The report notes in its introduction the vast differences between the wages of company directors and exceutives and those of the workers at the other end of the supply chain. It states that two years ago Sir Phillip Green claimed a £1.2 billion dividend, enough to double the salaries of Cambodia’s entire garment workforce for 8 years.

Lets Clean up Fashion 2007 analyses how many companies have been targetted for exposes in the last year. It argues convincingly that these exposes are not just troublesome cases, but are the result of endemic cases in the industry. It concludes that whilst some companies are now admitting there is a problem with wages in the sector, only a few have done anything about it and of those very few are engaging with the problems systematically.

Gap, New Look and Next however, comes out rather well.  The report stated “Gap’s strength has been in building positive relationships with trade unions and NGOs, dealing quickly and effectively with problems in factories when they emerge, and taking a lead on building cross-sector work.” Labour behind the Label state  that New Look are “one of the companies most open to our concerns.” They are encouraged by New Look’s work attempting to come to grips with a living wage in Bangladesh and their approach to using local groups for monitoring and verification. In Labour behind the Label’s view “Next seems to have started to take up our challenge of moving beyond pilot projects to a more systematic approach, at least in terms of the living wage.” Well done Gap, New Look and Next. 

A consumer survey was published last week which found that many consumers do not believe fashion retailers’ claims on ethical sourcing. It also stated that the most important issue to consumers was whether or not there were underage or child workers making the products that they were buying. 

The study, published by TNS Worldpanel Fashion, asked 7,000 people about the ethical credentials claimed by UK retailers. 45% said that they were sceptical. It suggested that older buyers (over 55) were more interested in ethical claims than those under the age of 25.

Our own experience shows that customers are pleasantly surprised to hear how much work certain fashion retailers are doing on ethics. More people are checking the labels for information. More people are becoming more discriminating in which claims they choose to believe.

Here at Impactt we welcome increased consumer interest. We welcome the exposes and the media coverage, but it would be great if retailers, brands, NGOs, unions and journalists could report more credible good news stories to customers – more stories to show that by working hard on these issues we can all make a difference to the lives of the people making the stuff we buy.

The Guardian have reported today that this year Gertruida has explained how some conditions have improved at her farm, especially after Tesco’s Chairman visited in May. However she says that her pay has not improved.

Tesco for their part have stated that they are members of the ETI and take labour standards in their supply chain very seriously.

At today’s meeting Tesco’s shareholder will be asked to consider a resolution demanding higher standards for workers in Tesco’s global supply chain. If passed, the resoulution would oblige Tesco to “appoint independent auditors to ensure that workers in its supplier factories are guaranteed decent working conditions, a living wage, job security and the right to join a trade union of their choice.”

Many of the larger shareholders are unlikely to support the resolution, because it asks the company to ‘guarantee’ conditions. Something that with the best will in the world Tesco is unlikely to be able to ensure. However the resolution, which was tabled by War on Want’s company secretary, Ben Birnberg, has the support of investors like the Joseph Rowntree Foundation.

There is still a great deal of pressure on supermarkets to show that they are responding to these issues. It is unlikely to go away.

Our China team just sent over this terrible story from the Chinese papers. Be warned its not for the faint hearted…

Following the news stories on the Olympics firm accused of using child labor, the Chinese papers have reported  that at least 1000 trafficked children  were found working in brick-making factories in Shanxi. The youngest children were only 8 years old,  the oldest only 13.  The children were locked up after working all day until 10 at night. They did not have water for showers, many had skin diseases.  Many were reported to have been severely beaten by the supervisors, some to the point where they had limbs broken, others had been beaten up with hot pods for churning bricks until their backs were burnt deeply. 

About 400 parents have signed a petition letter on the internet desperate to seek help. The local media have reported that some parents rescued 40 children, but found that some local police deterred parents from rescuing other children, warning them ‘not to interfere with children of others’ while leaving the children working in the factories.  Local police have been accused of being involved in trafficking the children among different brick factories in the region.  Other local police were accused of putting money for financing the rescue action into their own pockets. 

This sheds light on how deep corruption in the Shanxi area goes.  

The allegations though extremely worrying, reflect the general situation in China. Campaigners should be congratulated on their dedication to uncovering the issues. Researchers worked in the factories alongside workers to discover what conditions were reallly like. In one factory they found 20 children, some as young as 12, working in their school holidays. In another factory they found forced overtime, fines and pay 65% less than the local minimum wage.

Play Fair 08 are calling on the International Olympic Commitee to ensure labour standards are upheld. Poor standards clearly contradict Olympian values. After similar campaigns around the 2004 Athens Olympics the IOC should have been better prepared this time around.  

• Eliminate excessive overtime in their contract factories
• Implement tailored human resource management systems and educational training for workers in their focus factories
• Implement Freedom of Association Educational programmes in 100 percent of focus factories
• And lead multi-brand collaboration on compliance issues in 30 percent of their supply chain

Nike describe how their programme has gone through three iterations. Generation I and II were about standards and monitoring, Generation III they argue is about ‘responsible competitiveness’, identifying and remediating root causes with systemic approaches.  Specifically it focuses on:

• Building excellence in factory remediation
• Developing sustainable sourcing strategies
• Building business integration and accountability
• Increasing contract factory ownership of corporate responsibility
• Building industry coalitions

Nike used to be synonymous with sweatshops. They are now, along with the GAP, widely acknowledged within the ethical trade community as having the leading and most well resourced ethical trading programmes of all companies. That’s not to say they haven’t got problems. No companies can guarantee that their supply chains are problem free. After all this is about human relationships and about 800,000 young women in very poor countries. 

Nike argues that most people in ethical trade have become experts in rooting out the bad, but the real challenge is in outlining and delivering a vision of success.

One could quibble about whether all ethical traders are finding the problems in their supply chains, however Nike are right about the need for successful visions. Nike should be applauded for setting themselves such ambitious goals. But the proof of the pudding will be in the eating.

The article, posted on ChinaCSR.com, reports that 20 workers at an unnamed jeans-dyeing factory in Guangdong were paid in fake bank notes. When the workers asked the factory to exchange the fake notes for real ones, they were dismissed. 

The factory reportedly claimed that they were victims of the forgery as well, and that they would pay the workers in real currency when they had resolved the issue with their bank. But this does not explain the dismissal of the workers, and goes against the additonal reports that the factory ‘usually uses the fake notes only for new workers’.  

The story is in fact not remotely funny.

We have spent the past 30 minutes discussing what we should say on this matter, and how we as a company should react to the news. What we all agree on is that this is a form of forgery that goes well beyond the common practice of faking books to show that workers have been paid the correct amount of real currency. 

The opening scenes of the last group of migrants standing on top of their white van as the cold dark waves lap around their legs was absolutely heart-stopping. The film works back from these moments exploring how these workers found themselves in such a desperate position. Ain Quin, a young Chinese girl pays $25,000 to be smuggled into the UK. She becomes one of 3 million migrant workers that work in Britain. Living in cramped conditions with eleven other migrants she works in meat factories supplying UK supermarkets: Tesco, Sainsbury’s and ASDA. When the work dries up and they are hounded from their home by racist abuse, the Chinese migrants find themselves cockling in Morecambe Bay.

After being beaten up by other cocklers they risk their lives by going out on the sandbeds at night, with disastrous consequences. The film brings into clarity many facets of migrants’ lives. At almost every turn they were vulnerable to exploitation. Many were bonded to moneylenders and the smugglers who had got them into the UK. As illegal migrants they were as worried about being caught as they were about scraping together their meagre living.

The film raises many questions about the plight of illegal migrants in our globalised world and gives no easy answers to their situation. A fund has been set up for the victims’ families, who are still saddled with debts and under enormous pressure from moneylenders.

Everyone working in ethical trading should be made to sit down and watch this movie, maybe it would prompt braver and more human strategies to prevent this ever happening again.

More on the Today Website.

This raises some interesting points about the relationship between fair-trade and ethical trade. Impactt have been concerned for some time that whilst fair-trade guarantee a better price for farmers, it does not necessarily mean labour conditions through out the supply chain are upheld.

The packing plant may have been considered low risk by retailers – it was UK-based and supplying fair-trade, however this is no guarantee that labour standards will be ok. The UK like many other countries is a destination for migrant workers. And as Impactt’s experience the temporary labour working group demonstrated, migrant workers are vulnerable to abuse as they are completely dependent on one employer: the farm or labour provider that hired them.

Retailers and fair-trade organisations need to be aware of the issues relating to labour standards as well as the issues relating to terms of trade. Whilst these are certainly connected one does not guarantee the other.

The Premier League was fully briefed by Nike about its decision, and there will be a shortage of footballs while Nike switches production to China.

Nike is reported to have made significant efforts to work with the factory, including regular meetings and remediation plans to improve labour standards. Hannah Jones, Nike’s vice president of corporate responsibility, stated that ‘In this case, remediation didn’t work. In fact, we saw a further significant deterioration of working conditions due to a lack of commitment by management to address the problems. We also are deeply concerned about the broader conditions and practices we saw in home-based settings.’

Nike is also engaging with a group of governmental, non-governmental and industry stakeholders to ensure support for affected workers and explore sustainable approaches to manufacturing in Sialkot. Jones also said that the company’s efforts are now focused on securing the rights of those Saga Sports employees affected, and exploring with stakeholders the possibility of turning this into a ‘catalyst for change in manufacturing methods’ and contributing to sustainable development. Oxfam have praised the move by Nike saying that it is a positive step in the right direction, but that the company still has much to do with regard to trade unions and the right to organise. Source: Nike Inc press release; The Guardian