The Return of Retailers from Bangladesh and The Influence on The Economy and Society

Should Retailers Cut Losses and Run From Bangladesh?

The question of whether it is morally correct and permissible for a business to cut its losses and source a new one on the wake of disaster weighs on the responsibility of a corporation as a moral agent. The growing confusion among retailers on whether or not to leave the region stirs up the debate on the retailer’s obligation to stay and their ethical responsibility to the workers of Bangladesh. The factory collapse of April 24, 2013 that saw the deaths of more than 1100 workers has seen the scrutiny of the working conditions. The paper examines the circumstances that have come to affect the largest exporter of apparel and which hosts up to 3.6 million garment workers. This essay will outlay the ethical responsibility and dictate the moral obligation of Retailers on the working conditions of apparel workers in Bangladesh.

Despite being the second largest apparel exporter Bangladesh is still home to the lowest wages of the world. The recent wake of tragedies that has kept retailers and corporations guessing the next course of action, has opened up a debate on their moral obligations. Disney phase out announcement has also contributed to instability of the Bangladesh apparel industry with other retailers contemplating a similar move. The impact of the decision will have a profound impact on the fate of the 3.6 million workers in the region. Regardless of the labor groups urge to the retailers to stay, the underlying key determinant is the moral duty, which is required of the retailers, that matters.

The successful growth of the Bangladesh apparel industry, as a result of the increased number of low wage workers and the less restrictive labor laws, has seen the establishment of low cost garment manufacturing (Stewart 4). According to Zimmerman and Shah’s, analysis of 2013, it is the low cost garment factories that set the stage for a series of deadly accidents (B1). The lack of adequate and effective structures have necessitated the need for factories to acquire independent factory inspectors. None the less, the unethical issues are critical and undoubtedly a matter that needs cooperation of many participants before substantial improvements can be achieved. Salma Zaidi of the World Bank’s Dhaka office is of the opinion that, “Bangladesh is a desperately poor country, and still needs these factories,” furthermore, “we need better safety, better treatment… these are still better jobs than most of the other possibilities,” (Fairclough 11). It is therefore paramount the retailers to stay in Bangladesh and improve the working conditions.

In light of the pertinent ethical issues facing the country and its apparel industry, Karel De Gucht’s 2013 findings shows that, “…these people are… we can’t say underpaid, they are virtually, unpaid… they have to work in sanitary and security operations that are totally unacceptable (Zain 8). The causative problem is attributed to the fact that the retailers in Bangladesh demand for higher operating standards for factories while not willing to pay more. The secretary general of Cambodia state-run garment manufacturer is of the opinion that if retailers would pay 10% to 15% more that would have a huge impact. The fact that a number of manufacturers regularly undertake larger orders, than the factory can barely handle, is a contributor to the deteriorating standards.

Also, the involvement of too many subcontractors in the supply chain by the retailers has contributed to breaking of the codes of conduct. Furthermore, it emerges that Bangladesh retailers have differing views regarding appropriate work and safety standard with which entails compliance (Stewart 4). The Bangladesh garment industry is a huge one and this creates a lot of loopholes on the maintenance of standards.

“…given that there are 5,000 garment factories, an inadequate number inspectors, a local government that faces many serious issues, and great geographic distances between the buyers and the garment manufacturers, it is problematic to inspect and monitor factories as often as needed and to expect much in the improvements in working conditions. And doing so would encourage retailers to shift business elsewhere. These conditions make it easy to turn a blind eye to what is occurring and to shift blame regarding who should take responsibility for undertaking corrective measures.”

The philosophy of utilitarian theory recommends that decision-making ought to advocate greater benefits as compared to the costs. If the retailers stay to improve the working conditions and the set circumstances to fix the structural problems would save factory owners and retailers substantial out of pocket money Stewart (5). Improving the ethical conduct will help the country and the factories improve their financial performance.

More so, the ethical responsibility lies not only on the retailers but also on the government of Bangladesh and the labor unions. The retailer’s foundational commitment will help in revolutionizing the structures but still the participation of other key players and global contributions will go a long way. It is not permissible for the retailers to run.

The moral obligation of ethical relativism lies on the retailers as operating in Bangladesh contributes greatly to the aspect of decision making. The laws, regulations, policies and the overall culture may be significantly unique to the region. The complexity is on whether the moral obligation applied depicts the culture of the host nation, Bangladesh or that of the foreign countries. However, it is unwise to undertake the ethical duty from either extreme considering, “… adhering strictly to ways of conducting business elsewhere means that you can easily justify ways that clearly violate one’s own standards of acceptable working conditions” (Stewart 7).

Inviolability of national sovereignty and the human right and fundamental rights are in conflict in Bangladesh. According to the Stewart 2014 findings, “in the process of trying to respect the state of Bangladesh’s social, economic and cultural development, the human rights are seriously violated” (7).

Retailers and subcontractors together with the foreign firms ought to draw the boundary concerning the emerging factors and finding the proper balance. Despite the difficulty of undertaking the task of moral obligation and duty to the workers of Bangladesh, it is up to the retailers to set the foundation for structural foundation. The government should raise the minimum wage requirement in a bid to get the retailers and manufacturers to pay up. The inspectorate structures that would facilitate an effective undertaking and adherence to the standards of duty will also lead to a proper balance.