Local to global comments in three languages. Much also from Pitäjänmäki Sockenbacka in Helsinki Helsingfors Finland, as well as from the organisations I participate in. The older content is from my previous blog page which I have now closed. Most of the contents on the earlier pages deals with sustainability, human rights and social responsibility in the global supply chains.
Yesterday the final agreement was made for me to be part of the Stakeholder Board of APSCA. The Association for Professional Social Compliance Auditors (APSCA) is a new organisation created by the world’s leading social and environmental auditing companies.
Already for some years I have been pushing for the industry itself to get together to defend both the quality and the credibility of serious and professionally qualified auditing. I am happy to see that this has now been done.
I was pleased to accept the invitation of APSCA as I am convinced that social and environmental auditing will continue to play a key role in laying a credible and useful foundation for protecting human rights and improving labour conditions. The Stakeholder Board will bring into the organisation’s work the expectations and views of brands and retailers, civil society organisations, independent experts and others.
In most supplier countries it would take a long time before labour relations built on collective agreements, protective legislation and an efficient government control and labour inspection can take over completely. To ensure positive change, a multitude of approaches and involving different global and local partners are needed. Among the most important participants in this work are the environmental and social auditors.
Many things are moving in the social sustainability landscape this spring, but will they contribute to real improvement for working families world-wide? This question is relevant also for four international events during the next few weeks that I am preparing for. They all deal with global supply chains, but from very different angles.
The Global Social Compliance Programme GSCP meets in Berlin at the end of the month, both for its own meeting and for a multi-stakeholder conference arranged together with the German Government. Later in the week, the Advisory Board of Social Accountability International SAI (SA8000) meets for three days in Florence, Italy. After the First of May weekend, Germany’s multi-stakeholder Textile Alliance (Textilbündnis) convenes a working meeting in Frankfurt a.M. to continue preparing its principles and work programme, also hosted by the Federal Government.
GSCP Brings Leading Brands and Retailers to Sustainability Work
The Global Social Compliance Programme GSCP is first in line with a members’ meeting in Berlin at the end of the month. This initiative represents many of the worlds largest brands and retailers and has been driving convergence in a very much split corporate responsibility landscape. Its work builds on a reference code and a number of tools that set high standards and provide guidance for sustainability work. An intention is that global supply chain actors could recognise each others’ social audit results and cooperate more actively in the important remediation and capacity building.
GSCP is now pretty much done with creating this foundation and is increasingly trying to support and promote real change for the better. Much attention is still given to developing management systems for social and environmental sustainability, both in supplier and buyer companies. Monitoring conditions and their development through social and environmental auditing continues to be an important and necessary pillar for these activities.
Public – Private Cooperation Supports Sustainable Development Goals
A major GSCP achievement has been to raise the sustainability awareness of the Consumer Goods Forum CGF and its members. These companies are among the largest in the world and can play a critically important role for global supply chain sustainability.
The second event does in fact reflect these developments. In a letter last summer to the German G7 Presidency, the CGF member companies committed themselves to participate in the world-wide work for the United Nations Sustainable Development Goals (SDG). This promise is now followed up at an international Conference arranged in Berlin with the Federal Ministry for Economic Cooperation and Development BMZ, directly following the GSCP meeting.
Action on Forced Labour Opens Concrete Cooperation
The concrete human rights and sustainability commitment chosen by the CGF brands and retailers for joint action is to remove all forced labour from their supply chains. This does not mean that the other human and workers’ rights would be left out. The obligation to apply the UN Guiding Principles for Business and Human Rights is still on the agenda even if the particular issue of forced labour has been singled out as a specific aim.
To support the credibility of the entire CSR field, these large companies should now say clearly what they intend to do and deliver substantial results reasonably fast. Work on this is in fact going on, involving also GSCP.
Important resources must also be allocated to define the major problem areas and address the issues effectively. Walking away from suppliers who cannot prove that their own supply chains are not clean will not be an alternative. Forced labour is found from high seas fishing and cotton growing to mining and manufacturing, all areas that need to be addressed. A special challenge will be to go deeper down in the supply chains than to the final suppliers only. This has not been the strong point of most sustainability schemes and initiatives and will need particular attention.
I have been a member of the Advisory Board of GSCP since the beginning of this initiative. During these years I have seen how many of the large buyer companies have acted effectively in support of workers’ rights in their supply chains. There have been both interesting and innovative approaches to this which would have merited much more public attention. I have no doubts that – with a serious engagement – we will see much of these also in the activities against forced labour.
Recognising the importance of this CSR work and the social audit based supply chain engagement of buyer companies can contribute significantly to improving conditions for the working families concerned. This does not mean that we can be complacent. Criticism is important as it helps to push things forward, but it also needs to recognise the importance of the engagement and participation of global brands and retailers. The BMZ Berlin Conference will hopefully contribute to a broader coalition building and cooperation instead of an often ideologically influenced negativism against business driven action.
Social Accountability International SAI Continues as Innovative Leader in Sustainability Field
Social Accountability International SAI meets immediately after this for its Advisory Board meeting. The three day event hosted by Gucci in Florence, Italy is also the starting point for a new stage of the organisation’s development. With a new President and CEO Jane Hwang and a new President of the Board of Directors Dan Henkle, SAI is well prepared to secure a leading role as an innovative and highly respected multi-stakeholder initiative. The SA8000 Social Standard and the detailed application guidelines make this into a unique and recognised benchmark for best sustainability practice.
I have had the privilege of working with SAI and its founder and President Alice Tepper Marlin over many years, both in the Board of Directors and the Advisory Board. This is where I have learned what sustainability and social responsibility in global supply chains really means. Alice and her team, where also Jane Hwang has played an important role, have built up a solid organisation which is well positioned to meet today’s challenges and make use of the opportunities to effectively promote human rights at work.
Germany would be a good role model for supply chain cooperation between business and unions. Of course there are major disagreements but this does not stop the social partners from taking joint responsibilities for human rights at work in producer countries. This picture is from the last of three multi-stakeholder Conferences arranged in 2015 by Development Ministry BMZ, to prepare the German National Action Plan for implementing the UN Guiding Principles on Business and Human Rights.
Will brands, retailers and other buying companies voluntarily respect human rights in their global supply chains? Are voluntary commitments reliable, or do we need legislation? Can consumer country laws help improve working life in producer regions?
These questions were very much present when German businesses and stakeholders met recently for a third and final conference in the run-up to a National Action Plan for implementing the UN Guiding Principles on Business and Human Rights. Next step will be drafting a proposal to be discussed with all stakeholders, beginning early next year.
How will Germany build a balance between civil society expectations and business preparedness? All of us who are engaged in promoting supply chain responsibility are surely waiting to see how the country will apply the business part of the UN Guiding Principles – “Protect, Respect and Remedy”.
Germany’s National Action Plan will influence also other countries. Europe’s biggest economy is actively promoting sustainability in global supply chains. We have seen this clearly during its 2015 G7 Presidency when the country has put business and human rights on the leading industrialised countries’ common agenda.
Business concerned over unwanted negative effects
In Berlin, business representatives and social advocacy organisations were far from each other when speaking about voluntary initiatives and binding legislation.
Most business representatives preferred voluntary action as the best way to apply the due diligence required by the UN Guiding Principles. They were concerned that legislation and possible sanctions could lead many buyers to leave sensitive supplier countries and regions when they should stay and help improve conditions. If Germany would introduce more obligations for buyer companies than those of competing countries it would put the country’s business sector at a clear disadvantage, it was said.
Corporate speakers questioned whether small and medium enterprises really have the knowledge and capacity to deal with new regulations.
Business is not a uniform group but consists of companies on very different levels when it comes to sustainability issues. For ‘the best in class’, even a demanding National Action Plan would bring little change as their voluntary approaches already go much further.
This has been all too slow. Fully understanding that changes take time there should already be major improvements in the big picture.
Sub-standard wages and uncontrolled excessive working hours remain the reality in many parts of the supply chains. There is less child labour, but still too much. Forced labour continues to be a problem in some industries and regions, and freedom of association is frequently ignored. Farming is a weak area for many schemes and initiatives.
If buying companies and other businesses want to be credible when pushing for voluntary due diligence approaches they need to show more concrete results, on all fundamental human and workers’ rights issues.
Unions question CSR effectiveness
Global unions have a more negative attitude towards voluntary corporate social responsibility initiatives than before. They say that there have been little if any results from corporate social responsibility programmes. This has driven them to close alliances with social advocacy organisations.
Deteriorating labour relations has a negative influence on supply chain cooperation. Collective bargaining has turned into a defensive union struggle as new wealth to share in negotiations is not generated anymore. Social dialogue suffers and aggressive campaigning has increased.
Trade unions do have a point when they criticise brands and retailers for largely ignoring freedom of association in supply chains. Many buyers demand that suppliers comply with child labour, forced labour and anti-discrimination rules but are quick to leave trade union rights out. This can give suppliers the impression of having a free hand to resist organising efforts. Many companies are also reluctant to engage in joint projects with worker organisations, although here the distrust is often mutual.
Unions and advocacy organisations are calling for binding legislation in consumer countries, as part of the National Action Plans. This would include the right to initiate collective legal proceedings, something like the U.S. class action lawsuits. They also call for legal sanctions against companies in these countries if they ignore their due diligence obligations.
The role of social standards and codes
Social standard and codes will continue to be important tools, as will social auditing. Collective bargaining and social dialogue between employers and workers’ trade unions can often not replace these functions. There are no structured labour relations in many countries and regions, and all governments do not effectively guarantee decent conditions. This will continue into the foreseeable future. The aim must be that labour conditions are eventually set by local partners, through mainstream tripartite procedures. Also corporate responsibility initiatives and activities must be geared in this direction.
Environmental and other initiatives pay increasing attention to human rights and labour conditions. They are responding to business demands but also protecting their own quality and reliability. The Global Organic Textile Standard GOTS where I am engaged certifies organic textiles through a highly demanding process. The same serious and demanding approach applies to human rights and labour conditions. Many others are doing the same which does not mean their standards or codes or other tools would be as detailed as those of specialised social responsibility initiatives. There is in fact already much cooperation around capacity building, training and other activities, as well as in auditor accreditation. The National Action Plans will surely intensify this cooperation.
Whether a scheme or initiative calls itself multi-stakeholder or business driven does not have to make a big difference. Important is that they are serious, demanding and committed and produce results. Social Accountability International SAI, the Ethical Trading Initiative ETI, the Business Social Compliance Initiative BSCI, the Fair Labor Association FLA and the Fair Wear Foundation FWF are examples of cross-industrial initiatives which have set their standards and ambitions high, and which are working actively with remediation programmes. The Fairtrade movement has a similar approach in its own niches of the global economy.
None of these initiatives can guarantee that every workplace audit produces absolutely reliable results, but as verifying and certifying demands and social auditors’ skills grow, also reliability increases.
More than voluntary, less than legislation?
I would expect an approach by the Berlin government that goes further than only demanding voluntary commitments by businesses to apply due diligence in global supply chains. This would not necessarily mean that sweeping legal responsibilities or tight sanctions for buying brands and retailers would be put in place.
A National Action Plan is of course exactly what it is called, an action plan, not legislation. It is more about the process towards more responsible business practices than about a set end result.
A solution is surely now sought that meets at least part of the civil society expectations while protecting and promoting German business interests. Responsible politicians and government agencies will have a difficult task as there seems to be a mutual lack of confidence especially between business organisations and social advocacy movements. When political positioning now is giving way to concrete drafting, Germany’s influential trade unions could well play a constructive role in looking for balanced and realistic compromises.
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I represented the Global Organic Textile Standard GOTS at the meeting in Berlin. Human rights and labour conditions are important concerns for this organisation which is engaged in updating its certification standard. Above all, training and capacity building ‘on the ground’ is developed and growing.
This article does not express the views of GOTS and I do not write it as a GOTS representative. These are my personal reflections and opinions, of course influenced by my background in the global trade union movement and my very active board engagements in the Global Social Compliance Programme GSCP and Social Accountability International SAI,which owns the SA8000 Social Standard.
Never before has supply chain responsibility attracted as much attention on high political levels as it did at the G7 Summit in Elmau Germany which closed today. The leading western industrialised countries did not only formulate policy but also committed to action in their concluding statement:
– Unsafe and poor working conditions lead to significant social and economic losses and are linked to environmental damage. Given our prominent share in the globalization process, G7 countries have an important role to play in promoting labour rights, decent working conditions and environmental protection in global supply chains. We will strive for better application of internationally recognized labour, social and environmental standards, principles and commitments (in particular UN, OECD, ILO and applicable environmental agreements) in global supply chains.
The Government of Germany deserves much credit as this would never have come about without their strong and longstanding commitment to drive and support human rights and decent working conditions in the global supply chains.
Safe workplaces are obviously among the main issues that were singled out in the declaration. As one of the concrete action points, the summit spoke out in support of a German initiative to establish a “Vision Zero Fund” together with the International Labour Organisation ILO, to support measures for improving labour, social, environmental and safety standards.
The G7 heads of state and government also committed themselves to strengthening the use OECD Guidelines for Multinational Companies in applying supply chain sustainability. This follows up on the commitments made by OECD Secretary-General Angel Gurria who together with ILO Director General Guy Ryder and World Bank President Jim Yong Kim spoke at a preparatory Conference arranged by the German G7 Presidency in Berlin in March. It will include improved complaints procedures and a strengthening of the OECD National Contact Points to deal more efficiently with these complaints.
Much of this supply chain work builds on the UN Principles on Business and Human Rights. The G7 countries welcomed the efforts to set up substantive National Action Plans. The private sector will play an important role, implementing human rights due diligence. Corporate responsibility initiatives are an important part of the cooperation between government and business, fostering sustainable supply chains and encourage best practices.
The G7 countries will also continue their support to multi-stakeholder initiatives:
– …we will strengthen multi-stakeholder initiatives in our countries and in partner countries, including in the textile and ready-made garment sector, building upon good practices learned from the Rana Plaza aftermath. We will continue supporting relevant global initiatives. Furthermore, we will better coordinate our bilateral development cooperation and support partner countries in taking advantage of responsible global supply chains to foster their sustainable economic development.
Palais Wilson in Geneva is the UN human rights headquarters. The UN Guiding Principles for Business and Human Rights created a solid basis on which Germany’s G7 Presidency can now try to launch a new and more socially responsible approach to global supply chains. Geneva is also the home of the global social dialogue and tripartite cooperation at the International Labour Organisation ILO. Governments and the social partners need to see to it that they use the opportunity that they now have thanks to the German government and bring justice and humanity to the people who produce much of what the more well to do parts of the world consume.
The German Presidency of the G7 Group of leading industrialised countries deserves much appreciation for their activity in supporting human rights and better labour conditions in global supply chains. The Summit on Sunday and Monday at Schloss Elmau in Bavaria could set conditions that drive real improvements in conditions which still are unacceptably bad in many producing countries. At a G7 Conference earlier this spring in Berlin, where I participated on behalf of the Global Organic Textile Standard GOTS, the German development and labour ministers Gerd Müller and Andrea Nahles made their country’s commitment to improve supply chain conditions very clear. This has been repeatedly confirmed by Chancellor Angela Merkel herself in the run up to this weekend’s G7 Summit.
The obligation to ensure proper living and labour conditions for supply chain workers and their families is of course with the national governments, and the employers directly concerned. This does not mean that the international community would be free of responsibility and lack influence. The UN Guiding Principles on Business and Human Rights are quite clear about this, both when it comes to government and business.
As labour conditions in general, the basic protection of supply chain workers should be set through legislation. This comprises the universal human rights conventions and includes the fundamental rights as defined in the ILO Declaration on Fundamental Principles and Rights at Woirk and its Core Conventions which forbid child labour, forced labour and discrimination. Freedom of association and the right to collective bargaining is also one of these fundamental rights, although all too many employers conveniently try to forget it.
It is obvious that the G7 countries and others need to put effective legislation in place to ensure that businesses based in these countries respect these norms also when they are active abroad. This would be welcome also for those responsible buyer companies that take their supply chain commitment seriously as it would create a level playing field where good corporate behaviour would not hurt their competitiveness. This follow up to the UN Guiding Principles is in fact already in motion in many industrialised countries, large and small.
All the necessary elements for decent work are not covered by the UN Guiding Principles or Core ILO Conventions. This we can see also by looking at leading supply chain codes and standards such as the GSCP Reference Code or the SA8000 Social Standard – and many of the Fairtrade Standards – which are much more complete.
Labour legislation can define minimum requirements and thus hinder at least the most serious forms of rights violations and exploitation that could push also general conditions down. In a developed industrial relations system, laws are completed by employers and trade unions through collective agreements and social dialogue on different levels.
We are still very far from this in most important producer regions and it could take very long before local tripartite structures would bear the responsibility for regulating wages and conditions. This is of course a main reason that the UN Guiding Principles has come about.
Here we need public-private partnerships, to help make good intentions and principles into reality. The German authorities have clearly understood this and involved brands and retailers, trade unions and other stakeholders. Hopefully the business and trade union communities will also grow up to the challenge. They need to cooperate on these supply chain issues even when other interests may pitch them against each other.
Both business and unions have indeed been active as the G7 Summit comes closer.
We have seen some concrete commitments from leading businesses, in addition to general support statements for Germany’s G7 initiatives. Leading global food brands and retailers have promised to take concrete action to help realize the UN Sustainable Development Goals (SDG) which will be formally agreed on later this year. In a letter to Chancellor Angela Merkel on behalf of the 400 Consumer Goods Forum member companies, the CEOs of Royal Ahold and Nestle commit these leading retailers and food brands to acting concretely to help secure and improve human rights and labour conditions in global supply chains.
These companies will now have to deliver on their promises which I am very optimistic about. The Global Social Compliance Programme GSCP, which works independently but is hosted by the Consumer Goods Forum, will have to play an important coordinating and supporting role. The corporate social responsibility CSR schemes and initiatives will be important tools and resources for practical on the ground work.
Maybe also the International Trade Union Confederation ITUC needs to take a new look at what CSR organisations such as SAI SA8000, ETI, FWF, BSCI and others are doing today. They have nothing to do with the paternalist approach to human resource management that sometimes has been labelled as corporate social responsibility. The CSR organisations which all involve civil society and build on third party verification of conditions in the supply chain have their main focus on capacity building and remediation of conditions at supplier workplaces. All of them have codes or standards that are clear on supporting freedom of association and the right to collective bargaining. Sometimes it is difficult for me to understand why they are not mobilised to support efforts to organise workers, gain employer recognition and negotiate fair and decent conditions.
It is equally important that buying brands and retailers and the business community more broadly understand how important it is in supplier countries that workers can organise freely and that proper structures and practices for collective agreement negotiations and social dialogue are established.
Will this year be a game changer when it comes to protecting and promoting human rights, labour conditions and environmental sustainability in global supply chains? Much is now happening on different arenas and if things work out as they should, we may see major positive changes.
There is important government activity in main consumer regions of the world. Many countries are transposing the UN Guiding Principles for Business and Human Rights into national legislation. Germany is committed to drive these issues within the G7 agenda during its Presidency this year. ILO, OECD and the World Bank are all stepping up their supply chain cooperation and activities.
Also the business community is on the move. Many of the world’s largest brands and retailers send signals about a more active grip and closer cooperation on their supply chain sustainability issues. A key player is the Global Social Compliance Programme GSCP which already has a widely accepted Reference Code in place, complemented by a well furbished toolbox for its implementation.
Public-private cooperation is the proper and most effective way for consumer countries to positively influence social and environmental conditions in the global supply chains.
To ensure maximum efficiency and results, brands and retailers on one side and unions and advocacy organisations on the other side need to develop a constructive and pragmatic cooperation and overcome their adversarial relations in supply chain work. Conflicts in other issues should not be allowed to undermine the work for human rights and better conditions for the often very disadvantaged supply chain workers and their families. This is an area where all efforts are needed and different approaches should be accepted and supported.
