“Walmart rolls out big expansion plan.” This headline leaps from the front page of the business section of the Toronto Star this morning. These words are more than a little surprising to me. Walmart’s reputation is still shaky after the Bangladesh fire, November 24, at the Tazreen Fashion Factory that made clothes for Walmart and Sears. Or is it? Did people simply read about this tragic event that killed 112 workers who made cheap clothes in well-documented hazardous conditions?
Here’s what I know to be true. The Tazreen Fashion Factory was operating without a safety licence and had been warned twice to improve its conditions. In a Dec. 13, 2012 Toronto Sun article, I read that the factory’s fire certification expired June 30. Wal-Mart claims is didn’t authorize Tazreen to manufacture garments but at the same time, did not take the necessary steps to ensure this was the case. In my book, I find Walmart ultimately negligent. And I can’t help but wonder why the factory itself wasn’t shut down when its fire safety certification expired.
I know also that Walmart won’t help make factories safer because of the high costs. “At a meeting convened in 2011 to boost safety at Bangladesh garment factories, Walmart Stores Inc. made a call: paying suppliers more to help them upgrade their manufacturing facilities was too costly.” (Dec. 5, 2012 Bloomberg article)
Srideu Kalavakolanu, a Walmart director of ethical sourcing, and the Gap counterpart issued this statement: “Specifically to the issue of any corrections on electrical and fire safety, we are talking about 4,500 factories, and in most cases very extensive and costly modifications would need to be undertaken in some factories. It is not financially feasible for the brands to make such investments.”
Third, Walmart needs to walk the walk. Just yesterday, Jan. 22, in a Huff Post’s Business Canada article, Walmart said it has notified its global suppliers it will drop them if they subcontract work at unauthorized factories. In addition, starting June 1, suppliers must have an employee stationed in countries where Walmart subcontracts to ensure safety compliances are met.
But Walmart is refusing to pay the costs that will arise from this increased demand for accountability. Scott Nova, executive director at Workers’ Rights Consortium is quoted as saying that this move is not enough unless Walmart and other retailers pay suppliers more to cover the costs of factory repairs.
Walmart could put some muscle behind its words by signing a document issued by the Workers’ Rights Consortium last March. This calls for companies to publicly report fire hazards, pay factory owners more to make repairs and provide at least $500,000 over two years for the effort. They would also sign a legally-binding document that would make them liable when there’s a fine.
PVH Corp., which sells Calvin Klein and Tommy Hilfigger brands, signed this agreement 10 months ago, but there’s a catch…PVH will only start the program if at least three other major retailers sign on. Only one has done so, a German company called Tchibo.
If Walmart truly wanted the situation to change, they’d sign this document, potentially opening the door for further signatures. In fact, Walmart could be a leader not just in size but in ethic responsibility by signing. But they’re not, which negates their declared improvements.
The fourth thing I know is that consumer’s demands for rock-bottom prices are driving discount retailers like Walmart and Target to cut corners so that they pay as little as possible for garments. In an article in today’s Toronto Star, Walmart Canada’s CEO Shelley Broader explains what drives pricing within the company: “And our DNA is all about saving people money so that they can live better. And our research and our traffic continue to tell us that first and foremost in the minds of the consumer is getting quality merchandise at a tremendous value.”
I understand that affordability is key in being a successful retailer, but should low costs come at the expense of the people making the clothing? Is there no way that Walmart can cut its costs in North America while increasing spending in its factories to ensure worker safety?
Maybe Walmart should look at expenses closer to home—in the Jan. 15, 2013 Toronto Sun, I see that in the U.S. the highest earning Walmart store manager made more than $250,000 last year. The average store associate salary, stated in this article, runs from $50,000 to $170,000 a year. What do Walmart executives make? In 2012, Walmart U.S. sales were $264.19 billion.
It’s hard to believe there isn’t some wiggle room within this massive amount of money. And if Walmart can increase within Canada, by 37 stores, I can’t understand why they don’t have the money and wherewithal to sign the Workers’ Rights Consortium document.
Until Walmart actually puts money behind its pledges, I’m boycotting its stores. I’d rather own buy fewer, more expensive items of clothing that were manufactured under safe, fairly-paid conditions, than purchase a bunch of graphic t-shirts at four dollars a piece. I don’t want to even imagine what workers were paid to make these garments.