At least 12 surveyed global apparel brands confirmed that they have not transferred orders to other countries, thus maintaining order stability in Bangladesh despite unrest, according to a global rights organisation.
The Business and Human Rights Resource Centre contacted a total of 22 global clothing brands that source from Bangladesh, seeking information on how these brands were managing disruptions in the country.
They inquired how they have ensured responsible purchasing practices and protected worker welfare during the recent unrest.
The BHRRC urged the fashion sector to publicly account for how they were engaging with suppliers in Bangladesh while prioritising needs of the workers.
The report said that 12 responding brands, namely adidas, ASDA, C&A, H&M, Inditex, Marks & Spencer, Next, PUMA, PVH Corp, Tesco, Primark and Walmart, affirmed they have not transferred orders to other countries, maintaining order stability in Bangladesh despite the crisis, with Gap not providing information to this question.
In its response, Walmart stated that the brand鈥檚 strategy in Bangladesh remained unchanged and it was not seeking alternative sources for next season鈥檚 clothing.
鈥楢ny movement of orders in or out of Bangladesh is standard course of business,鈥� the brand said.
Walmart confirmed that it was not imposing penalties for production delays or late deliveries related to the current situation.
The survey also mentioned that PVH, Tesco and H&M further cited their alignment with ACT member brands鈥� commitment to responsible purchasing practices to maintain stability in Bangladesh.
The BHRRC also asked if any penalties had been imposed on suppliers for delayed deliveries and 13 responding brands confirmed that they have forgiven delays and not imposed penalties following the supply chain disruptions.
The rights organisation has criticised seven major fashion buyers 鈥� Bestseller, Mango, JC Penney, Kontoor Brands, Levi Strauss, Target and Tom Tailor 鈥� for their lack of response.
According to the resource centre, many brands were hesitant to disclose how the protests had affected their efforts to ensure responsible purchasing practices and protect worker welfare during the recent unrest.
The resource centre inquired how brands monitored worker wage payments to ensure that wages were paid on time and in full for the July-August period.
Regarding wage payments, seven buyers 鈥� Gap, PUMA, PVH, Primark, Tesco, Next and H&M 鈥� reported that wages for July were paid in full and on time.
In contrast, adidas, ASDA and M&S outlined their monitoring processes for wage payments during July and August but did not confirm whether wages were paid on schedule and in full.
C&A, Inditex and Walmart failed to answer this crucial question, as noted in the findings.
According to the report, when it comes to financial support for suppliers, among the 13 brands that responded, Gap, Inditex, PUMA and Walmart chose not to provide any information.
In contrast, Next, PVH, Primark and Tesco indicated that they have not offered any specific financial assistance to their suppliers.
The BHRRC report mentioned that the garment industry in Bangladesh was facing unprecedented challenges due to political unrest and infrastructural crises, including a recent violent crackdown on protests against the government鈥檚 employment quota system and a worsening gas shortage.
The resource centre has been monitoring disruptions in Bangladesh鈥檚 apparel industry, reporting factory closures and work stoppages that cost the sector an estimated $150 million to $500 million per day from July 20-23, 2024.
Indirect losses are even higher, with industry insiders estimating nearly $543 million due to delayed shipments, stockpiling, increased shipping costs and concerns over the long-term impact on the industry.
The reported impact on workers includes mandatory overtime to meet lead times, increased production targets to offset financial losses or prevent order cancellations, higher transportation costs for commuting to factories and issues with wage payments, such as non-payment or delays, the survey read.
Bangladesh Knitwear Manufacturers and Exporters Association executive president Fazlee Shamim Ehsan said that exporters had been facing significant costs, including at least $83 million, due to late shipment discounts demanded by buyers and high air freight charges as suppliers strived to deliver goods on time and mitigate delays.
Although industry bodies are working to negotiate relief from penalties, the high costs associated with air shipments remain a pressing concern, he added.