Arcadia Boutique’sEco-Friendly Fashion

Sweatshops and CSR

One of the guiding principles of good business sense is that you need to be able to produce goods or services at a certain cost in order to maximize your profit. After all, you can only maintain a certain price range that your target consumers are willing to pay for.

Many industries, including fashion, opt to outsource their production to developing countries. This is a good business practice for them because they can keep production costs to a minimum while their profit margins stay put. It is no secret that developing countries attract businesses in other parts of the world because of the cheap labor they offer, and big businesses are more than willing to take hold of this advantage.

Speed and bulk at a fraction of the cost
Production in third-world countries is preferred over their home countries because of the sheer difference in minimum wages. If they were to produce at their home country, they would often have to deal with unions that negotiate wages and also shorter maximum working hours. These conditions allow foreign investors to hire thousands of employees to fill production lines.

In contrast, living wages in developing countries are a pittance once you factor in the exchange rate of their currencies. These countries have also made it more attractive for business entities because they have institutionalised low minimum wages and could very well be tax havens as well. This is aside from the fact that these countries already have very low standards of living to start with.

Loose regulations
Another reason that attracts foreign-based businesses is the fact that that governmental regulations in the developing countries are very lax. Aside from tax cuts, the foreign investors are given more leeway since they bring in the much-needed dollars or euros to prop up the local economy.

It is often the case that the work areas of these employees would not even pass the most basic requirements of a safe workplace in the home countries of their employers. That is why these factories have been called sweatshops because workers are often subjected to subhuman conditions.

The start of changes
There have been massive changes in how these companies conduct their business. This has largely been because of the Rana Plaza factory incident in Bangladesh. Over a thousand factory workers were killed when their building collapsed. It was reported that the workers were forced to come in for work to produce the garments for clients despite their misgivings. There were huge cracks seen all around the building structure prior to the collapse, but owners opted to ignore the warnings.

After this incident, there was a wave of anger felt by consumers. They felt they were betrayed into thinking that what they bought came from places where workers were at least happy to be employed in.

What they do now
To manage the backlash, most of the companies have vowed to produce their products in an ethical manner. They have signed accords with labor organisations that made public the full list of their contractors all throughout their supply chain. This made sure that it was easier to make full audits and assessments of their partner companies be made by external inspectors.

Many companies have also vowed to source their raw materials only from producers who engage in sustainable behaviours. They also now partner with companies that provide employment to workers with just compensation. The sweatshop issues of the fashion industry are still far from being a thing of the past. There are still many brands that do not conform to sustainable standards. It is up to the consumer to call out these companies to show that such acts will not be tolerated even by those who have been most loyal to their brands.