VF Corporation (NYSE: VFC) today announced a collaboration with the International Finance Corporation (IFC), a member of the World Bank Group, to provide up to $10 million in financing for building upgrades and fire and safety improvements in vendor factories in Bangladesh. These funds are part of VF’s overall US$17 million commitment to the health and safety of Bangladeshi garment workers.
This commitment was made bending to the right groups’ pressure and negative press reports hurting share prices and profits of the NYSE listed US$11.5 billion corporation, following the collapse of the Rana Plaza on the 24 April 2013 in Bangladesh in world’s deadliest industrial disaster, killing at least 1,138 people, since Bhopal (India) tragedy of 1984. With this financial commitment, VF is providing a corporate guarantee for IFC remediation loans to VF suppliers. The programme will enable the IFC to lend at a reasonable cost to qualified suppliers who own factories in Bangladesh that produce VF products, helping to accelerate the implementation of needed fire and building safety improvements.
“The safety of the people making our products around the world is an imperative,” said Eric Wiseman, chairman, president and CEO of VF. “Our programme with IFC helps to ensure that our suppliers have access to the necessary capital to complete safety improvement plans.”
Qualifying suppliers have undergone structural, electrical and fire safety assessments under the protocol outlined by the Alliance for Bangladesh Worker Safety, of which VF is a member. The loan will be used to implement corrective action plans derived from these assessments.
Individual loans granted to suppliers are expected to range from $100 thousand to $1 million and must address one of three applicable performance standards: assessment and management of environmental and social risks and impacts; labour and working conditions; or, resource efficiency and pollution prevention.