Retailers seek plan to prevent disasters like ones in Bangladesh

News - Retailers seek plan to prevent disasters like ones in Bangladesh
 Wal-Mart Stores Inc., WMT -0.85% Gap Inc., GPS +1.28% and Hennes & Mauritz AB HM-B.SK +0.22% met with about 30 Western retailers, labor groups and nongovernmental organizations to work on a plan to prevent industrial disasters like last week’s deadly building collapse in Bangladesh.

The discussions included creating a clearinghouse of factory-inspection results, so companies can see where other retailers stopped production over safety concerns, participants said. The group plans to publish the results of the talks in May, reports The Wall Street Journal.

Gap, Wal-Mart and H&M all confirmed they attended Monday’s meeting in Eschborn, a town near Frankfurt, at the headquarters of GIZ, a German federal agency. A spokeswoman for El Corte Inglés SA, the Spanish department-store chain, confirmed discussions of a program aimed at monitoring and improving Bangladesh’s industrial infrastructure.

Separately, European Union officials said they are considering action to pressure Bangladeshi authorities to improve labor conditions. In a statement Tuesday evening, the EU’s trade commissioner, Karel De Gucht, and the bloc’s foreign-policy chief, Catherine Ashton, said they were “very concerned” about labor conditions in Bangladesh. The EU is Bangladesh’s largest trade partner.

Clothing and order forms from a half dozen Western brands were found in the rubble of the toppled building outside Dhaka, including Canadian retail giant Loblaw Cos., L.T +2.69% Spanish retailers Mango and El Corte Inglés, and Italian retailer Benetton Group SpA.

Those companies confirm that factories at the building were producing clothing for them, with Mango and Benetton saying these were test runs.

Loblaw and El Corte Inglés have both said they plan to compensate victims and the families of the garment workers.

Bangladesh’s $20 billion garment industry represents the second-largest clothing exporter after China and has become a prominent link in the global supply of low-cost clothing for so-called fast fashion and budget retailers in the U.S., Europe and Canada.

The building collapse represents the third major industrial incident in five months in the country, following two deadly fires last year that killed more than 100 people in total and prompted Western brands to re-examine safety measures.

A contract crafted by the U.S.-based International Labor Rights Forum and other groups after a 2010 garment-factory fire, the Bangladesh Fire and Building Safety Agreement, has so far failed to take effect since not enough retailers have signed on.

The incidents have renewed calls for a wider safety agreement that would require retailers to sign on to a binding inspection system that would alert workers and the public when a factory is unsafe.

Retailers are working on a broader agreement that “more brands are likely to sign up for,” said Peter McAllister, director of the London-based group Ethical Trade Initiative, who attended the meeting.

Labor groups would like to make this information open to the public so workers will also know if their factories are safe, but retailers have resisted amid worries about lawsuits.

Some participants said it is unclear if the meeting will result in meaningful action.

“What will end these disasters is an urgent program of building renovations,” said Scott Nova, executive director of the Worker Rights Consortium, who attended the meeting. “That will only happen when brands make enforceable commitments to carry out and pay for it.”

Source: UNB Connect


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