Read the final statement issued by the Danish NCP – 17 October 2016
Read the follow up statement issued by the Danish NCP- 17 January 2018
On 12 December 2014, the NGOs Clean Clothes Campaign Denmark and Active Consumers submitted a specific instance to the Danish NCP alleging that PWT Group (a clothing company) had not observed the OECD Guidelines for Multinational Enterprises due to a failure to carry out due diligence in relation to its supplier, the textile manufacturer New Wave Style Ltd. which was located in the Rana Plaza, Bangladesh, before the collapse of the factory on 24 April 2013.
The NCP conducted an initial assessment, which was completed in June 2015 and the NCP offered mediation to the parties. The parties were unable to agree on a mediated agreement and the mediation process ended in February 2016.
On 17 March 2016, the NCP decided to conduct an actual investigation of the specific instance.
New Wave Style was located in the Rana Plaza building in Dhaka, Bangladesh, which collapsed on 24 April 2013, killing 1,138 people and injuring more than 2,000. PWT Group has stated that the company conducts inspections of the working conditions at the factories that manufacture goods for the company, and that an inspection was conducted at New Wave Style in 2012.
The Danish NCP found that the documents submitted by PWT Group did not provide details on checks and inspections that were conducted during the visit, nor whether improvements were required by PWT on the basis of the inspections. Nor did the NCP find that PWT has submitted documentation of the company’s risk and decision making systems, e.g. checklists, used as the basis for inspections and visits at New Wave Style for the purpose of ensuring health and safety at the workplaces.
The NCP found that PWT Group had not applied processes for due diligence in compliance with the OECD Guidelines. In particular, PWT Group had failed to make demands that New Wave Style ensure employees’ basic human and labour rights, including failing to take adequate steps to ensure occupational health and safety in their operations (see chapter V, paragraph 4c of the OECD Guidelines).
On 17 October 2016, the NCP released its final statement concluding the specific instance and recommending that PWT Group:
- Revise its management and risk assessment systems in order to implement processes by which the company can meet the requirement of due diligence in relation to its suppliers, in accordance with chapter II of the OECD Guidelines.
- Ensure that the company’s corporate social responsibility policy complies with the OECD Guidelines.
- Review its suppliers’ self-assessments in conjunction with an analysis of industry and country risks and, on this basis, select what is to be inspected.
- Report and communicate about these efforts and about the measures carried out by the supplier to prevent potential risks.
- Continue its efforts to systematically incorporate the company’s Code of Conduct into management and risk systems.
- Remain up to date on new guides on due diligence within its sector as a means of continuously developing the company’s work in this respect.
The NCP requested that PWT Group, within one year of the publication of the final statement, provide a follow-up report on the above recommendations and on the company’s efforts to develop decision-making and risk management systems that meet the due diligence requirements of the OECD Guidelines.
On 17 January 2018, the NCP published a follow up statement noting the PWT Group had responded to the recommendation of the NCP.