Fashion retail giant Hennes & Mauritz has today (25 November) set out plans to pay a fair living wage to some 850,000 workers in its clothing supply chain by 2018.

The retailer has been working on its "new vision" for the past year, and says it will tackle the issue both in the short and long term.

It is also focusing its efforts in several areas including its own purchasing practices, supplier practices, workers' rights and government responsibility.

"It has always been our vision that all textile workers should be able to live on their wage," the company said. "We believe that the wage development in production countries, which is often driven by governments, is taking too long.

"H&M wants to take further action and encourage the whole industry to follow. With size comes responsibility and we have the ability to contribute to a positive change."

As a first step, H&M's goal is that its strategic suppliers should have pay structures in place to pay a fair living wage covering workers' basic needs by 2018.

This will be possible, it says, by reviewing its own purchasing practices, as well as ensuring that workers' wages are negotiated and reviewed annually in a process that involves democratically elected trade unions or worker representatives.

As reported on just-style last week, H&M has teamed up with three of its best suppliers in Bangladesh and Cambodia to create model factories where it can test new ideas and standards before rolling them out to its wider supply chain.

It now says it will evaluate wage development every month at these factories, aiming for "substantial improvements" within a year - before scaling up to a larger number suppliers.

The retailer emphasises that paying a fair living wage won't have a negative impact on the price of its products.

"Wages are only one of several factors influencing the sourcing costs and prices in our stores," the company says, adding: "We are willing to pay more so that the supplier can pay higher wages.

"It is a collaboration between H&M and our suppliers. We believe that our purchasing practices will lead to better efficiency and productivity. Long term this will be beneficial for both us and our suppliers."

Helena Helmersson, the retailer's global head of sustainability, is speaking today on the "Living wage - a shared responsibility" at the first ever conference on Living Wage in International Supply Chains taking place in Berlin. The event is organised by the Dutch and German governments.