A battle between Unilever and an Amsterdam-based non-governmental group over the rights of workers on tea plantations in India and Kenya shows the difficulties facing multinational companies that are trying to ensure their products are ethically produced.nilever, which makes the popular Brooke Bond and Lipton brands, has committed to sourcing all its tea sustainably by 2020.
But doing so is tricky. First, what does sustainability constitute exactly? Does it comprise basic worker rights and environmental protections? Or should it mean that workers on tea plantations in India and Kenya, poor countries, should be extended the same working conditions as most Europeans and Americans?
And who makes sure these companies –often not owned by the multinationals but local suppliers–abide by the standards?
The Netherlands-based Center for Research on Multinational Corporations, in an October report, claimed the existing system of checks and balances has failed to stop abuses of workers on Unilever’s Kenyan estate, including sexual harassment and poor housing conditions.
In India – where Unilever buys tea from producers in Assam and Tamil Nadu, but does not own the estates – the report claims workers are kept permanently on rolling short-term contracts, denying them health and pension benefits, and are often exposed to dangerous pesticides while working.
Unilever, in its response to the report, says the center has failed to produce evidence to back claims made about its Kenyan operations. The company said it would look in to allegations of abuses at the Indian suppliers if given specific information.
At the crux of such battles is a debate about whether the move to sustainable production is a real attempt to improve conditions for workers in poor parts of the world or a kind of “green-washing” carried out by multinational companies under intense pressure from customers in Europe and the U.S.
In reality, it’s probably a bit of both. Companies, for sure, have a real interest in managing their brand image, which means not buying from people that exploit workers.
But at the same time, they have to watch their bottom lines and produce enough to meet demand for their product, which they say would be impossible if moving overnight to apply Western-style standards uniformly across emerging market economies.
The balance between certifying adequate quantities of sustainable product – of tea, or other products like wood and palm oil – and keeping to strict standards is a tough one to negotiate.
The Forest Stewardship Council, which makes sure the paper in your novel is from sustainable sources, got caught out in 2007 and had to change its rules when one of Indonesia’s most controversial paper producers got an FSC certification.
Sometimes it’s difficult to know what is sustainable. Take palm oil, used in products like margarine and cosmetics, which is grown on plantations that have led to the destruction of massive area of natural rainforest in Indonesia and Malaysia.
The red palm oil fruit is collected from hundres of small plantations and processed at refineries, making it difficult to know whether the end product is sustainable.
Unilever, one of the world’s largest buyers of palm oil, has been instrumental in developing the Roundtable on Sustainable Palm Oil, a group of suppliers, NGOs and producers. But progress toward the RSPO’s goal of sustainability by 2015 has been slow, with lack of clarity on how to ensure a product meets “green” standards.
In theory, tea should be easier to track. But Unilever’s response to the latest report by the Center for Research on Multinational Corporations highlights the difficulties.
The company said it relies on regular, independent audits of its tea plantations by the Rainforest Alliance, a U.S.-based nonprofit environmental group, which has improved rights for workers. Unilever says it has spent €1.2 million on housing upgrades at its estate in Kericho, Kenya, which it claims offers workers among the best conditions in the East African tea industry.
Rainforest Alliance carries out audits for a number of companies according to social and environmental standards set by the Sustainable Agriculture Network, a coalition of leading global conservation groups. During the process, auditors should be allowed to go where they like and meet workers without management presence.
“Attempting to undermine public trust in the Rainforest Alliance scheme is not a responsible approach to addressing these issues,” Unilever said in response to the report.
The center, known by its Dutch acronym as SOMO, retorts that the Rainforest Alliance auditing process is deeply flawed, based on short visits and not deep investigation.
The report points out instances when management at the Kenyan estate tried to cover up housing problems ahead of auditor arrivals.
The center says women who have faced sexual harassment are scared to come forward given their lack of belief in the oversight process.
In India, the report claims that many workers are employed by tea suppliers to Unilever on short-term contracts that offer them no benefits, an effort to cut costs after a crisis in the Indian tea industry a decade ago.
In Assam, as many as 50% of workers in the tea industry are on short contracts, meaning they don’t get benefits, the report says.
Unilever says that tea production is seasonal and defends its use of contract workers with “clearly defined rights” as a usual practice.
The report acknowledges that use of contract workers doesn’t break national or international labor laws. But it argues that heavy reliance on these kinds of workers, who are sometimes employed for decades on rolling short-term contracts, goes against Sustainable Agriculture Network standards that lay down equal benefits to workers for the same kind of work.
wsj.com
But doing so is tricky. First, what does sustainability constitute exactly? Does it comprise basic worker rights and environmental protections? Or should it mean that workers on tea plantations in India and Kenya, poor countries, should be extended the same working conditions as most Europeans and Americans?
And who makes sure these companies –often not owned by the multinationals but local suppliers–abide by the standards?
The Netherlands-based Center for Research on Multinational Corporations, in an October report, claimed the existing system of checks and balances has failed to stop abuses of workers on Unilever’s Kenyan estate, including sexual harassment and poor housing conditions.
In India – where Unilever buys tea from producers in Assam and Tamil Nadu, but does not own the estates – the report claims workers are kept permanently on rolling short-term contracts, denying them health and pension benefits, and are often exposed to dangerous pesticides while working.
Unilever, in its response to the report, says the center has failed to produce evidence to back claims made about its Kenyan operations. The company said it would look in to allegations of abuses at the Indian suppliers if given specific information.
At the crux of such battles is a debate about whether the move to sustainable production is a real attempt to improve conditions for workers in poor parts of the world or a kind of “green-washing” carried out by multinational companies under intense pressure from customers in Europe and the U.S.
In reality, it’s probably a bit of both. Companies, for sure, have a real interest in managing their brand image, which means not buying from people that exploit workers.
But at the same time, they have to watch their bottom lines and produce enough to meet demand for their product, which they say would be impossible if moving overnight to apply Western-style standards uniformly across emerging market economies.
The balance between certifying adequate quantities of sustainable product – of tea, or other products like wood and palm oil – and keeping to strict standards is a tough one to negotiate.
The Forest Stewardship Council, which makes sure the paper in your novel is from sustainable sources, got caught out in 2007 and had to change its rules when one of Indonesia’s most controversial paper producers got an FSC certification.
Sometimes it’s difficult to know what is sustainable. Take palm oil, used in products like margarine and cosmetics, which is grown on plantations that have led to the destruction of massive area of natural rainforest in Indonesia and Malaysia.
The red palm oil fruit is collected from hundres of small plantations and processed at refineries, making it difficult to know whether the end product is sustainable.
Unilever, one of the world’s largest buyers of palm oil, has been instrumental in developing the Roundtable on Sustainable Palm Oil, a group of suppliers, NGOs and producers. But progress toward the RSPO’s goal of sustainability by 2015 has been slow, with lack of clarity on how to ensure a product meets “green” standards.
In theory, tea should be easier to track. But Unilever’s response to the latest report by the Center for Research on Multinational Corporations highlights the difficulties.
The company said it relies on regular, independent audits of its tea plantations by the Rainforest Alliance, a U.S.-based nonprofit environmental group, which has improved rights for workers. Unilever says it has spent €1.2 million on housing upgrades at its estate in Kericho, Kenya, which it claims offers workers among the best conditions in the East African tea industry.
Rainforest Alliance carries out audits for a number of companies according to social and environmental standards set by the Sustainable Agriculture Network, a coalition of leading global conservation groups. During the process, auditors should be allowed to go where they like and meet workers without management presence.
“Attempting to undermine public trust in the Rainforest Alliance scheme is not a responsible approach to addressing these issues,” Unilever said in response to the report.
The center, known by its Dutch acronym as SOMO, retorts that the Rainforest Alliance auditing process is deeply flawed, based on short visits and not deep investigation.
The report points out instances when management at the Kenyan estate tried to cover up housing problems ahead of auditor arrivals.
The center says women who have faced sexual harassment are scared to come forward given their lack of belief in the oversight process.
In India, the report claims that many workers are employed by tea suppliers to Unilever on short-term contracts that offer them no benefits, an effort to cut costs after a crisis in the Indian tea industry a decade ago.
In Assam, as many as 50% of workers in the tea industry are on short contracts, meaning they don’t get benefits, the report says.
Unilever says that tea production is seasonal and defends its use of contract workers with “clearly defined rights” as a usual practice.
The report acknowledges that use of contract workers doesn’t break national or international labor laws. But it argues that heavy reliance on these kinds of workers, who are sometimes employed for decades on rolling short-term contracts, goes against Sustainable Agriculture Network standards that lay down equal benefits to workers for the same kind of work.
wsj.com
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