‘Etireno’ was the ‘slave ship’ off Benin, which hit the headlines in April. ‘Etireno’ means ‘end of story’ – ironic, for an incident which marks a new chapter in the history of corporate supply-chain issues. In the first of two articles, Mick Blowfield and Alison Gulliford examine why.
Slave ship captain pushes frightened children to watery grave. It seems he had not, but in the search for someone to blame for the plight of child slaves, the spotlight swept on to how there came to be a market for them. As UNICEF works with the world’s poorest children, the Guardian approached them for comment.
“We are up against powerful players, as the money to buy children initially comes from big business” says UNICEF’s deputy director, Anita Tiessen. She’s talking about where the Etireno’s cargo might have been bound. Cocoa farms in Gabon and the Ivory Coast were a possible destination. Ms Tiessen continues: “Companies need to accept that the onus is on them to monitor suppliers”.
We thought transnational companies were meant to be letting local people get on with running their lives and farms, not issuing diktats and taking over the show like some kind of colonial administration. Companies draw enough fire already for the economic might of the corporate entity. But ‘monitoring’ sounds reasonable enough. Let’s pretend we’re a company buying cocoa beans. ‘Show me how these cocoa beans are grown’. ‘OK’ might come the reply. ‘Which of the hundreds of thousands of cocoa farmers do you want to meet today?
The legacy of the Etireno story is to bring a new group of companies under the ‘supply chain’ spotlight, and the whole debate into perhaps the most complex territory so far.
It may help to take stock of the story to date, as it raises some practical issues companies will need to tackle. In the UK, the first move towards what we now loosely term ‘ethical sourcing’ was the organic agricultural movement – the prime mover being the Soil Association in 1946, set up to research and promote organic farming as the key to sustainable agriculture. Today it is the UK’s leading campaigning organisation and certification body for organic food and farming.
After the Rio Summit came The Forest Stewardship Council (FSC), set up in 1993 by a group of environmental and conservation organisations, the timber industry, forestry profession, indigenous peoples’ organizations and community forestry groups (http://www.fscus.org). They were dissatisfied with governments’ lack of progress in protecting forests in Brazil and Indonesia, to name but two key markets. They developed forest certification as a voluntary alternative to regulation. It worked by linking environmental good practice to the power of the buyer.
The FSC’s approach really started to have an impact when B&Q and other companies set up a buyers’ group in 1995, which would source only from certified forests. This was the first ‘shadow market’ for responsibly produced goods and the first real example of management of environmental issues in the supply chain.
Why was B&Q taking a lead? In B&Q’s own words “action was catalysed when we were asked by a leading Sunday newspaper ‘How much tropical timber does B&Q stock? Unable to answer the question, the obvious interpretation by the journalist was ‘if you don’t know, you don’t care’. We did care and we knew many of our staff cared and most important of all, our customers cared” (http://www.diy.com).
The setting up of the US Apparel Industry Partnership in 1997 (involving Nike, Reebok, Liz Claiborne and others), and the Ethical Trading Initiative for retailers in 1998 (members include Sainsbury’s, Levi Strauss & Co, Littlewoods, Marks & Spencer, Safeway, Somerfield, Tesco and The Body Shop) are further examples of companies looking back down their supply chains and taking more responsibility for their impacts – but this time with a bias towards social issues. Christian Aid prompted the foundation of the ETI (http://www.ethicaltrade.org) with its ‘Change at the Checkout?’ report and campaign in 1997. This encouraged consumers to push supermarkets into asking more questions about how goods they stocked –
particularly horticultural and apparel goods – were produced. The ETI aims to improve conditions for workers overseas, and ensure their fundamental human rights are observed at all stages in the production of high street goods sold in the UK. For an update, see Christian Aid’s report in 2000 ‘Taking Stock: How the supermarkets stack up on ethical trading’ (http://www.christian-aid.org.uk).
Of course, customers can create both push and pull: with the threat of boycotts comes the opportunity to create a market for labelled products. The Marine Stewardship Council (MSC) was set up in 1996 by Unilever, one of the world’s largest buyers of frozen fish, and the Worldwide Fund for Nature (WWF). The MSC’s labelling scheme for seafood products actively engages customer purchasing power in the battle to protect the world’s dwindling fish stocks – and ultimately the global seafood industry (http://www.msc.org). It creates a brand for goods produced in a certain way.
The rise of the fairtrade movement is complementary to – but distinct from – these efforts. There are many approaches to fair trade, some of which target disadvantaged communities and all of which target poor countries, taking steps to involve them in international trade. Again this is an area in which development NGOs have been active, as has Traidcraft. Traidcraft is both a corporate and non-profit, campaigning entity, set up at the end of 1979 to develop a trading model centred on paying a fair price to the end producer, and providing credit to buy raw materials and training for greater efficiency (http://www.traidcraft.co.uk). Twin Trading, Christian Aid and Traidcraft were among the NGO founders of the Fairtrade Foundation (http://www.fairtrade.org) which promotes a Fairtrade Mark to identify goods which meet these ‘producer-orientated’ standards. Goods carrying this mark include bananas, cocoa, coffee, honey, orange juice, tea, sugar, and as of this June, a new Fruit Passion range of fruit juices. They are stocked in leading supermarkets, including Waitrose and ASDA. So Fairtrade creates a brand for goods both produced and traded in a certain way.
Where does this leave companies now? And how does the Etireno incident affect them? Our next article will answer this in detail, but here are a few points to note.
First, bear in mind that the initiatives so far reflect different starting priorities: the FSC and MSC grew out of a desire to guarantee environmental sustainability. The ethical trading movement sought to promote higher labour standards among suppliers to major retailers, whilst the ‘fair trade’ movement’s aim was primarily economic – to open up new trading routes to the small producer in disadvantaged communities, guarantee them a fair price and help build their capacity to do business more effectively in future. There are encouraging signs of convergence between these agendas, but the message for leading-edge companies is to think through all three of their social, economic and environmental impacts. They – the companies – are the ones best placed to do this, and prioritise the issues.
Second, the Etireno incident is a forceful reminder that companies are coming under the supply chain spotlight from the media and campaigners as never before.
The ethical trading movement started among industries – and products – with relatively simple supply chains. Nike or GAP know exactly who makes their garments, so are very exposed if they don’t meet clear standards. Christian Aid’s supermarket campaign focused on horticulture products because they were easily traceable – mangetout, cut flowers, bananas – for quality or food safety reasons, or because of a shorter supply chain.
The Etireno brought chocolate manufacturers into the debate – many of which already had or were developing supply chain policies – but which buy cocoa from literally hundreds of thousands of suppliers, through intermediaries which necessitate a far broader range of impacts to be considered – employment of truck drivers and port workers, for example.
Companies which have not yet recognised that their impacts – social, environmental and economic – go far beyond their owned and operated businesses, may soon be forced to do so. It is their brand names which campaigners will use to draw attention to the plight of the voiceless. Note that the UNICEF spokesperson mentioned neither the African government concerned nor the many alternative destinations for the unfortunate children – domestic employment, fishing, prostitution. Whether or not companies have genuine issues in their supply chains, their names attract attention and sell newspapers – so their involvement in a particular market is enough to make them a target – as many corporate press offices are already very well aware. Better to take action before that stage. In CAB’s next edition we will look at how companies should go about this, what the leading initiatives are, and which industries we expect to come under the spotlight in future.
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