A Laudes-commissioned study into transparency in the apparel industry in Bangladesh reveals that while local and global initiatives are making progress, brands, manufacturers and workers are facing significant barriers to achieving more transparency in their sectors.
The report, entitled:Transparency Assessment: Examining the transparency journey for the Bangladesh apparel sector ties into Laudes Foundation’s global strategy to find solutions to deeply rooted issues in the apparel industry. It examines the initiatives that have been introduced to improve transparency and provide incentives for brands and manufacturers to demonstrate greater accountability. A key aspect of the report is a continuum diagram showing the barriers each stakeholder – workers, manufacturers and brands — faces in embracing transparency.
The report is part of a global momentum for change in the industry and its release coincides with the launches of the 2020 Brazilian and Mexican Fashion Transparency Indices, which collectively will add to the global knowledge and expertise around efforts to improve transparency in the apparel industry worldwide. This report contributes insights on how transparency is perceived in the industry and what stakeholders’ real concerns are – as well as how to address them. The challenges and concerns of stakeholders in Bangladesh, the second largest apparel producer in the world, will likely be familiar to those in other countries and sectors as well.
An important finding is that transparency is interpreted differently by workers, manufacturers and brands, resulting in a lack of shared vision among stakeholders. Up to 74% of surveyed manufacturers were unaware of the meaning of transparency, for instance. This misalignment builds barriers to the public disclosure of data resulting in challenges to accountability within the industry. In many cases, manufacturers do not distinguish between public and private disclosure. (Public disclosure is complete public transparency, while private disclosure generally involves transparency limited to a specific group of people or organisations).
Yet, transparency can play a transformative role in the supply chain. It is one of the six approaches that guide Laudes Foundation’s initiatives and is integral to our mission to combat inequality by shifting power structures for sustainable and inclusive growth.
The Covid-19 pandemic has hit the apparel industry hard
A core issue is the global apparel industry’s continued reliance on increasingly complex supply chains to create and deliver products quickly and at low cost. This has been exacerbated by the Covid-19 pandemic, which resulted in overwhelming social and economic setbacks.
The report highlights many initiatives making positive impacts in Bangladesh, like Fair Wear Foundation (FWF), which has 229 Bangladeshi factories working with 23 FWF member brands and offers training for managers, supervisors and workers aimed at raising awareness about labour standards, methods for communicating problems and resolving disputes. In country innovations like BRAC University’s Mapped in Bangladesh initiative, it allows easy web-based access to basic factory information for all exporting apparel factories in the country, including location, customers, and memberships or affiliation with inspection programmes.
A big concern is many manufacturers have mixed feelings about transparency. A large number accept there are benefits to transparency but there is also the perception it could hurt business.
“Apparel is a product where competition happens in cents (¢) and not in dollars ($) and manufacturers fear disclosing business information gives leverage to competitors”.
On the upside, 87% of manufacturers are willing to disclose labour issues/working conditions and safety related compliance information publicly. This will be good news for workers, who have continually advocated for more transparency regarding wage payments, safety and business performance.
Will Bangladesh take a lead on transparency?
Without a doubt, a change in mindset and culture is required to bring greater transparency to the Bangladeshi apparel sector. The study provides recommendations for targeted actions for each stakeholder group, and industry interventions that focus on the principles of reciprocity, coordination and consensus building.
While transparency was initially thrust on Bangladesh after the Rana Plaza factory collapse, it is an open question whether leaders in the Bangladesh apparel industry will take ownership and promote transparency as a way to differentiate the country in a more competitive post-Covid world.
