How to Move Bangladesh Factory Safety Forward

Michael Posner
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Improving factory safety will require substantial capital. But it is within reach if Western governments, and the companies that were part of the Accord and Alliance, share the financial responsibility with parties in Bangladesh.
By Michael Posner
Last week in Brussels, members of the European Parliament met to assess the current state of Bangladesh’s massive ready-made garment (RMG) industry, now the second-largest in the world and a major supplier to Europe. It has been almost seven years since the Rana Plaza factory complex collapsed, killing more than 1,100 workers, mostly young women, and injuring 2,500 others. Rana Plaza generated worldwide headlines and searing images that still color many people’s perceptions of Bangladesh and the broader risks to workers in global supply chains. While the government and local industry in Bangladesh still need to address significant factory safety and labor rights issues, they have made real progress over the last seven years, progress that was discussed last week in Brussels. Building on this momentum requires support for a new oversight body, the Ready Made Garment Industry’s Sustainability Council (RSC). To succeed it will need substantial backing and funds from foreign governments and buyers to address the root causes of systemic safety and other labor rights issues, including poor safety records in subcontracting factories and restrictions on freedom of association.

This year, the apparel industry is forecast to generate approximately $1.65 trillion globally. Over the last four decades, driven by pressure to cut production costs and generate high volume with short turnaround times, garment manufacturing has migrated from the United States and Western Europe mostly to Asia and Latin America. More recently, as Chinese labor costs have increased, global clothing brands like H&M, Zara, Walmart, and GAP have turned to countries like Bangladesh, where wages are lower and production capacity ample. Since 2008, Bangladesh apparel exports have more than tripled, and are now valued at more than $34 billion. Garment sector exports now account for 82% of all exported goods from Bangladesh. This tremendous growth has helped to fuel the country’s economic development and cut the level of extreme poverty in half since 2000. In large part due to this explosive growth, the World Bank projects that Bangladesh will achieve middle-income status by 2024.

Throughout this expansion, factory safety has remained a problem. In the aftermath of the Rana Plaza tragedy, governments, global brands, and industry and labor representatives cooperated in an unprecedented way to improve factory conditions through two coordinated factory safety programs. The Bangladesh Accord on Fire and Building Safety brought together more than 200 mostly European brands and retailers, along with the global union federations IndustriALL and UNI Global. On a parallel track, the Alliance for Bangladesh Worker Safety included more than 20 mostly American brands, though without union involvement. For more than six years, these initiatives drove significant progress in safety standards at more than 2,400 factories, providing inspections, remediation plans and safety training. These efforts resulted in safer workplaces for more than 2 million workers.

Read the full Forbes article.
Michael Posner is a Professor of Business and Society and Director of the NYU Stern Center for Business and Human Rights.