The Gunther Report

Lesson from Apple: Why Investing in Poor Women is Good Business

One lesson of the Apple in China scandal is that factory monitoring is a necessary but insufficient way to improve the lives of workers in poor countries. Apple inspected its suppliers’ factories, but conditions remain harsh. While strengthening inspections and sanctions, smart brands and retailers are finding ways to help workers in their supply chains gain more control over their work and lives.

A program run by BSR (Business for Social Responsibility) called the HERproject, which gives women working in export factories access to health information, is an example of what could -- and should -- be done. Teaching young women about health, including reproductive health and family planning, is, by itself, a good thing. It also delivers a not-so-subtle message to factory owners that it might be good for their business to take better care of workers, instead of exploiting them until they are used up.

Many factory owners “see their workers as cogs in a machine” and act accordingly, says Racheal Yeager, who leads the HERproject for BSR. “That’s why there are high rates of turnover and high rates of absenteeism.”

“What we’re trying to do is change the mindset of the factory management,” she says.

I recently met Racheal, who’s just 29, at BSR’s office in San Francisco. She was just back from Bangladesh, where she talked with women workers in their homes and on the shop floor. She told me that the young women who make the electronics, clothes, shoes and toys that we consume are woefully uneducated, particularly about health. Many suffer from anemia, poor hygiene, inadequate pre- and post-natal care, sexual violence and exposure to infections and illness.

The HERproject works with local nonprofits that select and train female factory workers as teachers, and then send them back into their factories to talk with their peers about menstrual hygiene, family planning, sexually-transmitted diseases, prenatal and postnatal care.

“There are the strangest myths and miscalculations around women’s health.” Racheal says. “Women were missing two or three days a month when they had their period because they didn’t know what to do. Culturally, they had been told that it’s shameful.”

The HERproject (it stands for Health Enables Returns) has grown rapidly since it began in a few factories in China in 2007. It has reached more than 120,000 female workers and more than 25,000 males in factories in Bangladesh, China, Egypt, India, Indonesia, Kenya, Pakistan, and Vietnam. Brands that have nominated suppliers for the program -- and agreed to pay for it -- include Abercrombie & Fitch, Ann Taylor, Clarks, Columbia Sportswear, H&M, Hewlett Packard, J.Crew, Levi Strauss & Co., Li & Fung, Marks & Spencer, Microsoft, Nordstrom, Primark, Talbots and Timberland.

Gee. Why isn’t Apple, the world’s most valuable company, on the list? Or Walmart, the world’s biggest? Just asking.

The western brands pay about $5,000 to $7,000 per factory per year, funds which go to the local NGO that runs the project. The HERproject is designed as a yearlong effort, after which factory owners are asked to keep it alive and pick up the costs.

For the brands and factory owners, the business case should be clear, at least according to BSR. Healthier workers tend to be more productive workers. Workers tend to feel more loyal to employers who invest in their well-being. Turnover should decline. The HERproject’s impact and effectiveness is being tracked by BSR.

“Women’s health matters to business,” Racheal says. “It is such an enormous social need, and it has such an impact on business that we don’t see why this isn’t something every brand should be doing.”

In a just world, sure. But many brands and factory owners -- not just in poor countries, but also in the U.S. -- don’t see a need to invest in their workforce. Spending $5,000 per factory may not sound like a lot, but it’s real money in a place like Bangladesh, where wages are as little as $40 a month. What’s the return on investment, they may wonder.

The challenge for BSR and forward-thinking brands will be to demonstrate to factory owners that treating their workers with decency and care is good business -- whether those workers are American, Chinese or Bangladeshi. Until they do, expect more scandals like those at Apple.

Photo courtesy of Robert Scoble via a Flickr Creative Commons license.