Jan\nFurstenborg
\nGeneva, Switzerland
\nj.furstenborg@bluewin.ch<\/p>\n\n\n\n
7 October\n2012
<\/p>\n\n\n\n
New paternalism or\nworker empowerment ?<\/strong><\/p>\n\n\n\n SAI and supply chain responsibility in times of global crisis <\/strong><\/p>\n\n\n\n \u201c Social Accountability\nInternational’s shared vision is of decent work everywhere\u2014sustained by\nwidespread understanding that decent work can secure basic human rights while\nbenefiting business. \u201c<\/p>\n\n\n\n The SAI website www.sa-intl.org<\/p>\n\n\n\n When the President of Social Accountability International SAI\n(SA8000) Alice Tepper Marlin asked me to prepare a presentation for the SAI\nAdvisory Board about the changing operation environment where we were, nobody\ncould imagine that only days later would we experience the tragic and\ncatastrophic factory fire at Ali Enterprises in Karachi, Pakistan. <\/p>\n\n\n\n The fire that cost the lives of 300 workers once again drew\nattention to the serious shortcomings in working and employment conditions in many\nof the countries where products are made for the global supply chains of brands\nand retailers all over the world. The factory had received an SA8000\nCertificate from an auditing firm that was accredited to do this, bringing the\ndisastrous event very concretely to the hearts and minds at SAI as well.<\/p>\n\n\n\n Of course, SAI bears no responsibility for this catastrophe\nhitting the workers at Ali Enterprises. But it is clear that something went\nseriously wrong when it comes to the SA8000 audit and certification, negatively\naffecting the credibility of the whole CSR approach and the various schemes and\ninitiatives that serve it. This could have happened to any scheme or\ninitiative, but as it came to concern an SA8000 Audit and Certification, it is\nthe task of primarily SAI to find out\nwhat really happened and where the system failed to uncover the truth about the\nconditions at this factory on the day that catastrophe stuck. <\/p>\n\n\n\n There was no way that SAI or Social Accountability\nAccreditation Services SAAS could have known of the shortcomings of this\nCertification that was granted by Italian auditing firm RINA. But accepting\nthat SA8000 or any other certification can never be perfect, we must together\nwith RINA and others concerned address all possible problems that can continue\nto undermine the reliability of the system. <\/p>\n\n\n\n Let me also say that it is regrettable that possible buyers\nat Ali Enterprises \u2013 if such still exist in addition to the German retailer\nthat has come forward \u2013 have chosen not to come out in the public. They could\nplay an important contributing role both in supporting the victims and their\nfamilies, and in the joint efforts that are now needed to find out where\nchanges must be made to hinder a repetition of what happened. Neither SAI nor\nSAAS have any information as to which buyers could possibly be involved. All\ncorporate members and companies represented on the SAI Advisory Board have\ninformed that they are not the company\u2019s customers.<\/p>\n\n\n\n There is also a need to go further and deeper into how SAI\nand the entire SA8000 system should be developed, and a thorough analysis of\nthe Ali Enterprises fire will contribute to this. A full review of SAI, SA8000\nand the work that we are doing is as important as ever, and has become even\nmore urgent after this tragic event. <\/p>\n\n\n\n Of course, the originally planned document dealing with the\ncorporate social responsibility landscape and how SAI could position itself for\nthe future has been affected by this terrible event. I have edited it heavily\nduring the last days, and left out the originally planned brief presentation\nintended for this AB meeting. Instead there is now a background paper to read\nand hopefully to use in further planning and discussions as well as in the\nrelated decision-making processes.<\/p>\n\n\n\n In the spring of 2011, I wrote a document for SAI on\nstakeholder relations. This was partly to draw conclusions from my experiences\nfrom the Dolefil issue where SAI came under the attack of ILRF and which raised\nmany questions about the social audit system, but also about the roles of SAI,\nSAAS, audit companies, outside organisations and the different interrelations\nbetween these. I will be quoting extensively from that paper, particularly\nrelating to our stakeholder relations. <\/p>\n\n\n\n The original heading of the reflections that I promised to\nwrite for Bologna was \u201cSupply chain\nresponsibility in times of global crisis: New paternalism or worker\nempowerment?\u201c<\/em> I think that it is still a valid question to ask. <\/p>\n\n\n\n I regret that the paper is rather long, but taking the\nimportance of the issues I prefer to go into some detail on various points. I\nhave also made some effort to write this so that in opens up not only to SAI\n\u2018insiders\u2019 but also to others with at least a basic knowledge about labour\nrelations and corporate social responsibility. The paper is not written for\npublication, but also does not contain confidential material. <\/p>\n\n\n\n To understand some of my comments and conclusions in this\ndocument it is probably useful to remember that my background is in the trade\nunions where I held responsible positions both nationally and internationally\nuntil I decided to take pre-retirement a few years ago. I represented UNI\nGlobal Union, the largest of the international trade union organisations of\nthat time, on the Advisory Board of SAI almost since it was established. Later,\nI have continued as a member of the SAI Board of Directors and as part of the\nFounders Committee linked with the Advisory Board. I am also member of the\nAdvisory Board of the Global Social Compliance Programme GSCP, and have been\nthere since it was established. <\/p>\n\n\n\n All this plays in to how I look at things, but the paper is a discussion document, not a\nproposal<\/strong> for measures to be taken, and not linked to my functions in SAI or\nother connections. <\/p>\n\n\n\n Of course I accept that other people can come to quite\ndifferent conclusions about these issues. I did not have much time to prepare\nthis document, so there will surely be inconsistencies, and issues which could\nhave been addressed better. I am sure that the Advisory Board discussions in\nBologna will contribute to making many things more clear than they perhaps are\ntoday.<\/p>\n\n\n\n Environmental and social responsibility are expanding fast in\nthe corporate world. Where only a few frontrunners used to be engaged, this is\nnot becoming a mainstream activity. Brands, retailers and others who engage and\nparticipate in global supply chains are all keen to show their customers that\nthey behave responsibly. <\/p>\n\n\n\n This expansion has brought lots of new players to the\ncorporate responsibility field. Schemes and initiatives now abound where SAI\nand its SA8000 Standard was almost alone for many years. The largest companies\nstart to have their own codes of conduct and dedicated services and staff to apply\nthem. Consultancies thrive as well as auditors and other service providers.<\/p>\n\n\n\n New media and communications structures have been driving\nmuch of these developments. The world is more transparent than ever and far\naway living and working conditions are exposed on TV and computer screens\naround the clock. Trade unions, campaigners and other non-governmental\norganisations are able to mobilise public opinion as well as activists in ways\nthat were not possible in the old media world. \n<\/p>\n\n\n\n Politicians and their constituent entities have been fast to\nsee the significance of these changes. Public authorities on global and\nregional as well as national levels have got engaged, determined to leave their\nown fingerprint and secure their influence. Organisations as the UN, the OECD\nand particularly the European Union have placed themselves visibly on the CSR\nmap, as have many others.<\/p>\n\n\n\n Governments and \u2018outsourced\u2019 organisations of an almost\nsemi-public nature – such as the International Standardisation Organisation ISO\n– have created programmes and documents such as the Global Compact, the UN\nGuidelines and the ISO 26000, which while having their own role to play and\nbeing well intentioned are not adapted to auditing or other credible outside\nverification. An expanding corporate social responsibility industry offers\nservices which regularly includes questionable use of non-auditable standards\nand other means to \u2018certify\u2019 brands, retailers and others. <\/p>\n\n\n\n It is also difficult to assess which initiatives and schemes\nare serious and intended to have a real impact on supply chain labour\nconditions, which are excluding important elements of workers\u2019 rights, and\nwhich are there only to prop up the reputation of participating brands and\nretailers. <\/p>\n\n\n\n Codes and standards range from the audited and monitored\ncertification based systems such as SA8000 to mere policy statements where a\nmanagement declaration may be the only concrete commitment. What a code or\nstandard really means is increasingly difficult to assess and consumers can\nhardly be expected to differentiate between the serious and those which are\nthere as a window washing. <\/p>\n\n\n\n The catastrophic factory fire in Karachi, Pakistan in\nSeptember 2012 will surely force not only SAI but other CSR schemes and\ninitiatives as well to take a close look at their approaches and perhaps also\nreconsider some of the things that they are doing today. <\/p>\n\n\n\n What is clear, however, is that there will continue to be a\nneed for audit based schemes to allow brands and retailers to set social\nrequirement on their suppliers and to work with these to ensure that human\nrights and decent working conditions are secured. <\/p>\n\n\n\n It would be na\u00efve to believe that this would not be seen by\nmany employers as an alternative to worker empowerment and collective\nagreements. Freedom of association and the right to collective bargaining, such\nas they are established by the Core Labour Conventions of the International\nLabour Organisation ILO, are far from being universally accepted. While all\nserious codes of conduct and social standards require respect for these\nworkers\u2019 rights, they are among those that are most frequently violated. The\nhardened labour relations climate and the economic pressures of the continued\ncrisis will surely add to these problems. <\/p>\n\n\n\n For SAI and other CSR schemes and initiatives it becomes\nincreasingly important to make clear that they are not an alternative to\nmainstream legislation, collective agreement and social dialogue based working\nlife regulation but a complement and support. <\/p>\n\n\n\n As the emphasis and functions of these schemes and\ninitiatives is moving increasingly into working with the supply chain\nstakeholders to support capacity building and remediation of concrete\nconditions, this complementing and supporting role becomes even more evident.\nOf course, this work alone is not effective unless the commercial buyer demands\non suppliers are set so that there is space to provide decent conditions for\nthe workers.<\/p>\n\n\n\n It stands clear that binding labour norms set by legislation\nand collective agreements and secured by well organised local social partners\nwith a support of public authorities is the only effective and reliable way of\nensuring proper conditions for the workers. Regrettably, this is missing in\nlarge parts of the world, and particularly in many of the countries which today\nare the most important parts of global supply chains. <\/p>\n\n\n\n With all their shortcomings, social standards \u2013 whether\ngeneral such as SA8000, industry codes or even set by brands or retailers\nthemselves \u2013 are needed. A situation where emerging and developing economies\nare pressed to compete with each other through low prices and attractive\nsupplier conditions and where no social requirements are imposed by buyers\nwould be disastrous for the workers. <\/p>\n\n\n\n It is equally clear that only empowering workers through\nrepresentative structures, which would normally be trade unions, can make sure\nthat the rules and agreements are respected. The fire catastrophe in Pakistan\nwas a stark reminder of this.<\/p>\n\n\n\n It is not the role of SAI or other CSR schemes and\ninitiatives to get involve in general labour relations issues outside their\ncore area of competence and activities, unless specifically asked so by\ncompanies or industries concerned. To adopt more stringent requirements for\nworker organising rights and possibilities and their empowerment at supplier\nworkplaces is hardly possible without drawing this clear line. <\/p>\n\n\n\n To consider whether there are credibility issues involved if\na brand and retailer requires this from their suppliers whilst questioning\nwhether their own staff should organise in trade unions should be left to\nthemselves to answer. For SAI and other CSR organisations it should be clear\nthat the supply chain workers whose conditions our work is trying to secure and\nimprove cannot be used as instruments to resolve issues in the home markets of\nbuyers.<\/p>\n\n\n\n The following is from my Facebook page, written on 3 October:<\/p>\n\n\n\n I have recently been working with corporate social responsibility in\nglobal supply chains. Of course, there are companies who are more serious about\nthese, and those who are less, and these schemes are not a fully reliable\nsolution, only a second best option.<\/em><\/p>\n\n\n\n What is appalling though is that some non-governmental organisations are\nreally aggressively trying to question the right of buyer and retailer companies\nto set social conditions for buying in developing or emerging economies.\nParticularly if they are multinationals, they should not be allowed to support\ndecent conditions in their supply chains… <\/em><\/p>\n\n\n\n Far away from reality they are, these NGOs, not understanding that the\nbest alternative where unions and employers negotiate collective agreements\ndoes not exist in many parts of the world. This would not be the first time\nthat the fight becomes more important than the issue itself, we remember this\nfrom political life in years gone by. <\/em><\/p>\n\n\n\n On the positive side, not so many trade unions have sided with these\ncampaigners. Much better for them is to benefit from the freedom of association\ncommitments in the CSR codes and use this for providing organising opportunities\nfor the supply chain workers. At the end of the day, only worker empowerment\nand collective agreements can guarantee decent work for all.<\/em><\/p>\n\n\n\n The experiences from the fire catastrophe at the Ali\nEnterprises factory in Karachi and the obvious failure of the audit and\ncertification to ensure that conditions were safe and appropriate should lead\nalso to considering some very basic issues in relation to the SA8000 Standard\nitself:<\/p>\n\n\n\n \u201c In 1997, SAI launched SA8000\n(Social Accountability 8000) \u2013 a voluntary standard for workplaces, based on\nILO and UN conventions \u2013 which is currently used by businesses and governments\naround the world and is recognized as one of the strongest workplace standards.\n\u201c<\/p>\n\n\n\n The SAI website www.sa-intl.org<\/p>\n\n\n\n When it was launched in 1997, the SA8000 Social Standard was\nreally the only one of its kind. It continued to be a lonely frontrunner for\nmany years, attracting broad support from both trade unions and other parts of\ncivil society. Relations with social campaigners were close and friendly in an\natmosphere where there was a strong feeling of a joint purpose and shared\nobjectives. Together with many trade unions and non-governmental organisations,\nSAI was instrumental in putting the notion of corporate social responsibility\non the global political agenda. This finally lead to the world business\ncommunity understanding that they need to address the social effects of their\nactivities, and to a veritable proliferation of schemes and initiatives to\nenable this work. <\/p>\n\n\n\n SAI and the SA8000 community has the reason and the right to\nbe proud of their commitments to these developments. The mainstream collective\nagreement system has until now been unable to secure the respect for human\nrights and decent conditions at work. Competition between important producer\ncountries wanting to offer attractive prices and supply conditions to global\nbuyers has effectively hindered governments from applying social requirements\nto world trade and globalisation. With all their serious shortcomings,\ncorporate social responsibility schemes such as SAI and its SA8000 Standard\nhave emerged as the main concrete support for supply chain workers.<\/p>\n\n\n\n Todays large number of schemes and itiatives should not be\nseen as a problem but as an opportunity. Unwanted effects such as too frequent\nmultiple audits by different initiatives and buyers, and the resulting audit\nfatigue, are are issues that buyer companies as well as the schemes and\ninitiatives work actively to resolve. The common objective is to continue\nmoving both focus and resources from only auditing to concrete capacity\nbuilding and remediation in the supply chains. <\/p>\n\n\n\n Of the relative newcomers on the CSR scene, three stand out\nas particularly interesting but also problematic:<\/p>\n\n\n\n The UN Guidelines<\/strong><\/p>\n\n\n\n From a supply chain responsibility viewpoint, the UN\nGuidelines introduce some major new elements. The responsibility of brands and\nretailers to control their supply lines is now clearly defined, which surely\nwill have an important effect of increasing their attention to both\nenvironmental and social initiatives and schemes. <\/p>\n\n\n\n Although the UN guidelines are not legally binding, they are\nalready influencing governments as well, which can be seen in the tightening up\nof the OECD Guidelines for Multinational Companies. They have also visibly\ninfluenced the UN Global Compact where a cleaning up operation intends to\nrestore some of its lost credibility. <\/p>\n\n\n\n Remarkably, while recognising freedom of association the UN\nguidelines contain almost no reference to worker empowerment, trade unions or\nsocial dialogue. One reason may be that including these issues would have\ndisabled the political consensus that has been necessary to ensure that they\nwere adopted by the United Nations community.<\/p>\n\n\n\n On this point, SAI has profiled itself in a very positive\nway, by contributing actively when it comes to guidance on applying these good\nprinciples. It is, however, important to make sure that these guidelines are\nnot seen as something that governments and business can adhere to through\ndeclarations, and then forget about applying and respecting the good principles\nin concrete situations.<\/p>\n\n\n\n Perhaps because of these guidelines, the Global Compact has\nmade serious efforts to tighten up its act. The list of companies that have\nmade commitments is being g cleaned up and there are now certain real criteria\nfor staying included. The fact remains, however, that this is and remains a\ndeclaration \u2013 albeit a positive one – and does not credibly substitute for a\nserious voluntary CSR initiative or scheme.<\/p>\n\n\n\n ISO 26000<\/strong><\/p>\n\n\n\n The ISO 26000 was a problematic initiative from the very\nbeginning as it brought standardisation into the realm of labour conditions\nwhich were regulated through legislation and collective agreements. Alerted by\nSAI through a conversation between Alice Tepper Marklin and myself, the global trade unions reacted towards the\nInternational Labour Organisation, and sparked discussions between the top\nmanagement of the two organisations, ILO and ISO. As a result ISO recognised\nthat standard setting takes places on a tripartite basis within the ILO, and\nagreed not to set labour conditions through its standards. Instead ISO 26000\nwas developed as a management system oriented tool, which is not intended to be\naudited against or certified.<\/p>\n\n\n\n These principles have not been entirely upheld. National\nstandardisation associations and a broad field of consultants and social\nauditors have seen a potential goldmine in the ISO 26000 and started to develop\nand apply auditing and even certification applications. Being an uncontrolled\nactivity without any stakeholder participation or support, and based on a\nstandard that is not suitable for this use, the ISO 26000 based auditing and\ncertification cannot be more than window dressing. Regrettably, as serious applying\nof ISO 26000 can play a positive role indeed in supporting the social\nresponsibility management of companies and institutions.<\/p>\n\n\n\n GSCP <\/strong><\/p>\n\n\n\n The Global Social Compliance Programme GSCP is a business\ndriven voluntary initiative to drive convergence of social and environmental\nresponsibility schemes in global supply chains and thus liberate resources from\nmultiple auditing to capacity building and remediation. Its ambition is to set\nstandards at a high level, with the GSCP reference code based on best practice from\nmulti-stakeholder and business schemes and initiatives. The reference code is\nnot auditable, nor is it certifiable, but is intended to be a benchmark and an\ninspiration for companies and others to engage in protecting human rights and\nimproving the social conditions in global supply chains.<\/p>\n\n\n\n For voluntary initiatives and schemes, such as SAI, the GSCP\nis the only available benchmarking instrument that can be used for building up\nmutual recognition with other similar programmes. The reference code as well as\nthe tools that deal with the various elements related to its application cover\nthe same things as SA8000, and are on the same ambition levels. There are some\nstructural differences, such as management systems not being part of the GSCP\nreference code itself. Instead they are raised in individual tools and\nguidelines.<\/p>\n\n\n\n In addition to driving convergence \u2013 actually aiming at\nupward harmonisation \u2013 GSCP has succeeded in signing up important numbers of\nleading brands and retailers to participate in its work. As it does not conduct\naudits or engage in capacity building or training on its own, organisations\nsuch as SAI can benefit from the GSCP platform through making their own\nservices available. <\/p>\n\n\n\n This programme does not actively seek to grow the number of\ncompanies that participate in its work. Already representing many of the\nworld\u2019s largest and leading retailers and brands, GSCP is now focusing on\nencouraging and promoting companies, schemes and initiatives to step up their\nremediation and capacity building within the supply chains. <\/p>\n\n\n\n The on-going GSCP Equivalency Process, which will surely show\nthat SAI and SA8000 are at least equivalent with the GSCP reference codes and\ntools will create a basis for this, as does the SAI participation in GSCP\u2019s\nPartner Network.<\/p>\n\n\n\n It is in SAI\u2019s interest to support a development where the\nminimum standards of the GSCP system are set on a demanding level. <\/p>\n\n\n\n In a stagnant or shrinking economy, growth does not create\nnew wealth to share, and the conflict between capital and work becomes ever\nmore difficult. Corporate shareholders\nand other investors put pressure on operative management to deliver returns and\ndefend share prices, which at the end of the day is reflected in lower\ncompensation levels for workers, dwindling social security and health care\nprovisions for their families, and raising unemployment. Attitudes between employers and unions are\nnow harder, with open hostility towards unions from the political and business\nestablishments, where the dominant mood is increasingly conservative. It is not\neasy for unions to see what they gain, under these circumstances, from\nsupporting and participating in any cooperative schemes and initiatives. <\/p>\n\n\n\n The coverage of collective agreements continues to narrow. Long-term\nunion membership trends show sinking numbers, although some organisations have\nalso experienced a recent surge as workers seek protection in the crisis\neconomy. Public sector employees are often the most important groups as\nindustrial production falls or moves to emerging economies. Entire sectors see\nunion membership crash as their functions are privatised and outsourced, with\nthe new employers often overtly opposed to recognising trade unions. The\nexpanding private services industry remains poorly unionised.<\/p>\n\n\n\n The role of international unions has not followed the pace of\nthe global economy. They remain in a coordinating role, conducting campaigns\nand projects on behalf of their member unions on national levels who are\ncarefully guarding that concrete bargaining powers remain with themselves.\nDifferences in living standards and labour legislation as well as in union\nstrength often make a fast increase of international coordination difficult, if\nnot impossible.<\/p>\n\n\n\n Their efforts to organise workers and industries through\ncampaigning and projects in emerging industrial economies and developing\ncountries have led to only limited results that have often not been stable. In\nglobal supply chains, collective agreement coverage is often marginal.<\/p>\n\n\n\n It would be a mistake to think that trade unions would be\nlosing their influence, or that global and regional trade union structures\ncould be ignored. In fact, unions remain strong in many parts of the world,\nsuch as in Western Europe where their position is built into the economic and\nsocial systems. In these developed economies they are needed as a\ncounter-balance to business to make the political and social systems work . <\/p>\n\n\n\n In northern Europe, the position of trade unions is based on\nactual membership numbers, established and accepted labour relations structures\nand social dialogue traditions, and the broad support from large parts of the\npolitical establishment. Also employers realise and accept that they need the unions\nas social partners to ensure their own stability and competitiveness. <\/p>\n\n\n\n In southern Europe, the trade unions\u2019 ability to mobilise\nworkers and close cooperation with parties left of the centre renders them a\nsignificant position. In these countries they also have broad legislation based\nrights, often not dependent on their representativeness.<\/p>\n\n\n\n Unions are also an important part of the common strategy and\nstructure of the European Union, through their formal social dialogue with\nemployers\u2019 associations, and their influence over social legislation and\ndecisions. <\/p>\n\n\n\n In the emerging and developing economies, union importance\ndiffers from one country to another. Whereas they have a strong position in\nBrazil and South Africa, they are weak in India and the Middle East. Active and\nmilitant unions can play an important role in countries such as Indonesia,\nSouth Korea and Bangladesh, often with the support of unions and NGOs from\nabroad. In China, worker organising and involvement is clearly rising both\nthrough independent initiatives and structures and the All China Federation of\nTrade Unions ACFTU. <\/p>\n\n\n\n \u201c SAI recognizes that voluntary\ncompliance standards are only one part of what is needed to raise labor law\ncompliance around the world. To that end, SAI has developed training and\ntechnical assistance programs to work on the broader context surrounding\ncompliance. Over its history, SAI has developed an array of services all geared\ntowards working with companies, trade unions, NGOs and governments to achieve\nmore socially responsible practices around the world. SAI pulls its\ncapabilities together in comprehensive capacity building programs, as well as\noffering them on a stand-alone basis. \u201d<\/p>\n\n\n\n The SAI website www.sa-intl.org<\/p>\n\n\n\n Without expressing any judgment at this point, I think that\nit is useful to see how CSR schemes and initiatives are conceived within the\ntrade union world, and what changes\nthere may have been in the attitudes. Doing this, one must bear in mind that\nthe trade union community is not homogenous and that opinions on how best to\ndefend worker interests can differ even sharply between different\norganisations. <\/p>\n\n\n\n SAI is based in the United States, and while being global in\nits reach, of course influenced by this as well. It is therefore useful to\nunderline that the campaign approach that many important U.S. trade unions have\nincreasingly chosen instead of a traditional social dialogue is not necessarily\napplied in Europe, Japan, Australia and\nother regions where trade unions are particularly active. Of course this\ngrowing focus of campaigning reflects the surrounding anti-union sentiments as\nwell and is part of the polarisation where labour relations are getting\nincreasingly hostile.<\/p>\n\n\n\n As corporate social responsibility approaches are based on\nmanagement policies and auditing rather than collective bargaining and\ncollective agreements, many unions have begun to see them more as a risk than\nan opportunity to promote their objectives. They are often viewed either with\ngreat scepticism or with outright hostility, conceived as an attempt by big\nbusiness to marginalise worker participation and influence and replacing a\nregulations-based approach with voluntary standards. <\/p>\n\n\n\n Corporate social responsibility initiatives and schemes such\nas SAI have to take these changing opinions very seriously and consider what\naction would be necessary to defend and strengthen their credibility with this\npart of civil society. The whole concept of corporate social responsibility,\nand the work that organisations such as SAI is doing, is still largely unknown\namong the public at large, including trade union members and decision-makers.<\/p>\n\n\n\n The discussions among the corporate social responsibility consultants\nand other members of the CSR community on websites such as Linked In show that\nthere is indeed a justification for these trade union concerns. The union\ndimension or the need to empower workers themselves through trade unions, to\nparticipate in regulating their employment and working conditions, is hardly\never mentioned. Instead, it is completely focused on code and social audit\nbased approaches. Of course, freedom of association is part of all serious\ncodes and controlled in one or another way during audits, but whether it is\nthere because it has to be or as a serious aim for capacity building and\ndevelopment is at best unclear. <\/p>\n\n\n\n The conclusion is that although trade unions themselves may\nstill be in an overall membership decline, their influence does not necessarily\ndiminish. There are many other developments in the global economy that play in\ntheir favour and that they also make active use of. These unions have a clear\nopinion : Even the most well intentioned corporate social responsibility\napproach by the academic world or non-governmental organisations cannot replace\nmainstream labour relations where workers are empowered to conclude collective\nagreements and conduct social dialogue through genuine trade unions. <\/p>\n\n\n\n As an initial reaction to these issues that are at the heart\nof the trade union concerns, SAI should speak out clearly, effectively and\nunambiguously about its approach to the relation between the mainstream labour\nrelations system and the SA8000 Social Standard. This should also make it clear\nfor everyone what the SA8000 is not and will not become:<\/p>\n\n\n\n By being clear and active on these points, SAI can once again\nshow its leadership in developing the concept of corporate social\nresponsibility so that it responds both to corporate needs and trade union\nexpectations. Without wishing at all to marginalise other stakeholders, one\nshould accept that the social partners in working life have particular\nresponsibilities and rights that SAI must fully take into account in its work.<\/p>\n\n\n\n The relation between trade unions and campaigners is an\nambivalent one. On one hand, unions do often benefit from the direct or\nindirect support of campaigns, and at times they even knowingly use them for\ntheir aims. Unions themselves have initiated or launched campaigns and\nestablished and financed campaign organisations, particularly in the United\nStates, but also in the United Kingdom. Some of those that are targeting\nWal-Mart with the objective of getting the company to allow unionisation of its\npersonnel in the United States are an example of this, as is similar union-led\ncampaigning that tries to force British multinational retailer Tesco to open up\nfor unionisation and collective agreements in its United States stores.<\/p>\n\n\n\n There are also examples which show a strained relation\nbetween trade unions and campaign organisations. To take an example, a\ncommercial workers\u2019 union does not always welcome campaigner criticism of a\nunionised employer for something that it considers to be incorrect.\nParticularly, it is adverse employment effects that could be the reason for\nthis, as well as the basic loyalty towards one\u2019s own employer, which is quite\ncommon in the European retail sector.<\/p>\n\n\n\n As works councils play an important role above all in Europe,\nthey can be expected to get more and more involved by companies that are\ntargeted by campaigners. Early experiences from European Works Councils have\nhighlighted major differences between some campaigners and the workers of the\ntargeted companies.<\/p>\n\n\n\n Another reason for disagreement and possible conflicts can be\nthat campaign organisations claim to speak for workers whom the trade union\ncorrectly consider to be under its responsibility. This has frequently been an\nissue between global union federations and some campaigners who have claimed to\nbe advocates for the rights of workers in particular industries, companies or\nworkplaces. When a campaign has been distinctly politically motivated and\nnegative towards enterprises, unions have at times either distanced themselves, or even ignored or denounced\nthem.<\/p>\n\n\n\n Trade unions are not civil society or non-governmental\norganisations such as any others, but have specific rights and roles that are\nclearly defined by ILO and International Labour Conventions. As collective\nagreements cannot be substituted by social codes, trade unions cannot be\nsubstituted by campaigners or other non-governmental organisations, however\nmuch they claim to be advocating for workers and their rights. <\/p>\n\n\n\n \u201c The whole system is flawed,\u201d said\nScott Nova, executive director of the Worker Rights Consortium, a monitoring\ngroup based in Washington that is financed by American universities. \u201cThis\ndemonstrates, more clearly than ever, that corporate-funded monitoring systems\nlike S.A.I. cannot and will not protect workers. \u201d<\/p>\n\n\n\n The New York Times 19 September 2012<\/p>\n\n\n\n \u201c While SAI claims that its mission\nis to advance the rights of workers around the world, what SAI really does is\nprotect the reputations of apparel brands around the world,\u201d Nova told Here\n& Now\u2019s Robin Young.<\/p>\n\n\n\n Here and Now 2 October 2012<\/p>\n\n\n\n Civil society involvement through social campaigns is not\nnew. The abolition of slavery and the introduction of equal voting rights for\nwomen were early themes for successful campaigning. In the 1960\u2019s, opposition\nto colonialism and the Vietnam War sparked popular movements all over the\nwestern world. More recently, Greenpeace and other environmental organisations\nhave showed their convening power and determination to bring about changes.\nAmnesty International and numerous national federations keep up pressure on\ncountries to respect human rights and dignity.<\/p>\n\n\n\n Not only governments are pressed by campaigners to be more\ntransparent and responsible. Also the business world and investors are\nincreasingly in the public eye as globalisation of the world economy continues\nto grow their influence. <\/p>\n\n\n\n The sprawling corporate social responsibility community with\nhundreds of schemes and initiatives has evolved as a direct or indirect result\nof such campaigns. Some have their roots in campaigns themselves, supporting\ntheir aims through codes and labels. Others are a response by enterprises,\naware of the need to respond voluntarily to demands from civil society.\nRegrettably, there are also those who serve other more dubious aims and thus cannot\nbe considered serious.<\/p>\n\n\n\n Consumer awareness – but also increasing concern for these\nquestions within the corporate world itself – has been successfully influenced\nby movements such as Fair Trade and Clean Clothes, to mention two of them.\nWithout an active civil society, social and environmental issues in global\nsupply chains would not be given the attention by retailers and brands as they\nenjoy today.<\/p>\n\n\n\n The fundamental changes in communications infrastructures and\nthe easy and fast networking between people and their movements have placed\ncampaigns and campaigners in a position of power and influence. They can go out\nwith their message well aware that they reach their audience without censorship\nor rebuttals, having previously been dependent on edited media which were often\ninfluenced by the very companies that they campaigned against. The Internet\ncreated a new environment for them which is now further enhanced by the\nveritable explosion in social networking.<\/p>\n\n\n\n Of course, a campaign has to have a relevant and credible\ncontent – or be otherwise interesting – to be influential and effective. <\/p>\n\n\n\n A campaign can emerge around a particular issue, which is of\nconcern for a group of people. This is often the case with planned measures or\nactions that affect a neighbourhood or even a larger community, where residents\nsee the need to join forces to promote their views and interests. The urgency\nand seriousness of their message weighs heavily when considering their\ncredibility.<\/p>\n\n\n\n Another way for campaigning to emerge is that an established\ncampaign organisation picks up an issue which it starts promoting. This is the\ncase with many campaigns related to brands and retailers and their\nresponsibility. The objectives can range from concrete demands on changes in\nthe way that the companies are working to much broader political aims, where\nthe enterprises are seen mainly as tools. The impact of this action is\ndependent on a combination of the issue itself, its presentation and the\ngeneral credibility of the organisation promoting it.<\/p>\n\n\n\n When it comes to an ad hoc movement, a campaign message is\nusually weighed and assessed on its contents and presentation, or thus on its\nown merits. <\/p>\n\n\n\n Issues put forward by well-known campaign organisations are\nnot always scrutinised with the same carefulness as they have already\nestablished their own particular degree of general credibility both with\nfollowers and the public. When one of these organisations goes out with a call\nfor solidarity, its own circle of followers and sympathisers do not often see a\nneed to verify whether the issue or its presentation merit their support. But\nalso these campaigners have to be careful and aware that each new campaign\naffects their overall reputation.<\/p>\n\n\n\n It is not always easy to recognise when a campaign wants to\nbring about a concrete change in the conditions under which people work and\nlive, and when it has a broader objective of promoting political, economic and\nsocial issues or values. It is not uncommon for social campaigning to have\ntheir roots in the anti-imperialism that marked their strong emergence in the\n1960\u2019s. Sometimes the two objectives tend to be mixed in a way that makes it\ncomplicated to know what they really want to achieve and where their priorities\nare.<\/p>\n\n\n\n One should also not forget that there may well be a dimension\nof protectionism in social campaigning that is related to global supply chains.<\/p>\n\n\n\n For campaigners, the interesting thing is to target companies\nwhich have well-known brands and have made commitments which can then be\n\u2018proved\u2019 to be wrong. An anonymous trader or producer is not so interesting for\nthem, however much workers\u2019 rights are violated. But for targeted global\nretailers and brands, all deficiencies in the supply chains \u2013 and one can\nalways find those – are mercilessly exposed and then generalised in order to\ndiscredit the behaviour of the entire company or even a whole industry, such as\nretailing. We have many examples of this approach.<\/p>\n\n\n\n Questions have been asked about the important role that\ncertain companies have played in creating the GSCP even if they themselves have\npoor if not even hostile relations with trade unions trying to organise their\npersonnel. Among these, Wal-Mart stands out because of its size, although it is\ndefinitely not the only one. <\/p>\n\n\n\n Actually, I was under some pressure at the time that we as\nUNI \u2013 a leading Global Union Federation \u2013 decided to join the GSCP advisory\nboard. The pressure did not come from affiliated trade unions, who felt that\nusing supply chain workers as an instrument for their own work in\nindustrialised countries would not be ethically correct. Instead, for instance\na well know European-based campaign organisation even went as far as\napproaching leading affiliates to ask them to hinder my participation, Attempts\nto stop us from working on supply chain issues were also made by non-retailers\nas part of their influence struggle with the retail sector.<\/p>\n\n\n\n All experiences from GSCP over the years show that these\nissues have not been allowed to play a role. There has been a remarkable\nconsensus between the corporate world and the stakeholders as to where this\nprogramme is heading, and a genuine acceptance of its reference code that\nincludes among other issues a clear and unwavering support for freedom of\nassociation and the right to collective bargaining. There has been no reason\nfor UNI to regret its engagement, and the organisation is still present on the\nGSCP Advisory Board.<\/p>\n\n\n\n Sometimes this has led to think that recent attacks against\nSAI and SA8000 are related to domestic political and labour objectives or\nissues in the United States. They follow previous US campaigning related to\nallegations of trade union rights violations in the Philippines, where actually\nthe campaigners themselves had tried to make questionable use of the SA8000\nsocial auditing and Certification system to support an extreme left wing trade\nunion leadership. Finally, as workers\nwere able to express themselves in free elections, where this particular\nunionist group was represented on the controlling government commission, the\ncampaigning collapsed. A huge majority of the workers at this large\nagricultural workplace voted the previous leadership out and replaced them with\na more moderate trade union, in an election which even the losing group had to\naccept. <\/p>\n\n\n\n The attacks against SAI and the CSR system have indeed been\nlargely populist. They have aimed at making believe that these CSR approaches\nare there to mislead the consumers and the public and have suggested that they\nshould be abandoned. They have also been openly related to general campaigning against the particular US based\nmultinationals. In a way that is typical for populists, these campaigners have\nnot been able to propose any concrete alternatives to be put in place of those\nthat they want to destroy. <\/p>\n\n\n\n As to trade union support, one can note that it usually comes\nfrom unions that are very much campaigning oriented. Those which focus on\nmembership growth, social dialogue and collective agreements have not had the\nsame interest in these negative campaigns but instead seen a value in the support\nthat CSR commitments by large retailers and brands have given.<\/p>\n\n\n\n All this is not to say that all campaigners or campaigns are\nlike this. There are numerous examples of real anomalies and abuses which would\nhave continued to exist, had it not been for active campaigners. It is\nregrettable when a poorly planned or conducted campaign, or a campaign that is\nnot fully honest, and thus conceived as unfair and sometimes also clearly\npolitically motivated, hurt the credibility and effectiveness of urgent, important\nand supportable civil society activities by the non-governmental sector. <\/p>\n\n\n\n Stakeholder relations and cooperation with different parts of\nsociety have always been at the heart of SAI. This can be seen in the\nmulti-stakeholder governance structures and decision processes and is a\nfundamental value on which SAI and the entire SA8000 are built.<\/p>\n\n\n\n As an important part of this approach, SAI has invited both\ncampaigners and other non-governmental entities to participate in its work, be\nit as members of the governing bodies or through a good and constructive\ncooperation. It is important that this cooperation continues.<\/p>\n\n\n\n There have also been situations where a campaigning\nnon-governmental organisation has found that there is an SAI or SA8000 related\nissue which could support an on-going campaign. These have been related to\ncompanies that are part of the SA8000 System which have been targeted by\ncampaigners for alleged violations or non-compliances with the SA8000 Social\nStandard or the fundamental principles of SAI.<\/p>\n\n\n\n It would be regrettable if interaction between the SA8000\nSystem and campaigners would be relegated to deal with acute problems rather\nthan working together for real and positive remediation with developments and\nchanges being brought about to the employment and working conditions in global\nsupply chains. <\/p>\n\n\n\n Conflicts and problem situations must be handled, but there\nis also a need for new positive initiatives for working together that would\nenhance the effectiveness of both cooperating parties.<\/p>\n\n\n\n SAI is well placed and able to communicate with both\ncompanies and campaigners, also when there may be major disagreements between\nthese two parties. Thus, an important SAI contribution can be to help transform\nthe campaigners\u2019 aims for improvement of economic and social conditions into\nconcrete action at workplaces, undertaken or supported by an influential and\ncommitted participating brand or retailer. \n<\/p>\n\n\n\n Although corporate responsibility continues to be high on the\npriority lists for serious businesses, it is obvious that much emphasis has\nmoved away from labour conditions to environmental issues. This reflects also\nchanging consumer interest and civil society activism. To keep social standards\nand decent work on the global agenda requires a broad cooperation between all\nthose who are engaged, be they businesses, trade unions, campaigners and other\nnon-governmental organisations, public authorities or of course corporate\nsocial responsibility initiatives and schemes such as SAI.<\/p>\n\n\n\n \u201c SAI works to protect the integrity\nof workers around the world by building local capacity and developing systems\nof accountability through socially responsible standards. SAI established one\nof the world’s preeminent social standards\u2014the SA8000\u00aestandard for decent work,\na tool for implementing international labor standards–that has improved the\nlives of over 1.8 million workers in over 3,000 factories, across 65 countries\nand 66 industrial sectors. Many more workplaces are involved in programs using\nSA8000 and SAI programs as guides for improvement. SAI is one of the world’s\nleading social compliance training organizations, having provided training to\nover 30,000 people, including factory and farm managers, workers, brand\ncompliance officers, auditors, labor inspectors, trade union representatives\nand other worker rights advocates. \u201c<\/p>\n\n\n\n The SAI website www.sa-intl.org<\/p>\n\n\n\n The Ali Enterprises catastrophe and the malfunctioning SA8000\nCertification raises the obvious question whether the SA8000 should remain as a\ncertifiable instrument and whether social auditing against it should continue.\nAnother alternative could of course be to focus entirely on capacity building\nand remediation programmes. This could of course be done through the Social\nFingerprint approach, which already plays an important and fast growing role in\nthe overall work of SAI.<\/p>\n\n\n\n With all its shortcomings, including those that we could see\nwith this recent catastrophe, there is a clear and continued need for the\nSA8000 Standard. There simply is no alternative, and mainstream labour\nrelations are still unable to take over these functions in many parts of the\nworld. <\/p>\n\n\n\n That catastrophe hit SA8000 does not change the fact that it\nhas a leading position among its peers when it comes to the level of demands\nand the serious approach to applying it. Auditing requirements and controls are\nstill stricter than with any other comparable standard or code. <\/p>\n\n\n\n In fact, the SA8000 Social Standard has reached a\nparticularly strong recognition in the world of voluntary corporate social\nresponsibility schemes and initiatives. Without in any way diminishing the\nseriousness of the questions asked about\nit in the discussion following the Karachi fire, the Standard will continue to\nkeep its position. With all due respect for those campaigning organisation that\nhave used the opportunity and launched broadsides against the CSR concept\nitself, they are far from representing the prevailing views in society.\nBusiness will continue to need these schemes, and the big majority consumers will\ncontinue being indifferent, with most others welcoming this engagement of\nbrands and retailers. Being loud and declaring themselves as representatives of\nthe workers does not make the campaigner message carry far or for long. <\/p>\n\n\n\n The alternative would of course to completely rethink the\nSA8000 approach, and to develop SAI into an organisation that focuses of\ncompany-wide application of the Standard instead of only a supplier workplace\noriented approach. It would mean setting requirements on companies that sign up\nto work for the application of SA8000 in their entire supplier network. In a\nway, SAI would then \u2018certify\u2019 also participating brands and retailer and have\ncertain control obligations and functions in this respect. <\/p>\n\n\n\n Our experiences in handling the Dolefil case in the\nPhilippines and the related campaigner attempts to use SAI as a vehicle for\nattacking Dole as the mother company, which continued until the workers at this\nlarge site effectively put an end to that campaigning through a decisive local vote,\ndoes not encourage to take this approach. It would surely force SAI to devote\nmuch attention to handling general campaigns and take away focus and resources\nfrom the core task of defending human rights and improving social conditions in\nglobal supply chains. <\/p>\n\n\n\n In this paper, I will not go into the detailed measures that\nsurely are needed with regard to SA8000 auditing and certificating procedures.\nThere will surely be a deep discussion about this when all facts related to the\nPakistan catastrophe have finally been analysed, and I will therefore restrict\nmyself to some general observations and suggestions for discussion and possible\naction, focusing on SAI and SAAS and their roles.<\/p>\n\n\n\n The strict separation approach to avoid conflict of interest\nissues ends at the SAI and SAAS levels, and does not stretch to the\ncertification bodies accredited by SAAS. As we can now see very clearly, the\ninterests of SAI and SAAS and those of certification bodies can be both\ndifferent and at times also in clear conflict with each other. This can concern\nboth the general setup of SA8000 and its applications that is the task of SAI,\nand the more detailed control functions performed by SAAS.<\/p>\n\n\n\n The cooperation and networking with these certification\nbodies should of course continue, but the way this is done needs rethinking.\nTheir role as service providers to the SA8000 system should be the basis of\ntheir participation, perhaps through something similar to the partner\norganisations network that GSCP is building up. This would allow for their\nclose participation even if they would not be involved directly in any\ngoverning bodies.<\/p>\n\n\n\n This is a problem as these entities \u2013 mainly private\ncompanies \u2013 at present have an independent right and role in granting or\nrefusing SA8000 Certifications. It is too early to comment on this in relation\nto the catastrophe in Pakistan, but I will instead make some general\nreflections.<\/p>\n\n\n\n Unlike SAI or SAAS, these certification bodies have a profit\nand business interest which makes their role \neven more sensitive. A certification agency can enforce business related\nconditions on a SA8000 certification, for instance when there is a need to\nextend its validity, as we saw in the Dolefil case. To retain the certification\nuntil a new audit can be done, a supplier could be forced to agree to have an\naudit done with a particular certification body at economic or other conditions\nset by this body. <\/p>\n\n\n\n Of course, there are complaints procedures concerning social\naudits and certifications. One can ask, however, whether these mechanisms work\ncorrectly or whether there is a need to look closer at them and revise them as\nnecessary. <\/p>\n\n\n\n One could also consider whether SAAS should not have the\nright to overturn a certification decision made by an agency if there are\nparticular reasons for it, be the decision positive or negative. This should\nperhaps also be possible without a formal complaint, but would of course\nrequire clear and transparent rules as to when and how this could be done.<\/p>\n\n\n\n Having said all of this, there are long-standing reliability\nand credibility issues common for all the CSR community which we should\ncontinue to address. This can and should be done by developing the SA8000\nitself where necessary, and by improving the reliability of the different\nstages of its application: <\/p>\n\n\n\n Jan Furstenborg Geneva, Switzerland j.furstenborg@bluewin.ch 7 October 2012 New paternalism or worker empowerment ? SAI and supply chain responsibility in times of global crisis About this discussion paper \u201c Social Accountability International’s shared vision is of decent work everywhere\u2014sustained by widespread understanding that decent work can secure basic human rights while benefiting business. \u201c The … <\/p>\n