One of the world’s longest-running ethical supply chain management
initiatives has generally led to only minor improvements in workplace
standards – or none at all – during its first decade.
That’s the conclusion of the first comprehensive review of the work of
the Ethical Trading Initiative, a UK-based alliance of companies,
non-governmental organizations and trade unions created to improve
labour standards in member companies’ supply chains.
The ETI commissioned the study from the UK’s Institute of Development
Studies, which found that the ETI, whose members include Body Shop,
Gap, Marks & Spencer, Sainsbury and Tesco, has had ‘minor or
isolated’ impacts on many suppliers, and the number of major impacts
has been relatively small.
In-depth analysis of 25 work sites in Costa Rica, India, South Africa,
Vietnam and the UK found 11 instances where the ETI could be said to
have had a major impact in the nine social and environmental
performance areas detailed in the initiative’s code. By comparison,
there were 42 instances of minor impacts and 35 where there was no
impact.
Six of the 11 major improvements related to health and safety and the
remainder to isolated instances of favourable impacts on working hours
and the treatment of workers.
However, there was little if any impact on discrimination, harassment
and freedom of association. In none of the 25 sites did the study find
an increase in union membership or the establishment of a collective
bargaining agreement as a result of ETI code implementation, although
at five sites this had made ‘some contribution towards greater freedom
of association and union activity’.
There was ‘almost no impact’ in terms of ensuring workers receive a
‘living wage’, which is one of the key elements of the ETI code. It had
however encouraged payment of the national minimum wage at nine sites,
although not always in the case of migrant and contract workers.
The ETI, which is funded by its members and the UK government, concedes
that many of the impacts have been minor, but says they are nonetheless
improvements that affect a large number of people. At least three
million workers were involved in ETI members’ activities last year.
‘We are clearly making a real difference to the lives of poor workers
and their families, and on a large scale,’ said ETI director Dan Rees,
who added that ‘many fundamental issues remain to be addressed’. The
ETI will bring in changes once findings of the three-year study are
digested.
Lesley Roberts, director of the Pentland Group, an ETI member and the
parent company of sports, fashion and leisure brands such as Speedo,
Kickers and Berghaus, told EP: ‘This was never going to be easy, and
it’s important to remember that we have come a long way over the past
decade.
‘The difficult issues are the ones which plague many workplaces, be
they in the UK or China. We need to be better at working together and
better at engaging with local institutions.’
