At a meeting convened in 2011 to boost safety at Bangladesh garment factories, Wal-Mart Stores Inc. (WMT) made a call: paying suppliers more to help them upgrade their manufacturing facilities was too costly.
At the April 2011 meeting in Dhaka, the Bangladesh capital, retailers discussed a contractually enforceable memorandum that would require them to pay Bangladesh factories prices high enough to cover costs of safety improvements. Sridevi Kalavakolanu, a Wal-Mart director of ethical sourcing, told attendees the company wouldn’t share the cost, according to Ineke Zeldenrust, international coordinator for the Clean Clothes Campaign, who attended the gathering. Kalavakolanu and her counterpart at Gap reiterated their position in a report folded into the meeting minutes, obtained by Bloomberg News.
“Specifically to the issue of any corrections on electrical and fire safety, we are talking about 4,500 factories, and in most cases very extensive and costly modifications would need to be undertaken to some factories,” they said in the document. “It is not financially feasible for the brands to make such investments.”