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SAP 2.60/WP.110
By Jean-Paul Sajhau
For a number of years, sensitization campaigns targeted on consumers have become more and more common as a means of bringing pressure to bear on enterprises. The objectives of these campaigns may vary, although their main goal as regards enterprises in the TCF sectors is to encourage them to react favourably to pressure from the public in general. These reactions should normally result in the establishment of a code of conduct and a system for the independent monitoring of its application.
Following the success of the campaign launched with The Gap by the NLC, many solidarity organizations and consumer associations have followed suit.
Alarming figures about poor working conditions led the Artisans du Monde on 18 November 1995 to launch a sensitization campaign entitled "Free your clothes" in collaboration with 27 trade union and associative organizations and consumer associations.
The campaign had two main objectives: to sensitize the public to the social conditions of apparel manufacture and to make people react. They were asked to send letters to the three major apparel retailers in France (C&A, La Redoute and Kookaï), requesting information on the company's criteria for selecting its suppliers. Between 13,000 and 15,000 letters were sent. When the three enterprises replied in a manner which was considered vague and evasive, the Federation sent letters in March 1996 requesting further information and details on the monitoring carried out. Meanwhile, it drew up a draft code and a proposed independent monitoring system. Although the replies received from the three enterprises remained vague, an initial dialogue had been established, through consumers, between the latter and the associations. Furthermore, this initiative was launched in close collaboration with the Clean Clothes campaign originating in the Netherlands and which was subsequently extended to Germany, the United Kingdom and Belgium. The network is thus becoming increasingly widespread, reflecting the greater concern by consumers about the social conditions in which their clothing is manufactured.
The sensitization campaign entitled "Soyez Sport" launched by Agir Ici is also part of a European movement established in coordination with Christian Aid (United Kingdom), IRENE (Netherlands), Evangelische Kirchengemeinde Duisburg-Neumühl (Germany) and Centro Nuovo Modello di Sviluppo (Italy). This campaign, which focuses on the manufacturers of sport footwear (Nike, Adidas, Reebok, Puma, etc.) and the major French retailers (Décathlon, Courir, Leclerc, Auchan, etc.), is an attempt to encourage these enterprises to guarantee decent working conditions through the adoption of codes of conduct and the establishment of an independent monitoring system.
More than 30,000 campaign documents were distributed, including tracks, posters and brochures. As with the campaign launched by the Artisans du Monde, consumers were asked to write letters about the measures taken by these enterprises.
Despite this widespread mobilization, the replies received were not very encouraging. The enterprises which already had a code of conduct said that it was being applied and monitored. But the monitoring remains internal and many examples of poor treatment in workshops show that the code is often a dead letter. Enterprises which do not have any code, such as Adidas, do not seem motivated to develop one. For Agir Ici, the sending of letters was only a first stage; it plans to chase up enterprises which have not replied and to propose a discussion with the others on ways of providing assistance for the preparation of a code of conduct.
According to Agir Ici, the campaign did not have sufficient access to support from the media, such as radio, television and the press, which had been the case in the United States. The campaign launched in the United Kingdom by Oxfam has perhaps had the advantage of greater media support. As well as sensitizing public opinion, it is also an attempt to mobilize governments and major international organizations in an attempt to reinforce respect of ILO Conventions in the sphere of trade.
As was noted in the case of The Gap and the NLC, the various United States Leagues are also trying to rally public support. The National Consumer League (NLC) has, with the assistance of the Union of Needletrades, Industrial and Textile Employees (UNITE), the main United States textile trade union, launched a sensitization campaign entitled "Stop Sweatshops: A Partnership for Responsibility", in collaboration with different groups (women workers, religious associations and consumers). As its name indicates, the main objective of this campaign is to eliminate sweatshops. As in the case of the two earlier initiatives examined, consumers are encouraged to send letters to different retailers and suppliers. According to the NLC, it is the consumers who take the initiative of requesting the names of companies which do not use the services of sweatshops and from which they can therefore buy with confidence. Consumers reacted strongly in the Kathie Lee Gifford case following the extensive media coverage given to the matter. Most organizations believe that pressure must be kept up through the assistance and support of consumers.
In order to make consumers more aware of the situation and make enterprises react, non- governmental organizations have also developed labelling campaigns. These campaigns consist of placing a label on TCF articles certifying that they have been manufactured in accordance with acceptable working conditions. The principles which enterprises must follow to be able to use this label vary according to the campaigns and the organizations concerned, but in general the same basic principles are used, namely non-recourse to child labour, the existence of a minimum wage, respect of local legislation in force, respect of the environment, etc.
The focus was initially placed on eliminating the still very widespread use of child labour in the manufacture of carpets and rugs; this was the case with the campaign launched by the Rugmark Foundation which has undoubtedly been one of the most successful. The Rugmark Foundation, established in October 1994 by various non-governmental organizations with the support of the ILO's International Programme for the Elimination of Child Labour gave support to various projects in different countries. In each participating country, a tax of 1 per cent which must be paid by rug exporters in order to be able to use the label, which is paid through UNICEF to a local organization which develops projects for children in the sphere of education, training and the building of schools. On the basis of this initiative, the Child Labor Coalition (CLC) has launched in the United States a vast campaign to sensitize the public, the Rugmark Consumer Education Campaign, to encourage United States importers, retailers and consumers to buy only rugs which have the Rugmark Foundation label.
The Care and Fair organization is also developing projects to promote the welfare of children in the main rug-making regions and which consist of the building of schools, educational centres, hospitals, etc. The costs are covered by the taxes paid by the member enterprises which use the label.
The STEP Foundation, established in October 1995 by a number of Swiss organizations to promote equitable conditions in the production and marketing of rugs, has prepared a label known as the Codex. In order to be able to use this label, enterprises which import and sell rugs must respect a code whose principles include non-recourse to the use of child labour, the payment of a fair wage to workers, a production process which is socially fair and which respects the environment and greater transparency in the production and marketing of rugs. Enterprises must be willing to accept monitoring by the Foundation to ensure that these principles are respected. For example, mention can be made of the Pfister Meubles furniture enterprise which has agreed to sell only rugs manufactured in satisfactory working conditions and without use of child labour. In its licensing contract with the STEP, Pfister Meubles pays a contribution in respect of each square metre of rug sold, which is used in development projects in the manufacturing regions.
This example shows that the promotion of labelling can become a marketing tool. By improving the image of products with the label that they have been manufactured in good working conditions, enterprises encourage consumers to give them their custom.
Following the introduction of such initiatives, non-governmental organizations have extended these campaigns to the TCF sector in order to promote fair trade. The Swiss Double Income Project (DIP) Foundation is endeavouring to improve the living conditions of workers in the apparel sector. Enterprises which have their clothing articles manufactured in countries with low wages undertake to pay the Foundation the equivalent of the amounts paid to the workers. The Foundation uses these funds to improve already existing infrastructure and to launch new medical and social projects. Verité, a not-for-profit organization, provides enterprises with information and helps them to improve their sense of social responsibility. But its objective is more ambitious since the establishment of a code of conduct does not necessarily mean that the code is applied. The Verité organization, on the basis of different standards and codes of conduct, including ILO Conventions, offers its services for the monitoring and supervision of codes. Enterprises which accept this monitoring can use the label which certifies that their products have been manufactured in good working conditions which respect the minimum standards as regards human rights. For its part, the Fairtrade Foundation is also examining the possibility of introducing a label in the clothing sector. Finally, in the sports equipment sector, the International Federation of Football Associations (FIFA) is trying to set up programmes to help integrate into the school system children who work in the production of footballs. After developing a code of conduct with ILO support and the collaboration of a number of employers' and workers' associations, it is planning to establish a system for monitoring the application of the code by an independent body as well as projects to promote the welfare of children.
We have selected ten United States enterprises which produce or distribute TCF products and which are representative in their economic importance and the references made to their codes of conduct in the media. The fact that they are United States enterprises is not fortuitous: it is in the United States that such codes were first adopted and have, over the last four decades, been extended to an increasing number of enterprises. In Europe, the movement is still at a embryonic stage and very few individual enterprises in the TCF sectors have introduced structured codes of conduct. To our knowledge the only sufficiently operational example is that of Mondial International, whose headquarters are in Brussels, and which is responsible for supplying the C&A group. The case of this enterprise will be examined in the section dealing with European initiatives.
In this chapter, each code of the selected enterprises is first of all presented, with a summary of its main components. An attempt has been made to group together, wherever possible, the different elements through keywords to facilitate comparison. This is followed by a comparative analysis of the codes on the basis of two major aspects: explicit or implicit references to fundamental ILO standards concerning human rights at work; and the methods of application.
The selected enterprises present their respective codes in very different forms. The codes sometimes consist of general principles applicable to all the firms' activities. In other cases, they are much more detailed and a distinction is made between the internal principles of the firm and the practices to be applied with its trade partners, or even in the choices of subcontracting countries, as at Levi Strauss. Sometimes, several codes coexist and have complementary functions. Some codes make explicit reference to the trade sanctions to be applied in the event of non-respect of obligations and mention is sometimes made of the methods of their application, although in this respect the information is the least precise.
Levi Strauss Associates is the world's leading apparel manufacturer, producing and marketing clothes for men, women and children. In 1995 the group's turnover was 6.7 thousand million dollars, with net profits of 734 million dollars. During its 142 years of existence, the enterprise used external financing sources only between 1971 and 1995. Thanks to a progressive repurchasing by the majority shareholder of shares offered to the public on the stock exchange in 1996, Levi Strauss has once again become what it was at the beginning, namely a company held by a single family. Its owner and Chief Executive Officer, Bob Hass, has developed over the years a strategy of expansion in which industrial ethics have played a major role.
The Levi Strauss code of ethics consists of two sets of guidelines. The first, the Business Partners Terms of Engagement, deals with subjects over which the enterprise's trade partners can exercise direct control. These include in particular general ethical standards, legal requirements, environmental requirements, and above all, labour standards. The concept of "business partners" includes contractors and subcontractors who manufacture or finish the company's products and suppliers who provide material used in these products.
The second set of guidelines deals with criteria which are beyond the ability of the individual business partner to control since they concern the selection of supplier countries (Country Assessment Guidelines). The objective of what is in fact a separate but complementary code is to ensure that the enterprise does not operate in countries which might have an adverse effect on its public image and its reputation as a good employer. An analysis is made of the social or political image of a country and the impact of this image on the company's reputation; the general conditions concerning safety and health; the human rights environment; the legislative system and the political, economic and social stability of the country. If Levi Strauss believes that a country does not offer sufficient guarantees in any of these spheres, it will refrain from developing trade relations with that country. The enterprise may decide not to renew its contractual relationships in countries in which there is a deterioration in the situation. Thus Levi Strauss has withdrawn from or terminated its trade relations with a number of countries, mainly due to the non-respect of human rights. In addition to these two sets of criteria, Levi Strauss has published a document which groups together the ethical values of the firm as a United States enterprise. The following synoptic table illustrates the complementarity between these different codes.
Table I. Levi Strauss: Synoptic table of codes of conduct
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Codes |
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| Keywords |
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Business Partner Terms of Engagement |
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Guidelines for Country Selection |
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Levi Strauss ethical values |
| Child labour |
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Use of child labour is not permissible (child = less than 14 years of age or below the compulsory school age). Levi Strauss encourages the development of workplace apprenticeship programmes for the educational benefit of young people. |
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"Aspiration statement". Employees should all have the opportunity to contribute, learn, grow and advance based on merit. The management of the enterprise must be guided by the following principles:
-- team work and trust; -- diversity of the workforce as regards origin and political belief; -- recognition of merits; -- ethical management practices; -- optimal internal and external communication; -- empowerment of employees. |
| Forced labour |
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No use of prison or forced labour. |
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| Non-discrimination |
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Each worker should be employed on the basis of their ability to do the job, rather than on the basis of personal characteristics or beliefs. |
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| Coercion |
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Business partners must not use corporal punishment or other forms of mental or physical coercion. |
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| Working conditions |
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Working hours in accordance with local standards. Maximum: 60 hours a week. One day of compulsory rest. Wages and social benefits in accordance with laws in force or prevailing wage practice in enterprises in the region. |
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Ethical principles which employees must follow:
-- honesty; -- keeping their promises; -- fairness; -- respect of others; -- solidarity; -- integrity. |
| Health and safety |
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Business partners must provide good health and safety conditions, including in residential facilities when provided by the enterprise. |
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Employees and representatives of Levi Strauss must not be exposed to a working environment which jeopardizes their health or safety. |
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| General ethical values |
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Business partners should, as individuals and in the conduct of their business, respect a set of ethical standards compatible with those of Levi Strauss. |
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Widespread observation on basic human rights. |
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Code of ethics:
-- respect of employees, suppliers, clients, consumers and shareholders; -- respect of basic human rights; -- avoidance of conflicts of interest. |
| Solidarity/ambition |
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"Business vision":
Levi Strauss will make decisions which will benefit the company as a whole rather than any one component. The enterprise seeks to be an employer of choice, a supplier of choice and a customer of choice. |
| Responsibilities of a global enterprise |
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Preference given to business partners who share Levi Strauss's commitment to contribute to the betterment of community conditions (Community Betterment). |
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Protecting the global brand image of Levi Strauss. |
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Mission Statement:
The mission of Levi Strauss is to sustain responsible commercial success as a global marketing company, i.e. to conduct business ethically and to provide a safe and productive working environment. |
| Legal requirements |
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Trade partners should respect the law as individuals and obey the laws and regulations regulating their occupational activity. |
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Legal environment which guarantees the protection of Levi Strauss trademarks, which is not detrimental to other important commercial interests or seriously impedes the company's ability to implement these guidelines. |
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| Social and political stability |
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Political or social disorder in the country must not pose an undue threat to the business interest of Levi Strauss. |
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| Information on the implementation of codes |
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Regular publications on the main principles, lines of conduct and application procedures. |
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| Sanctions in the event of violation |
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Termination of trade relations with partners who do not respect the guidelines. |
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Levi Strauss will not renew its contractual relations in countries which no longer meet the selection criteria. |
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In public presentations of their ethical approach, Levi Strauss officials have pointed out that these principles are mainly based on the relevant Conventions of the United Nations and, as regards working conditions and the respect of human rights at work, on ILO Conventions.
Since the establishment of its codes of conduct in 1992 (with a revision in 1994), Levi Strauss has acquired the means to implement them within a global perspective, with the objective of these guidelines being rather to improve the existing situation vis-à-vis its business partners than to apply sanctions against them. At a first stage, the country selection criteria make it possible to prevent the development of trade relations in countries considered as posing a high risk of non-respect of human rights in practice. At a second stage, before selecting a subcontractor or, more generally, a business partner, the enterprise carries out an ethical assessment of the potential of the enterprises concerned. This assessment is carried out by a team from headquarters made up of representatives of the different technical departments. The team always includes one of the 50 persons specially trained in matters of ethical practice by Levi Strauss. When a business partner has been selected, periodical audits are carried out concerning respect by the enterprise of its social obligations. This monitoring, which may be carried out during quality inspections, but also during unprogrammed visits to subcontractors, is an internal practice in the firm. The enterprise publishes regularly the results of these inspections and audits in a summarized form in its Global Sourcing Guidelines Fact Sheets. These can be obtained on request. Levi Strauss, which has played a pioneering role in the business ethics sphere, has over the years retained its credibility amongst consumers and its employees as a socially responsible enterprise. Thanks to its permanent dialogue with its business partners and workers' representatives, it has been able to resolve most of the social problems inherent in any industrial activity, without prejudice to its enviable commercial success.