Ivo in Vietnam

In May/June, FWF’s international verification coordinator Ivo Spauwen is travelling Vietnam and China, visiting factories, joining audits and talking to local stakeholders. As usual, he keeps us up to date on his adventures. His first message is from Vietnam.

I’m spending two days with our audit team in Hai Duong, a two hour’s drive East from Hanoi. This is the first audit our Vietnamese team has carried out since 2007, as not many of our affiliates have production here. As all three team members are experienced auditors, however, who are well-trained on FWF procedures, everything goes smoothly. Two observers of Kwintet Far East / Cotton Group who work as internal auditors in China and Bangladesh have joined us to learn about the FWF audit approach.

The audited factory is owned by a Dutchman whose family was part of the once renowned textiles scene from Noord-Brabant. In the 70s he left The Netherlands to set up shop in Vietnam. Later he also opened a factory in Laos. Although he leaves daily management to his personnel, he visited the factory yesterday, which offered us chance to meet. He explained to me that even though the financial crisis is also hitting the Vietnamese textiles sector, his factory is coping well as a result of a strong and diversified customer base. He has long-term relationships with several FWF members (in addition to orders of Kwintet Group, occasional production is done for other FWF affiliates) and other well-known EU retailers. The company indeed seems to be thriving with over 1000 employees and solid public procurement orders being placed, including uniforms for Dutch and German police.

Pay level is an interesting issue at this factory. Like other foreign owned factories this enterprise is required to pay wages well above the minimum wage in domestic enterprises. As part of its HRM activities, the factory recently carried out a living wage assessment which took local cost of living into account. Management set the lowest wages in this factory at the level which the study pointed out to be sufficient. While I am typing this, the audit team is assessing whether wages are indeed realistic for workers to live on.

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