Supply Chain Innovation

Taking a Second Look at a Monitoring Evaluation

Tuesday, June 12, 2007

Cesar Rodríguez-Garavito’s article in Politics and Society, “Global Governance and Labor Rights: Codes of Conduct and Anti-Sweatshop Struggles in Global Apparel Factories in Mexico and Guatemala” from Politics and Society offers an examination and evaluation of labor codes of conduct and monitoring systems in the broader context of global governance. He compares four monitoring systems in his paper, one of which is the FLA, which merits some response.

The sections of the paper that are most directly relevant to the FLA’s work begin on p. 212. Several points in Rodríguez-Garavito’s article resonate with the FLA’s work:

Consensus among union leaders, factory owners, monitors, brand representatives, brands, and labor advocates in Guatemala and Mexico that the state is not a reliable enforcer of labor laws and therefore there is a need for codes. Even a Guatemalan labor leader who dismisses codes of conduct as a “farce” was pessimistic that the state could be the sole regulator of labor conditions in factories (p. 212).
Third party monitoring – an external monitor that applies a code of conduct formulated by a multi-stakeholder umbrella organization like the FLA – is the most credible approach to monitoring codes of conduct (p. 214).
There is discontent on the part of unions, NGOs, and brands with the “policing” or “checklist” model of monitoring (p. 219). This is consistent with the FLA’s assessment of the situation and our commitment to FLA 3.0.
Logic of cooperation between the WRC and the FLA to achieve common objectives (p. 219).
With reference to the two case studies – Kukdong and Choishin – the work of monitors in collaboration with umbrella monitoring organizations (FLA and WRC) decisively pushed forward the negotiations that led to the establishment of unions (p. 225).
In the Choishin case, the threat of all FLA member brands not contracting with Choi & Shin International unless the situation in Guatemala was resolved was instrumental in the settlement (p. 226).

There are some errors in the paper and the research underlying the paper is a bit dated (although the paper was published in 2005, some of the research seems to date back to 2002, with partial updates in 2003 and 2004) and therefore some statements in the paper are not accurate. These problems crop up mostly in Table 1 (p. 216), which compares four “third-party monitoring systems,” WRC, FLA, SAI (SA8000), and WRAP with respect to 10 factors related to contents of the code, the independence and comprehensiveness of monitoring, the transparency of the system, and sanctions for noncompliance.

In Table 1, the following corrections should be made to the assessment of the FLA with respect to the 10 factors:

Worker able to file complaints?: The author says that no such system is available under the FLA system, which is not accurate. The FLA Third Party Complaint system is available to workers and has been used quite extensively by workers.
Are most monitors independent?: The author assesses “no” for the FLA on this dimension. The criterion (p. 215) is: “are most accredited monitors independent (as opposed to commercial) organizations? The paper states that out of 63 IEMs conducted at Nike facilities in 2002-2003, “virtually all were conducted by commercial firms.” The FLA has been moving in the direction of accrediting more civil society monitoring organizations. Currently, 7 of our 20 accredited monitors are civil society organizations, and several other civil society organizations are in the accreditation process.
Is monitoring continuous? Again, the author assesses “no” for the FLA in this factor. The criterion (p. 215) is: Are factory evaluations based on continuous monitoring (as opposed to one or a few visits? The FLA methodology of random selection of IEMs does not lend itself to continuous monitoring. However, we have stepped up our verification visits – which mean returning to the factory where an IEM was conducted – and moreover, we have a third party complaint system that in essence is very similar to the “continuous monitoring” that is conducted by the WRC. Under 3.0, there will be continuous contact with factories.
Are manufacturers required to disclose name and location of suppliers? The author rates the WRC “yes” on this dimension and the FLA (and the other two initiatives) “no.” Colleges and universities require licensees to disclose name and location of suppliers. With respect to its university licensees, then, the FLA should have the same rating as the WRC. Indeed, the FLA does not require its affiliated companies to disclose their factories, but several PCs – Nike, PUMA, Reebok – have voluntarily done so.

Correcting/updating the information on this table would bring the FLA’s score from the 6 in the article to about 8 or 8.5, very close to the WRC score.

One important difference between the FLA and the WRC that is not captured in the table is the number of monitoring events that each organization carries out annually. While the WRC probably conducts in the order of 6 investigations per annum, the FLA conducted 145 IEMs in 2006 and a combined 629 since 2002.

To conclude, even in its present form, the paper sets out quite effectively the strengths of the FLA system. With the correction/updating of some of the points above, the FLA system would show to be even stronger using the criteria developed by the author.

Jorge Perez-Lopez


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