Many of the world’s leading certification standards are not only failing to improve the ethical conduct of large corporations but are serving to entrench abusive business practices, a damning new report argues.
The study of 40 global voluntary initiatives, including emblematic on-pack labelling schemes such as the Forest Stewardship Council (FSC) and Fairtrade International, identifies multiple failures. The 235-page Not Fit for Purpose report draws on a decade of research into “multi-stakeholder initiatives”, the report’s sample alone involves more than 10,000 participating companies in 170 countries, and covers sectors as diverse as cocoa, sugar, palm oil, minerals, seafood, electronics, jewellery and children’s toys and which count global corporations from Nike, Coca-Cola and Nestlé to Shell, Apple and Newmont among their staunch supporters.
“These kinds of initiatives are not effective tools for holding corporations accountable for abuses or for protecting rights holders against human rights violations,” says Amelia Evans, executive director at MSI Integrity, the US-based human rights group behind the research. According to Evans, multi-stakeholder initiatives [MSI] have a “tricky relationship” with governments, which frequently interpret their existence as evidence that abuses are being “taken care of”. “In truth, the exact opposite needs to happen. Governments must recognise that because there’s an initiative in place, then underlying human rights abuses are occurring and they are obligated to take action,” says Evans. “Over time, MSIs have become captured and dominated by corporations. So, while they may not have been designed to fail, I think they were destined to fail,” says Evans.
Most initiatives tend to be heavily skewed towards corporate interests. Only 13% of the initiatives analysed include affected populations in their governing bodies and not a single one has a majority of rights holders on its board. Such an imbalance comes into stark focus at the complaints stage, with almost one third of the initiatives offering no grievance mechanism whatsoever to workers or other affected parties. The frequent absence of victims’ voice speaks to a wider concern about the use of certification schemes and similar voluntary standards to stall progress on human rights and safeguard the status quo. Referring to the “flawed concept” of monitoring, she says third-party auditors are typically paid by the self-same corporations they are hired to assess, creating a clear conflict of interest. In addition, few if any protections are given to critics or whistleblowers, thus limiting the incentive for victims to speak out.
Setting below-cost prices, request fast turnarounds and other aggressive procurement practices by multinational buyers are also widely overlooked. Indeed, of the eight initiatives linked most closely to supply chain issues, only two explicitly reference the need for responsible purchasing.
MSI Integrity warns that consumers “can’t rely” on the claims made by many ethical labels. Not only are abuses continuing to occur, but generic terms such as “fair” and “sustainable” can be misleading.
Evans says: “The risk is that these initiatives are legitimising abusive behaviours by failing to detect them and by suggesting that a wider range of issues are being addressed than often is the case.”
Sarah Newell, a spokesperson for the US-based Worker-driven Social Responsibility Network, goes even further, arguing that multi-stakeholder initiatives exist to intentionally “obscure” worker abuses in multinational supply chains. Their “primary function”, she argues, is “to distract from the fact that these abysmal conditions are the direct result of the business practices of the brands at the top of these supply chains.”
https://www.theguardian.com/global-development/2020/jul/16/ethical-labels-not-fit-for-purpose-report-warns-consumers
The study of 40 global voluntary initiatives, including emblematic on-pack labelling schemes such as the Forest Stewardship Council (FSC) and Fairtrade International, identifies multiple failures. The 235-page Not Fit for Purpose report draws on a decade of research into “multi-stakeholder initiatives”, the report’s sample alone involves more than 10,000 participating companies in 170 countries, and covers sectors as diverse as cocoa, sugar, palm oil, minerals, seafood, electronics, jewellery and children’s toys and which count global corporations from Nike, Coca-Cola and Nestlé to Shell, Apple and Newmont among their staunch supporters.
“These kinds of initiatives are not effective tools for holding corporations accountable for abuses or for protecting rights holders against human rights violations,” says Amelia Evans, executive director at MSI Integrity, the US-based human rights group behind the research. According to Evans, multi-stakeholder initiatives [MSI] have a “tricky relationship” with governments, which frequently interpret their existence as evidence that abuses are being “taken care of”. “In truth, the exact opposite needs to happen. Governments must recognise that because there’s an initiative in place, then underlying human rights abuses are occurring and they are obligated to take action,” says Evans. “Over time, MSIs have become captured and dominated by corporations. So, while they may not have been designed to fail, I think they were destined to fail,” says Evans.
Most initiatives tend to be heavily skewed towards corporate interests. Only 13% of the initiatives analysed include affected populations in their governing bodies and not a single one has a majority of rights holders on its board. Such an imbalance comes into stark focus at the complaints stage, with almost one third of the initiatives offering no grievance mechanism whatsoever to workers or other affected parties. The frequent absence of victims’ voice speaks to a wider concern about the use of certification schemes and similar voluntary standards to stall progress on human rights and safeguard the status quo. Referring to the “flawed concept” of monitoring, she says third-party auditors are typically paid by the self-same corporations they are hired to assess, creating a clear conflict of interest. In addition, few if any protections are given to critics or whistleblowers, thus limiting the incentive for victims to speak out.
Setting below-cost prices, request fast turnarounds and other aggressive procurement practices by multinational buyers are also widely overlooked. Indeed, of the eight initiatives linked most closely to supply chain issues, only two explicitly reference the need for responsible purchasing.
MSI Integrity warns that consumers “can’t rely” on the claims made by many ethical labels. Not only are abuses continuing to occur, but generic terms such as “fair” and “sustainable” can be misleading.
Evans says: “The risk is that these initiatives are legitimising abusive behaviours by failing to detect them and by suggesting that a wider range of issues are being addressed than often is the case.”
Sarah Newell, a spokesperson for the US-based Worker-driven Social Responsibility Network, goes even further, arguing that multi-stakeholder initiatives exist to intentionally “obscure” worker abuses in multinational supply chains. Their “primary function”, she argues, is “to distract from the fact that these abysmal conditions are the direct result of the business practices of the brands at the top of these supply chains.”
https://www.theguardian.com/global-development/2020/jul/16/ethical-labels-not-fit-for-purpose-report-warns-consumers
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