Retailers to ‘face scrutiny over workers’

The high street will become the new battleground in the fight for improved labour standards, one of the world’s leading auditors of working practices has warned.

While campaigners’ pressure on sporting goods companies had paid off, retailers had only recently come under scrutiny and many were a long way from closely monitoring the working conditions in their suppliers’ factories, Auret van Heerden, president of the Fair Labor Association (FLA), told the FT.

“There are very big high-street names that are doing nothing, no due diligence, nothing,” he said. “The food question is also coming – you look at the agricultural supply chain and there are big problems there.”

Mr van Heerden said the FLA’s audits still found an average of 18 violations per factory it visited. All visits are unannounced and last about 10 days, with companies having to deal with issues identified.

The main problems it encountered conducting audits in Asian countries such as China and Thailand were related to working hours and wages, with few factories willing to do something different from competitors, he said.

“Our biggest problem is that governments aren’t enforcing their own rules. So we are trying to force multinational companies to pick up the ball that the governments have dropped.”

Several retailers, such as Spain’s Inditex and Germany’s KarstadtQuelle, faced negative publicity last year when a factory building in Bangladesh owned by Spectrum, a supplier, collapsed. Both Inditex and Karstadt have said they would help with compensation for the dozens of dead.

Closer to home, Inditex was accused last month by a Portuguese newspaper of having used suppliers in Portugal which had, in turn, employed child labour. The company investigated the claims within a week and said it had not found signs of child labour.

The speed at which Inditex moved to investigate such allegations reflects the damage that a brand can suffer.

It has, along with retailers such as Levi Strauss, Marks and Spencer, J. Sainsbury and New Look, signed up to the Ethical Trading Initiative – comprising companies, non-governmental organisations and trade unions – whose code does not allow child labour.

Last year social audits themselves came under fire. The Clean Clothes Campaign, a coalition of trade unions and pressure groups that surveyed 670 workers in 40 clothing and sports shoe factories, found that audits were often superficial.

In a recent interview, Achim Steiner, the new executive director of the United Nations Environment Programme, called for higher standards in the food and fishery industries. But he praised companies that had agreed to certification – committing them to using or selling only products proven to be environment-friendly.

Reporting by Richard Milne in Kaiserslautern, Hugh Williamson in Berlin and Jenny Wiggins and Elizabeth Rigby in London

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