Made in Bangladesh: scaling up green apparel manufacturing

Photo Source: Thedailystar

Many years ago, I did my doctoral research on the environmental compliance of Bangladesh’s readymade garment industry at the London School of Economics and Political Sciences. Back then, the industry was beginning to make its mark with their American and European buyers. They were demonstrating their newly found confidence at delivering cheap and basic clothes in a “fast fashion” supply chain. The foreign buyers were price-setters and controlled who participated in the global apparel supply chain. Their collective codes of conduct were the rulebook and governed the quality of the product, how it was made, how it was shipped, and how social and environmental issues were to be addressed by the garment companies along the way.

Years later, I was back at my alma mater to talk about a very different garment industry. This article is based on what I presented at the Bangladesh Summit hosted by the LSE and the UC Berkeley.

The Economist magazine recently said that it’s a good time to be celebrating Bangladesh’s economy right now. Bangladesh is no longer a disaster story. Bangladesh is not a basket case.

Gross domestic product grew steadily at 6 percent in the past decade, with the last two years’ growth being around 7 percent. Industrial share of the GDP is 29 percent, and the lion’s share of that comes from the garment industry.

The garment industry has about 4,000 active factories, employing 4.4 million workers, 80 percent of whom are women. In a conservative society like Bangladesh, that is a remarkable story.

The sector has spawned backward and forward linkage industries, and estimates indicate that about 50 million Bangladeshis depend on the apparel sector for a living.

Garment exports stood at $28 billion in the fiscal year of 2016-17, and globally Bangladesh is second only to China in apparel export volumes.

Like in any part of the apparel supply chain, compliance management has been a challenge in Bangladesh as well. In the 80s, sweatshop-like conditions and child labour were a sad reality. In 2012 and 2013, Bangladesh was the stage for the most horrific industrial accidents the world has seen: Tazreen factory caught fire, killing 112 workers and the Rana Plaza building collapsed, killing 1,134 workers. These tragedies shook the entire supply chain and buyers, governments, international development agencies, factory owners, labour groups, NGOs and trade bodies all rallied together.

Now the Unicef says that children are no longer employed in the garments factories (although child labour is prevalent in informal economic work and in murky corners of the sub-contracting supply chain). The International Labour Organisation and buyer groups – the Accord and the Alliance – in the past five years have inspected all garment factories and remedied them for building and fire safety. A large number of factories have shut down, some have moved, and some are still taking corrective action.

About $1 billion has been invested by factory owners to ensure better working conditions. The buyers now say that working conditions are a lot better and non-compliant factories no longer exist in Bangladesh. The workplace conditions are still not ideal and one can say with some certitude that there is a long way to go to maintain the standards rigorously.

Bangladesh’s compliance history is no doubt checkered and spotted.  But it is also the stage for some not so quotidian achievements. According to the United States Green Building Council, Bangladesh is home to some of the world’s most environment-friendly apparel factories.

The world’s highest-rated green denim, knitwear, washing and textiles mills are all in Bangladesh. Of the top 11 LEED Platinum-certified factories, eight are from Bangladesh.

So far, 67 garment factories have achieved LEED certification. Of them, 17 are platinum rated and 37 gold rated. Some 280 factories are under process for LEED certification.

But it’s just not the 300-odd LEED superstars. The garment sector is accelerating its greening and becoming known for its sustainability initiatives. It is home to the Partnership for Cleaner Textile (Pact), the world’s largest apparel resource efficiency programme. The Pact Phase-1 was implemented in 215 factories at a cost of $11 million. The Phase-2 has just been launched and will reach another 250 factories at a cost of $7 million.

While eco-friendly development remains a desideratum, the $28 billion question is how do we go from LEED and PACT success stories to transformational change that will ensure Bangladesh’s place in a green supply chain? Green technology involves hardware and operational knowledge and can range from large and complex technologies to simpler ones. Typically, cleaner production faces two kinds of barriers: economic and institutional. Garment factory owners will think about the economic viability of the suggested green tech, the capital availability, and the risks to their company’s main objectives of profit maximisation.

PACT and LEED results are critical at this point of breakthrough because they reify the eco-efficiency business case that fuels peer demonstration. Success stories in more than 400 factories present compelling case studies of what is possible through constructive dialogue, collective effort and technical advisory. The business case will act as a catalyst towards greening in many factories once the “super stars” become the norm.

In order to enhance peer learning and investment into cleaner production, Bangladesh’s garment factories specifically need strong regulatory signals favouring cleaner production (targets and regulatory measures), long-term institutional changes (not just availability of green loans, but ease of access and disclosure of disbursements), economic incentives to banks, financial institutions and factory owners, removal of perverse resource pricing, and collaborative and coordinated efforts to foster networks of greening, skills building, trust building and behavioural change.

This list is not exhaustive, nor it is reflective of the complexity of the problem, but it starts a new way of thinking about spreading greening in a city that is also one of the most-polluted in the world. We must transcend from being islands of greening to more uniform performance, and learning how to do that from those which perhaps might be a better way.

Originally this article was published on July 17, 2018 at Daily Star. The author Shahpar Selim  is a visiting researcher at the International Centre for Climate Change and Developmentat(ICCCAD) at the Independent University, Bangladesh (IUB).