Global buyers can join to drive change at industry and community level
Too many people still live in poverty in today’s world. Meanwhile, we can also see that the environment that we live in is facing various scarcity issues. Some of the key challenges for my industry are clean water and textile waste, and when it comes to human development, we are focused on issues such as wages and overtime.
My job includes securing H&M’s global sourcing strategy by ensuring sustainability in production countries. This includes promoting our Fair Living Wage Roadmap in countries that supply our products.
H&M is a global fashion retailer and does not own any factories. The supply chain to our operation is very large and we work actively with our suppliers. We see this as a great opportunity to support and influence local businesses and to contribute to positive change for the whole industry.
At H&M, we work for sustainability by considering both present and future generations’ needs in the decisions we make today. People, planet and profitability are equally important in our business decisions. We are part of the community in which our suppliers operate, and we affect people and the planet in various ways. It is in our interest to strive for the well-being of workers, and the world.
When we started working on sustainability in the 1990s, it was very much issue-based with focus on basic safety such as ensuring that factories had fire exits, alarms, evacuation plans and fire fighting equipment. Over the years, the field has expanded to stretch over many different areas and today we are working in a more strategic way. In order to reach more sustainable business practices, we are addressing issues relating to wages, industrial relations and workers’ skills as well as water, chemicals and energy. We have had to learn how to prioritise and focus. This is about identifying and seeing where we have the best possibility of influencing and driving change.
It has always been our vision that all textile workers should be able to live on their wage. This is stated in our Code of Conduct. We do a lot of audits to make sure that the factories we use comply with this. Last year we did more than 2,800 audits and interviewed over 11,000 workers. The results from these audits and interviews serve as a base for us to develop our capacity building programs to drive change at supplier level.
If workers lack the opportunity to unionise and negotiate for their fundamental labor rights it creates an unpredictable and unstable market. This can, in turn, be a challenge for our business growth.
However, there is a limit to what you can achieve alone, even if you are one of the largest buyers in a country like Cambodia or Bangladesh. That’s why a collaborative approach is crucial.
We believe that developing a national minimum wage is taking too long in some countries. We are taking action for improvements and encouraging the whole industry to follow. With H&M’s size comes responsibility, and we have the ability to contribute to change. The key point of our current strategy is to use our size as leverage to create coalitions with like-minded companies and organisations.
Our new Roadmap to a Fair Living Wage is based on the vision that a fair living wage covering a workers’ basic needs should be paid by all our commercial goods suppliers. This should be enabled through H&M’s purchasing practices and based on the expectation that workers will have their wages negotiated and annually reviewed. It is also necessary to have democratically elected trade unions and/or worker representatives involved in the process.
To fulfill our Fair Living Wage commitment, we are dependent on others. An initiative such as the Global Partnership for Effective Development Co-operation is a good example of how many sectors can be brought together. Different actors have different roles to play: buyers, suppliers, workers, their unions and governments. For example, we as a buyer have to improve our purchasing and negotiation practices to ensure they enable our suppliers to pay their textile workers correctly. We also have to work actively to build the capacity of both workers and factory management.
If workers lack the opportunity to unionise and negotiate for their fundamental labour rights it creates an unpredictable and unstable market. This can, in turn, be a challenge for our business growth. We are working to strengthen the voice of the workers. In Bangladesh we are training suppliers and their employees in social dialogue, and encouraging freely elected Worker Participation Committees. The intention is to reach 100% of our suppliers by 2018.
To contribute to this objective, this year we have entered into the first collaboration of its kind between a multinational brand, Swedish trade union IF Metall, the International Labour Organisation (ILO) and the Swedish International Development Cooperation Agency (SIDA). Through this collaboration, we are supporting the development of functioning industrial relations, peaceful conflict resolution and collective bargaining in Cambodia. We are also planning a similar initiative in Ethiopia.
We are also working with like-minded brands and with governments to advocate for regular wage revisions and enforced labour legislation, including protecting workers’ freedom of association.
Going forward, H&M will be working on all levels towards fair living wages and functioning industrial relations. This will empower workers in the whole industry.
Anna Palmqvist is H&M’s Head of Sustainability Production, heading the sustainability programme in production countries including promotion of the Fair Living Wage Roadmap and Water Stewardship. She has been with H&M for 20 years, where she previously held the position of H&M Regional Manager for China, Cambodia and Vietnam.