Arcadia Group

Arcadia group

(Burton, Dorothy Perkins, Evans, Miss Selfridge, Outfit, Topshop, Topman, Wallis)

Download Arcadia group's submission (pdf)

Responded to survey: yes, updated summary based on comments

MSI involvement: no [what's this?]

Grade 2.5: Can offer concrete examples of steps to increase wages in the supplier base, but pilot projects are limited in scope and have significant omissions. [what's this?]

Summary

Mentions two pilot projects, both of which have significant shortcomings, and there is no sense of a broader ambition on wages. Ticks some boxes, but it's a far cry from some of the other submissions.

Position on living wages

"The Arcadia Group accepts that progress is needed on wages in some parts of the world, and supports the principle of a living wage. The difficulty is how to measure it. Until there is a universally agreed alternative, we rely on a solid benchmark specified by an ILO Convention, and that is the minimum wage set by law in the appropriate country, or local industry benchmark standards."

Work so far on living wages

"Through work with a supplier shared with Next in Mauritius, a piece rate system was introduced in January 2008. The initial findings for the first five months of this year compared with the same period last year show that this has had the effect of improving earnings for an average worker by at least 38%. No worker was penalised by this new payment method, since their time rate earnings were protected.

"This factory also has a significant number of migrant workers from other countries. Arcadia noted that it had drawn up guidelines that required the supplier to pay the recruiting agent fees that had previously been paid by garment workers."

Plans on living wages

Arcadia mentions projects in two factories relevant to this study, both collaborations with Next:

In Bangladesh, where its project will involve, “the gathering of detailed information on current wage rates, including benefits, and after deductions. We will consider all supply chain costs, including the level of automation in the selected factory, and opportunities to offset any increased labour costs in order to assure sustainability.”
In Mauritius, “we intend to have further engagement with manufacturers, industry bodies and government departments to conduct an investigation into the national minimum wage, the actual wage of workers in our factories - including benefits and after deductions - and the industry benchmark standard where applicable. As mentioned above, we hope to understand a living wage through reference to the ‘basket of goods’.”

Arcadia continued that, “Our next steps are dependent on the results of our three current projects, described above. These are expected to run for up to a year but we will review progress, and any developments from other sources, during the course of this period in order that we may accelerate it.”

Other significant information

Arcadia described its work on Fairtrade cotton extensively. This work does not relate to clothing manufacture, and so was not considered in our analysis above.

Our comments

Although Arcadia's submission suggests two interesting projects, a closer reading indicates some significant concerns. We raised these in comments to Arcadia, but the amendments it made to its submission did not allay our fears.

The project in Bangladesh is described as a wage study, but appears to focus on information-gathering and opportunities to raise wages, not on actually raising wages. In the longer term, Arcadia does not make any commitments to rolling out learning across its suppliers, unlike some of its competitors. Instead it simply says that its future action depends on the outcome of this learning.

Evaluated against our four pillars, we note that:

Arcadia's projects involve collaboration with another company, and in Mauritius some local stakeholders are involved; we must of course note that the projects as described are not designed and governed in a multi-stakeholder manner, and therefore we continue to recommend membership of a multi-stakeholder initiative such as ETI to considerably improve the credibility and effectiveness of Arcadia's work.
The projects do not involve organising as we have described it.
They focus on productivity improvements, and while Arcadia does state that it, “will consider all supply chain costs, including the level of automation in the selected factory,” it did not explain what this means and whether it will genuinely examine the prices it pays to suppliers.
There is no clear route map to a living wage or commitment to raising wages, but merely to 'examining' them.