Assure fair distribution of value within the Supply Chain
BAYLA President and Founder and CEO of Merchant Bay Abrar Hossain Sayem recently shared his opinion and called for a fair and transformative buyer-supplier partnership in United Nations Forum on Business and Human Rights- 2023 in Geneva, Switzerland. Following is the summarization of his talking points.
Bangladesh Apparel Manufacturing Industry stands at a crossroads, having weathered a series of challenges over the past few years. From the disruptions brought about by the pandemic to the shifts in the global economic landscape and geopolitical tensions, the manufacturing sector, particularly in Bangladesh, has been significantly impacted.
Watch Sayem’s Responses
Challenges Faced by Manufacturers and Workers
The adversities have not spared manufacturers and workers, leading to a notable percentage of closures of manufacturing units in Bangladesh. The landscape has witnessed instances of problematic partnerships, including cases of blackmailing, and these challenges have left manufacturers and workers grappling with the aftermath.
Thin profit margins further exacerbate the situation, with manufacturers surviving on a precarious edge. Despite being a crucial hub for global apparel manufacturing over the last decades, Bangladesh faces a stark reality— rising costs with inadequate adjustments in prices. This imbalance has rendered the business case for manufacturing for global brands less economically viable, leaving manufacturers vulnerable and many in substantial debt.
Bangladesh's Resilience
While facing these challenges, Bangladesh has demonstrated resilience, boasting over 2,000 socially compliant manufacturing units, with a significant portion certified as green manufacturing units. However, the current scenario demands more than resilience—it necessitates meaningful partnerships to help manufacturers weather difficult times and contribute sustainably to workers' welfare.
The conventional narrative of low wages and prices needs a revision, especially considering the recent 56% increase in minimum wage in Bangladesh. This increase impacts pricing dynamics, requiring shared responsibility across the entire supply chain.
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Manufacturer's Perspective on Partnerships and Sustainability
From the manufacturer's perspective, the daily interaction with thousands of workers provides unique insights into their challenges. Beyond verbal commitments, tangible actions are crucial for creating sustainable partnerships. Fair distribution of value throughout the supply chain is not only a necessity for manufacturers but also a pathway to positively impact workers' lives and contribute to environmental sustainability.
Importance of Regulatory Bodies and Transparency
Establishing regulatory bodies is pivotal, providing a platform for manufacturers to address grievances without fear of jeopardizing their businesses. Transparency, extending to third-party certifications and data disclosure, is foundational for building trust and collaboration.
Shared Costs and the Road to Sustainable Partnerships
In the quest for sustainable partnerships, the discussion inevitably turns to shared costs. Transparency and due diligence are deemed essential elements that must be shared to make any partnership economically viable. Without shared costs, the sustainability of partnerships is called into question, emphasizing the need for a fair and transparent model.
In conclusion, the global manufacturing industry faces formidable challenges, but within these challenges lie opportunities for transformation. Meaningful partnerships, transparency, and shared responsibilities can pave the way for a sustainable and equitable future for manufacturers, workers, and the industry.
The panel was moderated by international human and labor rights specialist Auret Van Heerden, featured notable attendees, including Fernanda Carvalho from the Global Fund to End Modern Slavery-GFEMS, Deputy Human Rights Ombudsman of Slovenia Dijana Mozina Zupanc, University of California researcher Sanchita Banerjee Saxena, ILO's Better Work Program Director Dan Rees, H&M Group’s Head of Social Impact, Sustainability Payal Jain, and BAYLA President and Founder and CEO of Merchant Bay Abrar Hossain Sayem.
Watch the full event here: