Change the way you do business to tackle labour abuses big companies told

Wednesday, 7 November 2018 01:09 - - {{hitsCtrl.values.hits}}

London (Thomson Reuters Foundation): Big companies too often offload responsibility for tackling labour abuses onto suppliers, while pushing them to cut corners and demanding a quick turnaround, experts said on Friday, calling for a re-think of global business practices.

Businesses face growing regulatory and consumer pressure to ensure workers in their supply chains are paid fair wages as campaigners estimate some 25 million people globally are trapped in forced labour in 2016.

Major brands could improve the situation by abandoning unfair purchasing practices that open the door to abuse, said Daniel Vaughan-Whitehead, an economist at the International Labour Organisation (ILO).

“They look too much at what is not going well at suppliers without looking at what could they change themselves,” he told the Thomson Reuters Foundation.

The problem was highlighted by a global ILO survey of more than 100 big brands - from fashion designers to furniture giants - conducted this summer in 13 countries, said Vaughan-Whitehead.

Only 15% of respondents said they immediately reflected increases in a country’s minimum wage in the prices they paid to local suppliers.

More than one in two rated the average lead time they offered to suppliers as just enough or too short.

“Companies that are extremely powerful can pass the cost ... down the supply chain and whether that’s inadvertent or not it has a knock on effect on the quality of jobs,” added Rachel Wilshaw, ethical trade manager at British charity Oxfam.

The survey’s initial findings, presented at a conference in London this week, added to a similar poll of almost 1,500 suppliers in 87 countries carried out by ILO last year.

This revealed that while 93% of suppliers were asked to abide by a code of conduct by their client companies, more than a third operated with unwritten contracts and roughly the same share accepted orders below the cost of production.

“If they’re serious about workers’ rights, brands need to develop buying practices that support rather than undermine suppliers’ ability to provide for their workers,” said Martin Buttle, a strategic lead at the Ethical Trading Initiative, a global network of companies, trade unions and labour rights organisations.

On Friday, Tetley, the world’s second biggest tea company, released a list of its suppliers, becoming the third major British tea company to do so in a bid to improve conditions in the industry.