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Human rights matter more and more in business

It has been just over a month since the collapse of the Rana Plaza garment factory in Dhaka, Bangladesh, killed 1,127 people, most of whom were lowly-paid factory workers. Barely three weeks later, closer to home in Phnom Penh, Cambodia, the roof of the factory manufacturing Asics sports shoes gave way, killing three workers.

In today’s business climate, companies must choose to do the right thing, instead of merely meeting minimum standards by adhering to regulations. Photo: Bloomberg

In today’s business climate, companies must choose to do the right thing, instead of merely meeting minimum standards by adhering to regulations. Photo: Bloomberg

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It has been just over a month since the collapse of the Rana Plaza garment factory in Dhaka, Bangladesh, killed 1,127 people, most of whom were lowly-paid factory workers. Barely three weeks later, closer to home in Phnom Penh, Cambodia, the roof of the factory manufacturing Asics sports shoes gave way, killing three workers.

Beyond the loss of lives, what is more unfortunate is the recurrence of such incidents time and again.

Last year, more than 400 workers perished in three separate garment factory fires in Pakistan and Bangladesh. In all three cases, the factories lacked fire extinguishers, had poorly designed fire escape routes or owners who had locked the escape routes.

These tragedies underscore the poor working conditions many factory workers in developing countries still face on a daily basis. And while these incidents occurred outside Singapore, we must not live in the belief that all corporations here are above board.

Singapore’s labour laws ensure that a minimum level of standards must be met; however, there have been instances where companies have not performed up to par. Instances, for example, where migrant workers who lack collective bargaining power are exploited because they are ignorant of the local laws and of employees who suffer physical or verbal abuse at the workplace that go unreported.

SOCIAL MEDIA AND REPUTATION

Increasingly though, corporations are finding that their customers pay close attention to what they do, where they source their products and how they treat their workers, and companies are soundly chastised when caught doing the wrong thing.

In the case of the Rana Plaza collapse, clothing brands Benetton and Joe Fresh — rumoured to have garments made at Rana Plaza — had their Facebook pages inundated with comments from indignant customers upset about the human rights violation in their supply chains, and threatening to stop buying their products.

In Singapore, a company is now being investigated following a 17-second video clip of an alleged workplace abuse that went viral.

Social media is aiding the spread of information and, slowly but surely, raising the level of civil consciousness among consumers in the process.

In today’s business climate, this means that companies must choose to do the right thing, instead of merely meeting minimum standards by adhering to regulations, because the cost to a company’s reputation and image tarnished by human rights violation can be high.

In a marketplace fiercely competitive for customers and for talented employees, this is not a price that companies should be willing to risk.

CERTIFIED SOCIALLY RESPONSIBLE

What is heartening for companies looking to adopt a holistic, sustainable approach to business is that over the past decade, developments in the area of corporate social responsibility (CSR) have resulted in frameworks and tools that can guide companies on reviewing their business philosophy and operations, and look at where they can improve both within their organisation as well as with external stakeholders.

For example, the ISO 26000 on Social Responsibility, launched in December 2010, provides corporations with guidance on socially responsible behaviour and possible actions to adopt. One of the seven principles is the respect for human rights.

Although ISO 26000 is currently only a guideline and not a certification, many countries have introduced similar standards that convert it to a management system extending certification to compliant companies. Countries leading the way include Denmark, which has adopted a national standard, the DS 26001, offering certification in “socially responsible management system”. Austria’s national version goes further to mandate actions that are currently only recommendations under ISO 26000.

Part of ASEAN Community 2015’s goal is for CSR to contribute towards achieving sustainable socio-economic developments. Could Singapore be an early adopter in South-east Asia and consider such national standards?

Another framework is the United Nations (UN) Global Compact, which covers 10 CSR principles in the areas of human rights, labour, environment and anti-corruption; advocates transparency and requires signatory companies to adopt, implement and report their CSR journey. And in 2011, the UN Human Rights Council endorsed the Guiding Principles for Business and Human Rights — the first UN framework on corporate human rights responsibility.

BREAK THE CYCLE

Regionally, the ASEAN Intergovernmental Commission on Human Rights is conducting a baseline study on CSR in its member states. The study will give us an overview of the situation in the region and will contribute to raising standards of human rights among businesses operating here.

The silver lining to the Rana Plaza tragedy is that it has compelled major clothing retailers such as Benetton, H&M, Mango and Esprit to sign the Bangladesh Fire and Safety Accord to improve the safety standards of their factories there. Meanwhile, major retailers such as Walmart and Gap are facing pressure from American media and consumers for their refusal to sign the accord.

It begs the question of what it would take for companies to finally sit up and take concrete, preventive action. Another disaster in Asia? Or more consumers demanding companies to demonstrate greater accountability?

In the face of a civil society that is growing in social activism, companies would do well to become early adopters of a more sustainable business model. Only when businesses actively look to ingrain the fundamental principles of human rights in their entire business operations, will we break the cycle of human tragedies like Rana Plaza.

ABOUT THE AUTHOR:

Thomas Thomas is the Executive Director of Singapore Compact for CSR, which is holding a forum on Business and Human Rights: Understanding and Implementing the UN Guiding Principles in ASEAN, today at the NTUC Centre.

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