A conversation with Alice Tepper Marlin of Social Accountability International

Transcription

1 A conversation with Alice Tepper Marlin of Social Accountability International What s the biggest challenge in your work? One is the short-term relationships between suppliers, brands and retailers. That s a big issue in a sector like apparel, when there is over-capacity and low barriers to entry and a lot of price competition. You work with a factory; it invests and improves conditions. But then it doesn t get the next order from the company that asked it to make improvements in the first place. So the suppliers become very wary. Another challenge is how do you incentivize everyone in the client company to reward improvements? A factory may hear from a compliance team how it needs to improve conditions, but the next day, when the buyer comes in to place an order, is he or she really informed about social and environmental performance? How do you know that the multi-stakeholder process is working? You see stakeholders with very different points of view start to understand each other better. They anticipate whether a given idea would work -- or not work -- for someone else at the table. They see not just their own perspectives, constituencies and constraints, but also those of others. So you might hear a trade union say about a proposed initiative, We d like to do this but I can see that this could never work at X company because Then you ll hear a corporate representative voice a similar understanding about the perspectives and constituent demands at the trade union. Suddenly you have a conversation marked by an empathy that didn't exist before. What have been SAI s biggest successes? SAI s biggest success is the model we set with the SA8000 standard, which has really led to the increased quality of other standards and codes. The initial reaction was, This is too demanding. Now there are 1.4 million workers employed in SA8000 certified farms and factories. Some of our biggest successes are where we can do integrated public/private partnerships and work over two, three or four years. In one project with the garment sector, it took us years to get representatives from factory management and labor to stay in the room for an afternoon together. Finally, there have been huge advances at the brand level with public reporting and the ability of companies to work effectively with stakeholders. Very few have done as much as Gap Inc. has, but there s been a real change. What value do companies like Gap Inc. bring to multi-stakeholder efforts? The most extraordinary thing about Gap Inc. is how enthusiastic and receptive it is to trying new things and engaging. The other thing is how much this work is imbued throughout the company -- you can talk with a junior designer or someone in a store and they know what the company is doing.

2 Finally, a company can bring others to the table. If an NGO tells a company something, that s interesting. But if Gap Inc. says, This really works for us, that is just so much more credible because it is coming from their peers. How has Gap Inc. s perspective influenced how others see issues? Gap Inc. has helped us understand how a major brand operates internally, and the different roles of the different players. They also play an important role in bringing stakeholders together. NGOs often compete with each other and it can be a company that provides the incentive, the glue and the resources to encourage them to work together. What issues do you envision working on in the coming decade? For SAI, the major focus is on scaling up. We ve been piloting the Social Fingerprint Program with Gap Inc. and over 20 other companies across different sectors and countries. It s a suite of ratings, training and toolkits for CSR and supply chain management that enables both suppliers and companies to self-assess online in an easy-to-use, cost-effective format, with customized tips to take immediate action. Two labor-specific issues deserve attention. One is homeworkers and the other is contracting. Homeworkers are a huge trend in some countries. It s very complicated for the factories how do you track activities when people are working from their homes? Another shift is moving beyond working conditions to other aspects of social responsibility. We re in the beginning stages of a pilot with a major fresh fruit company which will explore the inclusion of environmental criteria into the scope of SA8000, as well as others. Finally, we want to better measure and report out on the impact of our work. What do you think is misunderstood about corporations? One thing is constraints, the limits to power. Many campaigners assume that a large brand has a greater degree of control over its suppliers than is actually the case. If a Gap store in one place can be selling pants that are the same as in a Gap store someplace else, you might expect that there s consistency in how it s produced as well. But that s an over-simplification. Another general misunderstanding is how global the companies are. There s a mismatch between company growth and stock market returns and the jobs companies are producing in the U.S. How are consumers themselves changing? All these wonderful polls say percent of people won t buy a product if they knew it was made by child labor. But that s very different from the way they behave when they make a purchase. It s not so easy to check at the point of purchase. I also think there s a very strong anti-china bias. When I tell people what I do, the first thing they ask is, Where are the worst conditions? I say, It varies

3 based on what criteria you care about. If you care most about child labor, China is not among the worst. But if you care most about forming a union, China is probably one of the worst. Within every country you can find some really good factories and some abysmal ones. What would you like American consumers to know about what they buy? I would ideally like them to know how products are made the degree to which the people who make them are treated decently and fairly and what the environmental impact is. What is the number one pressure on companies today? It s the number one pressure on them yesterday and the day before and that s profitability, growth and risk management. We find constantly that doing a good job on social responsibility issues is essential to all three. The sweet spot is, how can we improve working conditions in a way that s profitable for the company? That s how you really create change. So how do working conditions connect with profitability? The area where we see the most dramatic improvements is retention. That s a huge cost savings. Then we have lots of cases where improvements in working conditions lead to sharp improvements in on-time delivery. Did the recession make your work harder? Yes of course. If you have fewer resources and less access to credit and more fear, that makes almost any kind of change more difficult. What gives you hope about the future? Part of that is just being born optimistic. And one draws a lot of hope by the degree to which these issues are seen more as integral to operating a business and less as a charitable contribution. Another reason I have hope can be explained with a story, the starfish story. There s a little girl wandering along the beach after a storm. There are thousands of starfish and she s taking the live ones and throwing them back in the ocean. A man comes along and says, Why are you doing this? You ll never be able to save them all. And the little girl says, It matters to this starfish. That s what gives one hope about the future. It s the one worker whose life you improve. A conversation with Peter McAllister of Ethical trading Initiative Why is it so important to bring a diverse group of stakeholders together? The issues that we re all concerned with are a challenge to understand, and none of us finds these things easy. The more we expose ourselves to other points of view, the more likely we are to find

4 solutions. ETI s tripartite membership of companies, trade unions and NGOs allows a 360-degree view of supply chains, and this is critical to understanding and tackling the root causes of poor working conditions. Have your own perceptions shifted? What I ve come to better understand is what companies can and can t do, and how to work with them in a way that s relevant to them. Can you give an example? We live in a world where there are a lot of expectations on multi-national companies to solve problems because they re seen as very rich. In fact, companies don t have all the levers and can t affect culture and politics on their own. How has this work evolved over time? A lot of time was spent in ETI s early days in developing a common lexicon and a common sense of purpose. Then there s been a lot of work in trying out ideas and building confidence in tackling complicated issues. Where we are now is asking how we can drive sustainable change. People thought these things were relatively easy to fix. The realization for leading companies is that they are actually very difficult to change, and they need to work with peers as well as with relevant civil society organisations to address underlying causes of problems. Can you give an example of something that is difficult to change? There s a practice called sumangali in southern India. It involves giving girls below the age of 18 an opportunity to build a dowry. In Indian culture, finding a decent husband is a very strong force for young women and their families. Over time that practice has been perverted. Factories offer the chance to earn a lump sum over three years, but many don't pay, the girls are denied freedom of movement or are cheated. That could be described as slavery but how do you tackle it at the factory level? If that practice is deep-rooted, we won t solve it just by saying it should be banned. It will show up elsewhere. How do we work to provide a protected environment for young women to earn a living and save? What is the biggest challenge to your work? It s actually taking the time to understand the issues. We ll hear about child labor, for instance. That s the headline. But how much do we really understand why it happens? Then how do we engage our busy partners in a programme that will drive real change? What have been your biggest successes? I think our first key success was developing the ETI Base Code with our membership. Second and this is by no means solely attributable to ETI we have seen a dramatic evolution of the discussion

5 around corporate responsibility for worker s rights in supply chains. Back in the early days, the general stance of many companies was it s not our problem. Then you saw companies starting to say OK we ll do a project to make it look good. Now, companies like Gap Inc. are very much involved in trying to understand and look at credible long-term solutions. What issues do you envision working on in coming years? Certainly those I mentioned in India. Also, there s a whole set of issues around contract labor. That s a problem all over the world where the pressure on prices and margin makes suppliers move toward contract labor, which is more flexible. However the workforce gets a worse deal and more often than not, is exploited. Another major issue is basic health and safety in countries like Bangladesh, where the state is weak in enforcing law and order and ensuring safe workplaces, and individuals are vulnerable. We can t solve this through companies or NGOs alone but need active partnerships and empowered workers who are able to organise collectively. Why not? You could work hard to improve one factory, but this will require a level of investment that may not be replicable across the sector and may not be sustainable unless the underlying approach to health and safety or law and order is not changed. It s very difficult to sustain one workplace if the environment in which it sits hasn t changed. Do you anticipate other issues in the future? We re hearing about an increase in child labor from a number of sources. Another big issue is wages - - the vast majority of the working poor are not empowered to negotiate on wages and often have to accept whatever is given to them. Finally, there is always China. It s going through fantastic changes. Some will be positive and others present challenges. The goal is to help Chinese civil society evolve without being top-down. One thing we have to do better is make sure workers are part of the discussion right from the beginning. They should be key stakeholders in saying what their priorities are. What do you think is misunderstood about corporations by the general public? When people are attached to a brand, they believe it is already doing the things they care about - ethical behaviour is discounted if you like. A lot of what branded business is about is creating an image, but the hidden cost of investing in ethical trade may not be visible to the public or well understood within the business. How do I market being ethical? The fact that Gap Inc. is seriously committed to doing things better how do you communicate that to the outside world? It s a real challenge. There is a need for a more informed debate. What do you want people to know about the products they buy? I m not sure everybody wants to know or needs to know everything. Can we really expect consumers to be fully engaged and understand rural India and poverty? I think we should forget the

6 idea of searching for a holy grail that doesn t exist a perfect company in a static environment. Maybe instead what we should be searching for is a thoughtful company that says, These are the challenges we had this year and this is how we re tackling them. What do you think is the number one pressure on companies today? There s a lot of pressure to sell at a reasonable price to consumers who feel cash-strapped. Also, this idea that they somehow need to be perfect is a big pressure. Yet we know that the real world is complex and challenging. What s important to us is that we see companies making incremental progress over time, and constantly striving to do better than they did last year. What gives you hope about the future? I m an incurable optimist. I believe common sense can win out and there is a genuine desire to do good things and make real changes that impact workers lives. Gap Inc. is a good example of this. In the end, I believe we can drive significant change even in places where things are very difficult. We just need to keep trying and learning.