Lessons from Rana Plaza: Shocked, But Not Surprised

May 28, 2013
  • Aron Cramer portrait

    Aron Cramer

    President and CEO, BSR

Aron Cramer, President and CEO, BSR

Note: This is a first of a series of BSR articles on the tragedy in Bangladesh that will look at root causes, challenges, and how to prevent it from happening again.

When the news of the Rana Plaza tragedy in Bangladesh hit last month, I was shocked, but not surprised.

In 1995, when I started at BSR to launch our Business and Human Rights program, BSR’s founding CEO Bob Dunn handed me a box packed with files, clippings, and correspondence from his days at Levi Strauss & Co. The papers detailed the chronic problems facing workers in Bangladesh’s apparel industry, an issue that was evident even then, two decades ago.

My immediate reaction to this case, and my knowledge that the Bangladeshi apparel industry has failed to reform for more than 20 years, caused me to consider whether divestment from the country was in order. My belief, and BSR’s approach generally, favors engagement to improve conditions, rather than disinvestment, which typically hurts the very workers such efforts are intended to help. Given this history, however, I had to think long and hard whether anything would change these deep-seated problems. Initial signs of systematic industry collaboration, working with governments, trade unions, the International Labor Organization, and others, give me some confidence that we have learned our lesson (finally) and will take decisive action.

My memory of those Bangladesh files made the awful news from Rana Plaza even harder to digest. We talk a lot about “shared value,” but this case lays bare a much more uncomfortable truth: These deaths stemmed from the shared failure of all parties—the Bangladeshi industry and government, factory monitors, and all the companies and consumers that rely on a country that is the world’s second-largest producer of apparel.

It is true that supply chains like those in the apparel industry provide opportunities for many people—especially women—to improve their lot in life by helping them join the formal economy. However, Rana Plaza also reminds us that systemic changes are needed to root out the chronic problems plaguing the industry. BSR has advocated for a package of changes in how supply chains are managed, and these changes are clearly needed now, more than ever.

Reform purchasing practices. It has been clear for some time that a constantly shifting set of suppliers under significant price pressure leads to excessive overtime, poor protection of workers’ rights, and opportunistic subcontracting to small producers who would never be approved by leading brands in the first place. A more stable set of relationships with suppliers committed to fair working conditions is a necessary first step.

Increase government action. The laws in Bangladesh are seriously out of sync with international labor and human rights standards, but in many countries where such laws do exist, governments have failed to enforce them. The de facto outsourcing of labor law enforcement leads to a patchwork approach that has not provided the assurance workers deserve (and that companies would like): a solid system of fair working conditions, consistent with internationally accepted standards. In addition, western governments should provide funding and technical assistance to stabilize an industry that has—despite its evident problems—led to increased living standards in Bangladesh over the past quarter century.

Empower workers. Bangladesh is a tragic example of how workers too seldom have the ability to protect their own interests. Freedom of association has been systematically undermined in Bangladesh, although there are more recent signs that the Bangladeshis are addressing this. International buyers and western governments should create pressure and incentives for this to change. It is essential that workers be given a voice in their own affairs, including the decision whether to join independent trade unions. In addition, new steps, such as mobile phones and apps enabling workers to report on poor working conditions, should be encouraged as opportunities to achieve improvements shaped by workers themselves.

Together, these changes have the potential to improve workers’ lives, health, and dignity, while creating a stable, sustainable supply chain. After more than two decades of relative inaction, the Bangladeshi industry needs to meet the moment and commit to long overdue improvements. The dual tragedy in Bangladesh is that the industry has not only put workers at risk, it has put its own business interests at risk due to its disregard for universal human rights principles and worker safety.

This time, that tragedy cost more than 1,000 people their lives. I would like to think the global marketplace will not tolerate this happening again. After 20 years, it is time for systemic change. Let’s get it right this time.

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