Promises of self-regulation will not lead to real change
Boohoo bosses are trying to get on the front foot after a week in which allegations about the treatment of workers in its supply chain have seen retailers deserting its brands, investors in more-or-less open revolt and the company’s shares shedding a third of their value.
“We are shocked and appalled by the recent allegations that have been made and we are committed to doing everything in our power to rebuild the reputation of the textile manufacturing industry in Leicester,” the company declared in an announcement to the stock exchange.
It also detailed an independent review of its supply chain to be led by Alison Levitt QC, and an “incremental” £10m investment to “eradicate supply chain malpractice”. That amounts to less than 7 per cent of what the company is investing in the £150m bonus scheme put together for its bosses. The latter figure is particularly jarring when set against the allegations about workers earning considerably less than the UK minimum wage.
Those claims, and the other allegations of cramped conditions and inadequate safety, seem to have moved the needle in a way that similar reports about conditions in, say, Dhaka – where the same kind of problems can easily be found – do not, except in the case of a tragedy such as the collapse of the eight-storey Rana Plaza complex.
The solutions put forward are broadly similar, however. The company or companies that find themselves at the centre of a scandal express shock at what’s been found happening under their noses. They promise action. They commission investigations. They sign up to codes. They may even throw around a few million to make them look good and allow them to pat themselves on the back in the corporate and social responsibility section of the annual report.
Then everyone goes to sleep and battered share prices are allowed to recover.
Given the way the current news cycle is working – with Covid-19 raging, the US election due, and the British government engaged in a mad dash for a no-deal Brexit – the spotlight will soon move elsewhere. Boohoo’s partners will be able to quietly put the company back on their rosters. There will be promises to do better when the QC’s report is released, and normal service will then be resumed.
Hardly a surprise, therefore, that Owen Espley, a campaigner for the anti-poverty charity War on Want, describes what’s going on as a “smokescreen”.
“Time and time again, we see this method employed. The problem is that the self-regulation by brands of their factories has repeatedly failed to address labour rights violations.”
Espley says the Leicester episode, the many others that have occurred in garment-manufacturing countries, and the fact that this sort of thing keeps on emerging, clearly demonstrate a failure of regulation.
The rules, when it comes to workplace safety and the minimum wage, may look stronger in the UK than they are in some developing countries. But people will cheerfully violate rules if they are incentivised to do so, all the more so if they are inadequately enforced. The desire of factory owners to win contracts, combined with the garment industry’s focus on price above all, provides that incentive.
The fact that these are not the first revelations about Leicester’s rag trade, and that it has taken journalists to expose the issue rather than the authorities, stands as mute testimony to the failure of enforcement.
The buck ultimately stops with the UK government, as it does with the other governments that have left the policing of issues like the ones that have emerged in Leicester to companies, their shareholders and their customers – an approach that clearly doesn’t work.
The fast fashion industry’s desire for a quick turnaround, and the rapid production of fast selling lines, has brought the problems with this industry closer to home than they have been previously. If this results in an overdue conversation about these issues, and how to better address them, then some good may come of
The fact that these are not the first revelations about Leicester’s rag trade, and that it has taken journalists to expose the issue, stands as mute testimony to the failure of enforcement
this. The spotlight needs to remain on them.