Ensuring Good Labour Rights in Fashion Supply Chains: The “Cooperative Approach”

Ensuring Good Labour Rights in Fashion Supply Chains: The “Cooperative Approach”

This piece examines the rise in social and labour injustices in fast fashion supply chains, specifically in the global South. It explores the benefits and shortcomings of the cooperative approach: a framework of sorts, which fashion brands have used to ensure that good labour rights are upheld by their suppliers.

Fashion Network / Flickr

An overview of the social and environmental implications of fast fashion

The global fashion industry has experienced important changes in the last two decades which have led to an increase in social and environmental challenges, specifically within supply chains (Lueg, Pedersen & Clemmensen, 2015; Turker & Altuntas, 2014). The expansion of global markets has allowed for a wider consumer base and a rise in global competition with new players. As consumers demand lower-priced goods with short life-cycles, keeping with the latest trends, the fashion industry has moved away from traditional fixed calendar seasons and instead has transformed into what is known as “fast fashion” (Lueg, Pedersen & Clemmensen, 2015; Turker & Altuntas, 2014). Fast fashion has led to shorter market cycles and new organisational buying requirements demanding that manufacturers be flexible at “very short lead times” (Barnes & Lea-Greenwood, 2006; Turker & Altuntas, 2014).

This transformation has resulted in environmental issues including increased CO2 emissions from transportation mileage, usually in the form of air freight due to time pressures. It has also led to the increased use of harmful chemicals and non-renewable natural resources during production processes (Turker & Altuntas, 2014).

The augmented time pressures of fast fashion have also caused a myriad of social issues, specifically in the developing countries where the items of clothing are produced. Firstly, cases of worker abuse have been observed including longer working hours, and in some cases forced labour, for example in Bangladesh (Turker & Altuntas, 2014). Furthermore, considering the manufacturing processes do not require high-skilled workers, employees are often poorly educated and disadvantaged individuals, such as women, who make up 80% of the global garment workforce (ILO, 2019), and children (Turker & Altuntas, 2014). Minimum wage rates set by Asian governments often end up below poverty lines due to the concerns that companies may relocate to cheaper countries. This is particularly distressing considering 60% of garment production takes place in Asia (Edwards, Hunt & LeBaron, 2019). Thus, the social issues that these employment structures have caused include worker discrimination, low wages, long working hours and unethical treatment (Turker & Altuntas, 2014).

However, it is important to recognise that the global fashion industry has nonetheless provided job opportunities for individuals at the bottom of the value chain in the global South. As Amaryta Sen explained in his speech for the London Stock Exchange Group series of lectures, it is better for individuals to be employed rather than closing sweatshops, considering workers have very few options (Skinner, 2019). It would then be up to states to provide educational opportunities for upskilling and to provide better factory conditions (Skinner, 2019).

Sustainable Supply Chain Management (SSCM) in the fashion industry

Considering this fast fashion context, brands have come under pressure by various stakeholders, such as non-governmental organisations (NGOs) and their customers, to consider the wider sustainable implications of their supply chains, especially in the developing countries they outsource to (Seuring & Müller, 2008). The most significant scandal which pushed the fashion industry to engage with sustainability, more specifically within their supply chains, was the collapse of the Rana Plaza garment factory in Bangladesh. It claimed the lives of 1,132 workers in 2013 and brought about a worldwide discourse on health and safety, low wages and issues of freedom of association (FoA) (Edwards, Hunt & LeBaron, 2019).

As such, brands have started to consider sustainability in their supply chain management. This is called sustainable supply chain management, which is defined in the literature as:

“The creation of coordinated supply chains through the voluntary integration of economic, environmental, and social considerations with key inter-organisational business systems designed to efficiently and effectively manage the material, information, and capital flows associated with the procurement, production, and distribution of products or services in order to meet stakeholder requirements and improve the profitability, competitiveness, and resilience of the organization over the short- and longterm” (Ahi & Searcy, 2013: p.339).

A cooperative approach between brands and their suppliers could help suppliers in the global South ensure good labour standards

As a part of this move towards sustainable supply chain management, apparel brands (and other companies) have resorted to standardisation and the creation of codes of labour conduct to ensure better working conditions. These codes of conduct tend to be based on the International Labour Organisation’s clauses such as no exploitation of child labour, no discrimination in employment, freedom of association, reasonable hours of work, living or minimum wage, etc.

Companies started by implementing a top-down approach to “force” compliance with their codes, but this method of pressuring suppliers actually inhibited change at the worker level. This was mainly due to issues with power asymmetry, insensitivity to local norms, and poor auditing.

However, more recently, multi-stakeholder initiatives (MSIs), international buyers/brands and other relevant stakeholders, such as researchers and NGOs, are testing and documenting alternative mechanisms for ensuring compliance (Lund-Thomsen & Lindgreen, 2014).

A new cooperative model is now being advocated by these actors, with the argument that close collaboration between buyers and suppliers can advance adherence to codes of conduct thereby improving labour rights, all whilst simultaneously improving the efficiency of production (Lund-Thomsen & Lindgreen, 2014).

This cooperative approach necessitates three major pillars to function effectively: increased responsibility and commitment, capacity-building, and the use of local resources. In terms of increased responsibility and commitment, international buyers are expected to review their prices so that supplier management can ensure higher wages for their workers (Lund-Thomsen & Lindgreen, 2014). Furthermore, improving production planning is also key in order to avoid peak seasons and last-minute orders thus circumventing overtime for workers (Lund-Thomsen & Lindgreen, 2014). As a result, instead of seeking the cheapest means of production, buyers are expected to form long-term partnerships with their suppliers (Lund-Thomsen & Lindgreen, 2014). These relationships should be built on frequent visits, trust and mutual conviction, which in turn are anticipated to produce a positive impact on the workers at the bottom of supply chains (Locke, Amengual & Mangla, 2009). Suppliers are also expected to invest in the long-term relationships between their workers and management, for instance with human resource programmes that address employee needs (Locke, Amengual & Mangla, 2009). Through a commitment to dialogue and responsiveness to suppliers’ needs, both buyers and suppliers can improve compliance with good labour codes of conduct (Boström et al., 2015).

Second, as a part of this cooperative model, buyers are encouraged to invest in the capacity development of their supplier managers and workers (Lund-Thomsen & Lindgreen, 2014). With the idea that suppliers can be “willing partners who simply lack certain organizational skills” (Locke, 2013), brands should encourage their suppliers to take part in training programmes that will help them effectively implement the codes. Instead of the top-down pressure, there could equally be bottom-up pressure from workers, especially if they are offered worker training on their basic rights and responsibilities (Lund-Thomsen & Lindgreen, 2014). Capacity building can also be reinforced using a complaint or grievance mechanism. In their review, Marx and Wouters (2016) consider grievance mechanisms as a way forward for strengthening private governance systems. Bottom-up pressure is expected as workers are given the opportunity to dispute decisions they find “deeply problematic” (Marx & Wouters, 2016), resulting in better monitoring and remediation for all parties. However, the researchers also claim that complaints mechanisms are not always effective if employees are afraid of management retaliation or if they are based in countries which have a feeble rule of law (Marx & Wouters, 2016).

Third, having social auditors that understand the local context and speak the language is of equal importance, for better communication and monitoring, but also to ensure better relationships and thus improved behaviour and transparency (Lund- Thomsen & Lindgreen, 2014). Finally, utilising local resources including NGOs and trade unions would enable better and more consistent independent monitoring of conditions (Lund-Thomsen & Lindgreen, 2014).

Without including local contexts, or the global South actors in a more meaningful way, the cooperative model remains flawed

Despite the promising approach of having more cooperation and understanding between buyers and suppliers, contextual barriers play an important role in hindering suppliers’ compliance and thus, brands’ ability to ensure better working conditions.

Local Institutional Contexts

Firstly, Lund-Thomsen and Lindgreen (2014) have argued that the cooperative paradigm has not emphasised the local institutional contexts and how they might be problematic. The cooperative approach, therefore, requires, firstly, some kind of “sensitivity, familiarity and recognition of context” (Boström et al., 2015) but also intensified communication with institutional actors such as national governments and local authorities (Locke, Amengual & Mangla, 2009).

Furthermore, it is argued that local actors and stakeholders should be part of the “co-creation process”, as they can help make global standards more specific to the context in which they operate (Boström et al. (2015). However, this kind of action has not been evidenced in the literature. As a result, the codes of conduct used by brands are only efficient if they are flexible in accommodating the “problem-solving strategies brought by local stakeholders” (Boström et al., 2015; Vellema & van Wijk, 2015). As such, brands could ask local NGOs and trade unions to assist with relevant company policies, while also understanding ways in which they can improve the flexibility of their codes of conduct for each country they source from. For the moment it seems that the onus is on helping countries become flexible in achieving their standards, and not on adapting the standards themselves.

Voices of the Global South

The whole of this cooperative approach is built on the research and advocation of international buyers, MSIs, western academics and NGOs (Lund-Thomsen & Lindgreen, 2014). As such, no matter the well-intended investments of international buyers, the voices of those at the bottom of the chain, and specifically the voices of those working in the global South, have remained unheard (Lund-Thomsen & Lindgreen, 2014). With such a focus on collaboration and cooperation, it is surprising that these opinions and lived experiences do not secure a place for the wider reimagination of SSCM. Instead, it seems that collaboration and cooperation is used to persuade these global South actors that the western standards provide the best way forward.

Despite the close collaboration between brands and their suppliers, as well as intensified communication via increased onsite visits, it appears that the goal is to convince suppliers that western codes of labour conduct, and the values they stand for, are legitimate. This isn’t to say that these types of labour standards are not legitimate; they are often enshrined in international labour laws of the ILO — although these have been criticised for their “lack of realism and of concrete influence on national law and practice” (Servais, 2013). The fact that the ILO struggles to implement their standards and rights in some countries means that it is easily understandable that factories might resist these standards. This resistance is even furthered by the fact that the suppliers’ desired roadmap for reaching these standards, and the cultural considerations that differ across those countries, are quashed — intentionally or not.

A way of reversing the exploitative system has been suggested by researchers, however, it would not give a voice to those lowest in the supply chain (like the garment sewers for instance) but would nonetheless give a voice to the global South. In the opinion of Chan and Ross (2003), the ILO standards are dividing developing countries from the global South and thus facilitating the exploitative system. Within this system, they identify competition between countries in the global south where the competitive advantage of having cheap labour causes a race to the bottom in labour standards (Chan & Ross, 2003). In their opinion, the voices of the global South can be heard through South-South agreements.

Relevance to wherefrom

This exploration of the cooperative approach is a useful thought piece for brands. However, the main intention behind this research is to help consumers understand the intricacies of supply chain management, specifically when it comes to ensuring good labour rights. The recent focus on the environmental degradation of fashion has put the sector’s social and labour problems on the back burner. Therefore, this piece is also here to help reignite the cognisance of labour injustices felt at the bottom of chains, in the poorest of countries.

This piece is directly in line with the wherefrom ideal in which we provide consumers with a more nuanced understanding of what actions brands take across their sustainability strategies, and how these actions need to be strengthened. The aim is for consumers to harness this new understanding when using wherefrom’s reviewing platform, to demand demonstrable evidence of brands’ efforts and effectiveness in ensuring good working conditions. Negative reviews will encourage better performance from brands, whereas those brands using robust approaches to improving labour conditions and reporting on this transparently will see better sales and reviews.

*This piece is an excerpt of Isis Bliah’s MSc Environmental Technology thesis — if you’d like to find out more, feel free to contact her.*