Responsible Supply Chains

Summary: The Rana Plaza Fire that struck a Bangladesh garment factory last June has brought international trade and working conditions back into the global spotlight. The factory fire killed over 1,100 workers. The incident has resulted in a number of beneficial changes to the working conditions of garment workers around the globe. Large companies in the US and Europe have signed agreements targeted to improve fire safety and conditions in Bangladeshi factories. The agreements also call to increase inspections of factories. The minimum wage is also scheduled to increase by 77% this year. Prior to the fire, there were already workers rights and safety standards in place. Unfortunately, the standards have been poorly regulated. Better Work is an organization that addresses working conditions in all of the many layers of the supply chain. Better Work provides factory assessments in a number of countries and is a partnership between the government, workers, employers and international buyers. For international retailers, they run the risk of ruining their reputation if they don’t hold factories up to working condition standards. President Obama is currently seeking support for the Trans-Pacific Partnership for nations with low wages and poor working conditions.

Analysis: As we witnessed in the China Blue film, working conditions in developing countries are harsh. Having studied retail merchandising for a number of years, the fashion industry considers it a “necessary evil” for providing the post industrialized world with affordable and trendy apparel. We also saw in the video that inspections are often not what they appear, workers are trained to lie and those inspecting the factory claim the workers are “happy”.  The fire in Bangladesh was extremely unfortunate. From it, we may see improvements to working conditions assuming retailers, factory owners, and governments cooperate.

http://economix.blogs.nytimes.com/2014/02/07/the-challenges-of-running-responsible-supply-chains/?ref=business