Bangladesh is now a role model so far as structural integrity and workplace safety are concerned

Bangladesh is now a role model so far as structural integrity and workplace safety are concerned

Five years after the Rana Plaza disaster, Bangladesh's apparel industry has undergone expansive structural transformation and become a role model for health and safety progress, industry-insiders and trade unionists say.

The Dhaka-based Envoy Group, which spent between US$2m and US$2.5m on a health and safety makeover following the tragedy accepts it was "a turning point in taking the industry to the next level," says Abdus Salam Murshedy, Envoy's managing director.

All divisions of Envoy have been assessed and certified by the Accord on Building and Fire Safety in Bangladesh and the Alliance for Bangladesh Worker Safety, notes Murshedy, who is also president of the Exporters Association of Bangladesh.

While the initial cost of remediation was high, it helped the company attract global buyers who are now placing increased orders.

"Buyers are running after us, we don't chase them anymore." Calvin Klein, VF Corporation, Kohl's, American Eagle, Walmart, JC Penney, Carrefour, Disney, C&A and Zara are among the major buyers of the company's clothing products.

With an annual turnover of US$400m, Envoy is one of the largest garment producers in the country, employing more than 21,000 people.

Another company saying Rana Plaza prompted major change is the Saiham Knit Composite Ltd, a knitter based in northeastern Bangladesh's Habiganj district.

Saiham has fully remediated its structural, electrical and fire hazards, claims Syed Shafqat Ahmed, the company's managing director. "We've learnt positive lessons from the Rana Plaza tragedy," he told just-style. "Today, Bangladesh's garment export industry is globally recognised as transparent and compliant."

Saiham, which turns over US$48m a year and employs 4,000 people, is awaiting a final remediation clearance from the Accord, a grouping representing mostly European clothing buyers and brands.

Ahmed says Rana Plaza was a wake-up call for global brands and their suppliers: "Do business but not at the cost of life."

Role model

Bangladesh is now a role model so far as structural integrity and workplace safety are concerned, he claims, urging competing countries such as India, Vietnam and Cambodia to catch up. "Then we'll have a level-playing field," he says.

Bangladesh is now the world's second-largest garment exporter, after China. To maintain this position, Ahmed says Bangladesh garment industry needs to boost efficiency and reduce waste.

Farhan Azim, director at Dhaka and Chittagong-based clothing manufacturer the Azim Group, says the company was always socially responsible and had structurally compliant buildings before the Rana Plaza incident – but says the tragedy made managers more aware of codes and regulations.

"Now the management is more conscious of the micro matters such as the aisle width, the electrical cabling, the training of the fire fighters, the engagement with safety committee etc," he says.

"I think in general, across all industries, people had a reality check and now acknowledge that any leakage in safety protocol can result in issues of a big magnitude," adds Azim, a US-educated engineer by training.  

With an annual sales turnover of US$250m, Azim Group has production units in six locations and employs 28,000 people.

International standards

Trade association leaders are similarly positive, touting major structural changes in the post-Rana Plaza period, saying that Bangladeshi factories are now upgraded to international standards.

The transformation imposed a "huge financial burden" on the owners, but this has led to spectacular operating improvements, according to Sulav Chowdhury, chief executive officer of the Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA).

"It's blessings in disguise," he told just-style. He says owners now design factories approved by accredited engineers, use fire-fighting equipment such as fire-proof doors meeting European standards, addressing detected weaknesses in walls immediately and installing plant that takes the load-bearing capacity of buildings into account.

And while he argues that post-Rana investments have not translated into what he regards as fair prices from brands, Chowdhury says China moving from price-sensitive production "has created huge opportunities for us."

Bangladesh's apparel exports grew 8.68% to US$20.25bn in July-February of the 2017-2018 fiscal year, compared with US$18.63nn in the same period of 2016-2017, according to data available from the government's Export Promotion Bureau (EPB).

Sourcing strengths

Company bosses and sector leaders are upbeat about the industry's future. Bangladesh will be a leading exporter of textiles and clothing in the next 25 years, predicts the BKMEA's Chowdhury.

Ahmed echoes this, saying the south Asian nation will remain a major outsourcing country over the next 15-20 years. Increased business will mean better corporate practice, so post-Rana Plaza changes will be sustained and built upon.

Chowdhury claims wages have risen three times in the past 10 years, and predicts pay will be hiked this year, too, following ongoing minimum wage talks.

Big manufacturing companies are now pursuing corporately-responsible policies such as employing disabled people and are running day-care and healthcare facilities. He said some 40 knitwear factories had all formed special health and safety units, working with the International Labour Organization (ILO). A total of 211,000 knitwear industry workers have so far been trained in occupational health and safety, he adds.

Meanwhile, Faruque Hassan, senior vice president of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), says some 90% of garment factories haved fixed any structural problems after factory inspections following the Rana Plaza tragedy. Moreover, many factories are focusing on automating processes and operations, easing the physical pressure on workers.

On the organised labour side, trade unions have also been beneficiaries, with 500 unions having been registered since 2013 when the number was only 32. On the safety front, the number of government factory inspectors has boomed, from just 35 in 2013 to 350 now.

"I think this is a huge progress for us," says Towhidur Rahman, secretary-general of the IndustriAll Bangladesh Council (IBC), an affiliate of the Geneva-based IndustriAll Global Union.

But Bangladesh's labour law, he says, still frustrates him, although work is in progress to amend it. "We don't think this law will be worker-friendly," he says.

Indeed, the ILO has also criticised the proposals, saying they do too little to lower worker minimum numbers required for union registration and would inadequately simplify associated bureaucracy.

Rahman says that while large factories have managed to develop a responsible corporate culture, the condition is worse in second or third tier units that run on subcontracted work. Still, he believes Bangladesh is an "acceptable market" internationally.