March 2001 Insights Issue #36

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Learning by doing?
Assessing multi-stakeholder approaches

The Ethical Trading Initiative (ETI) is an alliance of companies, non-governmental and trade union organisations committed to working together to identify and promote good practice in the implementation of corporate codes of labour practice. ETI has examined the contribution that trade unions, NGOs, trade associations and academics can make to identifying best practice in auditing labour standards in global supply chains.

Skills and research techniques developed by stakeholder organisations can contribute enormously to the discussion about competencies for auditors of labour conditions. Trade union officials, for example, know local workers, law and labour practices, academics use rapid techniques to survey workers' views, and some NGOs have developed relationships and techniques to engage some of the most marginalised workers. Such work can take years to develop and can only be done with strong local knowledge and close proximity to the workforce. What models have been tested so far? How, in practice, did the ETI multi stakeholder approach work?

Zimbabwe and South Africa
The ETI supported the development of local stakeholder alliances so that local organisations could contribute their expertise to understanding the competencies needed by auditors to assess labour conditions and respect for workers' rights. In Zimbabwe an international auditing company was also employed and a participatory auditing approach developed (see Auret). In South Africa supermarket technologists worked alongside local trade union and NGO reps, social scientists, health and safety experts and local ETI staff in inspection visits to wine producers.

In China this approach was not possible where Chinese law does not respect internationally recognised standards. Political restrictions mean there are no independent trade unions or NGOs outside Hong Kong. Although ETI intended to work with trade unions and NGOs in Hong Kong, it actually tested different models of companies with independent auditors and auditing their own suppliers.

Local stakeholders can help identify competencies for auditors of labour standards and thereby contribute to the development of good practice. Big issues remain unresolved, however, concerning the role of stakeholders once good practice is defined. Some ETI members argue for an internationally recognised standard for professional auditors, similar to the financial sector. Is it appropriate for trade unions and NGOs to become permanent auditors? Some say yes, whilst others stress a verification role for trade unions and NGOs - a periodic and critical scrutiny of the workplace to ensure labour standards are observed. In all discussions, ETI members agree that whatever the role of stakeholders in shaping the future of social auditing, prime responsibility for ensuring that codes are implemented must rest with the companies that have adopted them. A number of challenges, to which the ETI is turning its attention, face all those involved.

• Who will support capacity development of local stakeholders and the alliances between them?

• How can consistency between the multiplicity of codes be achieved so that codes are based on ILO Conventions and ILO interpretation of them?

• How do the principles of codes apply in detail in different industries?

• Who should set and maintain international standards in social auditing?

• What is the impact of codes on the main beneficiaries - the workers?

• Once sub-standard labour conditions are identified, who in the supply chain should pay for improvements?

• What is the business case for code implementation?

Dan Rees
ETI
Cromwell House
14 Fulwood Place
London WC1V6HZ
UK
T +44 (0)20 7404 1463
dan.r@eti.org.uk