Disaster at Rana Plaza
Nandita Farhad’s doctoral thesis “Supply Chain Governance for Social Sustainability – A Study of the Ready-Made Garment Industry in Bangladesh” begins in April 2013. Suddenly, an eight-storey building complex with bank, shopping centre and five textile factories collapsed in Rana Plaza on the outskirts of the capital, Dhaka. 3100 factory workers were in the building – 1136 of them lost their lives and thousands were seriously injured.
Textile faktory in Bangladesh. Photo credit: Nandita Farhad
Nandita Farhad has investigated what has happened to safety and working conditions since the disaster.
“It was an event that affected me deeply. I am a researcher and present facts, but I also hope that my dissertation will lead to improved working conditions”, she says.
"If you compare the situation today with that in 2013, wages are higher, but are still too low to fulfil the basic needs of the workers. Many are compelled to work ten-twelve hours to earn extra, but only receive wages for eight and most workers are uneducated. It’s nothing new. At the same time, safety has been improved in many factories and companies are collaborating with one another more than before. This is positive."
Cooperation between companies
Nandita Farhad has examined how eight large multinational clothing companies, three American and five European, have been working with social sustainability since the Rana Plaza accident. Social sustainability is defined in the dissertation as both physical safety, wages and working conditions, and social development such as access to clean water, healthcare and education for employees.
A worker rests by his sewing machine. Photo credit: Mikael Sönne
Some of the multinational clothing companies have audit teams that work closely with their suppliers; some make relatively large efforts, and are thus not representative of the entire textile industry. Several factories simply falsify the documents related to wages and working hours, and the problems are often greater among subcontractors. These smaller subcontracting factories are also more difficult to monitor.
One decisive, positive, change is that the eight companies (and many others) have joined forces in a joint organization to control the safety and physical building standards in the factories.
Previously, the companies had neither the resources nor the skills to carry out these checks. But now the joint organization can hire trained personnel who take care of the inspection, and help to inform workers about fire safety.
More effective and expensive
On a general level, Nandita Farhad defines four levels of social sustainability work. In the first, market-based, there are written codes of conduct and plans of the companies, but in the choice of supplier the lower price is much more important. Low prices cause factory owners to force workers to work overtime or to subcontract to unsafe factories, instead of considering the safety of working conditions. In level two, the hierarchical, the company itself performs most of the checks about the capacities of the factories, and monitors conditions.
At the higher levels, the eight companies collaborate with others, either other companies in the same industry or with independent non-government organizations. These working methods give the best results.
Companies’ costs increase when they are forced to negotiate. But at the same time, it is easier if several parties agree on a common standard instead of each company having its own. The companies also do not have to engage in monitoring, of which they are not experts.
If you look at the whole group of multinational companies, are they part of the problem or of the solution?
“Both. On the one hand, many suppliers continue to employ poor conditions, on the other they can do much to make it better.”
"Bangladesh is a country with weak rule of law, widespread corruption, weak unions and a huge supply of labour. In this situation, the companies should take great responsibility. Then the media, activist groups and consumers must also put pressure on the multinational companies for them to really do so. Everything is connected”, says Nandita Farhad.
Seen throughout the industry, development is moving in the right direction, but slowly. So far, 238 of about 4,000 textile mills have been certified for adequate safety.