This case was prepared by Jakob Utgård as a basis for class discussion rather than to illustrate effective or ineffective handling of an administrative situation. © licensed under CC BY-NC-SA 4.0. Jakob Utgård © 2025.
“This is a very difficult issue. We have a close dialogue with our contact in the factory and several relevant parties and stakeholders. We listen to all voices, and there are divided opinions about what textile companies trading with the country should do.” — Yngvill Ofstad, Head of Sustainability, Bergans Fritid AS (Solem, Frifagbevegelse, 2025)
In June 2025, the International Labour Organization (ILO) invoked Article 33 of its constitution against Myanmar’s military junta, only the third time in the organization’s 106-year history. The measure calls on all ILO member states to take action pressuring Myanmar to comply with international standards on freedom of association and forced labour. For Yngvill Ofstad, sustainability manager at Norwegian outdoor clothing brand Bergans Fritid AS, this again raised the question of whether Bergans should leave Myanmar.
A changed situation
Bergans entered Myanmar in 2013, when the country appeared to move towards democracy. Foreign investment, particularly in garment manufacturing, was encouraged by international optimism and low production costs. Myanmar offered competitive pricing, a growing workforce, and links to established Asian supply chains.
However, in 2021 the military seized power in a coup. Global brands including H&M, Primark, Inditex (Zara), and Marks & Spencer exited the country. Bergans ended its relationship with one supplier, but kept the other, which it describes as well-run and which independent European monitors assessed positively.
Active Brands, the Norwegian group behind Kari Traa, Johaug, Vossatassar, and Bula, also has a supplier in Myanmar. Its ESG manager, Rebecca Johansson, stated that: “We have worked closely with this partner for several years, improving both labour rights and health and safety conditions at the factory. It is important to us to help safeguard the jobs and rights of the people working there.”
Tough working conditions
A June 2025 UNDP report on Myanmar’s garment sector found that 55% of workers reported working overtime, with daily hours averaging 12, and in some cases reaching 21. Physical injuries were reported by 59% of workers, mental stress by 58%, and respiratory problems by 20%. Factories were described as overcrowded, with inadequate toilets, insufficient drinking water, and poor ventilation. The Business & Human Rights Resource Centre has documented several hundreds labour and human rights abuses across the sector between 2021 and 2024.
Wages are very low. Myanmar’s legal minimum wage has been frozen since 2018 and, due to inflation and currency collapse, is now worth less than a third of its 2018 value. The base daily rate sits at around $2.47. Eighty-five percent of workers surveyed by the UNDP reported needing higher pay. IndustriALL, a global union federation, has documented the use of forced labour: wage withholding, excessive production targets, intimidation, and child labour. The garment sector is simultaneously one of the military junta’s largest sources of foreign currency, generating $4.46 billion in exports in 2024, with Europe importing approximately €2.8 billion under the EU’s duty-free EBA arrangement.
Åpenhetsloven (the Transparency Act) from 2022 requires companies to conduct and publish due-diligence assessments of human rights and labour conditions in their supply chains. For Bergans, this means documenting working conditions at the Myanmar factory. The problem is Norwegian Foreign Ministry travel guidelines stop company employees from entering the country. Bergans relies on partners with access to Myanmar to conduct audits on their behalf.
Divided labour unions
The Norwegian confederation of trade union (LO)’s international director Liv Tørres claims that independent trade union activity inside Myanmar is barely possible, which makes due diligence extremely difficult to conduct. LO’s 2025 congress passed a resolution declaring that all trade with and investment in Myanmar supports the junta, and calling on Norwegian companies to exit.
The Confederation of Trade Unions of Myanmar (CTUM), operating from exile under leader Khaing Zar Aung, a former garment worker, aligns with LO and argues for an exit. Trade unions operating inside Myanmar ask companies to stay, arguing that factory jobs held overwhelmingly by women represent economic lifelines with no comparable alternative, and that withdrawal would punish workers most.
Heidi Furustøl, director of Etisk Handel Norge (of which Bergans is a member), states: “The easiest thing is to withdraw. But there is also extreme poverty in the country and the possibility of improving living standards if companies choose to stay.” Norway’s Foreign Ministry takes a similar line, urging companies to avoid actions that worsen the situation for vulnerable workers.
Discussion questions
- What are arguments for and against Bergans continuing to produce clothes in Myanmar?
- Would any of the arguments change if Bergans owned (instead of just buying from) the factory?
- If you were Yngvill Ofstad, what would you recommend to Bergans’ leadership?