Extractives

Timberland - Business Willing to Engage but a Multi-Stakeholder Effort Needed

Commentary, 30 November 2009

By Jeffrey Swartz, President & CEO, The Timberland Company

IHRB's Executive Director John Morrison wrote a compelling post in late September about the need for rapid scaling of progress on human rights – a view we wholeheartedly share. It has taken us 15 years to get to where we are – to create what can only be called a “baseline” for human rights; we cannot allow 15 more years to pass before we operationalize and scale efforts to ensure dignity and human rights within supply chains globally.

The problem is, as Morrison points out, that the movement is currently incomplete -- and as such, is structurally limited in its ability to achieve the progress required. Specifically:

The absence of any serious-minded attempt to create a global view of public policy about human rights de facto limits progress, period.

As long as the bewildering labyrinth of "local jurisdictions" apply, it is perfectly fair for the CEO to assert that just in order to ensure compliance absorbs a great deal of resource and energy—resources and energies that could be otherwise applied within the same problem solving universe.

Take something as basic as health and safety regulations for workers in shoe factories. We currently manufacture shoes in six countries (in our own factory in the Dominican Republic and contract factories in China, India, Vietnam, Thailand, and Portugal). On the specific issue of fire egress alone, we are subjected to six differing regulations. On other issues, there are even more variances among local regulations within the different regions where we manufacture. It is left to us to choose—do we harmonize our efforts against the individual local codes, or against the most stringent level globally relevant? And having chosen, we are then in the position of having to “sell” our point of view to the third party factory owner. Why should he have to submit to a global standard imposed by us, which is stricter than local law? So—we spend time and energy fighting an unnecessary battle. Standardizing basic elements of public policy, even at the level of health and safety, would leave us free to focus on the challenge that Morrison depicts.

In the absence of any consumer “pull” against the question of human rights, we’re missing a powerful counterweight to the activists who push for progress.

With regard to human rights, the consumer expectation today is somewhere in the neighborhood of, “don’t do anything horrible or despicable,” and nowhere near, “provide health services and support programs to help employees live a better life.” And if the issue doesn’t matter much to the consumer population, there’s not a big incentive for the consumer-minded CEOs to act, proactively.

To date, the activist community has done a fair job creating relevance as a threat (do the wrong thing, and you’ll be exposed) -- but to get to the breakthrough Morrison calls for, I believe the equation needs reframing from the mindset of “comply or be punished,” to “commit and be rewarded.” The growing green movement is proof that an issue once regarded as a risk can, in fact, be valuable: the appetite and expectations of eco-conscious shoppers for anything organic, recycled, renewable or otherwise environmentally friendly has skyrocketed, and smart, successful companies are working hard to keep pace... which leads to a growing market of green goods, produced by green companies using green business practices... and in the end (whether by mistake or design), yields positive benefits for the environment. I contend that given time and greater awareness, we can create similar consumer relevance – and a chain reaction of positive outcomes -- around the notion of human rights.

There are structural limits to how far and fast the demand for justice in the supply chain can go; what we ultimately need is something like the Kyoto protocol, or the Copenhagen process (hoping that it succeeds), as a way to create a more transparent and universal standard for human rights with governments at the table. Second, we need an activist community selling the affirmative value of justice, rather than only the threat of punishment.

Finally, by better educating and engaging consumers in the issue, we can effectively influence greater responsibility and greater profitability in the marketplace. Hard work? You bet. But by leveraging the power and resources of each distinct stakeholder against the task, this is progress we can make.

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