User:Janesmith329/Patagonia, Inc.

Labor Complaints
Since 2011, Patagonia has doubled its scale of operations and opened forty new stores worldwide During this period of expansion, it was brought to the company’s attention that some of its overseas suppliers have mistreated their employees. The manufacturing process takes place in mills which have been caught up in trafficking and exploitation of workers – about 25% of these mills are based in Taiwan [. These mills did not source workers themselves, rather they turned to labor brokers. Patagonia’s Taiwanese suppliers charged migrant workers to pay a labor broker to help them find a position with the company and fees for this hit over $7,000. Workers were also charged monthly fees in order to keep their jobs. Workers have said that the combination of the initial and monthly fees left them with a nominal and unsustainable take-home pay.

Internal audits revealed instances of human trafficking, forced labor, and exploitation of the supply chain. In each instance Patagonia’s suppliers were considered to be a labor violation and became increasingly prevalent in mills. The company’s supply chain is massive and consists of many small links which decreases the level of direct control and oversight of shops of producers for the fabric used in apparel. Patagonia did not prepare well at the time to root out forced labor at all levels.

Upon discovering these issues, Patagonia made it a priority to address the human front of its supply chain process. Patagonia partnered with Verité – an NGO focused on ensuring workers worldwide are working under safe, fair, and legal conditions. Through this partnership, Patagonia conducted migrant worker assessments with its Taiwanese suppliers. Following these assessments, Patagonia implemented a new set of standards for Taiwanese factories and then set up meetings with suppliers to explain the new changes. These standards have been published on Patagonia’s website – the company highlighted internal company problems through blog posts. In addition to this, Patagonia asked suppliers to reimburse workers for fees above the legal limit that they were charged to obtain their jobs. Patagonia asked suppliers to reimburse 5,000 workers for and workers hired post June 1, 2015 were all completely reimbursed.

Patagonia has started to account for changes regarding worker compensation. As of 2015, the company is the company is focused on maintaining a reputation of transparency and socially responsible behavior with its customers. For example, the company launched a project called Footprint Chronicles which is a tool that encourages open conversation surrounding the company’s approach towards sustainability. Patagonia’s commitment to its company values and full transparency in terms of acknowledging flaws to the public has allowed for future growth and brand acceptance. The company hoped that when its customers unravel potential future supply chain findings, they will remember Patagonia’s transparency with them and be more willing to trust the brand.

[1] https://www.newyorker.com/business/currency/patagonias-anti-growth-strategy

[2] https://www.theatlantic.com/business/archive/2015/06/patagonia-labor-clothing-factory-exploitation/394658/

[3] https://www.kcrw.com/news/articles/supply-chain-breaks-down-at-patagonia

[4] https://www.jstor.org/stable/jcorpciti.1.93

[5] https://www.verite.org/how-patagonia-is-addressing-forced-labor-in-its-supply-chain/

[6] https://www.theatlantic.com/business/archive/2015/06/patagonia-labor-clothing-factory-exploitation/394658/

[7] https://patagonia.typepad.com/files/migrant_worker_employment_standards.pdf

[8] https://www.theatlantic.com/business/archive/2015/06/patagonia-labor-clothing-factory-exploitation/394658/

[9] https://www.wsj.com/articles/patagonias-balancing-act-chasing-mass-market-appeal-while-doing-no-harm-1471426200

[10] https://insights.som.yale.edu/insights/how-patagonia-learned-to-act-on-its-values