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SAP 2.60/WP.110
By Jean-Paul Sajhau
Non-governmental organizations are becoming increasingly active in the campaign to sensitize enterprises in the TCF sectors to adopt an ethical attitude, including through codes of conduct.
The first part of this chapter briefly describes some of these organizations according to their characteristics and main spheres of action. This is followed by a discussion of their activities concerning social responsibility; this aspect is examined in the second part where the different approaches used are illustrated by specific examples.
In 1971, when the Episcopalian Church presented a shareholder's charter requesting General Motors to break its links with South Africa because of apartheid, the activism of religious shareholders gathered force and led to the establishment of what is now the International Corporate Social Responsibility Movement. Since then, many ecumenical associations have rallied to the defence of human rights by trying in particular to make the major enterprises in the TCF sectors aware of the need for respect of these rights and the improvement of working conditions.
For example, this study refers in particular to three ecumenical associations. One of these, the Interfaith Centre on Corporate Responsibility (ICCR), groups together throughout the United States almost 300 religious institutional investors which together hold a portfolio estimated at around 45 thousand million dollars and which are also consultants to major pension funds. This organization is therefore a significant pressure group. Its main objective is to make enterprises aware of the social consequences of the globalization of the economy. Thus, its action covers a much wider area than that of codes of conduct. For example, it takes a stand against militarism and violence and also tries to make public opinion aware of the role of enterprises in the deterioration of the environment. However, it is particularly concerned with the respect of basic human rights.
The Ecumenical Committee for Corporate Responsibility (ECCR) and the Task Force on the Churches and Corporate Responsibility (TCCR) are ecumenical associations based in the United Kingdom and Canada respectively. They are fervent champions of human rights and work towards making enterprises more aware of the deterioration of working conditions compounded by globalization. The ECCR is associated with the Council of Churches for England and Ireland. Its objective is to channel investments and monitor company initiatives. For its part the TCCR is particularly concerned with analysing the impact of Canadian enterprises on social and environmental problems.
These three ecumenical associations, which carry out similar activities, wanted to join efforts in the establishment of a project for developing principles which would serve as an ethical basis for assessing the impact of decisions by enterprises and, thus increase their sense of social responsibility: "Principles for Global Corporate Responsibility: Benchmarks for Measuring Business Performance" (see box 1, p. 13).
Although ecumenical associations and economic associations have been dealt with separately because of their origin, it is interesting to note that they have the same main objective: enhancing the social responsibility of enterprises in the developed countries. However, differences can be noted in the way they go about this task.
The Business for Social Responsibility (BSR), established in 1992, is a national association grouping together some 800 enterprises including Reebok, Levi Strauss and The Gap. Its main objective is to help enterprises, irrespective of their sphere of activity, to take account of ethical considerations in their business decisions without prejudice to their profitability. To this end, different projects have been established to help them improve or establish a social policy. These projects focus on different areas ranging from social responsibility to the environment. However, it is the Business and Human Rights Program which comes closest to the subject of this study. This programme was developed to make enterprises more aware of the poor working conditions existing in many developing countries.
Although it has a smaller membership, the Minnesota Center for Corporate Responsibility (MCCR) has the same concerns as the BSR. Since its establishment in 1978, it has been trying to help economic leaders to look at the business world from a more social rather than exclusively economic angle. To this end, it provides enterprises with information and assistance, including the preparation of general ethical principles. Unlike the BSR, the MCCR does not have any programme directly dealing with the defence of human rights. However, it participated in the preparation of a set of principles entitled "Principles for Business", in collaboration with the La Caux Round Table (CRT), which contain international standards for business conduct. The MCCR encourages enterprises to comply these principles or to create others based on them.
The World Business Academy (WBA), which was established at the end of the 1980s, is a not-for-profit association grouping together more than 500 members in 30 countries. It is a research and educational institution which endeavours to make the business community take up its new role as an agent of social change.
The main objective of this organization is not fundamentally different from that of the two other associations already mentioned. The WBA believes that the social aspect is not an obstacle to an enterprise's prosperity; on the contrary, both aspects are closely linked. The WBA provides information as well as specific instruments and advice to major enterprises enabling them to improve the social environment without jeopardizing their profitability. To this end, and in collaboration with the ILO, the Social Transformation and Enterprise Performance Programme was established in 1996, consisting of the study of different initiatives likely to enhance the sense of social responsibility and which will culminate in the establishment of a database covering the different practices analysed, study cases, etc., which could serve as a source of reference for enterprises.
The Council on Economic Priorities (CEP), established in 1969, is the oldest of the organizations studied here. Throughout its almost 30 years of existence, it has been able to diversify its activities and adapt them to the different social and economic changes of recent years. The CEP is a research organization whose objective is to analyse measures taken by enterprises in the social and environmental spheres. It carries out a number of activities, in particular publications, including its consumer guide entitled: "Shopping for a better world: A quick and easy guide to a socially responsible supermarket shopping" (first edition published in 1988). It also carries out a number of research projects, including one on the effect of the practices and policies of multinationals on developing countries. Like the other organizations, it provides enterprises with a vast range of information enabling them to learn how to reconcile social responsibility and respect of the environment with wise investments. Its spheres of activity are thus varied, although the promotion of social responsibility remains a special interest. In this respect, like the MCCR, it has established various principles for use by enterprises. What distinguishes the guidelines established in the "Principles for Business" is the area under focus. They are guidelines which enterprises are strongly encouraged to adopt with a view to the elimination of child labour: "Guidelines for corporate action on child labour". They provide an example of conduct to be followed, with information for enterprises on ways of establishing a code of conduct, how to apply it and monitor its application, how to protect children and promote their development, and how to ensure that subcontractors and producers respect the code, etc. Although enterprises are strongly encouraged to respect these guidelines, there is no follow-up or monitoring process and no obligation for them to apply it.
As their name indicates, the main objective of solidarity organizations or associations is to help the most underprivileged populations either abroad or in their country of origin. Some of these organizations specialize in a specific kind of aid, such as that for refugees. Others have a broad field of action, as in the case of Oxfam.
This organization became widely known in 1982 during the widespread famine in Ethiopia where it was very active. Today it carries out a number of programmes throughout the world in such spheres as health, emergency aid, agriculture, the defence of human rights, etc. As regards this last point, Oxfam UK/I (a member of Oxfam International) prepares a number of projects in direct collaboration with consumers' associations and workers in sectors in which rights are particularly threatened. Oxfam UK/I recently launched a Clothes Campaign to make public opinion more aware of the need to improve working conditions in the apparel industry throughout the world.
The objective of Agir Ici Association is to promote North-South relations which are equitable in political, social and economic terms. In order to carry out its mission, and in this respect it differs from other solidarity associations, it intervenes exclusively with political and economic decision-makers in France and in other European countries. Its principal "weapon" is the bringing of pressure to bear on these decision-makers by campaigns to enhance consumer awareness and make them react and thereby influence decision-makers. Since its establishment in 1988, it has carried out 29 campaigns, a large number of which have achieved tangible results. Its last campaign to date, "Soyez Sport", which was launched at the beginning of 1996, is designed to improve working conditions in the manufacture of sport shoes in South-East Asia through the increased sensitization of consumers.
This initiative is similar to that taken by the Artisans du Monde in 1995. This solidarity association, established in 1974, on the initiative of l'Abbé Pierre, a well-known French priest, also promotes the need for fair trade with the assistance of many other French and European associations (it groups together almost 60 local associations in France and is affiliated to a network of 3,000 associations in Europe). Its two traditional activities are the sale of food and handicraft products (bags, pottery, jewellery, spices, chocolate, etc.) and the education and mobilization of consumers on behalf of fair trade. Campaigns have been launched to heighten public awareness. In November 1995, Artisans du Monde broadened its scope of activity to the TCF sector with its "Free your clothes" campaign, launched in association with Agir Ici and several other solidarity associations (the Catholic Committee against Hunger and for Development, Brothers to All Men (BAM), Human Rights Leagues, etc.). The objective of this campaign is to establish among consumers a new criterion for the purchase of clothing: the social conditions of their production.
Of these solidarity organizations mention can also be made of The Labour behind the Label. This association is in fact a network of groups and bodies in Great Britain, the main members of which are: Save the Children Fund, Textile Environmental Network, Trade Craft Exchange, Catholic Institute for International Relations, World Development Movement, etc. Its main objective is to improve working conditions in enterprises in the TCF sector. To achieve its goal, it carries out measures to encourage enterprises to follow ILO standards. It has in particular participated in another sensitization campaign entitled "Clean Clothes Campaign" in the Netherlands.
This brief outline has already highlighted the different approaches used by the three categories of associations. Because of their financial clout, ecumenical associations are in a better position to bring pressure to bear on enterprises in the TCF sectors in the developed countries. The economic associations focus more on encouraging and helping enterprises to create, improve and apply a code of conduct. For their part, solidarity associations place special emphasis on increasing awareness by consumers enabling them to bring pressure to bear for the improvement of production conditions.
The initiatives of the non-governmental organizations and associations share a common goal: increasing enterprise awareness of the need for social responsibility. Some of these organizations approach this responsibility in a global manner. Others are more specific and focus only on working conditions in the TCF sectors. Different means with different characteristics and features are used to achieve these goals.
Economic organizations have an important stock of information which they make available to enterprises and which has been collected in different ways through the publication of studies and reviews, exchanges between organizations, research, etc. The available information ranges from human rights in general to the specific example of precise codes of conduct. Specific works on the links between the respect for human rights and the business world are also available. The BSR, for example, provides enterprises with the services of its Corporate Responsibility Resource Center (CRRC), with information on a sample of initiatives taken by enterprises as well as a description of their programmes and actions. It also provides research documents, prepares practical tools and facilitates the establishment of informal networks.
Some of these organizations, including the CEP and the WBA, also have a website on the Internet, allowing enterprises rapid and easy access to the information available and enabling the public in general to see in specific terms what is being done to improve working conditions. A similar approach has been adopted by the Fairtrade Foundation. The work carried out by this Foundation to help enterprises improve their codes of conduct and carry out controls, normally remains confidential but if the enterprise so wishes, the results can be made public. The Fairtrade Foundation believes that this encourages competitive enterprises to follow suit and gives the enterprise concerned an opportunity to make the public aware of its initiatives and enhance its "reputation". Publishing the results may bring pressure to bear on enterprises which will be obliged to continue along this path. If it is subsequently discovered that they have stopped applying their codes, this might well damage their reputation. According to the Fairtrade Foundation it is a risk which is worth taking.
The BSR, thanks to the research and studies which it carries out, is able to provide enterprises with lists concerning the respect or non-respect of human rights in various countries. This can encourage enterprises to reconsider their trade relations with certain countries.
Seminars and conferences also allow information to be gathered, offering an opportunity for heads of enterprises to meet together and to talk with professionals. Within the framework of its Business and Human Rights Program, the BSR sets up working groups, the main purpose of which is to exchange experience allowing decision-makers to find joint solutions to the problem of improving working conditions, in particular through the use and improvement of codes of conduct. A conference was held in 1995 which focused on such themes as the application of a human rights policy in the enterprise, the enterprise and child labour, etc. The participants included enterprises from the TCF sector such as The Gap, Levi Strauss and Reebok as well as representatives of the United States Department of State and the Department of Labor, Amnesty International, etc. The BSR has also set up an Apparel, Footwear and Retailing Working Group for enterprises in the TCF sector. The main objective of this group, which is made up of senior business officials and representatives of organizations which defend human rights and the rights of workers, is to study important aspects relating to globalization and human rights. In June 1996 the BSR also organized a working group for managers responsible for monitoring codes of conduct and respect of local legislation in their enterprises.
A large number of the associations studied in this report emphasize the importance for enterprises to have and comply with a code of conduct and ethical guidelines. Some non-governmental organizations help enterprises to establish or improve their own code of conduct. Most of these organizations, such the Fairtrade Foundation and Labour behind the Label, use the principles set forth in existing codes of conduct and in relevant ILO Conventions. Others, such as the three ecumenical organizations (ICCR, ECCR, TCCR) and the CEP, have their own code of conduct and guidelines, which may vary from one enterprise to another, or from one organization to another. Some are general while others are more precise and targeted. Box 1 illustrates a very complete code of conduct proposed by three ecumenical associations. Despite the very broad scope of this proposal, which makes it difficult to apply in full, it was adopted, since it provides a response to the questions which enterprises may raise in developing a code of conduct. Box 2 gives an example of very specific guidelines, in this case concerning child labour. However, it is interesting to note that this approach can be used in any other sphere concerning the respect for human rights at work.