Once considered a cheap sourcing destination for basic apparel, Bangladesh has come a long, long way to stamp its dominance as the second biggest apparel exporter globally.
It is amazing to see the kind of progress the country has made in every aspect of garment manufacturing and export over the years. And the credit for this, to a great extent, goes to the trend of green factories. Apparel Resources (AR) interacts with those who matter, the industry players, touching upon various aspects of going green, the concern areas and opportunities, and how to address and leverage the same.
“The industry as well as the country had to do something drastic to come out of the image crisis in the backdrop the Rana Plaza incident. That is when the industry leaders came together to make an effective strategy and, green factory and sustainability were two key areas they concentrated on to salvage the sagging image,” underlines Kyaw Sein Thay (Dolly), the Managing Director of Cloths “R” Us Limited, speaking to AR, referring to the green drive, which in the days to come would take the industry by storm.
Bangladesh’s reputation took a serious beating after the deadly Tazreen Fashions Fire of 2012 and the collapse of the Rana Plaza in 2013, which led the stakeholders to focus on sustainability and safe work environment as ways to help the industry regain its foothold.
This led more and more garment makers to embrace the green concept, so much so that today, Bangladesh has the highest number of green units; just 17 shy of the magical 200 mark after the United States Green Building Council (USGBC) recently recognised three more units as green.
One such unit is namely Gazipur-based Jinnat Knitwears Limited, the RMG and Printing units of which have got Platinum certificates (with respectively 84 and 81 points) and the other one is Swisstex Village in Singair, Dhaka, which has received Gold certificate (with 65 points).
Earlier Victoria Intimates Limited and Dresden Textiles Limited also received the green tag from USGBC.
Victoria Intimates Limited, located at Boiragirchala of Dhaka obtained a Gold certificate from the USGBC with a score of 62 even if Mymensingh-based Dresden Textile Limited too bagged Gold certificate with a score of 68.
As efforts towards sustainability are becoming major thrust area, more than 500 are in the pipeline to earn green certification in the days to come, as per estimates.
What’s more, nine of the top 10 green garment factories in the world are also from Bangladesh, a big achievement to say the least.
Reasons speeding up the Green movement!
“There is a huge competition, and it has reached such levels that without a green unit, it would be difficult to be in the business,” explains Akib Rahman, Director of HAMS Group, speaking to AR.
HAMS Group’s Victoria Intimates Limited on 12th December 2022 received the Gold certificate even if its woven unit Dhaka Garments & Washing Ltd., is also expecting to get the Gold from USGBC soon.
Dolly too agrees on this when she concurs ‘buyers prefer to work with factories that are safe and green’ even if Mohiuddin Rubel, the Director of the BGMEA underlines that in future, LEED-certified factories will not be an option but compulsion as buyers will try to place orders in the green factories.
HAMS Group was established in 1994 and remains one of the leading vertical textile manufacturers in Bangladesh.
However, for HAMS, more than the competition, it is the reputation factor which led it to aim for certification for its manufacturing units.
“We are hoping to get the Gold certification soon (for Dhaka Garments & Washing Ltd.),” expressed Akib adding it would be sometime in January this year that they should see their dreams fulfilled in terms of getting another green certification.
Even though buyers prioritise green units when it comes to placing orders, Akib feels, one has to back the same up by ensuring product quality and adhering to the delivery deadlines.
“Green certification alone is no guarantee for business,” claims the Director of HAMS Group even as the industry continues to debate on the key aspects of investment and RoI.
Akib is but hopeful notwithstanding the investment that went into making the manufacturing units green, it would help them in the long run while also ensuring a better work environment for the workers.
Meanwhile, gives a perfect example of how to get the desired ROI, Ranjan Mahtani, the Executive Chairman of Epic Group.
“If we produce 50,000 pieces that need to be washed, we invest in laundry system that can accommodate these quantities; unlike many other factories that have washing capacity in much excess to their actual production capacities which is why they don’t get desired RoI in required time frame,” while adding, “Yes, we are invested in sustainability and we will continue doing so in all our new global factories which are equipped with solar panels, ETP membrane, energy-efficient equipment and much more.”
It may be mentioned here that EPIC’s CIPL Project in Dhaka, which was certified LEED Platinum by USGBC way back in 2011, is the first LEED-certified project in the country.
In today’s age when social responsibility has become an essential part of running any business, especially in the garment industry amidst increasing number of end-customers seeking assurance clothes that they buy are created and produced with care, using sustainable resources and safe working conditions, more and more brands and retailers are looking for suppliers that are green.
Recent studies show that approximately 67 per cent of consumers consider the use of sustainable materials to be an important purchasing factor even if sustainability continues to grow in eminence across all generations, especially among millennials and Gen Z with one third of millennials likely to choose sustainable products over an alternative.
It may be mentioned here that recent improvements in Bangladesh’ infrastructure, such as the better work programme, have positioned the country as a preferred sourcing partner for conscious brands even if the Government policies and regulations are also adding to that push towards going green.
After the collapse of the Rana Plaza in 2013, Bangladesh Government came up with various acts, regulations, and policies for green development, some of which include green credit, environmental compensation mechanism, green banking, green trade, environmental tax, green insurance, urban green space and green innovation, which have catapulted the country as a leader of the green drive.
Price points, a major challenge in green endeavour!
Notwithstanding the popularity of green factories, the issue of price points remain a major roadblock.
“Entrepreneurs have to spend 30 per cent more for constructing green factories compared to the conventional ones but buyers do not pay anything extra for products from the green factories,” complained an industry player to AR, who further went on to maintain Bangladesh apparel manufacturers and exporters have already spent close to US $ 3 billion to improve the fire, structural and electrical safety at their factories following the recommendations by the now defunct international garment factory inspection agencies, Accord and Alliance.
Dolly also agrees that given the massive investment that goes into making a green unit, price points remain a major obstacle, to make up for which, she suggests increasing the efficiencies and reducing wastage, so to attain business profitability even as the industry continues to fight what it calls the sharp disconnect between sustainability and business as far as buyers’ purchasing practices are concerned.
“If we can make a purchasing system that allows brands to provide premium prices for products made in green factories, it will enhance the number and business that engage in green activities,” suggested a garment maker even as Ranjan Mahtani underlined what frustrates him is that no serious investment from stakeholders other than garment factories is being committed.
“As this collective commitment is lacking in the fashion supply chain, the industry needs to introspect and find answers to these relevant questions – Are we really talking about climate change? Are we serious about landfills and pollution that the fashion industry is accused of contributing to? Are Governments stepping up to pour money in making industries sustainable and environment-friendly?” asks Ranjan while adding despite much of the efforts being driven by the factories that are taking care of processes in the best sustainable ways possible, the garment manufacturers aren’t given the respect they deserve.
“I faced a lot of criticism as everyone asked me why we were going green when buyers will not pay anything extra for it. However, we have done it not because of the buyers but because we want it; we want to make our units green, we want to make them sustainable,” opines Md. Bin Quasem, MD of Incredible Fashions Limited and Director of Echotex.
Echotex is a LEED Platinum manufacturing unit and employs over 16,400 people, which Bin Qasem believes could be the single largest factory to be Platinum certified.
In doing so (building green units) Bin Quasem claims they have been able to achieve all round improvements while pointing out business sustainability is undoubtedly a very important aspect for any entity and they are no exception.
“The efficiencies that we have been able to be achieve, helped us to minimise operational cost as well. Be it power consumption, gas, so on and so forth,” elucidates Bin Quasem while adding thanks to the synergistic effect of various aspects of going green, they have been able to benefit more than expected.
Estimates suggest green factories help reduce overall operational costs in the long run even as they help reduce use of electricity by 24 to 50 per cent, water consumption by 40 per cent, and carbon emissions by 33 to 39 per cent.
EU angle to going green
The European Union played a massive role in Bangladesh becoming the second largest garment exporter in the world over the past four-and-a-half decades. Just after gaining independence in 1971, Bangladesh started enjoying trade benefits under the EU’s Everything but Arms initiative, which eventually elevated the country to its current position.
In January-September 2022, Bangladesh’s apparel export to European Union witnessed a staggering 43.21 per cent growth to reach US $ 17.56 billion, which helped the country (Bangladesh) to remain the second largest source of clothing for Europe, with a 22.56 per cent share.
However, the European Green Deal (EGD), approved in 2020, which is a set of policy initiatives by the European Commission with the overarching aim of making the European Union climate neutral in 2050, is loaded with consequences for businesses, experts maintain as imports into Europe will be impacted by the EGD in different ways.
In addition to setting higher sustainability standards in primary production and industrial processes, the EGD will require entities to provide more information about the products they export to Europe.
However, the growing number of green apparel factories will give Bangladesh a vantage ground to cope up with EU green deals and due diligence directives, say the industry players.
“There are more than 180 green factories here now, and it will not be difficult for other entrepreneurs to walk the same path in the future,” opined an apparel maker to AR.
Other advantages and certification dynamics!
While going green may seem somewhat superficial to many, it actually can have a direct and significant impact on bottom line profitability. However, to be certified green, one has to undergo a rigorous process of testing, based on which they receive the green ratings.
To be certified by the USGBC, one of the world’s greenest building certification bodies established in 1993, a project must meet the highest standards from construction to manufacturing under the supervision of the USGBC.
There are a total of 110 points for fulfilling the 9 conditions for the LEED certificate. Among these, more than 80 points are required for LEED Platinum, 60-79 points for LEED Gold, 50-59 points for LEED Silver and 40-49 points for LEED Certified.
| LEED Green Garment Factories of Bangladesh | |
| Platinum | 60 |
| Gold | 109 |
| Silver | 10 |
| Certified | 4 |
| Total | 183 |
Given the overall benefits of green units over the traditional ones, experts are not only for going green, they also believe, thanks to the green wave sweeping the Bangladesh garment industry, the country is now poised to take the lead globally by addressing mounting issues of sustainability, climate change, groundwater depletion and efficiency, to strengthen its position and standing as the global sourcing hub.
“We need a collaborative and focused engagement from the other stakeholders in order to be successful,” opined Ranjan Mahtani to wind up on a positive note.
