Major retailers and manufacturers doing business in California will be required as of January 1, 2012, to disclose on their Web sites policies they have in place to eradicate slavery and human trafficking in their supply chains. Governor Schwarzenegger, who signed the bill into law last week, isn't the only one that human rights advocates may want to thank.
A coalition of 31 members of the Interfaith Center on Corporate Responsibility and the Social Investment Forum, led by Christian Brothers Investment Services (CBIS), sent a letter to the Governor encouraging the bill's passage. It's just one example of recent shareholder efforts being undertaken to combat this social ill.
When Christian Brothers Investment Services Inc. (CBIS) most recently surveyed its participants to see which advocacy issues they wanted addressed, it was surprised by the results.
Human trafficking captured the No. 1 ranking, although it was the first time it was listed on the socially responsible investing survey that CBIS distributes every few years. CBIS, a leader in SRI, manages $3.6 billion for more than 1,000 Catholic institutions worldwide.
The support CBIS received this past spring for its initiative on human trafficking at the World Cup-a letter sent to the CEOs of eight major hotel companies with chains near South Africa's game venues-also well exceeded expectations, says Dan Nielsen, director of SRI.
Approximately 300 CBIS participants, socially responsible investors and faith-based organizations signed the letter asking the hotels what actions they were taking to combat human trafficking and suggesting best practices. They also denounced all forms of human trafficking whether intended for forced labor, child labor or sexual exploitation.
Responses were received from Accor, Carlson, and NH Hoteles-the only ones among the eight that conduct employee training on the issue and have endorsed the Code of Conduct for the Protection of Children from Sexual Exploitation in Travel and Tourism (www.thecode.org). Carlson, whose brands include Radisson and Country Inn & Suites, is a shareholder in the Rezidor Hotel Group. Accor's brands include Formule1, Mercure, Motel6 and Sofitel.
CBIS has also posted a similar letter regarding human trafficking on its Web site that individuals can download and present to the hotels they visit (www.cbisonline.com/sriaction).
"Human Rights is an interesting area; it definitely deserves more corporate attention. A historic lack of key performance indicators has kept it a difficult area for assessment," says Julie Tanner, assistant director of SRI for CBIS.
Now, though, the United Nation's Universal Declaration of Human Rights best practices are being cited more, along with International Labour Organization (ILO) conventions, says Tanner. Human rights is also starting to overlap a lot more with environmental issues. "The conversation used to be very siloed," she says.
It's hard to just look at a company's environmental record if its human rights performance is poor, says Tanner. Ceres, a leading coalition of investors, environmental groups, and other public interest organizations working with companies to address sustainability challenges, incorporated some human rights considerations in its Roadmap for Sustainability published earlier this year.
The definition of human rights is also expanding, notes Tanner. In July, the U.N. declared clean water and access to sanitation a "fundamental human right" following a resolution passed by 122 nations. Health care is starting to be viewed more as a human right too, she says.
Many human rights shareholder resolutions and dialogues are being jointly led by socially responsible investors, faith-based institutional investors, non-governmental organizations and the Interfaith Center on Corporate Responsibility (ICCR), to which many of the others belong.
In early 2010, leading U.S. steel producer Nucor Corp. entered into an agreement with Domini Social Investments to take steps to combat slavery in its Brazilian pig iron supply chains. Nucor had adopted a policy prohibiting forced labor in its supply chain and requires direct suppliers to certify that slaves aren't used. Now it will require them to join the Citizens Charcoal Institute (ICC), or sign and adhere to the National Pact for the Eradication of Slave Labor. ICC members agree to subject their entire supply chains to monitoring. Nucor will publish annual progress reports. Domini led the three-year engagement. CBIS and MMA Praxis Mutual Funds participated.
Also going strong is the campaign being waged by SRIs and human rights activists against the use of forced child labor in Uzbekistan's government-controlled cotton industry. As of August 2009, 25 of the world's largest apparel brands and retailers had committed to policies that seek to ensure that their supply chains are free of Uzbek cotton. Among them: Target Brands, Wal-Mart, Gap Inc., Levi Strauss & Co., Macy's and European chains Tesco, C&A and Marks & Spencer.
CBIS has also discussed this issue with U.S. department store chain Dillard's and expects it to commit to action. Dillard's vendor and supplier codes of conduct forbid forced labor and child labor below age 15 (14 if governing law allows this) or the age for completing compulsory education if above 15.
Forced child labor in cotton harvesting remains a problem in Uzbekistan, the world's third-largest cotton exporter, although the country banned it in 2008. Recent news reports indicate that such labor is also being used in Uzbekistan's government-controlled silk industry.
Another human rights hot button is abusive working conditions in electronics manufacturing. In July, an international investor coalition led by Boston Common Asset Management, Trillium Asset Management, Domini and As You Sow Foundation, all members of the ICCR, began urging global makers of consumer electronics to step up oversight of their supply chain factories following multiple suicides at a Foxconn Electronics factory in China.
Meanwhile, CBIS and others plan to continue to discuss human trafficking with the hotels they wrote to. Also included were Best Western Intl., Hyatt Hotels Corp., Hilton Worldwide, Starwood Hotels & Resorts Worldwide and InterContinental Hotels Group.
Hotels need to develop policies and train workers on how to identify and report incidents, says Tanner, who will be moderating the Human Trafficking and Corporate Accountability panel at next month's 2010 SRI in the Rockies industry conference in San Antonio.
Don't be surprised to hear more about human trafficking outside SRI circles too. Last month, a federal grand jury in Honolulu indicted six individuals for allegedly luring 400 Thai laborers to the U.S. with false promises of lucrative jobs and then making them work on farms under threats of serious economic harm. The FBI calls it the largest human trafficking case ever charged in the U.S.
In June, the U.S. Department of State ranked the U.S. for the first time in its 10th Annual Trafficking in Persons Report as part of its efforts to strengthen global efforts against modern-day slavery. Trafficking here occurs primarily for labor and most commonly in domestic servitude, agriculture, manufacturing, janitorial services, hotel services, construction, health and elder care, hair and nail salons, and strip club dancing, says the report.