Beyond Trafficking and Slavery

Supply chains roundtable: Sarah Labowitz

Sarah Labowitz
26 June 2016

Question 1 – do we need a binding international convention on corporate responsibility for labour standards in global supply chains?

I understand the desire for such a convention – we all want clear, enforceable rules that actually improve working conditions in the supply chain. But I don’t think a convention will get us there. States are already bound to enforce international labour standards and to protect the rights of their citizens. And treaties and conventions only apply to states, not companies (however powerful companies may be). Clearly we need new, ambitious ways of thinking about governance in the supply chain that provide for more rigorous, consistent application of standards to companies, with consequences for non-compliance.

Question 2 – what should global supply chain governance look like?

There is a need for a common approach to governance of  company supply chains that applies throughout each industry. This means the development and implementation of clear industry standards  that apply to large multinational companies, as well as the suppliers that comprise their supply chains. The evaluation of accountability to such standards should come from an independent entity, and not be based on each company’s self-assessment alone.

Question 3 – how can we promote business accountability for labour standards in supply chains?

First, standards have to apply to multinational firms themselves. This was one of the key debates at the International Labour Conference earlier in June – how much power “lead firms” have in their supply chains. Companies often want to push accountability onto their suppliers, and resist outside evaluation of their own performance and practices. Second, there has to be a mechanism for evaluating whether firms are complying with common standards, with consequences when they don’t. And workers have to be able to seek remedies when their rights are violated.

Question 4 – in the absence of extra-territorial legislation to ensure and enforce business accountability, how can workers best be protected in international supply chains?

Certainly unions are part of the answer. Freedom of association and the ability to bargain collectively are essential labour rights that give workers voice and power in the workplace. But we live in a world where some governments ban independent trade unions altogether, like China and Vietnam, while others severely curtail union rights. This is why we need stronger enforcement of standards in supply chains, so that even where freedom of association is not fully respected, workers are protected.

Question 5 – what are the benefits and drawbacks of global supply chains as a ‘model’ for production and development?

Global supply chains have the potential to be huge drivers of economic growth and large-scale employment, especially in developing countries. The promise of supply chains is that countries can move up the ladder to higher value-add production – from garments to electronics to automotive, for example. Many low-wage manufacturing countries are looking to South Korea, Japan, and China as successful examples of this pathway. But today, places like Bangladesh and Cambodia are still making the same kinds of inexpensive clothing they were 30 years ago. Their governments haven’t made the investments in infrastructure and education that would allow them to move up the value chain. The premise of globalisation is that it is supposed to benefit people in developed and developing countries. Just in the past six months, we’re seeing workers and voters at both ends of global supply chains questioning that premise. The discussion about free trade is very different than it was at this time last year. It will be fascinating to see if higher standards for supply chains result from this renewed debate.

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