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LONDON – An ‘independent’ review claims H&M’s Fair Living Wage Strategy “shows genuine leadership” yet major lessons need to be learned. Particularly, the review suggests H&M has underestimated the scale and complexity of the challenges, with the result that on-the-ground progress in some areas has been slower than expected. Nonetheless, on balance the report praises H&M for showing a “bold and unprecedented” commitment on wages.

The review was published by the Ethical Trading Initiative ahead of H&M group’s Fair Living Wage Summit in Cambodia. However, its credibility is diminished somewhat given that it was commissioned by H&M itself, the aim being to evaluate H&M group’s Fair Living Wage Strategy and its progress in the five years since roll out.

The report highlights the strategy’s main achievements as being strong support from most external stakeholders; efforts to improve wage management across 500 supplier factories; and substantial progress on improving workers’ ability to negotiate on wages and conditions. It suggests there is evidence of slight incremental rises in some workers’ wages; however, even in top performing factories some workers still report that wages aren’t enough to cover living costs.

The report goes on to analyse the factors that may have affected progress, including: political and economic developments in sourcing countries; H&M group’s business performance; and local regulatory changes such as restrictions on trade unions and civil society.

Peter McAllister, executive director of the Ethical Trading Initiative (ETI), said: “H&M has shown genuine leadership on the issue of wages, even if it appears to have underestimated the scale of the challenge. It’s clear that lessons need to be learned, but we should remember that H&M is the first major apparel brand to make such commitments. While it’s only right that it should be held to its promises, it’s just as important to recognise the progress it has made. After all, the vast majority of brands are conspicuously silent on wages, and we mustn’t allow this to be seen as the safest option.

“Despite the challenges, it’s critical that H&M continues its efforts to raise workers’ wages, and we hope to see it learning from the lessons of the first five years to expand and improve its work on the ground. We also hope to see other brands learning from H&M’s example. The issue of living wages is much bigger than any one brand and if we are to make sure all garment workers receive a decent wage then industry-wide action has to be the priority.”


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