Corporations Urged to Improve Safety Flaws in the Global Supply Chain

By Roy Maurer Dec 19, 2012

Corporations should examine their global supply chains and implement effective safety management programs and practices to guard against disasters like the recent factory fires in Bangladesh and Pakistan that killed hundreds of workers, according to the American Society of Safety Engineers (ASSE) and the Center for Safety and Health Sustainability (CSHS).

The ASSE maintains that many people around the world continue to work in unsafe conditions, sometimes leading to tragedies such as the Nov. 24, 2012, Tazreen factory fire in Bangladesh that killed 112 workers, or the fire at a garment factory in Karachi in October 2012, which killed almost 300 workers. Fundamental fire safety precautions, such as accessible exits, were lacking in both accidents, according to published reports.

The New York Times reported that “fire safety preparations were woefully inadequate in the Tazreen fire. The building itself was under construction—even as sewing work continued inside—and mounds of flammable yarn and fabric were illegally stored on the ground floor near electrical generators.”

The Bangladeshi government announced Dec. 17, 2012, that the fire was an act of arson, but added that the owner of the Tazreen factory had been guilty of “severe negligence.”

According to International Labor Rights Forum (ILRF) research, over 700 garment workers have died as a result of unsafe buildings in Bangladesh since 2005.

“Even the most basic safety and health measures and investments are frequently bypassed,” said Thomas Cecich, ASSE vice president for professional affairs and chair of the CSHS board, to SHRM Online. “The ability to get out of the buildings in the event of a fire must be a basic precaution in any industry.”

The CSHS represents more than 85,000 safety and health professionals around the world. It was founded in 2011 by the ASSE, the American Industrial Hygiene Association and the Institution of Occupational Safety and Health in the United Kingdom with a commitment to ensuring the safety, health, and sustainability of the global workforce.

The organization will release a report in January 2013 titled Current Practices in Occupational Health and Safety Sustainability Reporting, addressing the shortcomings in occupational safety and health-related reporting among 100 global corporations otherwise deemed the most sustainable in the world. Among the many findings of the report is underreporting of metrics related to worker safety in the supply chain.

“It’s not enough to condemn local factory owners for these conditions and to expect long-term change,” Cecich said. “The corporations that source supply chain products, as well as their stakeholders, have tremendous power to influence the conditions in which supply chain workers operate. The sustainability movement, long oriented predominantly toward influencing corporate decisions with regard to the environment, has developed frameworks by which corporations can compile and report on performance criteria.”

Who Is Ultimately Responsible in the Global Supply Chain?

Worker safety organizations say that workers’ safety is being put at risk by the complex and fragmented nature of global supply chains used by many of the world’s top clothing brands, which largely rely on cheap labor to turn a profit. In some cases, companies are unsure which factories are producing the clothing that ends up in their stores, making it impossible for a brand to know whether safety standards are being met, according to news reports.

Bangladesh is the world’s second-leading apparel exporter, behind China. Bangladesh has the lowest garment wages in the world, and many of the Tazreen factory’s victims were young rural women with little education, earning around $45 a month, according to published reports.

The global apparel industry aspires to operate with accountability. Big brands use auditing firms to inspect factories, so that the brands can control quality and understand how, where and by whom their goods are made, but many garment factories exist on the margins of this system through opaque networks of subcontracts, said Cecich.

For example, the Bangladeshi factory, owned by Tazreen Fashions, was itself owned by Tuba Group, which produces clothing for U.S. retailer Wal-Mart.

The world’s largest retailer told CNN that a supplier had subcontracted work to Tazreen “without authorization and in direct violation of our policies.” Wal-Mart said that it had ended its relationship with that supplier and would “continue to work across the apparel industry to improve safety education and training in Bangladesh.”

Wal-Mart said that in 2011 it audited over 9,000 factories globally to check whether its standards were being met, but the company acknowledged it controls its supply chain only up to a certain point. If suppliers hired by Wal-Mart in turn subcontract production, the seemingly tight controls Wal-Mart has put in place can fail, said Wal-Mart Vice President of Ethical Sourcing Rajan Kamalanathan in an interview with Reuters.

“We have a contract with the supplier and that’s where our control is and where our relationship is,” he said.

High-Profile Brands Called to Action

In March 2012, PVH Corp., the owner of popular brands Tommy Hilfiger, Calvin Klein, Van Heusen, Izod, G.H. Bass and Eagle, signed an agreement with Bangladeshi unions, international unions, the ILRF and other labor rights groups to develop a fire safety program to prevent future deaths in Bangladesh’s garment industry. The program includes independent inspections, public reporting, mandatory repairs and renovations, a central role for workers and unions in oversight and implementation, supplier contracts with sufficient financing and adequate pricing, and a binding contract to make these commitments enforceable, according to the ILRF.

Other brands implicated in large, deadly factory fires in 2010, including H&M, Gap, J.C. Penney, Target, Abercrombie, Kohl’s and Carter’s have been invited to join the agreement.

“We hope the tragic fire at Tazreen will serve as an urgent call to action for all major brands that rely on Bangladesh’s low wages to make a profit,” said Judy Gearhart, executive director of ILRF in a press statement. “Their voluntary and confidential monitoring programs have failed. Now it is time to come together and make a contractual commitment to workers and to involve workers and their organizations in the solution.”

Roy Maurer is an online editor/manager for SHRM.

Follow him on Twitter @SHRMRoy.

Related Articles:

Sustainability Scorecards: Does Your Supplier Measure Up?, SHRM Online Ethics & Sustainability, May 2010

Monitor Ethics, Compliance in Supply Chain, SHRM Online Ethics & Sustainability, April 2010

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