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1 May 2020

Interfaith Centre for Corporate Responsibility

Investors exhort apparel companies to meet supplier commitments during pandemic

... Members of the Interfaith Center on Corporate Responsibility (ICCR) and KnowTheChain announced that they are coordinating investor engagements with global apparel and footwear brands, urging the companies to safeguard the livelihoods of vulnerable workers during the COVID-19 pandemic.

... Since early 2019, over 60 investors from around the world have engaged apparel and footwear companies benchmarked by KnowTheChain, to ensure that the rights of workers producing the clothes we wear every day are respected; the group is now continuing the dialogues to address the impacts of COVID-19 on supply chains workers.

Investors are sending letters to the 43 apparel and footwear brands named in KnowTheChain’s December 2018 report on forced labor risk. Two additional letters will be sent to Next and Urban Outfitters which are included in KnowTheChain’s 2020/2021 benchmark report.

Workers around the world are experiencing the collateral impacts of widespread supply chain interruptions due to COVID-19, including mass layoffs and furloughs, reduced and delayed wages and loss of healthcare. Last month more than 314 long-term institutional investors representing over $9 trillion USD in assets under management called on their investee companies to protect workers by, among other things, maintaining prompt payments to suppliers for goods and services rendered in accordance with their binding contractual terms.

... Migrant workers face particular hardship.... The letters recommend a series of specific actions the companies can take and request a dialogue to learn about measures companies are putting in place to respect labor rights in their supply chains during and following the COVID-19 crisis.

... Companies are being asked to commit to the recommendations in the letter and to report publicly on their responses to COVID-19 related to worker protections, to ensure this vital information is also available to affected workers and their representatives.