TOPSHOT – In this aerial photograph, activists of the Bangladesh Nationalist Party (BNP) gather near a … (+)
The fall of Prime Minister Sheikh Hasina, Bangladesh’s long-time autocratic leader, follows a predictable pattern. Over the past three decades, seemingly stable but repressive regimes in countries such as the Philippines under Ferdinand Marcos, Romania under Nicolae Ceausescu and Egypt under Hosni Mubarak have been toppled when public outrage suddenly reached a boiling point. Leaders who ruled through fear quickly lost control. Unfortunately, the collapse of these and other autocratic regimes has not portended a better future.
Building the foundations for sustainable democracies takes time, popular will and competent political leadership. It also depends on economic support from international financial institutions and wealthy foreign governments, as well as private sector investment. Rather than betting on the future, global companies have all too often shut down their businesses, focusing more on short-term risks than potential long-term gains. In Bangladesh, where the garment industry generates 80 percent of export earnings, major global companies such as Walmart, H&M, Inditex (Zara) and Gap must play a critical role by continuing or even doubling their investments.
They must do so despite the current governance void in Bangladesh, a country of 170 million people that suffers from poor leadership. Sheikh Hasina, who has been in power for 16 years, is the daughter of Sheikh Mujibur Rahman, who led the country’s war of independence from Pakistan in 1971. At the start of her term, Hasina was elected through a democratic process and showed some leadership potential. The Economist called her “Asia’s Iron Lady,” and polls have repeatedly named her one of the most powerful people in the world Forbes And TIMEBut over time, Hasina became more isolated and insecure, and increasingly relied on dictatorial tactics. She actively undermined the independence of the judiciary, the press and civil society, and relied on state security forces and her party’s youth vigilante groups to suppress dissent.
When hundreds and then thousands of students took to the streets last month to protest against a quota system that restricted access to government jobs, Hasina’s security forces cracked down on them, killing hundreds of protesters and arresting thousands more. As more protesters took to the streets, they overwhelmed the security forces and Hasina had no choice but to flee the country.
Now comes the hard part for Bangladesh: trying to make a successful transition to a more stable and democratic future. To its credit, the military has quickly installed an interim government, whose “chief adviser” is 84-year-old banker Muhammad Yunus. Yunus won the 2006 Nobel Peace Prize for his pioneering work in promoting “microfinance,” a system of providing small loans to the poorest in society. Yunus gives the interim government instant credibility at home and abroad.
But his appointment offers no practical path to a successful democratic transition. Yunus has limited political experience, having once failed to form his own party. And the government he is inheriting is riddled with corruption, bureaucratic incompetence and very low popular prestige. It will be difficult to fix the current governance weakness plaguing Bangladesh. One important role Yunus can play is to support open and credible elections that lay the groundwork for a genuine democratic transition.
That is why the continued presence of global apparel companies is so important today. Over the past three decades, hundreds of global brands and retailers have manufactured their clothes in textile factories in Dhaka. This trend has accelerated with the rise of “fast fashion,” the marketing strategy of offering consumers frequently changing styles at extremely low prices. With a large productive workforce, Bangladesh has become the world’s second-largest apparel exporter after China. These factories employ more than four million workers, many of them young women who are often the first in their families to have permanent employment.
As Bangladesh undergoes democratic transition, global apparel brands must also rethink their relationships with their local business partners. As a recently published report shows from the NYU Stern Center for Business and Human Rights, The companies I lead should do this by adopting more responsible business practices, including transparent purchasing practices, respecting payment deadlines and more generous support for worker welfare, including paying a living wage. Big global brands can do this and still make very good profits on the products they produce.
Paul Polman, former CEO of Unilever, a global consumer goods company with a strong presence in Bangladesh, has called on international companies to “actively support the country on its new course”. While Unilever has moved away from Polman’s leadership model, he remains an influential voice in the corporate world. Polman recently noted: “Bangladesh is an economic engine in the making, whose full potential can be unleashed through a bold and comprehensive programme of political and economic reforms.” He concluded: “A free, stable and prosperous Bangladesh is good for the world and certainly good for the businesses that operate there.” Global companies, particularly those in the apparel sector, should heed his advice in fulfilling their stated commitments to building just transitions and sustainable business models.
