US retailers shun factory plan
American retailers have refused to sign up to an international accord to improve safety conditions in Bangladeshi factories sighting legal issues.
Gap and Wal-Mart are among several US clothes manufacturers who have refused to follow their European counterparts, including Primark, in adopting the plan that would see conditions improve for some 50,000 workers in the country in over 5000 factories.
Some shareholders protested at Gap’s AGM this week and questioned the company’s refusal to sign up to a plan. But Gap’s chief executive, Glenn Murphy, told the New York Times “In the United States, there’s maybe a bigger legal risk than there is in Europe. If we were to sign onto something that had unlimited legal liability and risk, I think our shareholders should care about that.”
The Accord on Factory and Building Safety in Bangladesh was forged by retailers, union leaders and Bangladeshi government officials, and is promoted by labour rights organisations including the Clean Clothes Campaign. It has been signed by a number of European retailers including H&M, whose manager for social sustainability, Anna Gedda, struck a different tone over legal issues, saying that the fact that it is a legally binding accord was not a big issue.
Unions have described the legal objections a "straw man" and pilloried the responses by Gap, Wal-Mart and other American retailers who have decided to rely on their own inspection systems rather than join the plan.
More than 1,100 people died when a 9-story building in the Bangladeshi capital Dhaka collapsed in April, six months after a fire in another clothing factory killed more than 1,200 workers. Both factories were producing clothing for European and American retailers.
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Bangladesh factory collapse
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