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Case study report team 4
- 1. After Rana Plaza Case Report Team 4 Abay Alikhan Opeyemi Tamara Akinyombo Tuguldur Altangerel Wolfe Bentinck Threynt-Regis Immongault Ella Carlos Fernandez TABLE OF CONTENTS
- 2. Part 1. Case Analysis: Current situation: The Rana Plaza building collapsed in April 2013, killing 1,132 people and injuring over 2,500 more. This tragedy became a symbol of the impact of the fashion industry and the need for long-term reform. The Rajdhani Unnayan Kartripakkha (Capital Development Authority) filed a complaint against the building's owners and the five garment factories that operate inside it. Much of the blame was put on Mr Rana's carelessness, who was accused of prioritizing money before human safety and lives. Retailers, on the other hand, were held accountable for a lack of attention in monitoring the capacity of their suppliers, safety requirements, and salaries paid.These catastrophes, which were among the deadliest industrial mishaps on record, alerted the world to the terrible working conditions endured by employees in Bangladesh’s ready-made garment business. Millions of individuals, the most of whom are women, are subjected every day to a dangerous work environment with a high incidence of work-related accidents and deaths, as well as occupational illnesses, for some of the world’s lowest salaries. The majority of the factories do not fulfill building and construction requirements. As a result, deaths from fires and building collapses are common. There have been 109 accidents since the Rana Plaza catastrophe. At least 35 of them were textile industry mishaps, in which 491 people were wounded and 27 died. In the lack of well-functioning labor inspection system and adequate enforcement measures, decent work and dignified living remain a distant dream for the great majority of textile workers and their families Stakeholders:
- 3. Bonmarche, Walmart, The Children’s Place, Primark, Matalan, Mango, Joe Fresh, Adidas, Gap, and Bennetton. Were among the fashion companies producing at the Rana Plaza garment factory at the time of the collapse. This was not the first garment industry accident, but its severity and preventability brought it to attention. The tragedy encouraged a wide variety of stakeholders to work to prevent future tragedies. Two multi-stakeholder agreements were prominent in these efforts, bringing together key buyers, trade unions, and non-governmental organizations(NGOs) in a concerted effort to improve health and safety conditions in the sector. These initiatives represent a shift away from the buyer-driven compliance-based model that continues to dominate CST and toward what is being described as a cooperation-based model that brings together multiple stakeholders who affect, and are affected by, the business operations of leading multinational corporations in global value chains.
- 5. Intention: In general, B2B customers are seeking to dodge purchasing clothes from Rana Plaza with the aid of diverse codes of conduct and NGOs; they are working on their supply chain choice. It has matured more influential importance on behaving ethically not just in the most secret society but worldwide. These organizations attempt to generate a more reliable future for the factory workers, implementing them with the correct standards. As these frequent demands are required but neglected to communicate, a stand might contain a future of enforced and supported. Having facilities that are operating ethically would be helpful in the future for the buyers. Another vital stakeholder that has some influence and can stand are the clients, so us. It is simple for us to get and pay more care than usual to see who made the clothes that we're about to buy even if the clothes are already in the shop, so the damage already occurs. Even if it already happens, someone needs to take a step to change, and it can start with us. So as a consumer it is crucial for us to speak up and make other people know of the truth and push them to act. If, for example, we decide not to buy from a specific brand and choose to explain why, it can have a huge impact thanks to the tools that we have that are social media. Knowing the media's weight in business can lead to a movement that can impact these factories. Learning Threshold: Competing forces in this case first of all might be other brands that might use this tragedy as black pair and say that they produce and know where their clothes come from. This is a big opportunity for other mass market brands to gain market share. Another competing force might be consumers that would not return to brands that manufactured their clothes through Rana Plaza or other similar companies and manufacturing plants. Also not to forget about countries that would like to have Western brands manufactured in their countries and creating new jobs. Some countries might make statements that they have strict rules on construction and guarantee brands with cheap and safe production lines. And our team assumed that there is no space for compromise because companies would look for countries that offer the cheapest possible labor and less risks for their reputation, especially in the mass production market. Brands would not take risks of using labor that might cause them problems later, and lose profits. So it doesn’t matter for them, if it is in Africa or Malaysia, or Bangladesh, the highest possible profit with less risks the better looks option. Help: Depending on only one industry for economic growth is a big risk to the industry itself. Not only could it result in a monopoly where employees are overworked and underpaid, but also it prevents growth from employees, and there is a risk that misuse of corporate power can be in
- 6. play. If the government can attempt to improve and lay more funding towards the country’s education to allow workers to develop in other countries, this cause and effect can be less probable. Implementing technology to set up new and advanced products is another recommendation that can help all stakeholders involved. This reduces long-term cost, number of employees, and brands could potentially get their products at a more efficient rate. Lastly, our last suggestion is for the 1% of the population who were aware of the situation to engage towards spreading awareness. This way, the social impact that Rana Plaza has would leave big corporations with no choice but to act. What possible solutions might emerge from dialogue between the focal organization and its stakeholders: The possible solution that might emerge from dialogue between focal organization and its stakeholders is view on problems more detailed and wider. Focal organization might make survey and research on the most problematic parts of the business and risks so company or companies might be better informed about problems and take actions. This might be very helpful also to better realize problem for people thousands miles away or people who are willing to make changes. Any survey and research gives new detailed view on business. It might not solve all problems or solve problems only partly, but changes come from small steps. If company would change something or improve anything that would decrease risks in long term effect would be significant. From a future point of view: In the twenty-first century, the world unfortunately runs on money and it changes at a very fast pace. All stakeholders might be severely affected from this several years from now if nothing continues to improve. Many steps have already been taken, such as the Rana Plaza arrangement, and the improvement in building and worker safety, which came mostly through the accord. However, there is rising anxiety over the accord's survival, as from 2018, it was only going to be financed for three more years. Meaning that in 2021, some companies were hesitant to renew their commitments due the moral and social attention that the Rana Plaza disaster brought on their respective companies. Today, workers’ lives remain the same after the incident. Wages are still very low and conditions are still very subpar. If this keeps going the way it is, and the working conditions are no longer under a legal entity that binds workers to compensation and protection, the garment industry in Bangladesh could be at risk of suffering another disaster in the future. Part 2. Case DiscussionQuestions Rana Plaza, was arguably a disaster waiting to happen. Countless disasters in Bangladeshi factories and workplaces had occurred such as the Tarazeen fashion accident in the lead up to
- 7. Rana plaza. The solution to make sure this doesn’t happen in the future is somewhat complicated. There are three key stakeholders, the employers and their employees, the government and the luxury brands. The Employers and Employees The psychological behaviour behind a business in Bangladesh would be proven to show that the employer is vested in profits and deliverables. Thus, the employee and their labour rights are often disregarded. This is due to companies with minimal to no regulation will completely disenfranchise employee rights and wellbeing for their ultimate goal of delivering highest possible profits. With Bangladesh being one of the poorest nations in the world with an unemployment rate of 6%(3 million people) employers are in a position of great power. This results in employers being able ignore workers and protections as the employer is all to aware of the countless others amidst the population who would happily replace them. The luxury brands Many of the luxury brands do not want to “get their hands dirty”. What does this mean? It means the likes of H&M, Top shop, GAP etc are not associated with any of the manufacturing companies and therefore are not held accountable to any of the atrocities held around the world. This leads to companies going to developing economies such as Bangladesh; taking advantage of the cheap labour, lenient labour laws and low company risk which they would not have access to back their home countries. With no accountabilities, these companies will only support the victims of the likes of the Rana Plaza out of ethical reasons and to more importantly keep their consumers happy. Government The Bangladeshi government has a notorious reputation of corruption from the low to high end of government. This leads to the priority of profits rather than the well-being of the counties people. A prime example is the Rana Plaza where 1100 people died due to “behind the curtain deals” with local mayor’s and owners of the Plaza.
- 8. If there is no change from the top down then we believe we would see little to no impact on the grander scheme of working conditions, ethics and quality of living across not only the country but world wide. Possible Responsible stakeholders Why Responsible? Possible actions to reduce changes of future occurrences (probability of effectiveness Sohel Rhana Violations of laws and the goal of making profit closing eyes on safety. Illegal construction. Corruption. Spend money on safety, create normal and fair working conditions. Managers Work for the companies that use sweatshops, and that violates laws. Forcing workers to work in dangerous places. Work only for companies that follow laws and don't violate human rights. Consumers Buying from mass market brands and not checking where their clothes come. Reduce the amount of clothes buying habits, and check where clothes come from and how it was produced. Government Corruption and allowance for working places like Rhana Plaza Eliminate corruption and work on making working conditions better and safe for everyone. NGO’s Missed places like Rana Plaza, and does not monitor everything Fill lawsuit against sweatshops and engage more people to share their experience to public so more people would be aware Suppliers Sell their materials to sweatshops Stop working with sweatshops and those that violate human rights.
- 9. TYPOLOGY OF STRATEGIC RESPONSES BY APPAREL RETAILERS/BRANDS Joe Fresh - were the first to send investigators to Bangladesh and contribute money to funds for families that suffered at the Rana Plaza crash. Primark - were the biggest money contributors among all others Benetton - promised to contribute money J. C. Penney - didn’t paid and made statement that they weren’t informed and don’t have responsibility Matalan - promised to contribute money Carrefour - promised to contribute money Walmart - made contributions directly to victims and families of victims. And also contributed money through their worldwide branches. The Children’s Place - made donations because used products from Rana Plaza Zara - contributed money but didn’t announced the amount