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17 Sep 2020

Pichamon Yeophantong

Why Chinese Investment Needs Gender Sensitivity: The Case of Sexual Harassment in Cambodia’s Garment Industry

Pichamon Yeophantong

The US$2.4 trillion garment industry employs around 75 million people globally, with the vast majority of the workforce being women in developing countries. For countries such as Bangladesh, Cambodia, Sri Lank and Vietnam where wages are low, this sector has proven central to their economic growth and also serves as a major source of employment. But this reality can create perverse incentives for manufacturers—and, at times, governments—to neglect workers’ rights and safety in a bid to keep wages low and productivity high, especially with the rapid growth of the ‘fast fashion’ industry worldwide. Disasters like the 2013 Rana Plaza building collapse in Dhaka have revealed the poor working conditions faced by garment factory workers, with brands and retailers subsequently put under pressure to ensure that their suppliers are abiding by worker safety standards. And yet, just last year, another deadly fire at a garment factory in New Delhi again spotlighted the safety problems that persist in this industry.

Such disasters represent some of the more ‘visible’ problems. There remain a range of other labor and human rights violations that continue to bedevil in the global garment industry’s obscure supply chain. In addition to ongoing problems such as underpayment and wage theft, persecution of trade union members or excessive overtime, the insidious problem of sexual harassment and gender-based violence (GBV) at work poses as a daily risk faced by garment factory workers. As a revealed in a 2018 report by the Global Labor Justice, despite women workers making up between 80-95% of the workforce, most tend to be employed in short-term, low-skill and low-wage positions. The export- and ‘fast fashion’-oriented nature of the garment industry further exacerbates these conditions, as demanding production targets become increasingly the norm and consolidates power asymmetries in the workplace. It was reported, for instance, that violence and harassment was 3.8 times more likely during the high season in Vietnam than the rest of the year, with one worker recounting how her supervisor had hit her and beat her “hands with a stick”.

At a time when China’s garment and textile industry is seeking to ‘go global’, with companies expanding their overseas manufacturing bases to Africa, Southeast Asia and beyond, these problems in the supply chain demand careful and urgent attention. If left unaddressed, not only can sexual harassment on the factory floor reduce firm profits due to poorer workforce retention and worker participation, but can also negatively affect its reputation and standing with buyers. Given global calls for ethical consumerism, maintaining a positive image is now a foremost concern for major brands and retailers like Zara, which have faced a string of supply chain-related scandals.

In Cambodia, where the US$7 billion-garment industry is responsible for producing over three quarters of the country’s exports and 40% of the country’s GDP, the industry has courted a spate of controversies from the job insecurity faced by workers—evinced by the mass layoff of workers in 2019 amid labour strikes—to the well-known problem of mass faintings among women workers. Of the 800,000 workers employed in the sector, most are young women who have migrated from rural areas for their first formal employment. These workers usually occupy ‘low power’ positions within the factory, being accountable to a line supervisor who assesses their performance, and are thus particularly vulnerable to harassment and other forms of gender-based violence.

Most of Cambodia’s garment factories are owned by Chinese investors from mainland China, Hong Kong and Taiwan, and are also largely managed by Chinese staff. But while some of these factories might have preventative policies and reporting mechanisms in place to support workers who have experienced sexual harassment or other forms of GBV, there often remains an organisational—if not societal—culture of silence when it comes to reporting and dealing with harassment. It was evident from in-factory interviews with workers and managers in Cambodia how a lack of organisational resources and awareness of what behaviours constitute ‘sexual harassment’, combined with fears of reprisals and dismissals among the workers, can contribute to the under-reporting of harassment incidences as well as a broader failure among factory management to recognise sexual harassment and GBV as ‘real’ problems in the workplace. It was also the case that a desire to ‘respect’ the local culture and customs tended to see Chinese managers rationalising observed behaviours that would otherwise qualify as sexual harassment.

At a time when the COVID-19 pandemic has disrupted global supply chains and women’s livelihoods, with Cambodia’s apparel sector being among the hardest hit, the responsibility to prevent all forms of GBV in the garment supply chain should fall not only on the Cambodian government and global brands, but equally—if not more—on factory owners and managers. There is an exigent need for Chinese investment in the sector to not just be gender sensitive, but also to proactively support women’s economic empowerment and gender equality through the development of better organisational guidelines, reporting mechanisms and awareness-raising among the workforce. And the business case for doing so is clear: economically, one study estimates that the indirect tangible costs of productivity loss due to sexual harassment in the sector, including turnover, absenteeism and presenteeism costs, could amount to nearly US$89 million per year. Reputationally, the ethical costs are immeasurable.

Pichamon Yeophantong is an Australian Research Council Fellow and Senior Lecturer at the University of New South Wales (Canberra).