Social responsibility issues in business
Social responsibility issues in business
This is the second of two articles on business responsibility
by Mayling Oey-Gardiner and Peter Gardiner, both social
scientists and principal investigators in a factory human rights
audit for the Reebok shoe producer referred to below.
JAKARTA (JP): The second approach for obtaining better
conditions for workers, by working with both management and
workers in a transparent manner, was applied by Insan Hitawasana
Sejahtera (IHS), an independent social science research and
consulting firm.
The method was applied to two factories producing Reebok
athletic shoes that account for about 75 percent of Reebok's
footwear production in Indonesia.
IHS conducted a comprehensive evaluation of factory compliance
with Reebok's own Human Rights Production Standards and with
Indonesian legal requirements.
For this purpose IHS assembled a team of specialists in the
areas of research, labor relations, and occupation health and
safety.
A three-pronged approach was applied, consisting of a
quantitative worker survey, in-depth worker interviews and on-
site observation.
The IHS team had full access to all factory records and
workers, and spent over 1,400 hours inspecting the factories and
conducting interviews with management and workers.
The research was conducted in three distinct stages to
demonstrate a problem-solving commitment. Initial findings were
produced to identify all factory problems and these were
communicated to Reebok and factory management.
Following this, factories, with technical assistance from
Reebok were given time to take action to correct these problems
or to establish clear action plans for future application.
Finally, IHS conducted a follow-up evaluation to review
progress and to provide further critiques of factory actions.
To ensure transparency and openness, the results were
published by IHS and Reebok under the title of Peduli Hak: Caring
for Rights.
Publication did not mean an attempt to gloss over problems.
Some fairly disturbing facts about working conditions in these
factories were highlighted.
For example, the report criticized the way the factory
managers communicated with workers, noting that most workers were
functionally illiterate and could not understand their rights
under existing collective bargaining agreements or the details of
their wage statements.
It also found that it was more difficult for women than men to
obtain promotions or supervisory positions. It faulted the
factories' health and safety procedures -- in particular the
procedures governing the use and handling of chemicals.
On the other side of the coin, the report offered
encouragement by documenting the positive steps taken by the
factories to address the problems as seen in the results of the
follow-up evaluation.
By adopting an approach of working with all the major
stockholders -- Reebok, factory management and the workers -- IHS
felt that tangible benefits for the workers were more likely to
result.
Similar to the findings of Press for Change, IHS found that
workers were mostly concerned with wages and overtime --
particularly forced overtime where workers were not given a
choice.
But by working with all parties, improvements were made not
only in salary and overtime conditions, but also in regards to
workers rights to freedom of association, gender equity, and most
important of all, health and safety on the factory floor.
The factories had to make substantial investments (each more
than US$ 250,000) to improve the work environment.
For instance, hundreds of chairs and numerous items of
personal protective equipment were replaced, ventilation and
emission was improved, relevant workers learned about proper
chemical handling procedures, and so on.
Improvements in working conditions were acknowledged by
workers during the follow-up evaluation.
Even though business social responsibility appears to be a
concern of consumers in rich countries, producers or suppliers in
poor countries, including Indonesia, are affected.
Proper attention to employee rights and working conditions by
employers is a must.
And, if employers do not know whether they are on the right
track, they need to seek assistance.
A new organization, the Fair Labor Association is developing
and monitoring programs with the support of such companies as
Reebok, Adidas-Salamon AG, Kathie Lee Gifford, Levi Strauss &
Co., Liz Claiborne, L.L. Bean, Nicole Miller, Nike, Patagonia,
Phillips Van Heusen.
Activities of this type, and continuing attention to the
obligation to be socially responsible, must increasingly become
part of normal business operations in the future.