Bangladesh’s ready-made garment (RMG) industry, which started in the late 1970s and expanded rapidly in the 1980s and 1990s, is now the backbone of the country’s economy. Accounting for over 80% of the country’s exports, it plays a significant role in the nation’s economic growth. The RMG industry employs around 4 million workers, mainly women from rural areas, and has played a major role in formal women employment and economic development in Bangladesh.
However, the industry has faced criticism over poor working conditions, low wages, and lack of compliance, especially after major industrial accidents like the Rana Plaza building collapse in 2013 which killed over 1,100 garment workers. This tragic event led to increased pressure on Bangladesh’s factories to improve compliance.
Overview of Compliance Issues in Bangladesh’s RMG Industry
The RMG industry in Bangladesh has been plagued by several compliance issues:
- Health and safety issues: Factories often lacked proper fire and building safety measures, had blocked fire exits, and lacked safety equipment. Electrical and structural integrity issues were also common.
- Low wages: Bangladesh has one of the world’s lowest minimum wages for garment workers, around $95 per month. This is seen as unfair compensation.
- Long working hours: Workers often had to do overtime to meet production targets, sometimes working up to 14-16 hours per day.
- Child labor: Despite regulations against child labor, surveys have found underage children working in RMG factories in Bangladesh.
- Sexual harassment: Verbal and physical sexual abuse of female workers has been reported in some factories. Lack of gender equity policies make women feel unsafe.
- Freedom of association: Bangladesh restricted trade unions until 2018. Lack of collective bargaining led to poor working conditions.
These issues have led to a call for improved compliance with international standards and certifications in Bangladesh’s clothing industry.
International Efforts to Improve Compliance
In response to the compliance issues in Bangladesh’s RMG industry, several international efforts have been initiated:
- The Accord on Fire and Building Safety in Bangladesh: Over 190 global clothing brands and retailers signed this 5-year agreement to inspect factories and implement safety upgrades. Around 1600 factories underwent inspections and over 120,000 safety issues were identified and corrected.
- Alliance for Bangladesh Worker Safety: This initiative, led by mostly North American brands, inspected around 700 factories. Over 200,000 workers received fire and safety training.
- Continuous Improvement Program by PVH: This program audits, scores, and engages suppliers to improve standards in health, safety, and workplace conditions.
- ILO programs for safer workplaces: This includes Better Work Bangladesh which provided training to managers, workers, and government officials on compliance.
- Individual policies and programs by brands and retailers: Various brands and retailers also developed individual policies and programs to track and improve standards at supplier factories in Bangladesh.
Many factories have obtained international certifications to demonstrate their commitment to compliance:
- ISO 9001: Quality management system
- ISO 14001: Environmental management system
- SA 8000: Social accountability standard
- OEKO-TEX certification: Demonstrates that the factory uses no harmful substances in production.
- WRAP, BSCI and other certifications: Show compliance with labor, health, safety, and environmental standards.
- Green Factory certifications: Awarded for sustainable manufacturing practices.
- LEED certified green factories: Show eco-friendly infrastructure.
These certifications serve as a testament to the factories’ commitment to improving compliance and meeting international standards.
Challenges for Bangladesh RMG Industry
Despite the progress made, the RMG industry in Bangladesh still faces several challenges in improving compliance:
- Building remediation and safety upgrades: These require major financing, and most factories lack the necessary funds.
- Training: Educating workers and mid-level staff on compliance takes time and resources.
- Developing adequate systems, policies, and procedures: This is a complex task that requires expertise and commitment.
- Monitoring complex supply chains: With thousands of sub-contractors, compliance verification becomes a tough task.
- Law enforcement and corruption: These issues hamper compliance efforts and create an uneven playing field.
Key Challenges Faced by Bangladeshi RMG Factory Owners
In addition to the industry-wide challenges, Bangladeshi RMG factory owners face their own set of difficulties in implementing compliance standards:
- High costs of infrastructure upgrades: Many older factories require extensive renovations to meet building and fire safety standards.
- Training costs: Developing compliance-related training programs for thousands of workers requires significant investment.
- Complex monitoring systems: Factories need to develop extensive monitoring mechanisms, which require expertise and technology.
- Supplier coordination: Coordinating compliance across the supply chain is extremely complex.
- Management mindsets: Many factory managers lack understanding of compliance and are used to old management styles.
- Corruption: Bribery of inspectors and forging of documents allow some factories to continue flouting standards.
- Lack of institutional support: Banks are often unwilling to provide loans for upgrades, and training institutes lack compliance-related courses.
- Competition pressures: Factories investing in compliance upgrades bear additional costs compared to non-compliant factories.
- Demands of brands: Some brands continue to demand very low prices, fast delivery, and last-minute design changes from compliant factories.
These challenges make compliance a difficult task for factory owners in Bangladesh.
Steps to Address Corruption and Ensure Compliance
To ensure that compliance standards are actually being met in Bangladesh’s RMG industry, several steps can be taken:
- Stronger laws and enforcement: The Bangladesh government needs to strengthen laws that hold factories accountable for compliance lapses. Corruption by inspectors and forging of documents should lead to penalties.
- Independent third-party inspections: Routine inspections should be conducted by impartial groups like the ILO Better Work program, not just by brands or factory-paid auditors. This reduces conflict of interest.
- Empowering workers: Workers should be educated on compliance standards and empowered to report non-compliance through anonymous grievance mechanisms without fear of retaliation.
- Transparency in reporting: Brands and factories should publicly share details of audits, remediation progress, accidents, etc. to stimulate public scrutiny.
- Incentives for factories: Factories taking authentic steps towards compliance should be rewarded with better contracts and public recognition.
- Certification mandate: Important certifications like fire and building safety should be made mandatory for all factories to operate. Extra points for green and social compliance certifications can be given.
- Due diligence by brands: Brands must thoroughly audit factories before placing orders and continuing relationships, to ensure claims are genuine.
- Cancelling rogue factories: Persistent violators and corrupt factories should have business cancelled and be publicly shamed. It sends a message.
- Anti-bribery policies: Strict anti-bribery and whistleblower protection policies will deter inspectors from accepting deals that compromise reporting.
- Technology systems: Electronic monitoring, attendance systems, and surveillance cameras can also help keep track of real compliance.
These measures can help minimize opportunities for corruption and ensure standards are actually followed on the ground.
The journey to reach comprehensive compliance and meet international standards in Bangladesh’s RMG industry, while marked by significant strides, remains a continuous effort. The industry, having confronted harsh criticism and witnessed tragic incidents, is more determined than ever to reform the landscape of working conditions and safety standards. This ambitious venture calls for the collaborative and ongoing efforts of government authorities, factory owners, international brands, and other significant stakeholders to devise effective policies, conduct rigorous training, and acquire the right certifications. Yet, the route to ingrained and sustainable compliance is fraught with challenges, some of which persist in impeding this progress.
In this context, we, at Brandex Sourcing, assure our commitment to quality control, affordability, punctuality, and an ethical approach towards our workers and the environment. Upholding the highest standards of labor rights and safety, and constantly working towards their improvement is integral to our operational philosophy. We invite you to explore our credentials and standards further in our main article, “Sustainability, Compliance, and Environmental Considerations in Bangladesh’s Clothing Industry”.
As part of our mission to transform the industry, we encourage you to partner with us. Reach out to us for a quote, and together, we can contribute to a safer, fairer, and more sustainable future for Bangladesh’s RMG industry.