|October 29, 2007|
|A Credibility Gap|
|By Greg Hazley|
|Things were looking good for Gap Inc. After years of struggling, the ubiquitous clothing retailer appeared to finally have the right management team in place, revenues were rising and a company-wide overhaul had shareholders thinking positively for the first time in years. |
Gap had also been riding a wave of feel-good PR and social responsibility by association with its involvement in the “Product Red” movement for Africa.
But ahead of the Christmas shopping blitz, the U.K.’s Observer has dropped the crisis PR bomb that perennially looms over multi-national clothing chains – sweatshop allegations. And not just any old sweatshop, an Observer investigation reports that Gap clothes are being made by child labor overseas.
The latest dramatic piece by the paper begins with a 10-year-old indentured worker in New Delhi sewing a Gap logo on a garment in a factory smeared with excrement from a flooded toilet. Gap told the paper that it is investigating the matter and reiterated its policies against child labor use by its vendors. But the retailer also said its own quality controls red-flagged 23 factories last year for not following its standards, indicating it knew problems were out there.
The focus on child labor opens a seven-year-old wound for Gap dating back to 2000, when the BBC connected its clothing to sweatshops in Cambodia. The company can only expect to see more quotes like this one from the Observer report:
Gap may be one of the best-known fashion brands with a public commitment to social responsibility, but the employment [by subcontractors ultimately supplying major international retail chains] of bonded child slaves as young as 10 in India's illegal sweatshops tells a different story,' says Bhuwan Ribhu, a Delhi lawyer and activist for the Global March Against Child Labour.
In a statement devoid of an apology or acceptance of blame issued to respond to “a UK media report,” Gap on Oct. 28 painted the picture of an isolated incident caused by an “unauthorized subcontractor”:
“We strictly prohibit the use of child labor. This is a non-negotiable for us – and we are deeply concerned and upset by this allegation. As we’ve demonstrated in the past, Gap has a history of addressing challenges like this head-on, and our approach to this situation will be no exception.”
The company does have a history in this department, but it’s not one to point to. Touting overseas inspectors and safeguards is meaningless when the system essentially failed in this case.
Shareholders and consumers expect corporate problems like this to be fixed when they crop up, not resurface a few years down the road.
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