Estimating the effect of buyers’ commitment to corporate social responsibility on safety risks in garment factories in Bangladesh

After eight years of the collapse of the Rana Plaza building killing more than 1000 garment workers in Bangladesh and motivating flurry of initiatives with international buyers taking the lead role to improve safety risks in the garment factories in Bangladesh, there is still no large-scale study estimating the effect of buyers’ commitment to Corporate Social Responsibility (CSR) on safety risks in supplying factories. In this study, we address this gap in the literature by estimating the association between buyers’ commitment and safety risks in a group of 222 randomly selected garment factories under inspection by Accord - a consortium of brands, retailers, trade unions, and garment suppliers with focus on inspection and remediation of structural, electrical and fire risks in garment factories’ buildings in Bangladesh. The empirical analysis is conducted using archival data available from Accord, while Buyers’ commitment to CSR is measured by the Fashion Transparency Index (FTI). Our results show moderately significant effect of buyers’ commitment on the three types of safety risks (structural, electrical, and fire risks) in supplying factories. Moreover, our findings reveal that the variables Multipurpose Building and Duration of Inspection by the consortium Accord have significant effect on the three types of safety risks. Taken together, our findings lend support to the reinforcing positive effect on safety risks of interrelated elements such as buyers’ commitment to extend Corporate Social Responsibility to supplying factories, privately regulatory initiatives (i.e., Accord), and compliance-based enforcement strategies including new safety regulations.