Bangladesh has come a long way as a ready-made clothing country in recent years and is on track to oust China as the world’s largest exporter. With the collapse of the Rana Plaza building in 2013, which marked the rock bottom of the country’s apparel industry, how has the country risen to the current top position in such a short period of time? And what about the security of the factories now? FashionUnited spoke to Tuomo Poutiainen, Director of the International Labor Organization (ILO) in Dhaka, Bangladesh.
Could you explain a little how you got into your current job at the ILO?
I have been working for the ILO for over 20 years, in different countries. I decided early on to focus on issues of workers’ rights, their safety and health, and working conditions. I was in Bangladesh for about eight years, not continuously but quite intensely. After the Rana Plaza disaster, I came to Bangladesh to launch our initiatives to improve working conditions in the garment industry. Four and a half years ago I came here as head of the office that not only deals with the garment sector but also with other sectors and issues such as unemployment, labor migration and child labour.
I have always been interested in human development and how we can create the most equitable opportunities for all. There is a common good and these kinds of opportunities, especially for young people, are part of that. I think we all have a responsibility and that is what the ILO, which is part of the UN system, stands for.
Bangladesh is a relatively young and fast-growing country and there is much debate about skills development and how to achieve equal opportunities, especially for girls and women. From the perspective of the ILO and the UN, we say that none of these beautiful SDGs can really be achieved unless women are integrated into the labor market. However, two million people enter the labor market each year, and Bangladesh is a relatively small country that relies to some extent on the informal sector, making it a challenge to create so many opportunities so quickly.
Are changes being made, in a sustainable way?
I think yes and no. The government is paying a lot of attention to this issue, and even the Prime Minister has called for gender equality to be achieved by 2041, but how is this to become a reality when organizations still lack investment? From the ILO/UN perspective, there are two priority areas: investing in primary and secondary education and gender equality in technical jobs, i.e. training girls and women for technical jobs despite the stigmas that still exist at school and employer levels. Another area of focus is entrepreneurship. Most of the jobs here are created by small businesses, crafts and SMEs, probably 60 to 70 percent. Again, we need more female participation and more women-owned businesses, especially in newer industries.
The garment industry and other industries such as pharmaceuticals, plastics, bicycle manufacturing and IT are important sectors because they offer jobs at all levels, but also opportunities and high-level jobs, and that is why it is important to create these avenues for women . Another sector that can offer good jobs is the service sector.
Your work has taken you to different countries such as the Philippines, Cambodia, Thailand and Bangladesh – what country-specific challenges and strengths have you observed?
All countries are of course very different. In Bangladesh and Cambodia, there is strong apparel-led growth that is more or less exclusively driven by one sector, bringing with it a plethora of challenges and opportunities. Job creation is important. When shocks such as the Covid pandemic occur, this poses a major challenge and questions such as safety nets come to the fore – who will take care of the workers when the job is gone?
Bangladesh and the garment industry have fared quite well during the pandemic. It was among the countries that were relatively quick to get vaccinated, took Covid seriously and very quickly adopted policies and practices that reduced risk. There were times when factories opened and closed, but when the opportunity presented itself to reopen, the garment industry jumped at it. However, the lack of a safety net has been revealed and the government takes plans and measures to remedy the situation very seriously. Of course there is a social welfare system, but there is also a need for contributory programs on the part of employers. This is the kind of support that will be needed in the future when problems arise, and this is something new on which the ILO is working with governments.
What about the responsibility of brands and retailers?
When incidents occur in industry, the focus is usually on safety and working conditions. I would say that there has been real improvement and learning in the industry and that clients and brands have real support and a focus on working with the industry to ensure these changes are happening and being complied with. They must ensure that the suppliers they manufacture from comply with local laws and practices and maintain safe working conditions. This is known today, but perhaps ten years ago it was not fully understood and certainly not applied. While there are different levels of operations, in general the industry in Bangladesh today has a much better safety record.
What do you think is the percentage of factories that are compliant now?
It’s hard to give a percentage in such a heterogeneous industry, but probably 70 percent of factories are now in the expected range and the rest are somewhere in between, at least the export-oriented factories. Many factories are keen to do good in general, such as providing free water to the community, repairing the local mosque, paying for childcare, orphanages, or schools. They do good in their neighborhoods without making a big deal out of it. They understood that providing good food and healthcare is part of a good business model. Employees’ loyalty to the company improves as a result, and when there are good relationships between them and management, things go better. They are their capital and it is not easy to find qualified employees. The basis for this is a mutual, respectful relationship, and a good working relationship works. It is also important here that the industry spreads out and is not just concentrated in and around Dhaka, so that the whole country can benefit from this local engagement.
In addition, a generation change and a geographical shift in the production sites can be observed. Ten years ago factories were still in residential areas and often in mixed facilities – a garment factory that also made or housed something else. All of that is almost gone today, because the shock of Rana Plaza radically changed this practice. Factories have moved to purpose built buildings in economic zones. This reduces the risk for the public and in a sense also for the workers as the operation can be inspected as a garment factory and measures can be taken on the entire facility. Simply by changing the location where production takes place, transparency and security have been improved.
Could Bangladesh become a role model for other garment manufacturing countries?
Yes, in the sense that the results speak for themselves. And when you look at how these results have been achieved, it’s really important to look at the tremendous pressure that international brands are putting through quite a lot of investment. There were two multi-million dollar organizations, the Accord and the Alliance, that were here for this purpose and almost forced these changes that are now being internalized by the industry. The task is to maintain these changes and this vigilance and also to understand the value of these investments. So that was the real trigger for the change. At first it was “This happened, what can we do?”, but it turned into “This can be done”, “This is what we have to do if we want to stay in this business”. And yes, we will as international community, of course the organizations will support the governments, but companies need to support companies and this is where the international buyers came in.
Would you say the transition was successful?
It is fair to say that the transition from the Accord and Alliance to the RMG Sustainability Council was met with skepticism and perhaps controversy at the time, but the rationale was to shift responsibility to a new organization involving the industry as a whole , was a good way to sustain and continue the project because then you have a much greater responsibility. It’s a much better way to keep it up and have a body with international unions and international industry and brands to keep oversight.
In this way, credibility can be maintained, and we now have job security as a result of ten years of tireless work. And in this way, this model can also work for other countries – their situation may be different, also their motivation, their resistance and their positive reception – but they can look at how this change has taken place.
Bangladesh is benefiting now as the world, trading partners and markets expect more compliance – in terms of social and environmental compliance, corporate governance and due diligence in general. And there are more and more laws that oblige buyers in the countries of origin to comply with them and to prove that they are being manufactured in markets where the right conditions prevail. So Bangladesh is at the forefront of these methods and now needs to transfer this to other sectors as the country also wants to sell other products than RMGs, such as spices, shoes and bicycles. All of these supply chains need to be examined.
What about consumers? How much power do they have, how much pressure can they exert?
Consumers’ perspectives have been sharpened for years – how much do they know, how much do they want to know? How does this affect their purchasing behavior? I don’t have an answer for that, but I think the clearer a retail company or brand can be about responsibilities and how their factories deliver, the more consumers will take that into account when making their purchasing decisions.
Market regulators, the European Union and others will help set minimum standards so consumers no longer have a choice to buy an inferior product because it is regulated and only certain types of products are allowed in a given market. And over the years this has been rolled out to other products such as toys, electronics and food. This is the next hurdle to overcome and it is now a matter of reaching consensus between governments, consumer groups and business.