Loblaw Companies Limited updated statement on Bangladesh

04/23/2014

At the one-year anniversary of the collapse of Rana Plaza in Savar, Bangladesh, Loblaw continues to express condolences to the victims and families affected by the tragedy.

While we do not forget its tragic beginnings, we are proud to have made Loblaw a contributing voice in the Rana Plaza response and its unfolding legacy related to factory safety. Similarly, we have become a lead contributor in the financial response to this tragedy, having committed $5 million for local relief and compensation.

We continue to believe that the economy and manufacturing communities of Bangladesh benefit from our presence, attention and long-term commitment. Over the past twelve months, Loblaw has worked with individuals, industry, government, NGOs and the International Labour Organization (ILO) to respond to the human tragedy of Rana Plaza and to improve the standards that will define and protect the safety of workers here forward.

In April 2013, Loblaw committed to relief, compensation and improved standards in Bangladesh. In the past year, the company has undertaken the following actions:

  • Provided total relief and compensation commitments of $5,000,000, as follows:
    • $3,715,000 in compensation to the ILO-led trust fund for long-term compensation to injured workers and the families of deceased workers
    • $1,000,000 in relief committed to Save the Children Bangladesh and the Centre for Rehabilitation of the Paralyzed for textile workers in Savar ($500,000 funded in 2013; $500,000 scheduled for 2014).
    • $285,000 in short-term compensation to provide approximately three months’ salary for Rana Plaza workers (paid in 2013).
  • Publicly committed to maintaining production in Bangladesh, while also contributing to improving workplace conditions in the country. The company has made every effort to be a leading voice on this topic, making public commitments and public statements on an issue many other brands have chosen to avoid.
  • Became an early signatory – and the only Canadian company – committing to membership in The Accord for Fire and Building Safety in Bangladesh, which introduces standards and audits related to the structural integrity of factories.
  • Increased the level of standards and inspections of all factories where its products are sourced. In the summer of 2013, the company audited each of the dozens of factories in Bangladesh producing its goods. These audits were shared with The Accord.
  • Created and stationed a team of employees in the region to ensure the rigour of factory audits and to monitor workplace conditions and local relationships. This team is led by a long-time Loblaw supply chain expert from Canada who has relocated to the region.

In our view, the collective industry response to the Rana Plaza collapse has taken too long and various necessary steps have yet to be taken. Further, based on the initial compensation model – calculated on a shared basis between government, industry and brands – Loblaw, as one of the top contributing organizations, is contributing more than its share.

However, we believe that progress is occurring, most notably in the improvement of factory audits and related information sharing within the industry. And, we are pleased with unprecedented coordination – between our company and a small number of other retailers – to account for the very real human and financial costs of the Rana Plaza collapse.