H&M CEO visits Bangladesh to discuss wages

Karl-Johan Persson, CEO at H&M, visited Bangladesh yesterday to meet with the Minister of Commerce in Bangladesh, Tofail Ahmed. At this meeting, Karl-Johan Persson presented H&M’s request for effective systems that regulate costs and prices in Bangladesh.

H&M CEOHe also highlighted the need for continued wage development through annual revisions, one of the requirements of establishing a fair living wage that H&M has been working actively towards for many years. The previous meeting with the Government of Bangladesh was held in 2012.

“We commend the Government of Bangladesh for addressing minimum wages. However, we see that costs in society are negating many of the positive effects of increased wages. This is due to the absence of efficient systems of cost control leaving both workers and business owners in a difficult situation,” says Karl-Johan Persson.

The textile industry of Bangladesh is continuously developing. However, to ensure the needs of workers as well as the continued competitiveness of the Bangladeshi textile industry, further actions are required. Therefore, a continued wage development through annual revisions based on cost price index is necessary. H&M also encourage the government to address the issue of cost regulation, on for example rent and basic commodities.

At the meeting, Karl-Johan Persson highlighted the importance of establishing a structure for compensation in case of workplace accidents and a greater government attention on the shortage of clean water, which could lead to major health issues as well as a halt to the development of the Bangladeshi textile industry.

For H&M it is important that the Bangladeshi garment industry is further stabilized, since foreign trade in general and specifically garment production plays a major role in the industrial development of emerging markets. Finding a job in the textile industry is an effective and important way to leave poverty for many people, not least for women.

Bangladesh is an important buying market for H&M and we are committed to grow our business there. Our production in Bangladesh has grown faster than in other markets, and today we source products from around 300 factories employing over 600,000 workers. H&M does not own any factories, but we want to use our size and influence to promote long-term change and make sure that the communities in Bangladesh benefit from our presence.