This series of posts reviewed the John Lewis Partnership‘s Responsible Sourcing Supplier Workbook and summarized each of the key areas of Corporate Social Responsibility (CSR) that you need to get a grip on to truly be a good corporate citizen. Based on this knowledge, as per the workbook’s recommendations, you should be:

• working to understand the issues referred to in the Responsible Sourcing Code of Practice and what they mean to you
• identifying your key areas of risk and assessing your production site’s performance against these standards
• learning about practical solutions and actions that can be taken to tackle the issues
• identifying suitable corrective actions for your production site(s)
• demonstrating continuous improvement and commitment to best-in-class corporate social responsibility standards
• rigorously working your way through the checklists in the workbook; this involves
  • making a visual inspection of the workplace
  • looking at management records
  • actually talking – and listening – to managers

This is because the JLP, in their research, uncovered many startling facts, which include:

• over 246 million children worldwide are involved in child labour
• almost 180 million children are facing long-term health risks due to the hazardous nature of their employment
• the ILO estimates the number of victims of forced labour globally at approximately 12.3 million
• children in forced and bonded labour represent two-thirds of children in the worst forms of child labour, conservatively estimated at 5.7 million children worldwide
• more fatalities have occurred in the workplace than during war-time: almost 270 million accidents are recorded yearly, of which 2.2 million are fatal
• over 208 million workers suffer from work related diseases
• a sexual harassment study in commercial agriculture and textile manufacturing in Kenya found that over 90% of respondents had experienced or observed sexual abuse and 95% of women who had suffered abuse were afraid to report the problem for fear of losing their jobs
• workers in England and Wales experienced an estimated 849,000 incidents of violence in 2002/2003
• nine economies reported over 2,000 annual hours worked per person in the latest year for which data was available to the ILO
• workers in China often work 360 hours per month, and some up to 400 hours per month, almost twice the legal limit
• women in the UK earn, on average, 17% less than men
• women in Malaysia earn, on average, 32% less than men
• an estimated 1.4 Billion Workers (half of the world’s working population and almost one quarter of the population) live on less than $2 / day
• an estimated 550 million people, or 20% of total world employment, live on less than $1 / day
• the ILO estimates roughly 20 Million migrant workers (& family members) across Africa, 18 Million across North America, 12 Million in Central & South America, 7 Million in South & East Asia, 9 Million in the Middle East, and 30 Million across Europe
• CO₂ levels have risen more than 30% since widespread fossil fuel use began and are at their highest point in 400,000 years
• a recent survey by the World Health Organization / United Nations Environment Program (WHO/UNEP) found that 10 of 11 major cities in the Asia-Pacific region exceeded dangerous levels of Suspended Particulate Matter (SPM) air pollutants
• approximately 300 Million Chinese drink unsafe water and 90% of China’s cities have polluted groundwater

In addition to the workbook, The John Lewis Partnership also makes the full Responsible Sourcing Code of Practice freely available for download to anyone who wants it – and does so in nine different languages. So if you have difficulty with English (which may arguably be the hardest language on earth from a grammar, and even a definitional, perspective*), you can choose another language!

In conclusion, I’d like to give the John Lewis Partnership a great big Thank You for creating this great workbook and making it available for free to any supplier who wants to become more responsible. I only hope I did it justice. I’ve invited a couple of leading bloggers on the topic of corporate sustainability & responsibility to guest post on the issue, so, hopefully, next week will yield a Part XIII with a surprise guest post or two. You’ll just have to check back to find out.

As always, you can (still) access all of the posts in the series (to-date) by selecting the JLP category at any time.

^* I’m not multi-lingual, but I have studied some of the basics, including grammar rules, of different languages in the past in an effort to understand the fundamentals of communication and thought patterns, which is much more important in the development of good algorithms than most people think. If I did not know English, of all the major languages out there, the only language I would be more concerned with having to learn is Chinese – and only because of the kanji alphabet. You could spend a lifetime learning five thousand words! As a comparative point, the Japanese have it right. Simplify the language with hiragana, and now katakana, and you only have to learn around sixty syllables – and, like German, you never have to worry about the correct way to spell the word as each syllable is consistently pronounced and spelled. (You only need to worry about where to place the intonation, since this can be mistaken for syllable stressing, which can completely change the meaning of the word, or be construed to convey emotional state.)

In our last post, we discussed the environment, corresponding to section J of the report. In today’s post, we cover section K of The John Lewis Partnership‘s Responsible Sourcing Supplier Workbook, which covers environmental issues.

Considering the breadth of environmental issues – air pollution, water contamination, waste treatment, and energy use, just to name a few – you’re probably wondering why the JLP Responsible Sourcing Workbook devotes but a single chapter and this blog but a single post in the JLP series. It’s simple – of all the issues, this is the topic getting the most attention, in no small part due to global warming and tireless campaigns of a select few, such as that of Al Gore.

Although lack of environmental legislation around pollution and waste control is usually promoted as the primary problem, the real problem is, as it has always been (and I suggest you read A Brief History of Globalization by Alex MacGillivray for additional insight), industry and its thirst to be the victor at all costs. However, now that over six billion of us have populated the far reaches of the globe, we can no longer afford to do business at all costs. With the population expected to increase to nine billion before it levels off later this century, we have to start protecting, and saving the environment today. Unless technology rapidly advances to the point where we can colonize the ocean floor, inhospitable planets, and space, we’re out of room and out of time.

Although one would hope that reaching out to your humanity would be enough to convince you to trim your wasteful ways, history has taught us better. Thus, I’m instead going to point out what’s going to happen to your business pocket book if you don’t. Sooner or later, and hopefully sooner, those who don’t clean up their act are going to find themselves regulated or financially forced out of business thanks to consumer backlash and heroic efforts by forward thinking politicians such as The Governator.

More specifically, in developed countries, I am positively predicting that not only are conscious, educated consumers going to pay slightly more for “fair trade”, “carbon neutral”, and “environmentally responsible” products and services, but that, as more of these options start to spread across the marketplace, they are going to stop buying products that don’t fall into these categories. The media backlash when they discover your sweatshop in West Africa and your dumping operation in South America is going to pale in comparison to the beating your pocketbook is going to take when consumers simply stop buying your product. Furthermore, I am predicting that as these conscious consumer groups gain in numbers, we’ll start to see progressive politicians with a back-bone who will stand up and fight for what’s right, regardless of how many oil-barrons, automobile-manufacturers, and tobacco-peddlers they p*ss off along the way. And even though they may not win at first (unless Arnold can convince a few of his more radical well-known celebrity counterparts to also run as governors and senators), they will eventually.

(What boggles my mind is the fact that so many politicians are afraid to even suggest the imposition of tighter regulations because it will “hurt the big automakers, oil companies, and tobacco plantations that employ thousands and thousands of workers and damage our economy”. This is garbage. We can make better cars, process oil cleaner, and reduce the pollutants in cigarettes with our current technology. It might cost millions of dollars to upgrade the equipment to support cleaner processes and produce alternative fuel vehicles, but this does not have to hurt the manufacturers. Just like governments give big temporary tax breaks to natural resource companies to survey and develop new sources of supply, does not mean one could not apply the same logic and give companies a temporary tax break to cover their conversion cost, as this would help to ensure their success in the long run and prevent job loss. The problems they promote with their one-sided viewpoints don’t exist as they can almost always be solved with education, creativity, and a willingness to work toward a compromise solution with long-term goals.)

Some facts on the issue from the JLP workbook include:

• CO₂ levels have risen more than 30% since widespread fossil fuel use began and are at their highest point in 400,000 years
• Air pollution is the cause of three major environmental issues: global warming, ozone depletion, and acid rain
• A recent survey by the World Health Organization / United Nations Environment Program (WHO/UNEP) found that 10 of 11 major cities in the Asia-Pacific region exceeded dangerous levels of Suspended Particulate Matter (SPM) air pollutants
• Approximately 300 Million Chinese drink unsafe water and 90% of China’s cities have polluted groundwater
• In the UK alone, there were 661 pollution incidents in 2005 that had a serious impact on water quality

What do you need to do?

• Comply with all local, national, and international laws and regulations
• Make continuous improvement in environmental performance, regardless of what the regulations require
• Make practical efforts to minimize use of energy, water, and raw materials and use renewable resources whenever possible
• Minimize waste and dispose of any waste produced in an efficient, safe, and environmentally friendly manner
• Avoid contamination of the local environment
• Minimize chemical usage
• Insure there is an up-to-date action plan in place to achieve these goals

This concludes our coverage of the ten major issues tackled in the workbook. There are, of course, more issues (such as animal welfare), but these are the ones common to every organization and the most generally applicable, so they are a great start. Our next post will summarize the series and provide some concluding remarks. (You can access all of the posts in the series (to-date) by selecting the JLP category at any time.)

In our last post, we discussed the subject of wages, corresponding to section I of the report. In today’s post, we cover section J of The John Lewis Partnership‘s Responsible Sourcing Supplier Workbook, which covers regular employment.

Generally speaking, workers should have a formally recognized employment relationship and should have security in employment and the financial security and legal rights this entails. More specifically:

• Contract workers must have a written contract that clearly conveys their terms and conditions of work in terms they can understand
• Temporary and casual workers and subcontractors should only be used for short durations; it is unethical, and in some places illegal, to keep workers on repeated short term contracts for years simply to avoid the obligations (such as better pay and health benefits) associated with regular workers
• Unknown or closed agencies should not be used, as this robs workers of control over their pay and benefits
• Only workers with a right to work are to be employed

As with many of the other sections, we again find some disturbing facts around the issue of regular employment:

• The ILO estimates roughly 20 Million migrant workers (& family members) across Africa, 18 Million across North America, 12 Million in Central & South America, 7 Million in South & East Asia, 9 Million in the Middle East, and 30 Million across Europe
• Up to 80% of agricultural wage-earners in India, 77% in Brazil, and 62% in Spain are temporary workers
• Estimates of temporary workers in the UK vary from 600,000 to 1 Million

Therefore, it’s important that you:

• Provide all employees with a written contract in their native language
• Insure you are not employing the same workers on repeated temporary contracts or apprenticeship schemes
• Only employ apprentices for the maximum period permitted by law
• Encourage workers to participate in all state benefits
• Take reasonable steps to ensure you only employ those with the right to work
• Only dismiss a worker for a valid and legal reason

In our next post, we’ll tackle the tenth major issue addressed by the workbook, the environment. (You can access all of the posts in the series (to-date) by selecting the JLP category at any time.)

In our last post, we reviewed the necessity of equality of treatment, corresponding to section H of the report. In today’s post, we cover section I of The John Lewis Partnership‘s Responsible Sourcing Supplier Workbook, which covers wages.

Although governments set a minimum wage in most countries, which vary according to region, industry, and type of job, it is also the case that minimum wages are often not adequately enforced in many countries, especially developing ones. The most notable offenders often include:

• informal sectors
• suppliers who use subcontractors, homeworkers, and casual workers
• repeated short-term or probationary contract workers
• jobs that pay on a piece-rate basis
• countries that dictate a minimum wage that falls (well) below the cost of living

The last two offenders are often all too common. In most countries, legislation attempts to set the piece-rate at a level that is estimated to be sufficient to ensure the worker earns the equivalent of a minimum wage in a set number of hours, however, this is hard to calculate and notoriously hard to enforce and many workers in the plants of the worst offending suppliers and countries will have to work arduously long hours to reach a wage sufficient to meet their basic cost of living. Furthermore, in the worst of the worst, some employers will not be transparent about piece rates and wage requirements and the workers will have no understanding of how their wages are calculated relative to how they should be calculated.

Furthermore, in some countries where minimum wages fall below the cost of living, their wages will be further eroded through a system of, usually illegal, fines and deductions for “misbehavior, lateness, production errors, uniforms, supplies, and accommodation”, among others.

As with the other subjects tackled by the workbook, JLP points out some startling facts:

• Almost 10% of countries do not have a minimum wage legislation of any form
• A recent survey in China found that 32% of workers were being paid below the legal minimum wage
• An estimated 1.4 Billion Workers (half of the world’s working population and almost one quarter of the population) live on less than $2 / day
• An estimated 550 million people, or 20% of total world employment, live on less than $1 / day
• Even in the EU, minimum wage rates vary by a factor of more than 10: from 115 euros/month in Latvia to 1,500 euros/month in Luxembourg

And if this isn’t enough to force you to ensure you, your partners, and suppliers are paying fair wages, consider the following:

• workers who cannot make a living working regular hours in one job are forced into a cycle of poverty where they have to take other jobs during evenings and weekends – this makes them tired and worried, and we already know that tired, worried, and stressed workers are less productive, more error-prone, and take significantly more time off than those who are rested and content with their jobs
• compensation is the basis of worker loyalty; as numerous responsible sourcing studies and human resource retention studies have found
• as Corporate Social Responsibility becomes more common and countries take action, your risk of serious fines, levies, and workforce departure will dramatically increase if you don’t take action now to ensure you are in compliance and paying, and treating, your workers fairly and equitably

Specifically, make sure that:

• Wages meet national legal requirements and industry standards
• Wages meet basic needs plus some discretionary income;
  the Living Wage Summit proposes the following formula to calculate your minimum wage, and you should pay this if it exceeds the legal minimum wage:
  (avg household size * avg cost basic needs per person /
   avg number adult earners per household) * 1.1
• Wage information, clearly written and inclusive of the payment process and job requirements (hours, pieces, etc.) must be provided to workers before they agree to employment
• Wages shall be paid directly to the worker in cash, cheque, or transfer at the agreed times and in full
• Pay slips shall be made available
• Deductions are not utilized as a disciplinary measure – only deductions required by law are permissible (unless they are allowed, such as 401K withholdings, and agreed to by the worker)
• Wage records are kept for sufficient periods
• Overtime is paid at least at the legally required premium
• Wages are not held from workers as a deposit

In our next post, we’ll tackle the ninth major issue addressed by the workbook, regular employment. (You can access all of the posts in the series (to-date) by selecting the JLP category at any time.)

In our last post, we covered the issues surrounding working hours, corresponding to section G of the report. In today’s post, we cover section H of The John Lewis Partnership‘s Responsible Sourcing Supplier Workbook which covers equality of treatment.

All workers should be paid the same for the same job and have access to the same opportunities and benefits. Employment discrimination happens when someone is treated differently because of gender, race, national origin, religion, caste, class, age, disability, marital status, sexual orientation, political affiliation, or union membership.

Discrimination comes in all shapes and sizes. It can also occur in all stages of the employment process: in hiring, compensation, training, promotion, termination, and retirement. Victims of discrimination may:

• be less likely to be hired
• be paid differently
• be unfairly dismissed
• suffer verbal or physical bullying
• receive little or no training
• have fewer promotion opportunities

Certain countries have particularly common forms of discrimination that you need to watch out for:

• gender or religious discrimination in the Middle East & North Africa
• union discrimination in Colombia
• caste discrimination in India
• migrant worker discrimination in China

Certain types of discrimination, especially compensation-based discrimination, are still very common, even in developed countries:

• women in the UK earn, on average, 17% less than men
• women in Malaysia earn, on average, 32% less than men
• in the UK, 30,000 women are dismissed a year simply because they are pregnant

The workbook offers a starting checklist that you can use to make sure that discrimination does not become a problem for your company:

• all managers are fully aware of the laws regarding discrimination in the country of operation and the policies of your organization
• there is an equal opportunity policy in place
• everyone receives equitable pay for the same work
• there are no medical tests as part of the recruitment process
• maternity and paternity leave is permitted
• there is a clear procedure for raising grievances

In our next post, we’ll tackle the eigth major issue addressed by the workbook, wages. (You can access all of the posts in the series (to-date) by selecting the JLP category at any time.)