KARACHI, Pakistan The century-old Central Jail here, a gritty repository of criminals, jihadists and sectarian killers, has a reputation for overcrowding and prisoner riots. But for Arshad and Shahid Bhaila, the industrialist brothers whose factory burned to the ground in September, killing at least 262 workers, there are some comforts.
They have a private room, a bathroom, a television and personally cooked meals. Those perks may prove only a short-lived solace once their trial begins in January and they face a possible death sentence on murder charges.
Yet their lawyer, in mounting a defense, is seeking to shelter the Bhailas behind an apparel industry certification system that gave their factory, Ali Enterprises, a clean bill of health just three weeks before the horrific blaze.
Despite survivors accounts of locked emergency exits and barred windows that prevented workers from leaping to safety, the Bhailas lawyer says their SA8000 certificate, issued under the auspices of Social Accountability International, a respected nonprofit organization based in New York, proves they were running a model business.
This was a state-of-the-art factory that met international standards, said the lawyer, Amer Raza Naqvi. The SA8000 is accepted all over the world. They have very strict rules before issuing any certificate.
But after the Karachi fire, and the more recent factory inferno in Bangladesh that killed 112 people, that contention raises a crucial question: Does industry-backed social auditing, which purports to safeguard the lives and working conditions of some of the worlds poorest workers, really work?
For the past 15 years, retail giants like Walmart and Carrefour have helped create and champion numerous factory inspection systems. In embracing such monitoring, the companies are motivated by genuine concern for the workers at the bottom of their supply chain, certainly, but also by their own bottom line.
THE SA8000 SYSTEM
These elaborate systems look good on paper, but the actual work is often delegated to largely unsupervised subcontractors. The company that certified Ali Enterprises, as in many other cases, never visited the factory, handing off the job to a local inspector it dealt with by telephone or at meetings outside Pakistan.
Right from the outset, there has been concern, said Philip J. Jennings, general secretary of UNI Global Union, a grouping of 900 labor unions that recently quit the board of Social Accountability International to protest what he said was the certification systems overall ineffectiveness in improving factory conditions and workers lives.
Monitoring systems like the SA8000, said Khalid Nadvi, an expert at the University of Manchester in England, are very patchy and in many cases totally ineffective.
Factories often know when the inspectors are coming, Nadvi added. You have workers being coached what to say. There may be two sets of books.
The certificate that Ali Enterprises boasts about is considered the most prestigious in the industry. It is the creation of Alice Tepper Marlin, a Wellesley College graduate and former Wall Street analyst who, after starting an activist group in 1969 to push for greater corporate responsibility, eventually settled on trying to make the worlds sweatshops less horrid.
Founded in 1997, Social Accountability International receives fees and membership payments from industry giants like Gap, Gucci and H&M, but it also obtains money from labor unions, governments, foundations and nongovernment organizations. It created the SA8000 to certify factories that meet basic requirements in eight areas, including health and safety, wages, working hours and child labor.
CULTURE OF COMPLIANCE
Today, Tepper Marlins modest-sized organization oversees a sprawling, often problematic empire. Its SA8000 stamp of approval has been given to 3,083 factories in 66 countries. Tepper Marlin said the catastrophic Ali Enterprises fire shook her deeply.
Nonetheless, she still vigorously defends that system, contending that it has been vital to setting and safeguarding baseline standards for supply-chain workers in poor countries, particularly those with corruption-prone governments and weak unions.
We think we do make a difference, Tepper Marlin said. Were just trying to help get a culture of compliance.
The various disasters have given fresh oxygen to critics who say industry-led certification should be abolished across the board and replaced with a more accountable system that requires the retailing giants and their Western consumers to help pay for needed factory improvements, even if that means higher prices for clothing.
There was evidence that Ali Enterprises was flawed well before Septembers fire. Abdulrauf Shaikh, a longtime inspector, examined the factory three times, in 2010, 2011 and again this July, just two months before the fire. Each time he found a locked fire exit, minimum wage violations and other serious problems.
Shaikh was there on behalf of a European apparel company that was thinking of using the factory. When Shaikh confronted the Bhaila brothers over these problems, he recalled, They said: We are SA8000-certified. Whether you pass us or fail us, thats your issue. We dont care.
Social Accountability International does not inspect the factories itself. It has a compliance affiliate that licenses firms to do the actual work. One such firm is RINA, an Italian corporation founded in 1861 to inspect ships. In Pakistan, the process was further subcontracted to RI&CA, which inspected Ali Enterprises last summer.
That Pakistani firm has a controversial reputation largely because of its unusually high rate of approvals, doing inspections that led to 118 SA8000 certificates between 2007 and 2012. In contrast, a larger auditing firm, Bureau Veritas, awarded 46 certificates in Pakistan over a period twice as long.
RI&CAs flurry of accreditations worried a team of English monitors led by Vic Thorpe and Stirling Smith, who often went to Pakistan to check on inspectors operations.
It seems very fishy, Smith said. Theyve certified so many factories compared to the other players, so you wonder.
Thorpe said he conveyed his concerns to Social Accountability International. Its compliance arm did step up its oversight, but no further action was taken.
Despite such concerns, industry officials said, RINA never sent employees to Karachi, instead conducting checkup meetings in the Middle East or by telephone.
In a statement, RINA said it had conducted periodic internal audits and meetings with Adnan ul Hasan, RI&CAs owner. But the firm declined to specify where and when those meetings had taken place.
CERTIFICATION, THEN A FIRE
Ul Hasans company inspected Ali Enterprises, a large plant with 2,000 workers in northern Karachi, between June 25 and July 5, records show. On Aug. 20, RINA awarded Ali Enterprises an SA8000 certificate.
Three weeks later, fire erupted in the storage department, among giant rolls of denim. The blaze spread quickly, engulfing the main building where about 660 people were working.
RINA has refused to release the inspection report that its Pakistani partner prepared in July, citing confidentiality requirements. But it is clear there were serious problems at the factory.
In interviews, workers said they worked 60 or more hours a week, sometimes in 24-hour shifts. Although most earned the statutory minimum wage of $83 a month, few satisfied the SA8000 requirement of a living wage one that met a familys basic needs.
Social Accountability International and its compliance arm have begun an extensive review of its work with RINA. On Friday, they announced that RINA would no longer issue SA8000 certificates in Pakistan.
RINA, in a statement, said it had suspended its relationship with its Pakistani affiliate and was conducting spot checks on factories that had been certified in its name. The group, however, is resisting calls to rescind all of its SA8000 certificates in Pakistan.
RI&CA, meanwhile, has sought to distance itself from the fire. In a telephone interview, the Pakistani owner denied he even did apparel monitoring.
We didnt do Ali Enterprises, ul Hasan said. Ive never even seen the factory.
The police, RINA and lawyers for Ali Enterprises contradicted that statement.
Extensive failings by the Pakistani state played major roles in the disaster. There was little enforcement of safety laws; labor unions, which experts say could provide a voice on workers conditions, have been strangled for decades.