What will move the needle for worker well-being in the fashion industry?

By Catherine Cheney 15 November 2016

Workers at their stations on the production line at a garment factory in Sri Lanka. Photo by: International Labor Organization / CC BY-NC-ND

Ayesha Barenblat founded Remake, a San Francisco-based nonprofit, to use visual storytelling as a way to connect brands and consumers with the people behind their clothes. Her Meet the Maker series takes viewers to several countries, including Pakistan, where Rubina, a 22-year-old, explains why she abandoned her plans to become a doctor, something she thinks about often as she sews hoodies and sweatpants, and her hopes for the future.

“Even the word maker, instead of worker, is deliberate,” Barenblat told Devex. “She made that for you. She put time and love and care into it. A worker is a balance sheet item.”

According to the Fair Fashion Center in New York City, 1 in 6 people on the planet works in the global fashion supply chain, and 3 in every 4 garment workers are women. Barenblat spent a decade working with companies, governments and nonprofits in an effort to change fashion supply chains, but she found it was difficult to convince brands across the industry to improve worker well-being. So she launched Remake in an effort to mainstream conscious consumerism, the movement to take into account the social and environmental impacts of products when making purchases.

Some say there is a clear business case for worker well-being in the fashion industry, whereas others argue change will only come with more demand for ethical fashion. But the fact remains that, when presented with the choice, the majority of apparel brands and consumers let cost rather than conscience be their guide. What can be done to increase wages and improve conditions across the $3 trillion industry?

From wake-up call to widespread change

The collapse of the Rana Plaza building in Dhaka, Bangladesh, in April 2013 was the deadliest garment factory accident in history. It called attention to the hazardous working environments in Bangladesh, the second largest garment exporter, and problems with wages and conditions across the industry and around the world. While companies joined multistakeholder groups that sprang up to ensure worker safety, and contributed funds to support victims and their families, many of their suppliers have yet to take basic steps such as installing fire exits.

“The paradox is that industry helped develop the world, but has become part of its problem,” Cara Smyth, founding director of the Fair Fashion Center, told Devex. Due to Rana Plaza collapse, the adoption of the United Nations Sustainable Development Goals, and the Paris climate agreement, change is happening, albeit slowly and steadily, she said. Accelerating that change will require cross-sector collaborations providing solutions that align with industry practice and maintain profit margins.

Nike, whose brand was once closely identified with sweatshops, has worked over the past two decades to change its supply chains, demonstrating how change in the fashion industry often comes from the reputational liability. While its efforts started as an attempt to save the brand after revelations about factory conditions, it has since become an example of how worker satisfaction not only mitigates risk but also drives business success. Protecting worker rights is not just about corporate social responsibility, but productivity and profitability, Hannah Jones, chief sustainability officer at Nike, said earlier this year.

“Too often retailers don’t do enough to understand the full depths of their own supply chain by neglecting to monitor the subcontracting of work to smaller, unregistered suppliers,” said Laura Quinn, founder of the corporate social responsibility consultancy Do One Thing. “Human rights infringements and welfare issues occur most often within these smaller suppliers so, by failing to track this subcontractor chain effectively, retailers are turning a blind eye where the need is greatest.”

Nike has cut down on its contracts with factories in Bangladesh, due in part to concerns about working conditions, but boycotting countries whose economies depend on these industries can be harmful. Instead what companies can do is consolidate their global supply chains, and transition from an outsourced transactional marketplace to relationships with fewer larger suppliers, said James Gifford, senior fellow at the Initiative for Responsible Investment at the Harvard Kennedy School, who also works with a private equity firm that upgrades global supply chains. These larger factories are positioned to put new human resources policies in place and serve not only as suppliers but also as strategic partners to brands, he said.

As more consumers demand more information on where their clothes come from, it is likely that not only fashion brands but also their suppliers will become household names, said Shama Amalean, a fashion entrepreneur whose family owns MAS Holdings, the largest manufacturer in Sri Lanka. When Sri Lanka lost market share to cheaper sourcing destinations, the country launched Garments Without Guilt, a branding campaign that attracted buyers not by price but rather by safe working conditions and decent wages, she said. Similarly, as the fashion industry continues to move toward new markets where they can produce their clothes more cheaply, suppliers that might lose market share could point to investments in worker well-being as a selling point, despite the higher price.

Changing mindsets

Irit Tamir, senior campaigns and advocacy adviser for Oxfam America’s private sector department, arrived at a recent meeting with major fashion brands armed with her usual argument for the business case, as well as the moral case, for worker well-being. She was surprised to hear someone from a multinational company say there was no longer a need to make the business case, because the moral case had become so clear.

Still, particularly in public companies, where shareholders demand returns, it can be difficult for businesses to sacrifice revenues in the short term even if it means long-term benefits for both profit and purpose, Tamir said.

“As companies feel the pressure from consumers to create more products faster, they push those pressures onto their suppliers, who then in turn push those pressures onto their workers,” she told Devex. “Brands go where wages are low, and wages are low because people are poverty-stricken, and when you have people living in poverty and very little regulation, you are going to have all these issues around workers.”

Garment producers tend to move to markets where they can cut costs, which explains why factories have moved from the United States to China to Bangladesh, with interest growing recently in Myanmar and Haiti. While the fashion industry can drive the growth of national economies, the poor working conditions of most factories also perpetuate the problem of poverty, Tamir said.

“The core to improving worker well-being is shifting the thinking that labor is a cost to be managed, to labor is an asset to be invested in,” said Leslie Johnston, executive director of the C&A Foundation, the charitable arm of the global apparel brand.

One way to improve worker well-being is to turn the race to the bottom into a race to the top by replacing traditional mass manufacturing with lean manufacturing, which turns assembly line workers into workers who take on a range of tasks and have a stake in product quality. Another is to try and change the behavior of both suppliers and buyers through transparency. The Sustainable Apparel Coalition’s Higg Index provides self-assessment tools for its members, including major retailers and manufacturers, and the Fair Wear Foundation has a wage ladder that compares current wages to living wages.

Yet another approach is to ask that consumers demand better wages, but that will only happen when retailers educate consumers that decent clothing comes at a decent price, Johnson said. And given the many steps between the sourcing of the fiber and the purchasing of the garment, paying more for clothes will not necessarily translate into higher wages.

Thousands of garment workers and their unions rally on the one-year anniversary of the Rana Plaza collapse that killed more than 1,100 garment workers in Bangladesh. Photo by: Sifat Sharmin Amita / Solidarity Center / CC BY-ND

Making the business case

On Nov. 3, Good World Solutions, a social enterprise based in Oakland, California, released its latest report about worker satisfaction and how to reduce worker turnover in Chinese factories.  Produced in partnership with retailers including C&A, J. Crew, and American Eagle Outfitters, the report used anonymous mobile surveys to ask more than 100,000 workers for their opinions. The 70 participating factories were asked to complete action plans to act on the findings of the survey and address worker concerns.

Donors ranging from the Bill & Melinda Gates Foundation to the U.K. Department for International Development have supported efforts to build a body of evidence to show that better working conditions result in lower turnover, better productivity, and greater profitability. For example, Impactt Limited, a London-based supply chain consultancy that aims to assess and improve conditions, rolled out its Benefits for Business and Workers program across 188 factories in Myanmar, India and Bangladesh. The program, which is jointly funded by the factories, 17 brands, and DfID, has increased pay and improved skills. In participating factories, there has been a 32 percent increase in job satisfaction and labor turnover has dropped 49 percent. By keeping that institutional memory, programs aimed at improving worker conditions and happiness could pay for themselves.

Meanwhile a growing number of manufacturers and retailers are going beyond compliance and setting examples for the wider industry. For example, Patagonia is working with Fair Trade USA and the Fair Labor Association to increase the income of its workers from a minimum wage to a living wage, and the company has been open about the challenges of striking the right balance in raising wages and keeping prices competitive. Gap Inc. is partnering with nongovernmental organizations including CARE to provide life skills, education and technical training to women garment workers through its PACE initiative. PACE is an example of how brands can work with other allies — from urban planners to health workers — to improve conditions beyond the walls of their factories.

“It’s not just having a program and checking a box, but looking at your workforce as something you want to invest in,” said Kim Almeida, senior program manager at Levi Strauss & Co in San Francisco. “Are we moving the needle on well-being and by extension are we moving the needle on productivity?”

Levi’s is partnering with the Harvard School of Public Health’s SHINE initiative on a survey that will provide the brand and its suppliers with information on how worker health and wellness correlates with business indicators. The team has piloted the survey at one supplier location in Sri Lanka and will be piloting with two more suppliers next year. The aim is not only to support Levi’s own plan to expand worker well-being initiatives across its entire supply chain by 2025, but to improve standards across the industry, Almeida said.

But, at least in the short term, these early adopters of worker well-being measures will not be able to compete on cost with those who do not care, said Jenny Holdcroft, assistant general secretary at IndustriALL, a union representing 50 million workers. The the key is to convince these companies that they should accept or even advocate for more regulation in the interest of having more regulation on their competitors.

“The efforts of the better performers will not trickle down across the industry,” she said. “There is a limit on how far the better performers can go because it’s an industry whose profits rely on very low wages.”

Legally binding agreements, such as the Accord on Fire and Building Safety in Bangladesh, which was created in the immediate aftermath of Rana Plaza, to ensure safe working conditions in the country are important. While limited in geographical scope, this kind of industry wide accountability is the only sure path to improving worker well-being, Holdcroft said. She is working on an initiative called ACT, a process that aims to transform the way that wages are set by fixing those wages through industry agreements that are supported by brand purchasing practices. She believes that collective bargaining at the industry level is what is needed to address the barriers standing in the way of worker well-being.

“We need to stop seeing fast fashion as inherently bad,” Quinn of Do One Thing told Devex. “Millions of workers around the world, including a disproportionate amount of women, are reliant on the industry for economic opportunity so our role as a community has to be to support the industry not vilify it.”

The global development community plays a critical role in shining a light on good practices and continuing to build the economic argument, beyond the obvious human rights argument, for worker welfare, she said. In addition to supporting existing initiatives, the sector can seek out scalable solutions that enable workers to understand and assert their rights.

Read more international development news online, and subscribe to The Development Newswire to receive the latest from the world’s leading donors and decision-makers — emailed to you FREE every business day.

About the author

Catherine cheney devex
Catherine Cheneycatherinecheney

Catherine Cheney covers the West Coast global development community for Devex. Since graduating from Yale University, where she earned bachelor's and master's degrees in political science, Catherine has worked as a reporter and editor for a range of publications including World Politics Review, POLITICO, and NationSwell, a media company and membership network she helped to build. She is also an ambassador for the Solutions Journalism Network and the Franklin Project at the Aspen Institute.


Join the Discussion