Developing Ethical Supply Chains Internationally

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1. Identify and discuss what is Social Accountability 8000

A global social accountability standard for working conditions, Social Accountability 8000 (SA8000) was developed by Social Accountability International (SAI). A non-governmental, multi-stakeholder organization whose mission is to advance the human rights of workers around the world, SA8000 partners to advance the human rights of workers and to eliminate sweatshops by promoting ethical working conditions, labor rights, corporate social responsibility and social dialogue.[1] As one of the world's leading social compliance training organizations, SAI has provided “training to over 20,000 people, including factory and farm managers, workers, brand compliance officers, auditors, labor inspectors, trade union representatives and other worker rights advocates. Today SA8000 certification covers over 2,300 facilities in 62 countries, across 66 industries, and over 1.3 million employees. Many more workplaces are involved in programs using SA8000 and SAI programs as guides for improvement.”[2]

Created in 1997 by Social Accountability International, Social Accountability Accreditation Services certify facilities that conform to the requirements of SA8000. Predicated on the principles garnered through “thirteen international human rights conventions and developed through a multi-stakeholder process, SA8000 is a tool to help apply these norms to practical work-life situations. SA8000 contains eight core elements including health and safety, working hours, child labor, forced labor, discrimination, freedom of association and collective bargaining, wages, and discipline.”[3]

SA8000 is not without its critics. A paper published in 2008 by three Harvard University professors attempted to ascertain the quantifiable value of SA8000 among other international certification standards and corporate codes of conduct. According to Michael Hiscox, Claire Schwartz, and Michael Toffel, while the number of organizations becoming certified under SA 8000 and similar codes continues to rise, “a fierce debate is raging about whether these codes represent substantive efforts to improve working conditions or merely symbolic efforts that allow organizations to score marketing points and counteract stakeholder pressure by merely filing some paperwork.”[4] While the summation of the Harvard study was inclusive as to the value of SA8000 and similar standards, the professors provide ways to improve such standards so that a more quantifiable analysis could be divined.

2. Discuss the types of alliances which can be developed to promote ethical supply chains.

There are several institutes and organizations that promote ethical supply chains around the world. One of those organizations is the Ethical Trading Initiative (ETI). ETI “is a ground-breaking alliance of companies, trade unions and voluntary organizations. We work in partnership to improve the lives of workers across the globe who make or grow consumer goods - everything from tea to T-shirts, from flowers to footballs.”[5] Deborah Leipziger describes the ETI as a tripartite, “consisting of membership groups from three sectors: companies, non-governmental organizations (NGO’s) and trade unions. It is funded by the UK government’s Department for International Development and its members, which include NGOs and companies, which pay dues.”[6] ETI members include over “50 corporations including: Marks & Spencer, Sainsbury’s, Gap and Inditex, along with NGOs such as Save the Children, the FairTrade Foundation and the international trade union movement.”[7] According to the Ethical Trading Iniatitive:

Ethical trade means that retailers, brands and their suppliers take responsibility for improving the working conditions of the people who make the products they sell. Most of these workers are employed by supplier companies around the world, many of them based in poor countries where laws designed to protect workers' rights are inadequate or not enforced. Companies with a commitment to ethical trade adopt a code of labour practice that they expect all their suppliers to work towards. Such codes address issues like wages, hours of work, health and safety and the right to join free trade unions.[8]

According to Michael Levin, author of an article entitled ‘Building an Ethical Supply Chain’, affirms the work of the ETI by saying that “Being an ethical company isn’t enough anymore. These days, leading brands are judged by the company they keep. Consumers, investors, business partners, regulators, and media organizations now expect a company and its entire supply chain to be ethical.”[9] While many may dismiss this sentiment noting that it is either too expensive or too complicated, Mr. Levin asserts that “sooner or later, every company is bound to find itself part of a supply chain that experiences a significant ethics or compliance violation. When this happens, chances are great that the biggest brand in the chain will get stuck with most of the blame.”[10] While ETI is by no means the only organization looking to make a difference in this area,[11] they are a key participant in the global alliance promoting an ethical supply chain.

3. Under what conditions should products be manufactured so as to ensure that workers' rights are being respected?

While there are many standards that speak to the conditions that are acceptable for workers around the globe, the Ethical Trading Initiative (ETI) has compiled a very sensible and comprehensive standard that the organization considers the ‘Base Code’. According to the Base Code, there are nine fundamental rights that should be respected of all workers in the manufacturing sector. ETI’s website states that the provisions of the Base Code constitute “minimum and not maximum standards and this code should not be used to prevent companies from exceeding these standards. Companies applying this code are expected to comply with national and other applicable law and, where the provisions of law and this Base Code address the same subject, to apply that provision which affords the greater protection”[12] The nine codes are:

1. Employment is freely chosen
2. Freedom of association and the right to collective bargaining are respected
3. Working conditions are safe and hygienic
4. Child labour shall not be used
5. Living wages are paid
6. Working hours are not excessive
7. No discrimination is practiced
8. Regular employment is provided
9. No harsh or inhumane treatment is allowed[13]

The first code refers to the free ability of an employee to enter into employment and leave employment as the employee desires. And that no forced labor is exerted on any employee. The second code refers to the collective rights of the employees. That they be allowed the ability to associate, be able to form unions, and general bargaining rights. The third code refers to providing the employees appropriate safety and hygienic conditions to conduct their work. This code includes access to clean restrooms as well as health and safety training among other things. The fourth code refers to the unequivocal nonuse of child labor. The fifth code refers to, what is called the ‘living wage’. While not quantifiable, the living wage often provides at least the minimum wage as required by law, but generally speaks to the wage that would be consistent to adequately provide for yourself. The sixth code refers to having regular working hours. Similar to the living wage, not overworking employees is a combination of national laws and common sense. The seventh code refers to their being no discrimination being practiced in the work environment. The eighth code refers to a legal and ethical relationship between company and employee. Without this protection, it is possible for employees to be maintained as indefinite contract workers instead of full-time employees with benefits, or to be kept as an ‘apprentice’ long after you have learned your trade, etc. The final and ninth code refers broadly to the ideals inherent in the ‘Base Code’. Stating that ‘no harsh or inhumane treatment be allowed’ is the fundamental tenant of ETI’s code and is both a benchmark as well as a caution against any discrimination or unethical treatment that is not expressly stated in the Base Code.

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[1] http://www.sa-intl.org/index.cfm?fuseaction=Page.viewPage&pageId=472[2] Ibid.[3] http://www.saasaccreditation.org/certSA8000.htm[4] http://docs.google.com/viewer?a=v&q=cache:Qe2S1vXyvaEJ:www.hbs.edu/research/pdf/08-097.pdf+SA+8000&hl=en&gl=us&pid=bl&srcid=ADGEESiF_Duo0MMoH9QeaGZVZZpuXREvP1nom2bzmgT47EnzUhdLIU-BZGcCqN7WsrsuUAWhLRrUH-1ubm_qIKx27mlMGwHrH0om027aSd3aawpav4D39aBf80mM45e0INUwJC8E2xO0&sig=AHIEtbTcEG06NRB9mkjFj-3NDywN6gj2Jg[5] http://www.ethicaltrade.org/about-eti[6] Leipziger, Deborah. The Corporate Responsibility Code Book. Sheffield: Greenleaf Publishing Limited, 2003. Page 228.[7] Ibid. Page 229. www.ethicaltrade.org[8] http://www.ethicaltrade.org/about-eti[9] http://www.s-ox.com/dsp_getFeaturesDetails.cfm?CID=2235[10] Ibid.[11] http://www.fairbusiness-alliance.com/http://docs.google.com/viewer?a=v&q=cache:usqw3rIMcGgJ:www.iscom.nl/publicaties/gmi43blo%255B1%255D.pdf+alliances+which+can+be+developed+to+promote+ethical+supply+chains&hl=en&gl=us&pid=bl&srcid=ADGEESixRAaJtnu0LCwVp7PbpN-ylSTSVd590V-jOHmR7i0RoABiz04LnRwqcP8L_ZjgbydxhH89EDay0KebmL_zfvhlGJIJWvxrDINIahZV-ci6Fho9ZSHceOAxIOdoQJIOy8ap7PCh&sig=AHIEtbTGZNbUGtfquK4fGyc_RSVRCD_VrQ[12] http://www.ethicaltrade.org/eti-base-code[13] Leipziger, Deborah. The Corporate Responsibility Code Book. Sheffield: Greenleaf Publishing Limited, 2003. Page 232-234.