After Bangladesh: Ethical sourcing and supply chain management

  • Written by Peter Needle
  • Published on 17 August 2017
  • Our Voice

Events in the garment factories of Bangladesh, particularly the Rana Plaza disaster, have placed ethical sourcing firmly under the spotlight. On April 24th 2013, the eight-storey building on the outskirts of Dhaka became the scene of the deadliest clothing factory accident in history when it collapsed, causing the deaths of 1,129 people and injuring many more.

The catastrophe prompted global outrage, with western retailers mounting a swift and thorough response. Many of the workers killed and injured in Rana Plaza’s factories were making clothes that would ultimately find their way to stores in Europe and the US.

International Response

Since the tragedy, 100 companies have signed the Accord on Fire and Building Safety in Bangladesh, a five-year agreement to guarantee building inspections and promote higher safety standards. The signatories include major supermarket retailers, high-street fashion chains and smaller suppliers. A similar initiative, the Alliance for Bangladesh Worker Safety, has been formed by 17 large retailers in North America.

Rana Plaza certainly made the world sit up and take notice of the unethical and extremely hazardous conditions many garment workers in Bangladesh are forced to endure. Sadly, it was not an isolated incident and the international response, while commendable, is yet to bring an end to such practices in the country’s clothing industry.

The challenge faced by manufacturers and authorities is great. Bangladesh is the world’s second biggest clothing exporter after China, but it remains a poor and politically unstable country. Earlier in November 2013, at least ten people were killed in a fire at a garment factory near Dhaka. And a BBC Panorama investigation discovered a factory where workers were regularly forced to work 19-hour shifts and locked in the premises at night.

Ethical Sourcing: Theory and Practice

Amid heightened media scrutiny, many companies have conducted rigorous reappraisals of their global sourcing activities in the wake of the Rana Plaza disaster. They’ve sought to help ensure further tragedies do not occur, ease the concerns of their customers and safeguard the long-term future of their businesses.

A key part of this response has involved a renewed focus on – and public commitment to – ethical sourcing. A quick search on Google reveals that organisations of all shapes and sizes now have ‘ethical sourcing’ policies in place. But what does this mean in practice? And how can retailers make sure their policy is enforced at each stage of the supply chain?

On the surface, effectively implementing these codes of conduct can be highly problematic for ethical clothing companies. In the BBC investigation, it was revealed that some factories are skilled in concealing the truth about working conditions from their Western customers.

After observing people working for more than 19 hours and finally clocking off in the early hours of the morning, the undercover reporter was shown authentic-looking timesheets that stated the factory doors closed at 17:30.

This is just one instance of a supplier going to great lengths to squeeze margins and creating unsafe working conditions. Another example is when suppliers subcontract parts of an order without authorisation, potentially allowing non-ethically run companies to enter the supply chain.

Transparency and Approved Suppliers

To really be sure that every garment they receive is sourced from an approved supplier that follows their code of ethics, retailers need complete transparency in their supply chain. The complexity and geography of the typical retail supply chain has made this near-impossible in the past, but the technology is now in place to address this need.

Segura’s production tracking system is designed to promote ethics in supply chain management by enforcing transparency. When a retailer places an order for labels or trims, it is passed directly to one of the approved suppliers on their database. Similarly, these suppliers can only subcontract to other approved companies on the system. If any part of the order is not completed via Segura, the retailer will know immediately and can take action to investigate.

The aim is to make ethical sourcing simple, and ensure that transparency becomes ingrained in the supply chain. At Segura, we believe these things should be common features of modern retail businesses, not abstract concepts or goals to aspire to. Production tracking software has a key role to play in boosting supply chain visibility and thereby improving worker conditions in Bangladesh and many other countries.

 

Originally published on 04/11/2013

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