Gap Inc and Wal-Mart Stores Inc are among US retailers finalising an agreement to establish a $50 million, five-year fund to improve safety conditions in Bangladesh garment factories, the Wall Street Journal reported yesterday.
The fund for factory safety is contingent on the Bangladesh government meeting certain criteria that would ensure accountability for safety improvements, the Journal reported. A deal could be announced as soon as next month, the newspaper said.
Pressure on Wal-Mart and Gap increased after they refused to join an international accord to increase fire and building safety in Bangladesh. The legally binding agreement was signed last month by dozens of large European retailers, including H&M and Inditex, as well as by Abercrombie & Fitch, PVH and other American companies.
Amid growing criticism of their refusal to sign, representatives from Wal-Mart and Gap appeared at a Senate Foreign Relations Committee hearing this month to defend a separate plan by a group of North American retailers and industry associations.
The plan has been developed in meetings convened by a District-based nonprofit group called the Bipartisan Policy Centre, The Washington Post reported. Its president, Jason Grumet, said Wednesday that “at this point, only a few final details remain to be worked out and agreed upon. We remain on track to complete the process by early July.”
Other retailers involved in the talks are Macy’s, Sears and JC Penney. The meetings have been co-chaired by the center’s co-founder, former Senate majority leader George J. Mitchell, and a senior fellow, former senator Olympia Snowe, who act as facilitators.
A group of eight US senators, led by Sherrod Brown (D-Ohio), had written to Wal-Mart and other retailers urging them to reconsider signing the existing accord on fire safety in Bangladesh.
The senators argued that “only a legally binding global accord signed by US and European retailers — rather than self-monitoring or voluntary initiatives — will ensure worker safety in Bangladesh,” according to a statement.
The Wal-Mart and Gap alternative “cannot be called an agreement,” said Scott Nova, the executive director of the Workers Rights Consortium, an independent labor monitoring group. “There is nobody to enforce it, just companies and industry associations that represent these companies. For an agreement, you also need a party interested in enforcing the deal.”
United Students Against Sweatshops and other labor rights groups have called for protests at Wal-Mart and Gap stores in more 30 cities in the United States, Canada and Britain on Saturday to demand that they join the fire and safety agreement already signed by 50 apparel companies.
Source: The Daily Star