GLOBAL – A group of 15 institutional investors including PGGM, MN, F&C and Hermes Equity Ownership has called on companies doing business in Bangladesh to take measures to ensure the safety of workers in the garment manufacturing industry.

In a joint statement, they said: "The recent and ongoing tragedies such as the Rana building collapse and the Tazreen factory fire poignantly illustrate the significant reputational, operational and legal risks in global supply chains.

"The accidents underscored the urgent need for companies to know their suppliers, ensure compliance with safety standards and fully disclose their supply chains."

The asset managers acknowledged that improving worker safety might require the collaboration of companies and government, but they stressed that, as shareholders, they must rely on the companies in which they invest to monitor and mitigate the risks in their supply chain.

The group – which manages more than €1trn in combined assets – urged companies with significant purchasing power in Bangladesh, such as Walmart and Gap, to act "swiftly and effectively".

It also welcomed the announcement by clothing chains H&M, C&A, Calvin Klein and others to join Phillips-VanHeusen and Tchibo in the Accord on Fire and Safety in Bangladesh.

"We view such an agreement as an example of the crucial collaboration needed to both promote worker safety standards and protect shareholder value," the group said.

The asset managers said they were dismayed by public statements from companies suggesting they were unaware that certain factories were manufacturing their products.

"Companies need to know this in order to properly manage a complex global supply chain, including being effective at monitoring safety and other compliance risks at the facilities," they said.

In the investors' opinion, companies must ensure compliance actively, rather than leave it to suppliers, particularly "while pricing systems actively undercut requisite investment in infrastructure or encourage covert sub-contracting".

They added: "We expect portfolio companies to pursue co-operative relationships with suppliers that enable compliance and promote stable production."