On the Anniversary of the Rana Plaza Disaster, Finding Lip Service and Little Progress

Activists gathering in front of The Children’s Place on Union Square East to demand compensation for victims of the Rana Plaza factory collapse in Bangladesh in March. a katz / Shutterstock.com

According to the 2015 Australian Fashion Report, published by international aid monitoring NGO Baptist World Aid, 75 percent of the 91 fashion retail companies surveyed for the report did not know where knitting, dyeing, and embroidery work on their garments was being done. Only about half of the companies surveyed had some kind of relationship with their direct ‘cut-make-trim’ garment manufacturers.

These statistics are an improvement from the group’s report in 2013, done in the wake of the horrific Rana Plaza garment factory collapse in Bangladesh. The tragedy has inspired an annual movement called Fashion Revolution Day (FRD) to take place every April 24.

The movement calls for an improvement in those supply chain transparency statistics, policy changes, and consumer engagement but some say not enough changes have been made in the fashion industry’s value chain as a whole.

The Rana Plaza factory complex in Dhaka was home to several familiar fashion brands’ manufacturing operations. Despite warnings about cracks in the building walls, workers were forced to enter and work in the factories. As a result, over a thousand were killed and 2,500 injured—many permanently.

What surprised many inside and outside the fashion industry was that several companies were actually unaware that certain garments of theirs were being produced in those factories. The combination of Bangladeshi government oversight, manufacturing activities being done by subcontractors in ‘shadow’ factories, and lack of corporate responsibility are blamed by many for the collapse.

In the wake of Rana Plaza, cries were heard around the world blaming brands for lack of supply chain transparency and questioning how companies could possibly be so in the dark about where their garments are made.

The world realized the tragic irony: that the brands with seemingly unlimited resources like Benneton, Nike, and retail brands like Walmart and Target are the ones with the least transparency and most human rights and environmental abuses along their supply chains.

It is the smaller designers and independent brands that actually have more knowledge and control over the people and companies involved in each step of their supply chains. As a result they are able to monitor more effectively for gross violations. However, these companies do not reach the millions of consumers the larger, more well-known brands reach.

Two years on, consumers wonder if the fashion industry has changed as a result of the factory collapse or if it is business as usual.

Molly McCallum, a PhD student at Claremont Graduate University who is researching ethical leadership and international CSR notes that one of the reasons for a lack of real change in the industry is because “a lot of companies, especially garment companies, are watching and waiting…to see how changes to the [Bangladesh labor laws] address the underlying issues.”

Gap has partnered with an investment fund called Tau that hopes to raise $1 billion to make Asian textile and garment factories more transparent and safer for workers. However, there is no indication that the deal will make the global supply chain of the clothing giant public knowledge. Carry Somers, co-founder of FRD points to H&M’s post-Rana Plaza efforts in publishing their factory and supplier list for all to see and notes that H&M “didn’t have anybody…trying to take their factories.”

Despite the efforts of brands like H&M and Gap and the high ratings on transparency given to Inditex, Hanesbrands, Fruit of the Loom, and Patagonia, Ilana Winterstein, Director of Outreach and Communications for Labour Behind the Label says there is a lot more that needs to be done in the industry as a whole.

Winterstein and McCallum point to two initiatives in particular that have come about in the last two years: the Alliance for Bangladesh Worker Safety (Alliance) and the Accord on Fire and Building Safety in Bangladesh (Accord).

Both the Accord and Alliance “are revolutionary in their formation and purpose,” but do not go far enough. Winterstein notes that the Alliance is not legally binding and thus factory inspections are not independent, with brands maintaining control of the inspection process. She also notes that the Alliance was written without consulting independent worker representatives or unions. She calls the Alliance “more of the same, meaning if companies do not adhere to the terms there is no legal framework with which to hold them accountable.”

On the other hand, the Accord, which was agreed to a mere month after the factory collapse, is a legally binding, enforceable contract according to an assessment by the Clean Clothes Campaign that analyzed differences between the Accord and Alliance.

Over 70 companies have signed the Accord like H&M, Carrefour, Tesco, and Abercrombie and Fitch. Only 17 have signed the Alliance, however signatories include powerful, established brands and companies like Gap and Walmart.

The United Nations, European Parliament, and members of the U.S. House of Representatives and Senate have all endorsed the Accord. However, the Bangladeshi government is also backing the Alliance and not the Accord, signalling the government’s priorities: supporting the larger brands signed on to the Alliance because those are the brands that provide the most jobs and revenue for the country.

In spite of the government’s backing of a seemingly opposing initiative in the Alliance, according to Winterstein the Accord has resulted in a bit of positive change in the last year or so. She says that nearly 2,000 factories in the country have been inspected by qualified safety experts and “the Accord has raised the bar on safety checks in Bangladesh as whole.”

Winterstein says that both the Alliance and Accord have really focused in on factory conditions and inspections, but industry-wide there needs to be more focus on other issues, like giving workers a voice to speak out about safety concerns. Despite the strides made, less than 5 percent of garment workers in Bangladesh are organized. Unless workers feel unions can help them, agreements backed by large corporations will have power over agreements endorsed by labor unions, even if international agencies also back it.

McCallum points out that the two initiatives are only focused on Bangladesh because of Rana Plaza. “I think a lot of companies are waiting to see if sustainable change can be achieved [there] and if the Accord and Alliance might serve as a model for tackling labor and human rights issues in other countries.”

Along with criticism, there was momentum for positive change in the industry according to Somers. She and co-founder Orsola de Castro began the movement in the UK, and there are now events and ‘Ambassadors’ of the movement in nearly 70 countries.

FRD has a dual-prong strategy. The first is based on social media activism, employing the Twitter, Facebook, and Instagram hashtag #whomademyclothes. Somers says the campaign encourages shoppers to ask “the brands they love, the places they love to shop” to tell the public where and who makes their clothes. The hashtag is full of pictures of people wearing their clothes inside out as a symbol of label transparency.

“Though consumers were not the cause of the problem, they can certainly be part of the solution,” explains Somers.

Somers notes though that Fashion Revolution Day is not about singling out brands.

“What we’re saying is that almost everyone is doing something” that requires supply chain changes, “we’re about showcasing best practices,”she explains. By focusing on the positive rather than just the negative in supply chain transparency, Somers can inspire other brands to do the same rather than just criminalizing them. She notes brands like Adidas, Zara parent company Inditex, G Star Raw, and Eileen Fisher have all implemented industry best practices in mapping out supply chains.

Rather than a focus on the labor rights concerns that were brought to light by Rana Plaza, FRD stresses that “transparency is the prerequisite to improving” labor and even environmental sustainability concerns according to Somers.

“If every brand was acutely aware of who was making their clothes, under what conditions, it would be impossible to turn a blind eye,” says Sass Brown, Acting Associate Dean School of Art and Design at the Fashion Institute of Technology. “And should they be inclined, there would be someone who ensured they couldn’t hide it from their buying public.”

A company has to want to do it as well as being compelled by legal regulations, she notes, indicating that corporate social responsibility (CSR) is a major factor in the fashion industry since Rana Plaza.

McCallum, says that “historically, corporate social responsibility and supply chain operations [have] collided.”  Usually, she says, the two are at odds as a result of significant events like Rana Plaza. McCallum notes that since the event, the trend in CSR has been to integrate it “throughout an organization, so CSR is not a stand-alone department.” A more responsible supply chain is a more transparent one.

FRD’s second focus attempts “to move consumer from awareness to action,” says Somers. “We really do want to move past just the conversation and set the agenda so governments know what changes need to happen,” she explains. Somers and others are working closely with Houses of Parliament in the UK and the European Commission on policy changes in company reporting requirements for the fashion industry. Somers hopes these policy advocacy efforts will spread to other countries as well.

“We need the stick and the carrot,” Somers says on using policy advocacy alongside engaging consumers on social media. “We do need to give companies incentive to change [but] we also need to penalize companies that do not change,” Somers says.

However, supply chain transparency is not as easy as it may sound and Somers acknowledges the task “is very time consuming.” It is fairly common for global brands to have hundreds of manufacturing facilities and just as many raw materials suppliers because a single garment is often constructed in so many different countries before making it to the final, retail location.

Those manufacturing facilities are then sourcing materials, buttons, zippers, and other parts from other suppliers inside and outside the country where their factory is located. The milling facilities, such as cotton mills, are getting that cotton from a host of farmers and agricultural vendors. Lists of these entities are not shared among the various ‘tiers’ of the value chain and sometimes retailers do not even have direct relations with their top tier factories, working with middlemen instead. This was one of the contributing factors in the brands’ lack of awareness in the aftermath of Rana Plaza. Identifying, documenting, and tracking all those entities can, in most cases, be a long and expensive process for brands to undertake.

Somers says technology has improved supply chain transparency since Rana Plaza, though the nature of the industry still makes it relatively difficult to achieve.

The  focus of efforts in this area have been on improving conditions in Bangladesh. Due in part to the Rana Plaza tragedy, but also because the country is home to one of the cheapest labor forces in the world, and the fashion industry is perhaps the most labor-intensive industry in the world, with nearly one in six workers around the globe participating in some aspect of fashion value chain.

Part of the argument made by fashion industry executives over slow progress on supply chain transparency since Rana Plaza is that costs could be passed on to consumers. However Somers says that by some estimates she has heard, the added costs of keeping workers in Bangladesh at a living wage in safe conditions could be as little as 40 cents per garment in some cases. She notes though, that if that model were expanded to China the costs would be more to the consumers, but even then “we’re not really asking consumers to pay more.”

McCallum says that logic applies well to the European customer base given recent market trends towards more conscious shopping. However, she explains that the willingness and especially ability to pay more for a more ethical and transparent shopping experience is not as common in the U.S.

“There is not an overwhelming and sustained outcry from the U.S. customer base [and]…very rarely do U.S. consumer boycotts based on labor or environmental issues grow to the size that they impact financial results,” she explains.

The FRD social media campaign though seems to be the start of something that could get the attention of retailers if they think it is big and loud enough to impact sales.  However, the industry has certainly not slowed business with Bangladesh as a result of Rana Plaza, with recent estimates point to massive increase in exports with Canadian companies alone.

But Fashion Revolution Day is only in its second year, and with groups like them working on policy and regulatory changes, there could be momentum to push brands for more socially responsible and transparent supply chains. Until then, Somers says, keep asking #whomademyclothes because “we want fashion revolution all year round not just one day a year.”