Another behind the scenes video detailing the accounts of labor practices in China’s factories has been released on youtube, and this time the target of the film is Disney.  An ongoing battle for Disney, they have had some high profile issues in China and have begun working to address the issues in a public manner.

The film itself is compelling, and highlights some of the issues that Perig’s note highlighted a couple weeks back.

Part 1:

Part II:

Located within its 2007 CSR Report, OKI has a 2 page section on their China based CSR activities.  Concise, within the 2 pages we can see that the firm is investing in its people, looking to meet environmental standards, and has a small (but growing) community program where they are building schools, playing baseball, and donating blood.

Not overloaded with data, but a nice way to make sure to cover China as part of the overall report when many others have yet to take that step.

To read more about their CSR practices you can click here, or read their special section on meeting their CSR commitments

A few days ago, I received the below from friend Pierig Vezin of WethicA.  The founder of this company, Pierig is someone I have come to refer friends to who are in needed of ethical supplier audits, and his letter below shows why.  It is an excellent piece that I encourage everyone to read.

During the past month, we broke our yearly “record” of weekly working hours in one factory. The record number was 106 hours in a single week for these workers. Breaking it down, these workers labored more than 15 hours a day for a straight 7 days a week. But placed in the context of an average week consisting more than 80 or 85 hours a week (12 hours a day, 7 days a week), the severity of their working hours become all the more clear. Even worse, these workers have not been given a day off in more than 2 months.

Fortunately, if only marginally better, not every factory keep workers laboring those hours, but the majority of factories work more than 70-75 hours a week with one to two days off a month. When owners are asked for explanation for these labor-intensive hours, the common one is still: “They are migrant workers, they want to work. If we don’t let them make enough overtime, they will quit.”

This statement seems reasonable enough to most people because it is partly true. The legal cap on working hours is at 40 hours a week. But as the workers are far from their home, they are often willing to work those intensive hours in hopes of earning as much as possible in the shortest period. There is however a very important difference to note. Workers prioritize wages over working time, but believing workers want to work more than 40 hours a week of their own volition is hardy true at all. Looking carefully at factory policies, we often find hefty penalties for workers for not working each hour expected, or even those asking for a day of leave. As most of the workers are paid on a piece rate, not working already means losing the potential wages of that day, but with the factory polices, it serves to double penalize the workers ensuring they lose twice the wages they would have earned working that day.

From a different angle, if workers would have been happy with the working hours, factory penalties to limit absenteeism and leave request would not be necessary. Often complaints from workers in interviews confirmed about being forced to work long, excruciating hours.

Whenever you hear that common justification for imposing long working hours on workers, know that the incentive to earn more is not the sole motivator for overtime; often times, the penalties keep these workers glued to their stations.

Over at Yale 360, Christina Larson has written an article entitled China’s New Environmental Advocates that highlights the Centre for Legal Assistance to Pollution Victims and some of the core issues that exist in enforcing China’s environmental laws.

The challenge of coordinating environmental enforcement across multiple levels of government — with central authorities often looking at the long-term picture, while regional officials remain more concerned about quick economic gains and local protectionism — is not unique to China.

Founded in 1998, and based in Beijing, Xu and a colleague brought together Centre for Legal Assistance to Pollution Victims as a means to correct what they felt they needed to put their academic knowledge of China’s environmental laws to use

to date, Xu says:

The center’s staff has taken up more than 80 cases: They’ve won a third, lost a third, and a third are still pending.

One of those pending cases involves a case of where industrial pollution has contaminated the water of villagers.  It is a case where villagers felt the effects immediately:

from vomiting and migraine headaches, to diminished rice yields and dead cattle. They came to believe the factory’s sooty emissions and waste water dumped into the local water supply, the Xiang River, were the source of these problems.

The villagers first appealed to the factory owner to install more stringent pollution-control equipment. Then they brought their concerns to the local environmental authorities. But by the summer of 2004, little had changed. So the villagers turned to force to shut the factory down — twice storming the grounds to rip its power-supply unit off the wall. Each time, plant operations halted temporarily, while repairs were made, but the factory was back online within a week.

Today Xu is preparing a lawsuit against the local environmental protection bureau, which green-lighted the factory’s faulty environmental impact statement. If successful, the lawsuit will force the factory to shut down until it meets environmental standards

In the west we have a long range of jokes about the role of lawyers, and their role within our society, however through this example it is clear that going forward the role of lawyers will become more important as China’s civil society develops.

China, as we covered in the recent post Pattern of HIV Changes in China, has had its fair share of problems when it comes blood collection, monitoring, and distribution.

It was an issue that Kaiser Family Blog post China’s Blood Supply Not Being Monitored Properly address, but more recently we saw this first hand during the earthquae relief when cities were not initially allowed to send blood from their banks to the affected regions.  It was in part a logistics problem (lack of cold chain), but it was primarily a system by which prevented regional contaminatoins.

a process that the new system will hopefully prevent:

All eight umbrella branches of the Shanghai Blood Center had been linked with a sophisticated information system, said officials from the Shanghai Health Bureau.

The clinics will store the blood while samples are being screened, before distributing it to hospitals that need it.

Dr. Esslinger is the designer behind the sleek sophistication we see with Sony’s television series by Wagas and Apple’s “Snow White” design language. During the 1970s, early on in Esslinger’s career, designers did not have a prominent role when it came to producing a good. Now, however, they have become more important players with new responsibilities. Dr. Esslinger shares his views on how a designer can incorporate sustainability concepts within a capitalist system of production and what he has done so far in his own company frog design (not capitalized for the Bauhaus concept of nonhierarchical relationships) and at the University of Applied Arts in Vienna with his students.

Below is an outline of two separate talks given by Professor Esslinger on Friday September 19th, 2008.

The Next Apple and Sony
There was a panel of three people talking about design using the case studies of Sony and Apple while trying to answer the question of what it takes to become the next heavy weight brand today. The two supporting speakers were Mr. Sydney Chun from Kohler Kitchens and Lorraine Justice, Head of the School of Design at The Hong Kong Polytechnic University. The main speaker was Dr. Hartmut Essliger, founder of frog design and Professor for convergent industrial design at the University of Applied Arts in Vienna, Austria. Sydney presented on what made Sony and Apple successful in terms of using design as a tool for solving business problems and achieving leadership. Lori, on the other hand, was interested in exploring design differences between East and West. She made an interesting argument about how Sony’s layout corresponds with the East’s visual pattern in terms of being more holistic and viewing objects in a relational manner while Apple represented the West in terms of being punctual with focused detail areas. Stemming from these presentations, Professor Hertmut got into the meat of the discussion on Sony and Apple, remarking that Sony was and is a very undisciplined company, while Apple is on track now that Steve came back to lead the company in the right direction. The reliance on the charisma of a leader makes the industry unsustainable in terms of pushing the envelope for environmental sustainability.

Dr. Esslinger then got onto the topic of his role as the “leader” of frog design. He doesn’t see himself as the main guy; the company operates on a democratic principle and he said, “They don’t have to listen to me. I have to shut up sometime.” This makes the work at the office incredibly dynamic and creative. He also went on to upcoming designers in China. He thinks that there is a huge potential for Chinese designers to bring product back to the center. He cited the example that, in Western countries, designers work on software, the “virtual” design components. Since the factories are in China, they can do more work with the actual material. His example was the iPhone. He thinks the iPhone has great software but crap for telephone design because you are still using a telephone pad to access texts. It’s also awkward to carry and handle. This could be where Chinese designers could really step in a make a difference.

GIGA v5: Green Creative Leaps

Part I The Designer’s Role in Sustainability

Dr. Esslinger opens the GIGA hosted event with global warming and the role designers play in its creation. The proper role of a designer is to “create objects which are useful art, inspirational and use as few atoms and materials as possible.” He criticizes the role of capitalism and its relationship to the designer by saying, “Today’s business mania about ‘shareholder value’ and ‘pleasing Wall Street’ results in more and more incorporate[d] behaviors that promote ‘financially safe’ and ‘politically correct’ conformity [and] stifles creative thinking….” He goes on to say, “As of today, we designers are systemic players in a financially aggressive, economic model which depends on multiplying products into thousands and millions.” In the end, design-like marketing is still about driving mass consumption and that is something a designer needs to acknowledge and address.

So how does a designer begin to address this paradoxical relationship between design and consumption? Esslinger goes through the production process of a good:
1.    Product Genesis (strategy and design)
2.    Production and Operations (applying materials, consuming energy, emitting pollutants)
3.    Usage and Consumption (consuming materials, consuming energy, emitting pollutants)
4.    Recycling (re-using materials, management of disposal waste)

He then goes through how to improve each step starting with 4 (recycling) and working his way up to product genesis. This clip plays cuts off after step 3.

Part II ELF and Open Source Design

for electronic brands and retailers around the world, there should be few issues more important than e-waste and supply chain management in a CSR report, and the recent Best Buy CSR report is no exception.

In the forward to the report itself, they begin by laying out their three aspirations:
1. A global champion for human ingenuity and opportunity — our employees providing leadership for our industry, our customers, and our communities worldwide
2. A global advocate for consumers in the world of technology — delivering consumer
electronics products and services to more people than any other company in the world
3. Environmentally and socially accountable for our brands and business operations
worldwide

according to the author:

This report is one of our first steps on the journey toward our aspirations.

Through this 30 page report, the main issues for me were related to eWaste, packaging, and product life cycles, and they have clearly addressed those issues. however, I think there is still a long way to go before I would feel comfortable saying Best Buy is truly dedicated to sustainability.

Some areas that I am encouraged by:
1) all of their 196 offshore “exclusive brand” suppliers have been audited! Few companies could say they same.

2) they are providing training to staff on energy star, and how to sell it. there is of course a benefit to this financially, but none the less it is a basic first step that has been covered and will create more awareness among its employees who are looking to upsell the more environmentally friendly products.

3) their 150,000 have logged 151,000 hours of volunteer service in the community. While only 1 hour per year on average is low, this number is 250% higher than last year, and that itself is commendable

providing a bit of constructive criticism, here are a few areas/ issues that I feel they should have addressed more fully, and/or should look to in the future as they take their next steps.
1) their recylcing events are limited to about 10% of their overall stores, and this should be expanded significantly in the future

2) The report does not mention transportation at all, and as a firm with 1000 stroes, stcked with goods that come in containers, on pallets, in master crates, and wrapped in bubble wrap, I would hope that they focus on increasing efficiency in this area - and tell us about ti

3) they are working with paper mills to identify more environmentally friendly weekly inserts, but getting 100% recycled paper and using soy based inks for a firm like this could be easily accomplished.

4) I would suggest more coordination on specific issues - i.e. create an environmentally friendly paper coalition between themselves and Dell - i.e. work with Music houses on media packaging design, materials, and logistics

going forward, Best Buy is going to need to really work on their supply chain issues, and I am happy to see that they understand that and seem to be prepared to invest in it.

In an ideal world, they would be part of cradle to cradle discussions with designers, consumers, OEMs, and transportation firm to really ramp up their platform in terms of sustainability, however in the real world this report is a good first step - an encouraging sign that another large retail firm has taken on a higher level of responsibility- and I am looking forward to reading their next report in the summer of 2009.

When writing the post The Difficulty of Evaluating CSR Reports, I had not begun reading Sinopec’s 2007 Sustainability Report.

Had I, I would have had another example of just how wide the spectrum can be.

Using the image below as a start, for Sinopec, sustainability for them is about 3 things :improving the financial value of the firm, improving human capital,and improving the environment.  There are none of the pictures of executives helping children read or plant trees, and what “kids and babies” angles they did through into this went into the back

What they did cover, often, was corruption and how they had programs to deal with that, and they had programs that supported the development of their employees and their families.  It was like reading a state owned enterprise guidebook at time as I began to see that Sinopec’s angle on this document was not only honest.. it was holistic in many regards.

As an assessment under traditional means  Sinopec’s report as a pure environmental report was not complete.  they failed to mention many of the key programs I would have hope to see from an oil firm, and what programs they have are pretty thin at best.  I thought that there would have been more mention on R&D related to clean technologies - like a BP - or that there would be some discussion around their process to clean up their supply chain.  However, neither happened

However, by taking their view of sustainability out to a position of where a traditional CSR report is positioned it did force me to think about how different parties view sustainability in different ways. Surely everyone can admit that the system is not a perfect one, but what I found almost amusing in my second read was that Sinopec had some of the best statistics (and presentation of their statistics), unlike many firms that bury or hide numbers with in reports.

Where I would recommend this report for readers is to spend some time thinking about how China and the West see sustainability from a cultural perspective and how this highlights that gap.  It is not necessarily a bad thing that Sinopec took this route in their report, and I do appreciate seeing their view, but if they need to really work on their supporting information for next year so that we can see just what it is they are doing.

CD News has posted a very interesting interview of Dr. Simon Zadek, Chief Executive of AccountAbility discussing the role of corporate responsibility in today’s world.

For me the most interesting part of the interview comes in the first three questions as Dr Zadek really hammers away at the idea that the Western CSR model is “the” model and puts forward that it is actually lesser developed and developing nations like China, Cambodia, South Africa, and Brazil that will really start to define how companies develop CSR practices.

over the past 10 or 15 years at the international level come primarily from a western liberal mind set. I think that there is an assumption on the part of many businesses or CR activists that it’s just a question of other cultures and countries catching up. That seems to me the furthest possible place from the truth.

for myself, I would agree with this statement in at about the 75-85% level as I think that given the size of “CSR” there is going to be a large chunk of this business philisophy that will be driven by the ideals of Western firms moreso that the conditions on the ground in the afor mentioned countries.  Corporate HQ will set the strategic directions for global programs, HQ based staff will manage country Foundations will still hire and develop teams, and while programs will localize (something we are seeing in China already in the largest programs) we are not seeing where local policies are breaking through in many of the CSR strongholds.

Were I to model it out:

Community investment (philanthropy and volunteerism) - global directed programs will begin to localize as local staff continues to develop, and business units on the ground will take on much of this role.  however, large global partnerships will continue to receive the largest grants.

Environment - this is certainly an area where western based managers need to begin listening to their BRIC/ developing nation partners as it is their partners who are exposed to the problems of environmental degredation on a very intimate level.

Labor relations (incl. health & safety). - This is an area that will have an interesting dynamic long term.  The in-house lawyers (and PR firms) of the west will look to drive strong policies to address issues on the ground as a matter of defense.  No one wants to be Nike in ‘97 again, and with consumer activisim in the west growing, the issues of child labor and exploiting labor are sensitive issues,  Some of the most proactive firms (Nike) are working with governments and NGOs around the world to develop systems, policies, and capacity to reduce these issues, and so in that manner the loop will close.

Governance and Codes of Conduct - These will become global.  firms like Philips, Wal-Mart, and others are all working feverishly to abondon the local + concept and more to a global standard that is really driven by the western home office.  Partly a defensive mechanism, partly arising from a need to work with a single code of conduct, there are entire industry clusters (particularly textile and footwear) that have worked to take it a step further and coordinate as an industry at a global level.

To read more of his interview, and it is a very interesting interview, I highly suggest it.  for those looking to learn how to break into the CSR field, you will get some excellent advice in is last response as well:

The key decision that someone coming into this field has to make is, “Am I comfortable becoming another manager in the field, responsible for reporting or responsible for compliance, or responsible for philanthropy?”;

Recently there was a U.S. Clean Energy and Environment Trade Mission to China where 19 U.S. companies came to China in search of clean energy investment opportunities U.S. Commerce Secretary David Bohigian.

This trip is seen as a part of the U.S.-China 10-year agreement on cooperation in energy and environmental protection at the strategic economic dialogue (SED) that took place in June. At first glance, citing U.S. companies looking to partner with large oil companies seems a bit contradictory to the idea behind clean energy, but it is important to remember “baby steps.” Cleaner fuel burning is better than no NOx reduction technology.
The U.S. is of course not alone when it comes to tapping into the market of “green” technology and environmentally friendly investments.

The European Union has a EU-China Climate Change Partnership which is on display at Lu Jiazui’s Superbrand Mall on the second floor above Element Fresh. It’s worth checking out, but most of it is in Chinese and it is only up until September 15.

If you don’t have a chance to see it before it’s taken down, the following is a quick run through of each of the display panels (in no particular order):
•    What is climate change
•    International cooperation on climate change
•    EU mitigation and adaptation to climate change
•    Clean development mechanism (CDM)
•    What drives climate change
•    Green technologies and green habits (nice section on what companies can do)
•    EU-China cooperation on natural resource management
•    EU-China climate change partnership

I must say, I was really happy to see many Chinese shoppers taking 10 minutes to look at the panels and, of course, take pictures of it.