Managing social sustainability in supply

Question 1

What was the Dodd-Frank Act?

Answer 1

an American law that requires publicity traded companies to report the use of conflict materials in their products. Materials: Tungsten, Tin, Gold and Tantalum

Question 2

What is the modern slavery act 2015?

Answer 2

o If over 36m you must have a statement about what you’re doing about slavery
o Statement must be on the company website
o No slavery in your own company or in the supply chain

Question 3

What is the better coal sourcing initiative?

Answer 3

o 60% of Colombian coal is burnt in European power stations
o poor workers rights and environmental record
o project has targeted to improve these areas

Question 4

What is the ethical trading initiative? (ETI)

Answer 4

The Ethical Trading Initiative (ETI) is a leading alliance of companies, trade unions and NGOs that promotes respect for workers’ rights around the globe. Our vision is a world where all workers are free from exploitation and discrimination, and enjoy conditions of freedom, security and equity.

Question 5

What is defined as ethical trading?

Answer 5

Ethical trade means that retailers, brands and their suppliers take responsibility for improving the working conditions of the people who make the products they sell. Most of these workers are employed by supplier companies around the world, many of them based in poor countries where laws designed to protect workers’ rights are inadequate or not enforced.

Question 6

Why was the ETI formed? (4)

Answer 6

o People – students, investors, groups – want changed
o Reputational risk
o Child labour, slave labour – what can we do about this?
o Working hours and working conditions

Question 7

How does the ETI process work?

Answer 7

Need three players: business, NGO’s and trade unions to work together

Question 8

What are the basic provisions of the ETI? (3)

Answer 8

o Employment is freely chosen
o Working conditions are safe and hygienic
o Living wages are paid

Question 9

What are the principles of ETI management?

Answer 9

o Demonstrate clear commitment to ethical trade
o Drive year on year improvements in working conditions
o Put money and time into improving it

Question 10

What gave rise to social issues in the electronics supply chain? (5)

Answer 10

• Loss of control due to globalisation since the 1980s as people started to outsource
• Concentration on core competencies
• Encourage others to compete to reduce the cost of the supply chain
• Manufactures get benefits of supplying several companies – economies of scale
• Increased margins and definitely reduced the cost of electronics for consumers

Question 11

Why are social supply chain issues in the spotlight? (2 categories)

Answer 11

Rising consumer awareness:
• IT companies saw Nike (clothing) getting in trouble – seen as a risk
• Internally, people drove to change things (morals maybe)

Monitoring suppliers:
• Companies started placing expectations on suppliers – varied companies to company
• Expectations not necessary monitored or enforced
• Caused confusion for suppliers – some decided to ignore

Question 12

What is the Responsible Business Alliance (RBA)?

Answer 12

is a nonprofitcomprised of electronics, retail, auto and toycompanies committed to supporting the rights and wellbeing of workers and communities worldwide affected by the global electronics supply chain. RBA members commit and are held accountable to a common Code of Conduct and utilize a range of RBA training and assessment tools to support continuous improvement in the social, environmental and ethical responsibility of their supply chains.

Question 13

What do members for the RBA do? (3)

Answer 13

• Members adopt code of conduct
• Must at a minimum make the next tier of suppliers adopt the code too
• Provide training, tools, support and auditing

Question 14

What are some of the criticisms of the RBA? (5)

Answer 14

• Members only demonstrate working towards compliance
• Vague with respect to unions and collective bargning
• RBA does not hold its members accountable
• No requirement to public report findings of factory reviews or case of abuse
• Original code was very western focused in terms of supply chain needs

Question 15

What is the RBA’s stance on wages and child labour?

Answer 15

Child labour:
o Not allowed
o No one under 18 which could be damaged

Wages:
o Whatever is the wage in that area
o NGO’s argue that RBA sets the barrier to low

Question 16

Provide an overview of a company’s economic perspective on the RBA

Answer 16

• Increases costs
o Enforcement needs people which costs money
o Enforcement raises costs for suppliers who need to put things in place
• Therefore, companies make a trade-off with regards to how much to enforce
• NGO’s try and increase pressure by bring consumer pressure to bear
• This result in companies becoming more willing to invest more

Question 17

What are the five sections of the RBA?

Answer 17

a) Labour
b) Health and safety
c) Environmental
d) Ethics
e) Management systems – monitor compliance with the laws

Question 18

What is the ripple effect? Provide an example

Answer 18

• public focus of apple/foxcon put the whole industry under pressure
• change of hearts and mind of senior staff
• days of easy globalisation are gone – anon apple exec

Question 19

What are the issues regarding western values and auditing the supply chain?

Answer 19

• are we driving western values
• Standard minimum age
• Working conditions and hours per week? Uk/US working conditions in 1900s very bad

Question 20

What is fairphone?

Answer 20

In 2013, Fairphone launched a movement for fairer electronics. By making a phone, we’re opening up the supply chain and creating new relationships between people and their products

• aims to remove all conflict mineral from its phones