Big retailers take fresh look at BD dealings

Some of Australia’s biggest retailers, including Woolworths, Coles owner Wesfarmers and department stores Myer and David Jones, will review supply arrangements after the Rana Plaza collapse on last month which killed more than 1100 workers.It comes as some of the world’s leading fashion chains, such as Swedish group H&M and the owner of Spanish company Zara, have pledged to better monitor the working conditions of factory workers in Bangladesh and help pay for repairs.
Most of the Australian retailers, who represent the bulk of clothing sold here, said they either did not source directly or indirectly from Bangladesh or kept a close eye on any contracts they had with businesses linked to Bangladeshi garment factories, including building and safety audits.
After the April 24 disaster at Rana Plaza, outside Dhaka, Citi equities analysts Elaine Prior and Craig Woolford sent out a list of questions to Australian retailers to work out their exposure to the Bangladesh fashion supply network as well as their in-house ethical and safety policies.
“Western retailers are increasingly sourcing garments from Bangladesh. This brings specific risks, as evidenced by the Tazreen factory fire in November (112 dead) and the Rana Plaza building collapse last month,” their report says.
“Retailers that source from Bangladesh are exposed to various risks if their brands are associated with a factory disaster. Customers’ buying behaviour might be negatively affected.
A retailer might feel an obligation to provide compensation or relief funding, or face liability, with some NGOs suggesting this may come under the ‘remedy’ commitments of the UN guiding principles on business and human rights.”

Leave a Reply