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Something rotten at Joe Fresh

In wake of Bangladesh tragedy, the heat is on all organizations to pay more than lip service to corporate social responsibility

By Todd Humber

I drive by a Joe Fresh outlet on my way to work every morning.

The Canadian clothing chain, part of Loblaw and featured in many of its grocery stores, is known for its catchy advertising campaigns and low-priced fashion.

But now, when the bright orange logo comes into view during my commute, I can’t help but think of the workers killed in the factory collapse in Bangladesh. At the time of writing, the death toll stood at 390, according to Reuters, and more were still missing. There is almost no hope of finding any more survivors.

Loblaw isn’t the only company these workers sewed for — Britain’s Primark has also been identified as a customer — but photographs of clothing with Joe Fresh labels among the rubble are jarring.

It’s hard to reconcile the bright, clean stores across Canada and the United States with the carnage in Bangladesh.

And it’s impossible not to see the serious implications for organizations in our ever-shrinking world.

Primark and Loblaw have both pledged compensation to families members of the garment workers killed.

On April 29, Loblaw released this statement:

“We are working to ensure that we will deliver support in the best and most meaningful way possible, and with the goal of ensuring that victims and their families receive benefits now and in the future… our priorities are helping the victims and their families, and driving change to help prevent similar incidents in the future.”

Representatives of major international garment buyers — facing sharp criticism in their home markets for not doing enough to safeguard workers — have agreed to form a joint panel to put together a new safety plan, according to Reuters. That’s another good step.

But the days of companies relying on cheap overseas labour, with the expectations that consumers won’t question where the goods came from or how the workers who made them were treated, may just be coming to an end.

Public tuned in to treatment of workers

Sure, there have been campaigns in the past against titans like Nike, Gap and Apple to stop what some considered the exploitation of foreign workers. Those movements didn’t gain much traction outside of hard-core activists and they generated little more than lip service. (Though Apple did announce last year it was moving production of some computers to the United States.)

But, whether it’s because of the rough economy in North America or for other factors, there seems to be less public appetite for tolerating poor treatment of workers, either at home or abroad.

RBC was caught completely off guard by the public outrage over the outsourcing of about 45 jobs in Toronto to a firm using temporary foreign workers. I’ll be honest — I was too. So many firms outsource jobs all the time that it was surprising to see the traction it got.

The furor led to Zabeen Hirji, the bank’s CHRO, being put on the hot seat on national television and a very public apology from RBC’s CEO in full-page ads in newspapers across the country.

In Bangladesh, the population isn’t taking this massive tragedy in stride. Mohammed Sohel Rana, the owner of the building, was brought before a court where lawyers and protesters chanted “hang him, hang him.”

The scene was so volatile that Rana was led into court wearing a helmet and a protective police jacket.

In an era where corporate social responsibility (CSR) is taking centre stage, it’s becoming more difficult for employers to wash their hands of problems with suppliers. RBC tried to argue it wasn’t directly employing temporary foreign workers and that it was following the rules. That was true, but for many Canadians it didn’t pass the smell test. It wasn’t about just following the letter of the law, it was about doing the right thing.

Loblaw didn’t own the illegal building that collapsed, nor were the workers its employees. But it hired the company to supply Joe Fresh with clothing, and many people would probably say that means it had an obligation to ensure its supplier was treating workers properly and providing a safe working environment.

Loblaw has a slick CSR website that appears to focus almost exclusively on the grocery side of the business. There wasn’t any mention of Joe Fresh I could find, but it does have this statement under the heading “Source with Integrity” in its 2012 CSR Report:

“We know that our customers expect us to buy and sell our products responsibly. They also expect that we will take the necessary actions to promote the health and vitality of our food sources, ensure product safety, support the Canadian economy, and require our vendors to uphold the right values in areas ranging from labour conditions to animal welfare. We expect the same of ourselves and are doing our utmost to live up to the highest standards of responsible sourcing.”

HR’s role in all this

What does the collapse of a factory a world away have to do with HR in Canada? Plenty.

In many organizations, responsibility for CSR lies within the HR department — and for good reason.

Many workers — especially younger workers — have said that CSR initiatives play a huge role in determining where they want to work.

We all know Canada has a demographic time bomb that is going to go off in the coming decades. A poor economy may have lengthened the fuse, but there’s no doubt there is a huge talent mismatch looming — if not a downright shortage of all workers as our population ages.

Companies can ill afford to turn off workers, and idealistic young talent will not want to work for a damaged brand.

In an age of social media, where messages spread in a heartbeat and people are more likely to make friends with people in faraway lands, corporate social responsibility has to be more than just a well-worded slogan on the wall.

Todd Humber is the managing editor of Canadian HR Reporter, the national journal of human resource management. He can be reached at todd.humber@thomsonreuters.com or visit www.hrreporter.com for more information.

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Todd Humber

Todd Humber is the publisher and editor-in-chief of Canadian HR Reporter, the national journal of human resource management. Follow him on Twitter @ToddHumber
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