No positive impact of compliance on RMG sector: BIDS

The country's apparel sector has not yet witnessed any positive outcome from the improvement of compliance – as recommended by Accord, Alliance and the National Initiative – despite spending big for the purpose.

The observation came from a research paper titled "Impact of Compliance on RMG Industry of Bangladesh" which was presented at the Research Almanac 2019 of the Bangladesh Institute of Development (BIDS) at a city hotel on Sunday.

"We did not find any significant impact of compliance on labour productivity, total output, market access of firms and on crisis [labour unrest, accidents and injuries] faced by firms after remediation during 2013-2018," said Monzur Hossain, senior research fellow of BIDS.

Investing more on fire safety cost – proportion of expenses used in ensuring fire safety to total cost of firm – has a negative impact on labour productivity and total output, he also said.

The growth output during the 2013-2018 period was significantly higher for compliant firms compared to that of their non-compliant counterparts, the senior research fellow added.

However, compliance or remediation measures have a positive effect on workers' perception on workplace safety, said Monzur.

The intensity of risk against building safety, fire safety and electrical safety, perceived by the workers of compliant firms, is lower than the intensity of risk perceived by workers of non-compliant firms after remediation, he added.

Tahreen Tahrima Chowdhury said as part of the research they have conducted a survey on 1500 workers through interviewing three workers from each of the selected 500 firms.

RMG workers were asked about their perception on compliance measures, undertaken by the respective firms, she added.

SANEM Executive Director Selim Raihan said the compliance issue in many factories is only in name, but not in practice yet.

Centre for Policy Dialogue's Research Director Khondaker Golam Moazzem said the demand for apparel products in the global market has decreased in the last few years. As a result, the prices of garment products also declined. On the other hand, the apparel entrepreneurs have to pay high to their workers after their wage structure was revised in 2018, said Moazzem.

Unless the technological upgrade takes place in the improvement of workers' safety, it will not be sustainable for the sector, he added.