By Noshua Watson
My IDS colleague, Naomi Hossain, has a recent blog about the apparel factory building collapse in Bangladesh and how it symbolises the utter failure of globalisation. Until now, proponents of globalisation have advocated establishing private systems of governance to oversee supply chain compliance in situations that are not easily monitored by national or local authorities. In the case of Rana Plaza, the complex’s owner has been arrested and will be tried for the collapse, which is alleged to be among other criminal activities. Companies like Walmart, Gap, Carrefour and Li & Fung recently met with governments and NGOs to negotiate a plan for future factory safety in Bangladesh. The question for them is what to do going forward in unethical, but less than criminal, circumstances.
One activist approach is to boycott companies. Boycotts vary in their effectiveness due to the amount of media attention they can attract, the extent to which they passionately engage consumers over the long-term, whether they are easy for consumers to understand and whether it is easy for consumers to participate. In the Rana Plaza situation, the goal of a boycott would actually be indirect, to put pressure on garment factory owners by attacking the reputations of the global brands that they supply.
One problem with attacking a brand’s reputation is that reputations are merit-based, on the quality of the product and its past performance. Disparaging a product’s reputation increases a brand’s compliance measures only to the extent that it changes consumer perceptions of product quality or lowers the price premium that a brand can earn for its product. That is fairly difficult in the case of mass-market apparel, where consumers are already distinctly aware of the quality-price trade-off they are making.
Another way to address the situation would be to attack a brand’s status, the non-merit-based, social perceptions that it is better than other brands. The way to damage a brand’s status is to break its relationships with high-status people, drive the brand down in important rankings or challenge brand associations that the brand has cultivated like being ‘cool’ or ‘family friendly’. Given the more intangible and unearned nature of status, this might be an easier route for boycotters to take.
Prior to the Rana Plaza collapse, many major global brands were already minimising their presence in Bangladesh, due to their inability to achieve the levels of supplier safety compliance they wanted. Unfortunately, their departure may have left behind brands with lower standards. For the sake of their industry, the brands that care may want to make it clear who belongs to their club and who doesn’t.