accord.

"We call on all other global brands sourcing from Bangladesh to join us in making sure that every garment worker in Bangladesh can work in safety," he added.

H&M, the globe’s largest buyer Bangladeshi garments, expressed its commitment to support the accord earlier this week.

"Fire and building safety are extremely important issues for us and we put a lot of effort and resources within this area," said Helena Helmersson, who heads the Swedish retailer's sustainability efforts. "H&M has for many years taken the lead to improve and secure the safety of the workers in the garment industry."

As early as 2011, H&M introduced an education program to increase fire safety awareness amongst suppliers and their employees. The company also requires that all the supplier factories conduct electrical assessments in their factories, and H&M has offered to share the costs of the assessment with the factories.

“Our strong presence in Bangladesh gives us the opportunity to contribute to the improvement of the lives of hundreds of thousands of people and contribute to the community’s development," said H&M's Helmersson. "By being on site, [putting] demands on manufacturers and [working] for continuous improvements, we can slowly but surely contribute to lasting changes.”

Despite the eager response from dozens of multinationals, American companies are conspicuous in their absence from the list of signatories. Early this week, Walmart, which sources extensively from Bangladeshi factories, said it will not be signing the accord "at this time."

"While we agree with much of the proposal, the IndustriALL plan also introduces requirements, including governance and dispute resolution mechanisms, on supply chain matters that are appropriately left to retailers, suppliers and government, and are unnecessary to achieve fire and safety goals," the company said in a statement.

The world's largest retailer also announced this week that it will conduct in-depth safety inspections at each of the factories in Bangladesh that supply goods for Walmart. Based on the results of the inspections, Walmart will require remediation as necessary, and increase transparency by making the results available to the public.

"Walmart believes its safety plan meets or exceeds the IndustriALL proposal, and will get results more quickly," the company said.

The deplorable safety conditions in Bangladesh's some 5,000 factories have received extensive – and often unwanted – attention in recent months as fires and collapses have killed scores of workers.

A recent report by the International Labor Rights Forum found that Bangladeshi garment workers are "the lowest paid garment workers anywhere in the world" and work long hours in an environment of near-constant fear.

Implementing factory safety measures is one part of a much larger labor rights problem that plagues Bangladesh’s 3.4 million garment workers. At $38 a month, Bangladesh sports the world’s lowest minimum wage, and humble factory workers are barely able to eke out a livelihood.

Some wage improvement may be forthcoming as well. In an interview with the Financial Times this week, H&M chief executive, Karl-Johan Persson, said his company is ready to pay more for the products it receives from Bangladeshi factories.

“I want the salaries to be revised yearly, as in most other countries,” Persson said. “So we’re definitely willing to pay more but we have to find a good, sustainable way for the workers and for the country as well.”