The Business Ethics Blog

By now you’ve likely heard about this story that broke over the weekend: it’s been revealed that one of the factories making garments for clothing retailer The Gap has been using unpaid child labour.

Here’s CNN’s version: Gap: Report of kids’ sweatshop ‘deeply disturbing’

The president of Gap North America says a subcontractor accused of using child labor to sew Gap clothes in India has been fired and the Gap will not sell clothes made in the New Delhi sweatshop.

“It’s deeply, deeply disturbing to all of us,” Gap President Marka Hansen said after watching video of the children at work. “I feel violated and I feel very upset and angry with our vendor and the subcontractor who made this very, very, very unwise decision.”

Hansen blamed the alleged abuse on an unauthorized subcontractor for one of its Indian vendors and said the subcontractor’s relationship with the Gap had been “terminated.”

A couple of comments:

1) Is this story an indictment of outsourcing, or of globalization more generally? Clearly not. As I suggested in my blog entry about toy recalls, the amazing thing isn’t how often things go wrong in a globally ramified supply chain, but how often things go right. Note also that it is only because Gap is a big company with well-organized supply chains that any coherent response is even possible. If those products of sweatshop labour were merely being retailed through a few hundred small independent retailers across North America and Europe, there would be little anyone could do. The Gap serves as a clearing-house not just for products, but for blame, and the company (unlike a disorganized cluster of mini-retailers) has the resources to remedy the problem.

2) The Gap says they’re not even going to sell the products that have already come out of the factory involved. I guess the theory is that those clothes are now somehow ‘tainted,’ like blood diamonds or something. This seems a bit crazy. It’s a symbolic gesture at best, and it seems wasteful. Worse, it smacks of a kind of puritanical, holier-than-thou attitude. As in, “sure, other companies would apologize, yank the relevant contracts, and tighten up monitoring of sub-contractors, but we’ll go a step further and treat the products as if they’re bearers of contagion.” Why not give the clothes to charity or something? (For all I know that might be their plan.) Or would that be bad, too: making poor people wear morally-tainted clothes? (Think about that for a minute!)

3) Interestingly, the Indian government worries that attempts to (over?)-regulate the apparel industry (making it harder for Western companies to outsource work to places like India) is a veiled form of trade protectionism. See the comments from the Indian commerce minister in the Times of India. Though it doesn’t come anywhere close to justifying child labour (let alone child slave labour) it’s worth remembering that the Gap is an effective means for funnelling money from affluent North Americans and Europeans to the working poor of India, among other places. That might not change the diagnosis, but it might well change the prescription.