The EU should scrutinize European companies operating in Bangladesh

Last Update 2 July 2013

In response to recent accidents resulting in the death of thousands of workers in garment factories in Bangladesh, the EU (including the Council of the European Union, the European Parliament, High Representative Catherine Ashton, and EU Trade Commissioner Karel De Gucht) have made multiple statements. However, such rhetoric is not working to secure real progress in respect to Bangladeshi worker's rights.

The possibility of reassessing the EU's current trade preferences for Bangladesh (duty-free and quota-free access to the EU market under the 'Everything But Arms' scheme),[1] which had first been proposed by Commissioner De Gucht, was dropped after a meeting with Bangladesh's Foreign Minister.[2]

FIDH and ECCJ support the view by Commissioner De Gucht "that the Joint Statement by Tripartite Partners (government of Bangladesh, employers, workers) with the ILO on 4 May 2013 provides a valuable starting point for intensifying efforts to improve health and occupational safety in the Ready-Made Garment sector".[3] This agreement includes the revision of the country's labour laws, a safety assessment of all active export-oriented ready-made garment factories in Bangladesh and the recruitment of inspectors. It includes a follow-up mechanism to measure the progress made in six-month's time.

To bolster human rights improvements in garment sector supply chains in Bangladesh, the EU is committed to using its traditional instruments, such as financial and technical support and diplomacy. However, the events that occurred in Bangladesh also highlight the responsibilities of European businesses, the insufficiency of their internal audits,[4]. as well as that of the European legal and policy framework, to guarantee respect for human rights in the global supply chains of EU-based businesses.

The European Parliament suggested concrete measures to address those shortcomings, including the promotion of "mandatory responsible business conduct among EU companies operating abroad, with a special focus on ensuring strict compliance with all their legal obligations, in particular international standards and rules in the areas of human rights, labour and the environment".[5] To date, the European institutions have not adopted any of the proposed measures.[6]

"FIDH and ECCJ regret that the EU, the largest export destination for Bangladeshi textile products, has limited its response to calling for 'voluntary agreements'. Non-binding 'corporate responsibility programmes' have proved insufficient on their own to discharge businesses' responsibility to respect human rights", said Karim Lahidji, president of FIDH.

"Large companies should be required to report on human rights risks and impacts throughout their supply chains; the EU should seize the opportunity to include this in the proposed directive on non-financial reporting. If the EU is genuinely serious about preventing a repeat of the Bangladesh tragedy in future, it should also take steps to require companies to undertake mandatory human rights due diligence", he concluded.

In 2011, in its Corporate Social Responsibility Communication, the EU recognised the need for "a smart mix of voluntary policy measures and, where necessary, complementary regulation to promote corporate responsibility". The EU should reinforce its legal framework and require Member States to enact relevant legislation in order to:

• render human rights due diligence mandatory for EU-based companies, which shall require them to identify, prevent, mitigate, and account for human rights impacts and risks linked to their operations, products or services, including throughout their entire supply chains, and operations abroad; and

• adopt clear and mandatory requirements for the disclosure of EU-based companies' policies and impacts on human rights and the environment, including throughout their supply chain, as well as effective enforcement of such reporting requirements.

Footnotes

[1] Joint Statement by EU High Representative Catherine Ashton and EU Trade Commissioner Karel De Gucht following the recent building collapse in Bangladesh, Brussels, 30 April 2013

[2] Joint Statement issued by EU Trade Commissioner Karel De Gucht and Bangladesh Foreign Minister Dr. Dipu Moni on 28 May 2013.

[3] Joint Statement issued by EU Trade Commissioner Karel De Gucht and Bangladesh Foreign Minister Dr. Dipu Moni on 28 May 2013. For the content of the agreement, see: Conclusions of the ILO's high level mission to Bangladesh. Joint statement issued by the tripartite partners at the conclusion of the ILO's high-level mission sent to Dhaka, Bangladesh, following the Rana Plaza Building collapse, 4 May 2013, http://www.ilo.org/global/about-the-ilo/activities/statements-speeches/WCMS_212463/lang – en/index.htm

[4] Parliamentary question, Francisco Sosa Wagner, Solutions for the textile sector in Bangladesh, 22 may 2013

[5] European Parliament resolution of 23 May 2013 on labour conditions and health and safety standards following the recent factory fires and building collapse in Bangladesh. See also the measures proposed in parliamentary questions Frédéric Daerden, Importance of carrying out social and environmental audits of suppliers, 4 June 2013; João Ferreira The tragedy in Bangladesh and working conditions in companies supplying the EU market, 14 may 2013; Nuno Melo, Collapsed building in Bangladesh, 21 May 2013; Takis Hadjigeorgiou, Safety at work in European companies, 16 May 2013; João Ferreira The tragedy in Bangladesh and working conditions in companies supplying the EU market, 14 may 2013; Marc Tarabella Working conditions in Bangladesh, 7 May 2013; Claude Moraes CSR/Rana Plaza factory collapse in Bangladesh, 3 May 2013; Willy Meyer, Social responsibility of European companies in Bangladesh, 29 April 2013; Harlem Désir Corporate social responsibility (CSR): clear interpretation of the concept of 'reasonable care',17 December 2012; 29 November 2012, Jutta Steinruck, Minimum standards in the textile industry; 29 November 2012 Raül Romeva i Rueda, Fire in Bangladesh and corporate social responsibility.

[6] See, for example, response given by Mr. Tajani on behalf of the Commission, 1 March 2013, to Marc Tarabella's parliamentary question on victims of textile factory fires in Bangladesh, 17 January 2013; Response given by Mr. Tajani on behalf of the Commission, 6 February 2013, to Harlem Désir's parliamentary question on corporate social responsibility (CSR) and the clear interpretation of the concept of 'reasonable care', 17 December 2012.