Heightened HRDD amid Crisis: ETI’s coordinated response in Bangladesh

Since early 2024, Bangladesh has experienced significant civil unrest, political upheaval, and devastating floods. These overlapping crises have disrupted the country at large, severely impacting garment supply chains and increasing human rights risks for workers making readymade garments. In a sector already struggling from the global economic slowdown triggered by COVID, and worsened by conflicts in Ukraine and attacks in the Red Sea, these new shocks have further strained suppliers ability to operate safely and reliably.

When crisis hits — whether due to conflict, political instability, or extreme weather — it can be hard to know how best to react.  Even knowing what Human Rights Due Diligence means in such contexts can be challenging. In this case study we unpack how ETI, its members and other partners responded to this upheaval and paved the way for better working conditions in the years to come. 

National Context: Unrest, blackouts, and a shifting political landscape

Although the premiership of Sheikh Hasina had seen widespread growth and general economic development across Bangladesh, critics pointed to increased authoritarianism and arbitrary rule. The early January 2024 elections were marred with allegations of foul play, with the main opposition party the Bangladesh Nationalist Party (BNP) boycotting them altogether, and the BBC reporting “mass arrests of BNP leaders and supporters”. This compounded allegations of widespread corruption and authoritarian rule by the Prime Minister, with Human Rights Watch estimating that over 600 people had been disappeared since the start of her rule, most since 2014. In July 2024, students took to the streets to protest a law reinstating a quota for government jobs giving 30% of them to descendants of freedom fighters from the 1971 war. 

 In a country where government jobs offer one of the few viable routes out of poverty, the reinstated quota sparked outrage among students who viewed it as jeopardising their prospects. The protests grew and with it the heavy-handed government reaction. In July and early August 2024, the government repeatedly shut down access to the internet. In addition, widespread blackouts which were the result of storms in May continued to rock the country further causing widespread disruption to communication and industrial production. The military patrolled the streets, and a curfew was imposed. When renewed protests broke out in early August, they received were widespread support. Ultimately on 5 August Sheikh Hasina fled to India and an interim government was appointed, led by Nobel prize winner Muhammad Yunus. 

During periods of political unrest, especially with communication blackouts, customers in buying countries, can be concerned about their production base. Between the disruptions to communication and political unrest, some companies may have questioned how to address their production needs and wondered if Bangladesh was a reliable place to continue doing business. 

What was at stake for workers, suppliers and brands?

Among its company membership, ETI had over 40 brands that source from Bangladesh. Those brands were buying from over 1000 factories, most of which were making ready-made garments (RMG). The RMG sector in Bangladesh itself was made up of over 4000 exporting factories, employed approximately 4 million workers directly and accounted for much of the foreign exchange of the country. The centrality of this sector to the economy, and the role that ETI brands played in sourcing from it, meant that both the local unrest, and the potential decisions of ETI member brands could have sever detrimental effects on working conditions and pay both during and after the acute phase of the crisis. 

To illustrate the extent of uncertainty, at one point in early August, many banks stopped allowing for cash withdrawals and began refusing check deposits. One factory owner, who was scheduled to speak with ETI members about the situation came close to dropping out of the presentation. The bank was refusing to deposit his checks because they were not confident enough in the stability of the system. Faced with the uncertainty, and obstacles in paying he was stuck waiting for the branch manager for hours.  Ultimately, he managed to pay his workers only after finding the branch manager in person on the street. 

Political crises such as those in Bangladesh bring with them heightened risks for workers, which must be addressed by all actors, and for which the UN Guiding Principles on Business and Human Rights (UNGPs) can act as a guide. Companies are expected to continue monitoring the situation, to allow them to prevent and mitigate any harm to workers that their actions might make. However, such guidance is general, making actions difficult to take in specific moments of upheaval. A particular risk is that several purchasing decisions, which may seem sensible in normal circumstances, prove to have devastating consequences in times of upheaval, such as the imposition of late delivery fees, changing suppliers, or delaying orders.  These then have knock on effects on workers, leading to late- or non-payment of wages, reduced hours, or loss of temporary contracts. The additional complexity of the situation on the ground including blackouts, arrests or in some cases the flight of some factory owners and widespread protests made communication difficult. Ultimately this meant that normal communication channels were closed, and companies intending to respect their obligations under the UNGPs were left with little in the way of specific guidance.  

Challenges faced 

In particular, ETI was concerned that some elements of HRDD were difficult to do, heightening risks that workers would be harmed by both local political unrest and the potential actions of international brands. 

1. Lack of open channels for meaningful stakeholder engagement (MSE): 

   Companies that in more normal times might have good access to local civil society, worker representatives, and even suppliers lacked easy access to them during the crisis. This was especially true for smaller companies without local representatives.

2. Lack of guidance on how to act as a global brand

   Global brands may know their obligations but not necessarily what good looked like in this particular case. For example, as the country began to emerge from the acute phase of unrest, the port was overloaded, and workers there faced intense pressure that brands may not have been aware of. 

3. Risk of lost payments or future orders for suppliers

   Rumours were heard that all Bangladeshi factories were burned and no production could resume for months, this thinking might have led companies to focus on securing supply

   Further actions by brands to control supply chain risks could have had unintended consequences on their suppliers, thereby reducing revenues at a crucial moment for their long term survival. In addition, the disruptions may have encouraged companies to leave Bangladesh or reduce future orders to reduce risks. 

4. Non-payment of wages by suppliers themselves to workers

   With the crisis came serious disruptions to the payment systems in the country including cash withdrawals. Suppliers, especially without strong brand support may have delayed or not paid workers. 

What did ETI do?

As a first step ETI wanted to ensure that company members could engage in the process of MSE which is at the heart of good HRDD.  ETI and ETI Bangladesh reached out to those local supply chain actors to understand the risks and help them to communicate with international brands. 

• Engaged with factory senior management (60+) over phone
• Engaged with selected worker representatives (factory level)
• Engaged with trade union federation leaders

Next, ETI gathered its members with key industry actors to relate the information from those engagements, identifying risks and to start developing recommendations. At these meetings they invited an increasing number of partner MSI companies, to hear from local suppliers and labour union representatives directly. 

• ETI organised multiple virtual sessions for members to share information both during the acute phase and into the transition period of the political turmoil. They started off very regularly and have turned into monthly transition updates.  
  • First meeting on 29 July and subsequent 8 August meeting focused on calming member worries, especially for smaller companies without a robust in-country presence
  • Subsequent meetings focused on consultation to develop a set of agreed upon recommendations and guidelines. 

By August 20, upon the conclusion of the first meetings, ETI along with 10 other major international MSIs, trade union federations and NGOs agreed to a set of recommendations on responsible business conduct in Bangladesh. 

Subsequent monthly meetings allowed continued engagement and fostered ongoing dialogue within ETI membership on their work in Bangladesh. As we explore in another case study, this ongoing engagement has allowed for collaboration with the government and Labour Reform Commission during the transition period. 

What were the results

“We bought time for local actors” – Abil Amin, Country Director ETI Bangladesh

Quick engagement meant that concerns from companies were addressed quickly. One brand reflected, “I have to stress—ETI was so quick on this.” ETI got out ahead of other actors, which allayed concerns that Bangladesh may have had a complete industry meltdown. This was particularly important for smaller companies with no permanent staff in Bangladesh. The speed of action didn’t just result in calmed nerves for brands. According to Abil Amin, ETI Bangladesh country director, this quick action “bought time for local actors,” giving them a space to smooth out production and logistics concerns without the threat of fines or other supply chain actions. 

Industry alignment and call to action

By releasing draft recommendations early in the process, multiple MSIs including amfori, the Fair Wear Foundation, Cascale and FLA joined on instead of creating their own consultations and separate set of recommendation. Beyond saving local actors multiple interactions, this had the effect of setting the standard for good business conduct across a much larger remit than ETI brand companies alone. ETI member Lindex saw the value in this sort of coordination, and ETI's timely response: 

“It sets the standard and create alignment on how to act responsibly in times of crisis."  - Helen Göthe, Human Rights Strategy Manager, Lindex.
 

Outcomes 

Reduced duplication: ETI avoided duplicating efforts, saving local actors from interacting with hundreds of buyers on the same subjects, and heading off similar programmes from partner MSIs.

Company actions on recommendations

The recommendations themselves were comprehensive whilst also being attuned to the needs of the situation. They included specific risks to be aware of, and general guidelines and expectations on purchasing practices. Regardless of how well developed a brand's HRDD systems were, they were able to benefit from this sort of bespoke set of recommendations in a crisis. Helen from Lindex explained how she used the ETI recommendations to cross-check the actions Lindex had taken on HRDD during the crisis. The guidance reassured her that many of their existing measures were already on the right track. At the same time, the recommendations highlighted new areas for follow-up—for example, the heightened risks to workers at Chittagong port. This could then be further reviewed to ensure that potential vulnerabilities were addressed. 

Many of the recommendations had to do with purchasing practices. Sustainability and human rights teams rarely have oversight over such commercial decisions, and yet in this case they became extremely important concerns. The heightened expectations in the recommendations gave ammunition for sustainability teams to use in their internal advocacy. Ultimately, none of the companies that came to the consultations invoked force majeure clauses during the crisis (something totally normal during times of government collapse). In addition, none dropped their suppliers, except in rare cases of factories closing. 

Conclusion

The political upheaval during the summer of 2024 in Bangladesh is still ongoing. With a date for national elections yet to be confirmed, continued instability is a feature of the Bangladesh landscape. The RMG sector however has remained strong throughout this period of uncertainty. Actions by ETI during the acute phase and the subsequent fallout helped to reassure member brands, and ensure a continuity for suppliers and workers. This was possible for a few key reasons

1. ETI was able to act quickly. This rallied support, and allayed concerns due to the upheaval
2. ETI has a long history of working in Bangladesh. The large and trusted network developed in that time allowed the team to convene a wide variety of stakeholders
3. ETI brought in other MSIs and stakeholders which reduced duplication and streamlined messages on business and human rights during the upheaval, minimising confusion for brands. 

In times of political unrest, uncertainty could lead to rash actions by businesses which could endanger workers. Luckily in this case that didn’t happen. ETI will continue to engage with all stakeholders in a meaningful way to support workers in international supply chains, even when times ahead remain uncertain.