On the 4th Anniversary of the Rana Plaza building collapse in Bangladesh, Friends Fiduciary and over 200 other investors representing $3.1 trillion in assets under management expressed support for continued efforts to ensure worker safety in the region. The 2013 Rana Plaza tragedy, in which over 1,100 workers were killed and 2,600 injured, “drew attention to the systemic human rights abuses in the garment sector, as well as to the failure of the Bangladesh government and corporate compliance programs to create safe and healthy workplaces that respect and protect the lives of workers and mitigate the risks to companies.”
In response, investors urged their portfolio companies sourcing from Bangladesh to sign the legally binding Accord on Fire and Building Safety, created in 2013. The Accord, made up of trade unions, NGOs, brands, and retailers, required building safety compliance and included a commitment to livable wages and safe working conditions as well as grievance mechanisms for stakeholders.
Over the past four years, the Accord has received broad support, with over 200 participating brands, retailers, and importers. Over 1,600 factories have been inspected, 75% of identified risks fixed, and 80 major complaints addressed through the complaints mechanism. Progress is regularly and transparently reported.
However, there is still work to do. Investors urged that the Accord extend its legally binding mandate for another five years, and that Accord companies strengthen their financial commitment to allow for remediation of serious structural issues, which represent 25% of outstanding repairs. Investors also asked for the Accord to broaden the scope to include a focus on freedom of association and collective bargaining.
Investors were pleased to see that shortly after our statement was published, Accord companies agreed to renew the Accord’s mandate for another four years, and included freedom of association and collective bargaining protections. Friends Fiduciary believes that addressing these risks is the right thing to do from a humanitarian perspective and from a business perspective, benefitting both workers and companies.