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Using Social Responsibility for Financial Opportunity

Ever since the Rana Plaza collapse in Bangladesh in April of 2013, businesses have finally started dedicating resources to audit factory conditions. Factory-inspecting organization AsiaInspection has since last year seen a large rise in businesses’ willingness to spend large sums on their services, according to Robert Bowman in an article for Forbes.

The Invisible Love Tap

For years, stories of poor factory working conditions overseas have sprinkled into the media, but it used to be that these stories would then get swept under the rug once the next news cycle started. But the Rana Plaza collapse was severe and startling enough that “H&M, Zara, C&A, Tesco, Carrefour, Primark and PVH (parent company of Tommy Hilfiger and Calvin Klein) signed a binding accord on fire and safety codes. In addition, some 123 investor groups called for ‘zero-tolerance policies on global supply-chain abuses.’ ” These agreements have likely risen both for humanitarian and financial reasons, as Bowman notes that the upcoming generation of consumers legitimately wants to know whether the things they buy are negatively impacting people or the environment.

China Still at the Core

Even though 3 to 5 percent of production has relocated in the wake of rising costs, the brunt of manufacturing still occurs in China. Items such as underwear, which require close proximity to wool, ensure that supply chains will rely on China for years to come. With a drive toward social responsibility, Chinese factories will hopefully become both safer and more effective. Read the original article here: http://www.forbes.com/sites/robertbowman/2014/03/11/is-this-the-year-when-supply-chains-become-socially-responsible/

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