We bought a few H&M shares, just so that we could formally propose a living wage fund for the workers. Shareholders will vote on our living wage resolution at the Annual General Meeting taking place on 7 May. This is an opportunity for them to improve millions of lives! Read the resolution and tell the shareholders to do the right thing.
Resolution under agenda item “Disposal of the company’s earnings”
The Annual General Meeting calls on the Board of Directors to pay no dividend for this financial year.
The company’s earnings shall instead be transferred into a special “living wage fund” aimed to finance the company’s efforts to increase wages of workers in H&M’s supply chain. The fund shall be in place until supplier wages have reached at least living wage levels, and are thus human rights compliant.
The H&M group has not yet met the requirement to ensure workers in its whole supply chain at least a living wage. Meeting this requirement represents an essential human rights duty, as laid out for example in the UN Guiding Principles on Business and Human Rights.
H&M’s own wage data as well as third-party reports show that the measures undertaken so far have not yet delivered a living wage to workers in the supply chain. In important production countries like India, Turkey and Bangladesh, wages would need to increase significantly to secure workers and their families a life in dignity. In Bangladesh workers are demanding that the wages they are getting at H&M suppliers be at least doubled, so that they can afford decent housing, food and health care for themselves and their children.
Not meeting the company’s human rights obligations also represents a high risk for the future of the company. The strikes over low wages in Bangladesh in January 2019 show how poverty wages lead to disruption of production. Consumers are also increasingly cautious about brands’ reputation when it comes to sustainability. A clear sign of this is that over 140,000 people signed Clean Clothes Campaign’s petition calling on H&M to keep the promise concerning living wages to garment workers.
As responsible investors, it is our firm conviction that financial returns shall never be based on exploitation of labor. Paying poverty wages to those who create the value added in the products sold by the H&M group is unacceptable. The company’s earnings should therefore not be disbursed as dividend, but instead be used to build a “living wage fund”.
The fund shall serve to:
- raise the wages of workers in H&M’s supply chain who are earning poverty wages;
- pay higher prices to suppliers and at the same time ring-fence the cost of labor at living wages level;
- put in place monitoring mechanisms that ensure that suppliers pass on the increased prices to workers’s wages;
- fund living wage contributions in joint initiatives with trade unions aiming at closing the living wage gap; and
- reorganize H&M’s supply chain with living wages at the heart.
The fund shall be maintained until wages at all levels of the supply chain are at least at living wage level and H&M’s earnings no more rest on poverty wages.