About a year and a half before a fire at a clothing factory in Bangladesh killed 112 people in November, executives from Wal-Mart, Gap and other big retailers met nearby to discuss ways to prevent the unsafe working conditions that have made such tragedies common.
Representatives from a dozen of the world's largest retailers and fashion labels gathered with labor groups and local officials in April 2011 at the three-day meeting held in the 15-story, glass-walled headquarters of the Bangladesh Garment Manufacturers and Exporters Association in Dhaka, the capital. They were considering a first-of-its-kind contract that would govern fire safety inspections at thousands of Bangladeshi factories making T-shirts, blazers, and other clothes Americans covet.
Under the terms of the agreement, each company would be required to publicly report fire hazards at factories, pay factory owners more to make repairs and provide at least $500,000 over two years for the effort. They would also sign a legally binding agreement that would make them liable when there's a factory fire.
Discussions seemed promising. Then, on the second day, Sridevi Kalavakolanu, director of ethical sourcing for Wal-Mart Stores Inc., spoke up. "In most cases very extensive and costly modifications would need to be undertaken to some factories," Kalavakolanu was quoted as saying in the minutes of the meeting obtained by the Associated Press. "It is not financially feasible . . . to make such investments."
The statement from the world's largest retailer, with $447 billion in annual revenue, essentially sucked the air out of the room, witnesses said. It also set the tone for the rest of the meeting, which ended the next day without a single company agreeing to the plan.
"I think that really had quite an impact on . . . everybody who was in the room," said Ineke Zeldenrust, who was at the meeting representing the workers' rights group Clean Clothes Campaign. "It was quite clear that we were very far from a solution."
As if to underline how much still needs to be done, even as executives turned down the proposal over tea in an air-conditioned room, scores of scarred survivors and their relatives gathered outside the same building to await compensation checks from another fatal factory collapse more than six years earlier.
Retailers often claim they know little or nothing about conditions at factories, because the long and intricate manufacturing chain runs through several contractors and subcontractors. Wal-Mart and others whose garments were found in the ruins of Tazreen Fashions Ltd. on Nov. 24 say they had severed ties with the factory or were unaware their clothes were being produced there.
Yet some industry experts and labor activists say it is those major retailers, and the customers who buy their clothes, who ultimately set the price for how much factories get paid, and how much they in turn pay their workers.