The banks fail H&M's underpaid textile workers

Thursday, January 31, 2019

Sweden - Swedish banks are part owners of fashion chains whose clothes are made by workers who cannot live on their full-time salaries. The banks do not use their influence to put pressure on the clothing companies to take greater responsibility for the workers' wages. This shows our new study, which was conducted together with Fair Action and Fair Finance Guide in Norway.

H&M is the world's second largest fashion company and the largest purchaser of clothing in Bangladesh, where 80 percent of the employees in the textile sector are women. H&M would like to emphasize that they contribute to women's economic emancipation, but the textile workers who are interviewed in our latest report paint another picture. They often have to borrow money to get the economy together, crowded into inadequate housing and have difficulty affording health care and food to themselves and their children.

- H&M says that they want to give the textile factories the opportunity to raise wages. But at the same time, suppliers in Bangladesh state that H&M's purchasers are pushing prices hard so that it becomes difficult to meet, says Maria Sjödin, author of the report at Fair Action.

The banks are passive
Among the major Swedish banks, not one single clear requirement for H&M has to contribute to the cost of higher wages. SEB, Skandia and Swedbank report, however, that they have had a dialogue with H&M about the issue in recent years. Handelsbanken and Länsförsäkringar, on the other hand, have not had any dialogue at all, while Nordea and Danske Bank have announced that they do not want to answer our questions.

No guidelines
The report also shows that the major Swedish banks do not have any guidelines that say that companies should ensure that the employees of the suppliers are guaranteed wages they can live on.

- Many bank customers will be disappointed when they find out that their banks are not using their influence to improve the situation of the seamstresses. Today it is only the Ekobanken and JAK Member Bank that impose demands on fair wages according to their guidelines, says Jakob König, project manager for the Fair Finance Guide.

Problems also with other Swedish textile brands
KappAhl, Lindex and MQ also buy clothes from Bangladesh and are reviewed in the report. Unlike H&M, they lack goals for raising the wages of the seamstresses,
and none of the Swedish banks can show that they put enough pressure on the companies to raise their ambitions.

- Swedish clothing companies create important jobs in one of Asia's poorest countries, but they must not exploit the vulnerable situation of the workers. If the banks demand measurable wage increases, the fashion chains can become a positive force that lifts the women and their children out of poverty, says Jakob König.

 

You can read the
full report here:
Broke in Bangladesh

 

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