Clothing makers will stay in Bangladesh
Loblaw aiding victims’ families and tightening factory oversight
TORONTO — Loblaw Cos. Ltd. is committed to staying in Bangladesh and will work to improve safety standards after a garment factory where Joe Fresh clothing was made collapsed last week, executive chairman Galen G. Weston said Thursday.
“As the front edge of the wedge in global trade, the apparel industry can be a force for good,” he told shareholders at the grocery retailer’s annual general meeting, while appealing to the wider apparel industry to join the effort to raise standards.
“Properly inspected, wellbuilt factories can help lift people out of poverty in countries such as Bangladesh.”
Before the meeting, the Weston family scion and Joe Mimran, the Club Monaco founder who went on to develop Loblaw’s house brand of apparel, outlined steps the brand would take to help.
“I am troubled by a sequence of events or management practices that saw fit to send apparel workers back into this building after it was declared dangerous,” Weston said. “What role does industry play in propagating a manufacturing culture that would take such risk with people’s lives?”
Loblaw’s previous standards were designed to ensure products were manufactured in a socially responsible way, but did not address the issue of building construction or integrity, he said.
Mimran, who has spent his entire career working in apparel and design, said apparel manufacturers are often the first Western businesses to work in Third World nations. In the case of Bangladesh, Canada’s free trade with the country makes it a viable market for apparel brands, he said.
“We are encouraged as one of the first industries to go into an underdeveloped country, to go in there and start trade,” he said. “It costs us as much to produce in Bangladesh as it does in another country in Asia; the difference is the duty.”
Bangladesh has grown to be the second-largest apparel producer in the world behind China, with 3.6 million workers in the sector and about 4,000 garment factories. Loblaw manufactures goods at 47 of them, and accounts for about one per cent of the country’s total apparel production. This week the industry organization Retail Council of Canada said it would update its set of trade guidelines for the apparel sector and address safety standards in the Bangladesh garment industry.
Weston said he was troubled by the “deafening silence” from other apparel retailers on the issue. “As many as 30 international apparel brands were having goods manufactured in this building, yet only two have come forward and publicly commented,” he said.
The other company is U.K.based retailer Primark, another major purveyor of socalled “fast fashion” — very inexpensive, quick-to-market garments that are not meant to last much beyond one season.
“As the front edge of the wedge in global trade, the apparel industry can be a force for good.” LOBLAW EXECUTIVE CHAIRMAN GALEN WESTON
The factory collapse has overshadowed much of the recent news out of Canada’s biggest grocery chain, which reported a 40 per cent boost in first-quarter earnings Wednesday on a gain related to changes in its pension plan, and improved performance in retail and financial services.
The two executives outlined steps Loblaw is taking to address the sourcing and safety issue in Bangladesh. In addition to establishing a relief fund for victims’ families, new standards will be created to cover engineering and building codes, they said.
Loblaw sourcing and supply chain executives are flying out next week to oversee the situation from the ground, but the company will also now place its own employees in Bangladesh full-time to ensure those standards are met, Weston said.
Prior to the disaster in Savar, Joe Fresh had sent company representatives to Bangladesh every six months to audit factories, sent international safety auditing firms Bureau Veritas and Intertek annually and worked with vendors regularly.