Rip Curl, which sits among Australia’s most iconic beach brands, was found to have sold millions of dollars worth of inventory manufactured by workers who endured slave-like conditions.
A Fairfax Media investigation revealed garments labelled ‘Made in China’ as part of the brand's 2015 winter line were actually manufactured at a factory outside of North Korea’s capital of Pyongyang, where workers endured systematic exploitation.
North Korea holds one the world’s worst track records of worker treatment and conditions. In Human Rights Watch's 2015 World Report, North Korean workers are described as having been “systematically denied freedom of association and the right to organize and collectively bargain” while “systemic, widespread, and gross human rights violations have been and are being committed”.
After photos were sent to Rip Curl, the company released a statement highlighting that “we were aware of this issue..but only became aware of it after the production was complete and had been shipped to our retail customers."
Rip Curl blamed the debacle on its suppliers, saying they had breached the company’s policy.
Rip Curl’s chief financial officer Tony Roberts said in the statement, “This was a case of supplier diverting part of their production order to an unauthorised subcontractor, with the production done from an unauthorised factory, in an unauthorised country, without our knowledge or consent, in clear breach of our supplier terms and policies”.
“We do not approve or authorise any production of Rip Curl products out of North Korea."
Oxfam Australia’s CEO Dr Helen Szoke told the Sydney Morning Herald that the revelation brought into question not only the standards of Rip Curl but also Australia's other major companies.
"Australians would be shocked to hear that an iconic Australian brand with roots on the surf coast of Victoria can't confidently track clothing produced within its own supply chain," Dr Szoke said.
"Rip Curl has no excuse for being unaware of what is happening. Companies are responsible for human rights abuses within their businesses – not only morally but also within international human rights frameworks."
Dr Szoke also called on Rip Curl to follow the model of other Australian giants such as Kmart, Target and Coles, whom all publish the exact locations of their supplier factories.
"Rip Curl needs to show the Australian public it's serious about preventing this from happening again through a dramatic overhaul of its checks and balances. It should start by publishing its policies and a list of the factories where its products are made," she argued.
The revelation follows The Baptists World Aid’s 2015 Fashion report which found that of the 128 clothing brands surveyed, only five percent were paying international suppliers workers a living wage that met their basic needs.
“The research revealed 91 percent of companies don’t know where their cotton comes from, and 75 percent don’t know the source of all their fabrics,” the organisation stated.
“We could find little evidence that any of these fashion retailers were doing much, if anything, to protect workers overseas. Many of them had little or no publicly available information and/or didn’t respond to any of our requests to engage with the research process."
Meanwhile, the latest data from Nielsen shows the "caring economy" is on the rise, with consumers increasingly wanting to buy ethical and sustainable products. Two in five Kiwis will pay more for a brand from a company boasting environmental or social sustainability credentials, and 22 percent bought a product or service from a company supporting a worthy cause in the last month even though it was slightly more expensive.