Will horror and over a thousand dead be a watershed moment for Bangladesh?

A huge and chaotic conversation over how to respond to the appalling Rana Plaza factory collapse in Bangladesh (where the death toll has noweti_logo passed an unprecedented 1100) is producing some important initial results, in the form of the international ‘Accord on Fire and Building Safety in Bangladesh’, launched this week.

I got a glimpse of the background on Wednesday at a meeting of the Ethical Trading Initiative, which brings together big brand retailers, including garment companies, trades unions and INGOs like Oxfam to work on wages and conditions in company supply chains. The Accord got some pretty rave reviews – ‘absolutely historic’, said Ben Moxham of the UK Trades Union Congress; comparable to the 1911 Chicago factory fire, according to one of the big clothes retailers at the meeting.

So what does it say? The Accord covers independent safety inspections, publicly reported; mandatory repairs and renovations; a vital role for workers and trade unions, including a commitment to Bangladesh’s Tripartite Plan of Action on Fire Safety (a national initiative). A key, and controversial aspect is that the Accord will include a legally binding arbitration mechanism, which wins a lot of trust from civil society and trade unions, but has spooked a number of companies based in the litigation-tastic USA (not all though –  part of Tommy Hilfiger’s in there, while Abercrombie and Fitch have said it they will join).

30 companies  signed up ahead of Wednesday’s midnight deadline, including Primark, (who were buying clothes from Rana Plaza), Tesco, Sainsburys, M&S, Inditex (eg Zara), NEXT, C&A, Carrefour and PVH (part of Tommy Hilfiger). There are some holdouts – Walmart is insisting on going it alone and doing its own factory inspections, which is disappointing, not least because it is focussing on the short term problem and missing the need for longer-term coordinated political engagement. And of course, nothing legally binding there.

Given my current work focus, I fell to musing on the theory of change that underlay this apparent breakthrough. Obviously, the immediate driver is a particularly grisly ‘shock as opportunity’. But other factors worth noticing include:

  1. The ETI’s prior existence of a forum that established a high degree of trust between traditional antagonists (companies, unions and NGOs). This allowed people to get on the phone to each other and get things moving, without  first having to overcome barriers of distrust.
  2. Prior work on some kind of accord had been going on since 2011, but had got nowhere due to lack of urgency and trust – the Rana Plaza disaster massively escalated the pressure to act.
  3. A nascent national process (the National Action Plan for Fire Safety), that gave outsiders something to support and build on.
  4. Energetic leadership from two new international trade unions, IndustriAll and UNI Global Union, helped get the right people in the room.
  5. The organizers set a rather arbitrary, but very effective 15 May deadlineto prevent the response getting kicked into the long grass. A number of companies are feeling bruised by the pressure for immediate action, so there will be some fences to mend there once the Accord is up and running.

rana plaza 2An interesting underlying challenge, reflecting my ramblings last week on change, complexity and national ownership, is how to combine the catalytic effect of a massive shock, with the need for slow, painstaking construction of new/improved institutions from within Bangladesh – the only way to ensure that whatever emerges is not just another bit of corporate spin. Peter McAllister, ETI’s Executive Director, reckons that the circle can be squared if the shock is primarily used to get all the international actors lined up behind the Accord, but that the implementation process needs to be slower and nationally owned.

Next steps? The Accord lays out a 45 day period to come up with an implementation plan, involving a crucial shift from being internationally to locally driven.

The TUC’s Ben Moxham hopes the accord, and the ensuing government agreement to relax restrictions on trade unions, will help consolidate and strengthen Bangladesh’s chaotic garment workers unions (39 separate unions by his count).

Others at the meeting hope that the Accord could act as a model for both other garment exporters (Bangladesh is world number 2, after China), or for other sectors within Bangladesh – collapsing buildings are not confined to garment factories.

One last thought – in this conversation between companies, unions, NGOs and the ILO, where is the UK Government? So far pretty quiet, but you’d think that coming in behind a business-led response like this with some matching funding would be a pretty attractive ‘announceable’ for a Conservative Party minister, not least because the Accord could head off other short-term, and ultimately damaging exits like Disney, where companies stop buying from Bangladesh to protect their brand, but leave thousands of women without jobs. How about some constructive engagement, DFID?

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6 Responses to “Will horror and over a thousand dead be a watershed moment for Bangladesh?”
  1. Thanks for these reflections, Duncan. The TUC’s assessment of why more UK companies signed up than any other country is at http://touchstoneblog.org.uk/2013/05/dhaka-deaths-what-made-companies-sign-up-for-change But it makes several similar points to yours. However, the last point you make, about the British Government’s absence from the debate (although I’m sure DFID would point to their funding for ETI) speaks volumes about how little DFID does to promote decent work. They see backing the private sector as far more important.

  2. Hi Duncan,

    This is a good post, and your 5 points lay out the dynamics and drivers that have brought the big brands together around the Accord.

    But, as you recognise, in the end what will determine whether Rana Plaza become’s Bangladesh’s Triangle Shirtwaist disaster is what happens between government, manufacturers and unions in Bangladesh. The drivers and dynamics for this could also do with a similar unpicking.

    I don’t think characterising the last 15+ years of disappointing external efforts at trying to push the Bangladesh Garment industry from its current low-price, low-productivity equilibrium towards upgrading (of labour standards, safety, investment, and product) as ‘corporate spin’ is quite right. There has been spin on all sides, but underneath that I think what there is is frustration.

    It is comforting to think that the brands could fix this if only they do as the NGOs ask. But I think the lesson of the past 15 years is that they have been limited in what they can do, particularly if they don’t offer the government and industry in Bangladesh a credible threat of loosing sales.

    I am not sure I agree with you that exits, or credible threats of exits are therefore always a bad idea.

    Disney’s pull out from Bangladesh (and other countries whose governance makes them nervous) came with the rider that they would consider coming back if the government agrees to work with the ILO Better Work program.

    Similarly the important thing the UK government has done after the Rana Plaza tragedy was to call out through the EU in strong-by-diplomatic-terms the criminality in the industry and to threaten withdrawal of duty-free and quota-free access for apparel from Bangladesh.

    I wonder if this ‘bad cop’ role is more important in the wider dynamics of change than any ‘good cop’ money DFID could put into the pot at this point.

    • Duncan

      Interesting thoughts Maya, a credible threat of withdrawal is indeed a strong weapon, but hard to wield when so many want the garment industry to stay in Bangladesh.

    • Duncan

      I think you’re right Glenys, in fact most US companies are hoping to sit this one out, although Abercrombie & Fitch and Tommy Hilfiger have broken ranks – let’s hope more follow

  3. Yasmin Ahmed

    Dear Duncan

    I have worked closely with this sector in Bangladesh as a health care provider, and have seen a lot of changes in the last 20 years. The industry developed from a small number of back-of-the-yard establishments to what it is today. For many of the earlier times factory owners, this was the first business venture they were embarking upon, with very small capital, a lot of risks and hardly any well developed understanding of the manufacturing sector. So there were a lot of sweat shops and the mentality of the owners was to cut corners wherever possible to maximize profits. With time and success, this has changed, but elements of the earlier attitudes still remain. I think the industry still thinks and behaves in adhoc terms and finds it hard to make long term plans or investments.

    I agree with Maya that the threat/pressure of withdrawal can be used positively to bring about changes. But I also think it would help to engage with owners in developing a better sense of corporate responsibility along with scope for factory management to negotiate prices in a way which would give them room to improve factory conditions. What if a certain percentage of every piece of item produced had to be spent for workers’ welfare?

    I don’t think pressure alone will work. Owners will scramble to put in place what is minimally required. But if buyers could wield their pressure and relook at prices, Bangladesh government, multilaterals and NGos such as Oxfam could engage with the owners/management to help them develop better sense of corporate responsibility, we may see more sustainable changes.