SOCIAL ACCOUNTABILITY INTERNATIONAL SA Improving Labor Conditions Around the World through a Voluntary Workplace Standard, Independent verification and Public Reporting Dr. M.MADHAVAN Assistant Professor in Economics A.A.Govt. Arts College, Namakkal

SA-8000 Dr.M.Madhavan 2 The Business  What is business?  The aim of business is to be in business  In Business Change is only Constant.  Maximization of return to share holders is turned as maximization of return to stake holders.  Business is not only to doing well but also to doing good to others.  Business is not only Technical Investment but it is Socio Technical Investment.

SA-8000 Dr.M.Madhavan 3 The Standards & Business  More than 26,000 Standards are available in the world  Certain standards are applicable only for certain products  Certain standards are applicable only for certain countries  Only certain standards are treated as common for all – Ex: ISO, SA-8000 etc.,  The standards are very useful for the business people.  This will increase the confidence level of buyers

SA-8000 Dr.M.Madhavan 4 WHY SA – 8000  Customer is the King.  Service to the Customer results in ‘Money’  Heavy Competition  Profit Maximization by optimum utilization of resourses  What comes from the people should go back to the people  Islands’ of wealth can not survive in the ocean of poverty  Business has moved from ‘Charity’ to ‘Business Partnership’  60% of the customers are interested to know under what conditions the products are produced.  Europe has taken a decisions to insist on their suppliers to go for SA-8000.

SA-8000 Dr.M.Madhavan 5 THE MARKET SCENARIO Trust Me Because Today Business has moved from “Profit Centric” to “Customer Centric”, and the satisfied employees will only satisfy the customers. Show Me Prove Me Invoice Me Corporate Social Contribution to Corporate Social Responsibility

SA-8000 Dr.M.Madhavan 6 WHAT IS THE DIFFERENCE IN SA 8000?  First Party Audit – Trust Me  Second Party – Code – Through buyers Agency  Third Party Audit – SA-8000, ISO  The standard was developed by NGO’s, Business People, Trade Union, UN Organizations.  It is based on the ISO model making, it is easier to interrogate with ISO quality for environment standards  First auditable standard on “work place standard”  Can be applied to many sectors  Create management systems for implementation  Third party audit is ensured.

SA-8000 Dr.M.Madhavan 7 Difference between ISO & SA-8000 ISO  Management system  Standard developed at National Level and then International  Less focus on interviews SA-8000  Performance system & Management system  Global standard from the beginning  Interviews with workers

SA-8000 Dr.M.Madhavan 8 The Benefits  Greater employee relation  Enhanced productivity & Quality  Improved management systems (From Top level to Bottom level)  Protection of reputation  Developing new markets and new customers

SA-8000 Dr.M.Madhavan 9 SA Standards – Concentrates on  Abolition of Child labour  Abolition of Forced labour  Health & Safety  Freedom of association and right to collective bargaining  Disciplinary practices  Discrimination  Working hours  Remuneration  Management systems An auditable “Third Party” Standard which is globally recognized

SA-8000 Dr.M.Madhavan 10 World scenario on SA-8000 SA Living Wage FLA- Fair Labour Association (Only for Apparel & Food Wear) – (USA Only) WRAP- World Retails Apparel Products (Environment) ETI - (UK) – Living Wage CCC- Clean Cloth Campaign (EU) – Distributing post cards to the consumer, explaining various standards. Making awareness to the consumer Europe started the movement against child labour

SA-8000 Dr.M.Madhavan 11 APCDAPCD PLAN, DO, CHECK, ACT

SA-8000 Dr.M.Madhavan 12 MANUAL Systems Manual – Abide the Standard Procedures Manual – Residual Measures. Should be displayed. Records – No. of accidents, No. of people who obtained medical facility

SA-8000 Dr.M.Madhavan 13 SA-8000 – The Standard  A Standard that covers all core international labour rights – Cover child labour, forced labour, health & safety, freedom of association and right to collective bargaining, discrimination, discipline, working hours and wages.  Management system requirement for ongoing compliance – Certified facilities must have the management system in place to assure long-term compliance and continuous improvement Contd ….

SA-8000 Dr.M.Madhavan 14 SA-8000 – The Standard (contd…)  Involvement by all stakeholders – Full participation by business, workers and trade unions, socially responsible investors, NGOs and government in the development and operation of SA-8000 including the advisory board, development and revision of the standard and auditing system, conferences, training and the complaints and appeals system. Contd ….

SA-8000 Dr.M.Madhavan 15 SA-8000 – The Standard (contd…)  Public reporting – The name and address of all SA8000 certified facilities are available on the SAI website and facilities that lose their certification are removed from this official list. Companies that become SA8000 signatories must release their plan for achieving SA 8000 certification of designated company – owned and supplier facilities and submit annual progress reports to SAI for verification followed by public posting. Contd ….

SA-8000 Dr.M.Madhavan 16 SA-8000 – The Standard (contd…)  Harnessing consumer and investor concern – through the SA 8000 Certification and Signatory Programs, SAI helps consumers and investors to identify and support companies that are committed to assuring human rights in the work place.

SA-8000 Dr.M.Madhavan 17 Code of Conduct Elements  CHILD LABOUR – No workers under the age of 15; minimum lowered to 14 for countries operating under the ILO Convention.  FORCED LABOUR – no forced labour, including prison or debt bondage labour, no lodging of deposits or identify papers by employers or outside recruiters.

SA-8000 Dr.M.Madhavan 18 CODE OF CONDUCT ELEMENTS (CONTD…)  HEALTH AND SAFETY – provide a safe and healthy work environment; take steps to prevent injuries; regular health and safety worker training; system to detect threats to health and safety; access to bathrooms and potable water.  FREEDOM OF ASSOCIATION AND RIGHT TO COLLECTIVE BARGAINING – respect the right to form and join trade unions and bargain collectively; where law prohibits these freedoms, facilitate parallel means of association and bargaining

SA-8000 Dr.M.Madhavan 19 CODE OF CONDUCT ELEMENTS (COTND…..)  DISCRIMINATION-no discrimination based on race, caste, origin, religion, disability, gender sexual orientation, union or political affiliation, or age; and no sexual harassment.  DISCIPLINE –No corporal punishment. Mental or physical coercion or verbal abuse.

SA-8000 Dr.M.Madhavan 20 CODE OF CONDUCT ELEMENTS (CONTD……)  WORKING HOURS- comply with the applicable law but, in any event, not more than 48 hours per week with at least one day off for every seven day period; voluntary overtime paid at a premium rate and not to exceed 12 hours per week on a regular basis; exceptions for regular and overtime limits due to extraordinary circumstances  COMPENSATION- wages paid for a standard work week must meet the legal or industry standards and be sufficient to meet the basic need of workers and their families; no disciplinary deductions.

SA-8000 Dr.M.Madhavan 21 CODE OF CONDUCT ELEMENTS (CONTD…….)  MANAGEMENT SYSTEMS –The management systems need to assure long-term compliance.  This element requires that facilities seeking to gain and maintain certification go beyond simple compliance to institutionalize the intent and elements of the standard.

SA-8000 Dr.M.Madhavan 22 HOW COMPANIES CAN IMPLEMENT SA 8000  SAI has two ways for companies to formally implement SA 8000 to assure humane workplaces:  CERTIFICATION OF FACILITIES TO SA 8000: A company that operates production facilities can seek to have individual facilities certified to SA 8000 through audits by one of the accredited certification. Since the SA 8000 system became fully oriental in 1998.

SA-8000 Dr.M.Madhavan 23 HOW COMPANIES CAN IMPLEMENT SA 8000  SA 8000 SIGNATORY: A company that focuses on selling goods or that combines production and selling can become an SA 8000 Signatory, which requires that it issue a plan for moving designated company-owned and/or supplier facilities to SA 8000 certification over time and report publicly on progress against this plan. Launched in late 1999, the SA 8000 Signatory program has attracted entities representing more than $ 100 billion in annual revenue.

SA-8000 Dr.M.Madhavan 24 TRADE UNION AND NGO PARTICIPATION  As part of the SA 8000 system’s inclusive, multi-sectoral approach, SA 8000 features the extensive involvement of workers, trade unions and NGOs:  A multi –sector Advisory Board that includes substantial representation from trade unions and human rights NGO’s developed SA 8000 and overseas implementation and revisions  During certification audits, auditors are required to consult with interested parties as part of the information gathering process, including local trade unions and NGOs

SA-8000 Dr.M.Madhavan 25 TRADE UNION AND NGO PARTICIPATION (CONTD……..)  Auditing guidelines require that workers be interviewed and tie the numbers of workers interviewed to the size of the factory’s workforce.  Facilities that do not meet elements of the standard are guided to seek out unions and NGOs to help with corrective actions.  There is an easy complaints and appeals process that any one can use to challenge a certification

SA-8000 Dr.M.Madhavan 26 TRADE UNION AND NGO PARTICIPATION (CONTD……)  To inform trade unions and NGOs about SA 8000, the SAI provides free places for them at the auditor’s training courses.  As part of the bi-annual review of SA 8000, they seek guidance from all stakeholders through consultative workshops and individual requests for comment.

SA-8000 Dr.M.Madhavan 27 BENEFITS OF SA 8000 TO BUSINESS, WORKERS, TRADE UNIONS, NGOs AND CONSUMERS.  Along with assuring humane workplaces, the implementation of SA 8000 offers additional benefits for business, workers, trade unions, NGOs and consumers. BUSINESS BENEFITS  A credible and effective way to put company values into action.  Preserving and enhancing company and brand reputation  Improving employee recruitment, retention and performance

SA-8000 Dr.M.Madhavan 28 BENEFITS OF SA 8000 TO BUSINESS, WORKERS, TRADE UNIONS, NGOs AND CONSUMERS (CONTD…….)  Better supply chain management and performance.  Cost savings in developing, adopting and monitoring a workplace code of conduct  The opportunity to develop stronger relationships with workers, trade unions, customers, NGOs and government.

SA-8000 Dr.M.Madhavan 29 BENEFITS TO WORKER, TRADE UNION AND NGO  Enhanced opportunities to organize trade unions and bargain collectively.  An additional avenue to educate workers about core labour rights.  Another way for workers to speak up about the conditions under which they work.  Support for the proposition that labour rights are good for society and business  Opportunity to work directly with business on labour right issues.

SA-8000 Dr.M.Madhavan 30 WORKER, TRADE UNION AND NGO BENEFITS (CONTD…..)  A tool for generating public awareness of working conditions, core labour rights and companies that are committed to assuring humane working conditions.

SA-8000 Dr.M.Madhavan 31 CONSUMER BENEFITS  Clear and credible assurance for consumers who want to make ethical purchasing decisions  Identification of individual products made under humane conditions (Certification) and companies making progress toward humane conditions in their supply chains.  Broad coverage of product categories and production geography.

Thank You SA-8000 Dr.M.Madhavan 32