Major Chains Starting To Address Bangladesh Tragedy

Some of the world's largest retailers—including Canada's Loblaw, Spain's El Corte Ingles SA, Sweden's Hennes & Mauritz, Ireland's Primak and the U.S.'s Walmart (NYSE:WMT) and Gap (NYSE:GPS)—started making meaningful moves to help victims of the deadly building collapse in Bangladesh that killed hundreds and maybe more.

Loblaw and Primark on Monday (April 29) made the most specific moves, each pledging to spend unspecified amounts to compensate victims of the collapse.

The guilt follows Bangladesh becoming an important manufacturing site for apparel retailers worldwide, especially as countries have been dropping import tariffs and quotes for the region for the last 10 years, said a report in The Globe and Mail. Bangladesh's $20 billion garment industry represents the second-largest clothing exporter after China and has become a prominent link in the global supply of low-cost clothing for so-called fast fashion and budget retailers in the U.S., Europe and Canada. The illegally constructed, eight-story Rana Plaza in Savar, a suburb of Dhaka, collapsed in a heap Wednesday morning as thousands of people worked inside in five garment factories.

Many of those other retailers, including Walmart and Gap, met on Monday near Frankfort, at a meeting at the offices of GIZ, a German federal agency. The discussions in Germany included creating a clearinghouse of factory-inspection results, so companies can see where other retailers stopped production because of safety concerns, participants said, adding that the group plans to publish the results of the talks in May, according to a story in The Wall Street Journal.

A contract crafted by the U.S.-based International Labor Rights Forum and other groups after a 2010 garment factory fire, the Bangladesh Fire and Building Safety Agreement, failed to take effect when not enough retailers signed on, the Journal story said.

Retailers are working on a broader agreement that "more brands are likely to sign up for," said Peter McAllister, director of the London-based group Ethical Trade Initiative, who attended the meeting.

For more:

- See Wall Street Journal story
- See Globe and Mail story

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