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Wal-Mart audit finds progress at factories

Star Business Report
Calls for more transparency in safety at apparel factories in Bangladesh are paying off, as audit results released by Wal-Mart show.
The US retail giant became the first major retailer to release a large-scale audit of Bangladeshi factories it sources garments from, outlining the failure and improvement rates in fire and building safety at 75 facilities.
Ten of the 75 factories had failed initial assessments and improved their scores in follow-up inspections, Wal-Mart spokesman Kevin Gardner told Bloomberg. Only two plants did not meet standards during the follow-up assessment and Wal-Mart will no longer use those locations, he said.
The retailer hired Bureau Veritas to check some 200 factories it uses in the country, with plans to publicly release the results from the audits.
In an interview, Wal-Mart executives said the company stopped doing business with two factories that were unable to meet fire and building safety standards during remediation, although one factory owner plans to open a new facility.
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"This is the first time any retailer has published this breadth of information about their factory' base," said Jan Saumweber, vice president of ethical sourcing at Wal-Mart.
"We were so encouraged to see the rate of improvement in such a short window of time. On average, they had 60 days from the initial assessment to follow through."
She said the next phase of the process — a follow-up assessment of all of the factories — will begin in January.
The new inspection regime was prompted by the death of over 1,130 garment workers in the Rana Plaza buildingcollapse in April.
The disaster, one of the worst industrial disasters on record, put pressure on all multinationals to act because they had made Bangladesh Asia's biggest clothes exporter after China and Hong Kong by taking advantage of its low costs.
"It's always good to have companies like Wal-Mart conduct and release the results of the factory audits," said Richard Locke, a political science professor at Brown University, told the Women's Wear Daily.
"I think it is good that Wal-Mart stopped doing business with factories that failed both audits."
The International Labour Organisation welcomed the development. In Geneva, Gilbert Houngbo, a deputy director-general of the UN agency, said, "You can feel there is a momentum, quite frankly [in Bangladesh] that is quite different to what I saw six months ago."
But the audit also sparked calls for more reform.
Scott Nova, executive director of the Worker Rights Consortium, a monitoring group in Washington, said Wal-Mart's disclosures were disappointingly opaque given the expectations it had created by vowing to be transparent.
"They offer no specifics whatsoever as to the dangers workers face in these factories, just a very general assessment of risk, conveyed through a 'scoring system' that is largely opaque," he said.
Jyrki Raina, general secretary of IndustriALL Global Union, said, "There is very little information in the Wal-Mart reports; no specifics on what kind of dangers workers faced. It is just a very general assessment through this scoring system."
Locke said that audits alone are not enough to exact true reform in Bangladesh. Companies like Wal-Mart must invest to help owners develop more sophisticated management and health and safety systems to sustain a level of compliance. He also noted that retailers and brands should change the purchasing practices that may have contributed to the poor working conditions the companies are now trying to alleviate.
Jay Jorgensen, senior vice president and global chief compliance officer at Wal-Mart, said, "We are doing this because we believe transparency is a key driver of safety. Being transparent in our supply chain will help us all make safer working conditions for the workers."
With details from Women's Wear Daily