A forty-six page report is supposed to be impressive. An educated guess would indicate that there are at least twenty thousand words in there, which is supposed to reflect erudition. I look at it and assume that the detailed report must be a true reflection of an in-depth analysis done by a highly esteemed organisation that takes pride in being objective. I thought that the report would take me at least three hours to go through. I surprised myself by finishing in about one-sixth of the estimated time.
The report in discussion was one from Transparency International Bangladesh covering the readymade garments industry. I thank TIB for having saved five and a half hours of my time, and in contrast, for the thirty minutes that I spent, I demand a full compensation in either cash or kind. When I started glancing over the first seventeen pages, I stopped for a bit and asked myself: Who could have initiated the "research"?
The very mention of "scenarios" itself indicates that the report assumes incidents that generally happen in the sector. A research, which draws broad conclusions based on ambiguous data, can only earn a label of being incomplete and inconclusive. Most of the "scenarios" were covered in only seven to ten lines under the heading of "description" where no details are offered except for making random observations.
I experienced 16 shocks, while going through the 16 scenarios of the report. The shocks are all humbly listed below:
Shock 1: The first accusation, "Bribing the compliance auditor to pretend compliance thus satisfying the requirement of the buyer", almost attempts to indicate that the sector goes by absolutely loose standards, where the agents of the buyers and the buying houses are absolutely corrupt and that no progress is being made in remediation which ultimately prompts manufacturers to "bribe" auditors. How pathetic! With Accord and Alliance stationed in Dhaka, there is no way we will be allowed to just get away with "bribes".
Shock 2: The second scenario refers to smaller production units offering bribes for securing work order. Post-Rana Plaza, no one has the capacity to allow smaller production units to offer "bribes" and just get the order. There are many steps to list for even a tier-2 sub-contractor. Therefore sub-contracting does not happen…just like that.
Shock 3: The third "scenario" talks about "fake" or "duplicate" documents "tampered" by the factory. Along with this accusation, TIB has once again referred to the auditors taking "bribe" when a factory has "shortfalls". Perhaps TIB has spoken to factories which are either non-exporters or so small in size that these conversations have helped them generalise the sector in the most negative manner possible.
Shock 4: Scenario four refers to suppliers "influencing" the purchase decision of the buyer. This too is actually a repetition of scenario 2 where they have accused smaller units of influencing the buyer's merchandiser to place business to smaller factories.
Shock 5: Scenario five accuses buying house merchandisers to "bound" factories of buying nominated accessories. This is not new. Very often the buyers find it convenient to remain with the nominated suppliers, especially when it comes to labels, hang tags, etc, as there is a requirement from the buyers for all their labels, hangtags to look the same, having the same background colour, the same fonts, and basically the same appearance. Therefore, nomination is not necessarily a crime.
Shock 6: The sixth scenario implies that fabric is randomly sold in the open market and that the profit from this is shared with the "collaborator", the local agent of the buyer. This is a serious allegation that demands serious proof from TIB as this would mean that the Utilisation Department of BGMEA is seriously overlooking consumptions and that we are all large scale thieves.
Shock 7: Apparently, the exporters obtain cash against LC. No exporter with a steady business will attempt this fraudulent practice, especially because the false import will be counted as "stock", ultimately putting the exporter out of business.
Shock 8: Minimum wage, work-hour labour rights violation is an issue that is far easily spoken about than checked or remedied. The eighth scenario talks about violation of all of these in "one" factory. Such an isolated and limited reference cannot be the face of the entire sector. And if stray incidents lead to randomly labelling the sector negatively, then one would have to think about the ulterior motive of the report.
Shock 9: The ninth scenario talks more about how buyers change their minds about designs, colours and how they cancel goods at the last minute. This too is a serious issue, which does not apply to all the buyers and even if this happens, it is a business relationship through which the issue is addressed. This cannot be taken as a general practice of the buyer. The relationship between the buyer and the supplier is one of trust and this cannot be undermined.
Shock 10: The topic on illegal subcontracting has been mentioned by TIB a number of times, and scenario 2,4 and 10 speak of the same thing. Repetition demeans the quality of research and TIB's repetition is no exception.
Shock 11: Auditors accepting bribe to conceal negative findings is once again listed in the report. This too, is an encore, as the same point has been mentioned in scenario 1, 3, and 8. How many times can a report be allowed the right to refer to the same finding over and over again?
Shock 12: According to TIB's twelfth scenario, buyers cancel work-orders arbitrarily. TIB, in this case, could have spoken to an aggrieved factory and heard only their side of the story. No buyer would cancel any product unless there are some deviations. Had this been the practice in Bangladesh, brands and retailers would have been banned from doing business a long time ago.
Shock 13: The thirteenth scenario accuses Inspection/Compliance reports of being manipulated by buyers. One must understand that buyers have no ultimate interest in cancelling a production unit or produce orders unless their reputational risk is in question.
Shock 14: PU bribing inspectors to accept defective garment is another thing of the past, as with quality monitoring systems set in almost all the factories, the in-line inspection reports caution producers so that the defects are rectified in the final inspection.
Shock 15: The fifteenth scenario is also something that could have happened long, long ago. No single individual is responsible for approving shipments. Teams come into the factory floors to check and pass/fail inspections. Third party inspectors often get involved. So bribing just one person cannot guarantee a safe export.
Shock 16: Accusing the buyers of conducting fake inspections must be backed by substantial proof. The buyers just don't "fake" inspections at port to secure discount. This is not a regular practice.
In all honesty, TIB had likely spoken to a few factories which probably described their plight with an extra dose of prejudice. A report cannot be termed a report unless it has clear and "substantial" data. Otherwise the report would only look like a compilation of hypotheses, being threaded with a few isolated irregular incidents. Nothing justifies such an aggressive publication, putting the whole sector at risk at a time when brands and suppliers are trying to bridge all the differences and are trying to work together for the ultimate good of the sector.
Calling exporters thieves, naming inspectors corrupt and accusing buyers of rogue practices does not help the industry.
The writer is Managing Director, Mohammadi Group.