Investor Statement on Bangladesh
May 16, 2013: In light of a series of recent calamities in Bangladesh apparel manufacturing plants resulting in an overwhelming loss of life, we, the undersigned investors and stakeholders including 123 organizations representing over $1.2 trillion in assets under management, are calling on industry leaders to implement systemic reforms that will ensure worker safety and welfare, and to adopt zero tolerance policies on global supply chain abuses.
The November fire in the Tazreen garment factory, the collapse in April of the Rana Plaza, and a second deadly fire on May 8th in a sweater factory in Dhaka have resulted in the death of over 1,500 garment workers and at least another 1,000 seriously injured. While these individual incidents have different root causes, collectively, they are a grave indictment of the human rights record of Bangladesh, and an illustration of the failure of the global companies that manufacture and source their products there to ensure humane working conditions.
The current model, which assures global customers will have a ready supply of inexpensive and up-to-the-minute fashion, incentivizes corruption and lax oversight as low-cost producing nations compete in a race to the bottom for garment manufacturing contracts. Local governments can turn a blind eye to audit irregularities in an attempt to attract investment to their struggling economies. Global companies have seen their valuable brands put at risk by a shell game that makes oversight near-impossible, as local suppliers move manufacturing to unsafe factories without their clients’ knowledge. Caught in the middle are poor and largely unskilled factory workers with no recourse but to risk their lives by continuing to report for work every day in factories they know to be hazardous, only to earn a wage considered indecent by any international standard.
Clearly, the current model is broken.
As shareholders who have been engaging apparel companies and retailers to foster responsible sourcing practices, including human rights due diligence with robust audit oversight in global supply chains, we see the events in Bangladesh as a watershed moment for the industry. Regardless of whether products are being sourced from Bangladesh, Guatemala, China or the Philippines, morality dictates that the price/value calculus for all manufactured goods must begin with the fundamental human rights of workers, including health and safety, freedom of association and collective bargaining and a living wage.
We call on brands and retailers to collectively pledge to implement the internationally recognized core labor standards of the International Labor Organization. Further, we expect companies to acknowledge their human rights responsibilities as delineated in the “protect, respect and remedy” framework of the UN Guiding Principles on Business and Human Rights. These principles affirm the duty of governments to protect the human rights of their citizenry and the responsibility of companies to respect human rights regardless of where they do business, and further, to provide remedy in the case of human rights abuse.
Acting alone, companies can and do bring about meaningful and positive changes in human rights in the countries where they source and manufacture, and we encourage companies to be part of the solution to ensure better working conditions in Bangladesh. But when faced with intransigence of the type we have historically seen in Bangladesh on worker safety issues, we are convinced that systemic change will only occur when companies take action together. They must use the full force of their commercial power to press for reforms. The Bangladesh Garment Manufacturers and Export Association has a special responsibility to bring its members into compliance with basic safety measures.
As an immediate response to the crisis in Bangladesh we appeal to companies to:
- Join the multi-stakeholder initiative -the Accord on Fire and Building Safety- that includes the International Labor Organization, non-governmental organizations, trade unions and companies, to implement plans with measurable goals to address all aspects of fire and building safety in a timely manner.
- Commit to strengthening local trade unions and to ensuring a living wage for all workers.
- Publicly disclose all their suppliers including those from Bangladesh, the programs they have in place to ensure the safety and health of all their workers and their performance against these goals including any corrective action.
The horrific loss of life in Bangladesh serves to once again highlight the difficulties in building accountability into global supply chains. As investors, we also bear responsibility to enhance the power of the private sector to effect positive change by engaging companies to ensure that human rights remain at the core of their business models.
We will engage the relevant companies we hold, asking for meaningful and transparent implementation of safeguards to prevent future Rana Plazas from occurring.
Signatories to the Bangladesh Investor Statement as of May 16th, 2013, managing more than $1.2 trillion:
Boston Common Asset Management, LLC
Domini Social Investments LLC
Interfaith Center on Corporate Responsibility
Missionary Oblates of Mary Immaculate
Trillium Asset Management, LLC
American Baptist Home Mission Society
American Federation of Labor and Congress of Industrial Organizations
Bank Sarasin & Co. Ltd
The Benedictine Sisters of Boerne, Texas
Benedictine Sisters of Mount St. Scholastica
Benedictine Sisters of Pan de Vida Monastery in Torreon, Mexico
Birch Caring Capital
Bon Secours Health System
Catholic Health East
Catholic Health Initiatives
Catholic Health Partners
Christian Brothers Investment Services
Christopher Reynolds Foundation
The Church of Sweden
Clean Yield Asset Management
Cleveland Ursuline Sisters
The Climate Bonds Initiative
Climate Strategy & Partners
Conference on Corporate Responsibility of Indiana and Michigan (CCRIM)
Congregation of St. Basil
Congregation of St. Joseph
Congregation of the Sisters of the Holy Cross, Notre Dame, Indiana
Cooperative Asset Management
Diocese of Springfield, IL
Dominican Sisters of Hope
Dominican Sisters of Sparkill
Dominican Sisters of Springfield, IL
Ethical Markets Media
Ethos Foundation, Switzerland
Everence Financial and the Praxis Mutual Funds
First Affirmative Financial Network
Franciscan Friars (OFM), St. John the Baptist Province, Office of Justice, Peace and Integrity of Creation
Franciscan Sisters of Little Falls
Friends Fiduciary Corporation
General Service of Justice, Peace and Integrity of Creation of the Missionary Oblates of Mary Immaculate
Global Fund for Women
Green Century Capital Management
Jessie Smith Noyes Foundation
Justice for North America
Krull & Company
Leadership Council for the Sisters, Servants of the Immaculate Heart of Mary, Monroe MI
Leadership Team of the Felician Sisters of North America
LPL Financial, LLC
Marianist Province of the U.S.
Maryknoll Fathers and Brothers
Mercy Investment Services
Middletown Works Hourly and Salaried Union Retirees Health Care Fund
Midwest Coalition for Responsible Investment
Mutual Fund Sub-Advisory Services
Northwest Coalition for Responsible Investment
Oblate International Pastoral Investment Trust
Oneida Tribe of Indians of Wisconsin
Oneida Trust Committee
The Pension Boards – United Church of Christ, Inc.
Portfolio Strategies Securities Inc.
Presbyterian Church (U.S.A.)
Progressive Asset Management
Racine Dominicans SRI Committee
Region VI Coalition for Responsible Investment
The Regroupement pour la Responsabilité Sociale des Entreprises
Responsible Sourcing Network
Robert F Kennedy Center for Justice and Human Rights
Rockefeller & Co. Sustainability & Impact Investing Group
Scottish Widows Investment Partnership
Sisters of Charity – Halifax
Sisters of Charity of Cincinnati
Sisters of Charity of Leavenworth
Sisters of Charity of Saint Elizabeth, NJ
Sisters of Charity of the Blessed Virgin Mary
Sisters of Providence – Mother Joseph Province Leadership Team
Sisters of St. Joseph of Chestnut Hill, Philadelphia
Sisters of St. Dominic, Amityville NY
Sisters of St. Dominic of Caldwell, NJ
Sisters of St. Francis of Philadelphia
Sisters of St. Francis of the Holy Cross
Sisters of St. Joseph of Brentwood
Sisters of St. Joseph of Springfield, MA
Sisters of the Good Shepherd, New York Province
Sisters of the Presentation
SNS Asset Management
The Socially Responsible Investment Coalition (SRIC)
Society of Jesus – MAR, NEN and NYK Provinces
St. Joseph Health System
Strathclyde Pension Fund
The Sustainability Group of Loring, Wolcott & Coolidge
Sustainable Equity Value Ltd.
Transform Capital Management
Tri-State Coalition for Responsible Investment
UCC Pension Boards
Unitarian Universalist Association
United Church Funds
Ursuline Sisters of Tildonk, U.S. Province
Ursulines of Eastern Province, USA
US Province of the Religious of Jesus and Mary
US SIF: The Forum for Sustainable and Responsible Investment
UU Congregation at Shelter Rock
Vancity Investment Management Ltd.
Walden Asset Management
Wespath Investment Management
The Xaverian Brothers
Zevin Asset Management
Stephen Davis, Senior Fellow, Harvard Law School Program on Corporate Governance (in his individual capacity)