H&M and Zara Endorse Safety Accord After Rana Plaza Collapse

The collapse of Rana Plaza which to date killed over 1,100 people has finally prompted action by major retailers who rely on factories in Bangladesh to produce their garments.  Many companies have agreed to endorse a safety accord, which will be binding on retailers to create, implement and finance fire safety and building improvements.  The pact is gaining momentum in the U.S. and in Europe as fast fashion giants including H&M, Zara, Benetton, and Mango have already signed on.  


The details are still being fleshed out but it is expected that there will be independent and thorough inspections of factories, which inspection reports will be made public.  Any factory that does not make necessary improvements under the accord will obligate retailers to cease production there and cut off any business to the factory.   It also give a voice to workers and their unions to improve the conditions of their workplace.  To fund implementation of the accord, each retailers will make contributions based on how much they produce in Bangladesh.  H&M is one of the largest producers of garments in Bangladesh even surpassing Walmart, which has  since announced its own plans to implement safety in Bangladesh.  

Walmart plans to hire auditors to inspect its 279 Bangladesh factories and on June 1st, will publish its findings online.  Walmart said if fire and building safety issues are discovered, factory owners will be required to make repairs otherwise be removed from its list of authorized factories.  It doesn't sound too different from the safety accord being adopted by the rest of the retailers except Walmart is making a "commitment", whereas the accord will be a legally binding agreement for the retailers who opt in.

The Bangladeshi government has also taken action in light of the devastation pledging to raise wages and amend labor laws so workers can form unions easier.  There is discussion of forming a wage board to set minimum wages. The government is also seeking to increase severance and benefits for tenured workers.  

Wages in Bangladesh are among the lowest in the world which is why retailers have flocked there the last several years.  This has created a proliferation of low paying jobs for locals who otherwise would have no other source of income.  However, the growth has also fueled the construction of shoddy factories and exposed the lack of regulation which has made news around the world as fires break out and buildings collapse.

This is a good start considering what it took to get to this point but hopefully such safety plans, whichever get adopted by the world's leading fashion companies, will successfully prevent unnecessary deaths in the future.  I'm sure we will continue to hear about these plans as the details are finalized and implemented and I'll be sure to provide updates as well.

Read More:
WSJ: Benetton, Mango Agree to Bangladesh Safety Pact; Wal-Mart Lays Out Own Bangladesh Safety Plan
NYTimes: Global Retailers Join Safety Plan for Bangladesh