Sweating Out the Holidays: Supply Chain Factories and
Labor Rights
"I didn't tell my father about the violations and the
beatings because if I did, my father would not allow me to
continue to work and my family would suffer and not have an
income." - 11 year-old Halima, a Bangladesh factory worker
As the busy holiday shopping season commences, the issue
of child labor and exploitation of workers in developing countries
continues to nag at American consumers, some of whom may have
lost jobs to what has now become a common phrase in the vernacular
- "outsourcing."
In recent years an increasing number of companies in the
apparel, toy, footwear and electronics industries have started
outsourcing their production to other companies instead of
owning and operating their own factories. Companies increase
profits by driving down costs any way possible, so they contract
with low-cost factories. Places with the lowest wages and
human rights protections often provide the lowest costs. Sweatshops
can be found all over Central and South America, Asia, and
certain regions of Europe. There are even undocumented workers
in sweatshops in places like New York, San Francisco and Los
Angeles.
Many global corporations contract with vendors that place
orders with manufacturers who own the factories. Because the
factories are not owned by the corporation that promotes,
markets and sells the product, the challenge is to get the
corporation to take responsibility for workplace conditions
where its products are made.
Working conditions in many contract supplier factories fall
far below the most basic standards of fair and humane treatment.
Sweatshop conditions exist in too many factories where workers,
often young women, are subjected to abusive conditions, including
low wages, long hours, health hazards, psychological, physical
and sexual harassment, and the denial of basic rights to form
a union and bargain collectively. Children are employed in
sweatshops because they work for less money and are less likely
to complain about poor working conditions. Many of the children
must work to help their parents, who are not paid enough to
provide for the family. An education is out of the question
for these children, who must work instead of going to school.
The challenge is to press companies to use their influence
with their suppliers, vendors and factory management to respect
the dignity of the workers and create a safe and healthy workplace
where labor rights are enforced.
Rev. David M. Schilling is ICCR Program Director for Global
Corporate Accountability Issues such as Human Rights and Contract
Supplier Chain. For ten years, David has worked with ICCR
members and associates on a range of global corporate accountability
issues including human rights and labor rights in the contract
supplier system. David, a United Methodist minister, has participated
in delegations to Mexico, El Salvador, Honduras, Indonesia,
Thailand, Turkey, Vietnam and China visiting factories and
meeting with workers and non-governmental organizations.
Since its establishment, ICCR's Contract Supplier Working
Group has encouraged companies to work with suppliers to improve
wages and working conditions in the factories and to contribute
to the sustainability of the communities where the factories
are located. ICCR's members have urged companies to create
stable relationships with suppliers and to stay in factories
to use their influence to improve conditions for workers,
not terminate contracts when problems are found.
ICCR members press companies to:
adopt supplier standards that apply to all factories where
they place orders and include basic human rights and labor
rights standards, including a sustainable living wage;
monitor factories for compliance with their vendor standards
through internal and independent monitoring;
put resources into implementation of the vendor standards
including training of workers and factory managers; and,
issue transparent public reports on factory conditions.
While a great deal of progress has been made, ICCR members
continue their efforts to address these complex and continuing
issues. And as strong as these companies are, as investors
we understand that a company can't afford to have its customers
wondering if the company is profiting from unfair labor practices.
And as consumers, we need to know that the gifts we buy for
our family and friends in this season of peace aren't the
result of the suffering of others.
Recommend that your fund managers support resolutions
on Contract Supplier issues, and explain why.
Contact investor relations to let them know how you would
like them to vote on ICCR resolutions. If your fund is unresponsive
to your concerns, consider switching to funds that vote
in ways that support your values-and be sure to let the
fund's investor relations department know why you're no
longer going to do business with them.
