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'Better margin must to improve sustainability compliance'
Aug '15
Courtesy: CPD
Courtesy: CPD
Bangladeshi apparel industries should allocate additional margin for compliance in order to ensure labour welfare and thus increase sustainability of the sector, says a report of the country's Centre for Policy Dialogue (CPD).

Strengthening government's institutional mechanism and social audit system set up by buyers and retailers would be essential to inspect factory-level compliance and maintain international standards.

The observations emerged from a dialogue on “Bangladesh Apparels Sector: Does Margin Matter for Ensuring Compliance?” organised by CPD in partnership with Friedrich Ebert Stiftung (FES), Bangladesh Office, Dhaka recently.

FES resident representative Henrik Maihack called for fair wages, rights to unionism and government's role in ensuring justice in the apparels industry and doing what is economically possible and socially necessary.

CPD chairman Professor Rehman Sobhan observed that increasing export competitiveness at the cost of workers' wellbeing is socially unjust and politically unsustainable. He proposed making the workers shareholders to positively include their contribution in the Global Value Chain (GVC) and thus make the industries sustainable.

CPD additional research director Dr Khondaker Golam Moazzem shared findings from a CPD study which explored possible linkages between allocation of margin and maintaining firm level compliance. The study investigated whether compliance is being compromised in Bangladesh's apparels sector, which is benefitting the market agents of the value chain.

The study revealed that a disjointed value chain is in operation in the apparels value chain of Bangladesh because existing structure and market forces put little emphasis on compliance. Expenditure in compliance is extremely low in comparison with other countries and in contrast with investments in industrial raw materials including fabric.

Another delegate, Ms Rubana Huq, MD of Mohammadi Group observed that due to high cost, maintaining compliance standards would remain challenging, especially without apparels industries regulating themselves by addressing real compliance issues instead of protecting reputation for business.

Industries need to promote descent and productive employment, improve working condition and in this way, agree on sharing the profit with the workers, observed another delegate, Syed Sultan Uddin Ahmmed, assistant executive director, Bangladesh Institute of Labour Studies (BILS).

Former BGMEA president Anisur Rahman Sinha,felt that compliance is of least importance on the buyers' side, who instead prioritise product quality, delivery time and low price. After bearing the expenditure in extra freight, import and custom duties for fabric, cost cutting in labour remains the only solution. He cautioned that entrepreneurs need consider margin and sustainability before compliance, which is a non-negotiable requirement and not a choice. (SH)

Fibre2Fashion News Desk – India

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