Buyers prefer green factories but are unwilling to pay extra
The United States Green Building Council recognised three more readymade garment factories in Bangladesh as green, raising the total number of environment-friendly establishments in the country’s apparel sector to 183.
Of the latest certified green factories, Swisstex Village in Singair, Dhaka, received a gold rating, while the DBL Group’s Jinnat Knitwears Ltd received platinum rating for its RMG and printing buildings.
According to the US Green Building Council, Bangladesh is the global leader in the number of green garment buildings with 60 platinum, 109 gold, 10 silver, and four with no ratings.
Five hundred more units are in the process of achieving the US Green Building Council’s Leadership in Energy and Environmental Design (LEED) certification.
The country has been receiving the LEED certificates since 2001.
The council honours factories based on several criteria that include CO2 emissions, energy efficiency, water use, waste systems, transportation, materials, health and indoor environmental quality.
The best performers are rated with platinum, followed by gold and silver.
The ratings, however, come at a cost that buyers aren’t willing to pay.
An unrewarded compliance
Mohiuddin Rubel, a director of the Bangladesh Garment Manufacturers & Exporters Association (BGMEA), said green factories are a commitment to saving the environment and reducing use of resources.
Though a costlier process in the initial stage, green factories don’t mean the buyers are ready to pay any of the extra cost incurred.
He said international retailers and brands always put pressure to apparel exporters on being compliant but they are not ready to pay the price.
Now it is time to create awareness among the retailers, brands and their customers to pay for green initiatives as it has a cost, added Mohiuddin Rubel.
Despite the challenges, Bangladesh apparel entrepreneurs are investing in green buildings and adopting eco-friendly manufacturing practices.
Fatullah Apparels Chief Executive Officer Fazlee Shamim Ehsan alleged that top retailers use the green-factory tag to promote their products, but often times they give little orders to green-certified factories, while the bulk goes to other producers who have no sustainability practices in place.
Talking with The Business Standard, Kutubuddin Ahmed, founder of Envoy textile Ltd, said after the Rana plaza incident buyers are very strict about compliance and regulations.
The compliance issue has meant green-certified factories are on the priority list to place orders.
He said the green initiatives help to save energy and water usage by 20%-30 % compared to conventional factory buildings.
Syed M Tanvir, managing director at Pacific Jeans, said buyers are not giving any price benefits yet, but they prefer placing orders to LEED-certified factories.
Buyers also look for factories who have the capacity to produce quality products and deliver those on time, he added.
Abdullah Hil Rakib, managing director at TEAM Group, said the cost of setting up a LEED Platinum factory is around 30% higher than a conventional factory, but it reduces lifelong operational costs.
LEED certification requires technology to increase efficiency, resulting in a longer lifespan of the factories. Overall costs are also lower than in conventional factories, said Rakib, also a director of the BGMEA.
