Investigating Apparel Worker Needs in the Dominican Republic - McDonough MBA's Present to VF Corporation
By Jackie Balakarski (MBA’18)
It was a hot May day in Santiago in the Dominican Republic and the smell of rubber filled my nose during a tour of a factory which exclusively makes shoes for Vans. Although I’ve toured many manufacturing facilities, this was my first time seeing shoe production and I was fascinated.
Vans’ production, like most apparel and shoe brands, is outsourced to a company called SunJade, a Taiwan-based expert in shoe production. SunJade had set up a factory in the DR at the request of one of its larger customers, U.S. based VF Corporation, owner of the Vans brand. When invited to visit the DR and tour VF’s factories, I knew globalization and international supply chains would be part of the story, but their complexity was showcased here clearly. Adding to the complexity was the fact that VF Corporation also produces its Timberland brand at another factory in Santiago. However, in that case, VF directly owns and manages that factory as a subsidiary, whereas the Vans brand is produced in a contract factory.
My classmate in the MBA program (Becky Arnold) and I were both in the DR to do a small consulting project for VF, comparing worker satisfaction and needs at the two different factory complexes. Despite being producers for the same company, there were major differences between the VF-owned and contract factories regarding absenteeism and turnover of the workers on the production line. Workers at the contract factory making Vans stayed much less time at their jobs on average than at the VF-owned factory making Timberland footwear. The difference in turnover was contributing to lost production time and significant additional costs. We were traveling with VF’s Responsible Sourcing Advisory Council, which was visiting factories and worker communities in both the DR and Nicaragua.
As to the origins and purpose of the Responsible Sourcing Advisory Council, Sean Cady, VP of Global Supply Chain and Responsible Sourcing for VF Corporation, stated:
“A couple of years ago, we asked ourselves what we could and should be doing to continually improve the lives of workers throughout our global supply chain. I was lucky enough to be asked to put together and lead the new team. We started doing several things that gained traction, but last year we asked ourselves, are they the right things? Are we really focusing where we need to, and are we looking at this issue of responsible sourcing from the best angle? We just didn’t know, and decided the best way to determine that was to create a council of advisors who could advise us on best practices.”
The visit and project in the DR was an extension of the Council’s work. Along with Jazz SinghKhaira from VF, Becky and I designed a survey for workers at both factories regarding their community needs. Our survey discovered that the most common needs were for better education for their children, daycare, and reduced delinquency and crime in their neighborhoods. A need for daycare was expressed even more strongly at the contract factory where turnover was higher. In fact, 12% of workers who voluntarily left their positions at this factory and completed an exit interview noted that needing care for their children was the reason for leaving their jobs.
We presented our findings to VF’s Advisory Council on Responsible Sourcing, formed to advise VF’s Responsible Sourcing Department and the company’s board of directors. The council includes Bill Novelli, Professor and founder of the Global Social Enterprise Initiative (GSEI) at Georgetown’s McDonough School of Business, along with 10 other leaders focused on development, good governance, nonprofit management, and socially responsible business. Among them are Matthew Frazier from Dalberg Global Development Advisors, George Ingram, a former Congressman and current Fellow at the Brookings Institute, and Jane Mosbacher Morris, the founder of To The Market.
In the DR, VF is currently in discussions with several nonprofits and the government to provide more daycare services for the children of the workers in their contract factories, as well as an education program. Our survey work highlighted the need for these two programs, and clarified the need for immediate action on the childcare issue for the contract factory. Although reducing crime in local neighborhoods is likely outside the control of a single private enterprise operating in the community, this expressed need highlights the role public-private partnerships can play.
VF Corporation is a large and complex company with many possible areas of focus in responsible sourcing: including worker conditions both inside and outside the factory, country conditions, political interactions, and environmental impact. Like any producer in the apparel industry, there is certainly room for growth. Georgetown is pleased to be a part of that continued growth in sustainable and responsible sourcing for VF, continuing this fall with listening sessions with current Georgetown students. These sessions will be focused on young students’ and millennials perceptions of VF’s brands as well as what sustainable sourcing is and what they believe could be done to better the industry. We hope to open up the conversation with these sessions and learn more about the demands and perceptions of young customers and activists.
We are looking forward to being a part of the future steps VF takes to make the production of our clothes and shoes more equitable, safe, fair, and environmentally clean for all.