OECD Conference: Anna Burger Talk

Anna Burger speaks on stage at the OECD conference forum titled Due diligence in the garment and footwear sector.
OECD Forum on Due Diligence in the Garment and Footwear Sector

Below is the transcript of Anna Burger, NCP Executive Director, talk at the Organisation for Economic Co-operation and Development (OECD) Conference.
February 14, 2019, Paris, France

Thank you to the OECD and their incredible team for the work you do…for inviting me to participate, share thoughts and engage on impactful approaches to human rights and environment.

So, let me introduce myself –

I spent my life in the labor movement - 40 years – retiring a few years ago as the Secretary Treasurer of Service Employees International Union and Chair of a US labor federation, Change to Win.  As a union leader I lead my share of organizing, bargaining and political campaigns.  I agitated, demonstrated, and walked picket lines.

I reached across communities to build coalitions, created new forums and tried new approaches. We built alliance and partnerships when we could and battled, using every tactic possible when we couldn’t. And I must admit the results were mixed.

We organized and grew - SEIU was the fastest growing union in North America but the labour movement was under attack, union density was shrinking. 

We were the ground troops for Barack Obama’s election but the forces eroding workers’ lives and living standards were winning. As strategic, creative and principled as we were there was only so much, we could do as one organization to have systemic impact.

Einstein once said that doing things over and over and expecting different results was the definition of insanity.  So, retiring from the labour movement gave me the opportunity to step back and focus on what we can do differently to have impact on workers’ lives.

As the Executive Director of the New Conversations Project at Cornell University Industrial Labor Relations School I have the opportunity to attempt to help all of us get out of our historic ways of fighting and agitating against the “enemy” and begin a new process - -- one that suspend assumptions about motives to explore and to find new approaches and solutions together.

NCP is a one of a kind platform bringing together stakeholders with historically different perspectives and approaches together to take on the thorny, hard to solve problems and challenges in the global supply chain.  Anchored in focused research we explore old problems from new perspectives. Coming together under Chatham House Rules, we leave our weapons at the door, NCP creates a safe space to challenge, to think, to explore and to collaborate on new approaches that have the potential for systemwide impact.

Our objective is to take stock of what we know about the limitations of existing “private sector” regulatory approaches to solving problems; to consider how these problems can be remedied; and to highlight new paths and practices that hold greater promise for significant improvement.

Our academic team lead and coordinated by Sarosh Kuruvilla undertakes new research; evaluates promising pilots, experiments and approaches; and we engage in continuous dialogue with stakeholders.

Different forms of engagement, collaboration with a deeper exploration and understanding of obstacles and challenges based on research enables us to put the spotlight on obstacles and see opportunities for impactful change.

When we have access to data, which brands, MSIs and evaluators can be help with…we can learn about the real impact of efforts to address problems in the global supply chain.

Effort and impact are different.  Effort can make us feel good demonstrates a commitment but impact change lives.

Changing lives is (what I care about and) what brings us here today.

Sometimes it takes “a new conversation” to open dialogue and change our thinking and then change lives.  Today I hope to expand the conversation.

Research demonstrates that part of the reason that there is little progress in improving worker outcomes is because the field of “private regulation” with respect to labor standards is opaque in many ways. It’s opaque because of:

  • Practice Multiplicity
  • Behavior Invisibility
  • Causal Complexity

And in a nutshell that means -- too many actors are creating too many different initiatives, codes, tools, with little ability to determine what is really happening on the ground because of a lack of standards for auditing.  And this resulting in an inability to distinguish the cause and effect of any of the efforts – including the good outcomes.

So, let’s see how this plays out with something we are actively experiencing and attempting to address – Audit Fatigue.

Codes of Conduct and compliance systems were created as response to exposes of terrible conditions of workers in the global supply chain. Brands, retailers, MSIs, NGOs and investors took action – created their own codes of conduct, established their own approach to auditing, auditing teams, standards, rating systems and remediation programs with the promise of penalties and rewards.

Recent research demonstrates that there is a lot of effort with little measurable impact.  While we can check a box on factory compliance there is no proof that the “effort” of that process improves the working conditions in the factories or that sourcing is tied to meaningful compliance.  At the end of the day a multitude of compliance audits don’t prevent workers from being overworked, underpaid, and treated badly in too many factories around the globe.

An issue flagged at NCP and researched at the factory level demonstrated the problems with a fractured approach to solving a systemwide problem.

These are a few findings:

  • An average of 24 to 32 audits /year of factories of recognized high standard suppliers. 
  • As many as 4 audits in one month, with no correlation of findings.
  • Audits ranged from 1-person day to 9-person day and no standard methodologies,
  • Audits done 2 days apart had vastly different ratings
  • Audits by the same auditing firm within days were dramatically different
  • And if the goal is to provide support for the supplier to improve, the sharing of the finding is dysfunctional. 91% audit results were shared, 80% ratings shared, only 57% the rationale for the rating was shared.

This is clearly an example of Opacity:

  • Practice multiplicity – everyone acting on their own
  • Behavior invisibility – difficulty in measuring factories because of different standards, measurement, competencies and codes
  • Causal complexity – inability to determine cause and effect/impact ----- is preventing us from addressing issues of social and labor standards

I applaud the industry for taking beginning steps together to address this. Your collaboration and collective work as an industry through the Social Labor Convergence Project created a common tool and verification model, a first step in dealing with practice multiplicity and behavior invisibility but if we don’t address Common codes of conduct and standards of verification with transparency, we will not be able to learn what works and doesn’t and achieve the impact of   decent working conditions throughout the supply chain.

If we want to have impact on addressing the critical issues in the global supply chain, we need to act together.

I understand the challenges.  Brands are competitors, as are NGOs, MSIs, and trade union entities.  We are all smart, creative and we want to act first and be the BEST.  And the heat is on…

Throughout the global supply chain there continue to be reports of exploitation of workers – child labor, forced overtime, wage standards and wage theft, gender violence, fire and safety, workplace intimidation, violation of FOA and ILO standards, …… and I can go on and on.

NGO and the media turn on the spotlight and turn up the heat. The spotlight on a brand or retailer for exploiting workers isn’t good for your image, reputation, customers or morale. There is an urgency to act.  And Brands and Retailers react – you each launch new initiatives.

Working on your own and/or with an MSI or NGO or tripartite entity you create new programs, announce policies, create new models, demand action by your suppliers.

A great deal of effort on the part of well-meaning actors – Each of you might be able to count how many factories you touch or workers you train but how do we know the impact of any one of these programs. 

Which elements of which ones are most effective?

 How do they support capacity building of the suppliers, the knowledge, skills and awareness of managers, supervisors and workers?

How are the different problems connected and what needs to be changed systemically within the industry to make a difference for workers?

To end opacity and have our practices create impact we need to answer the bigger question of how we create models that can be analyzed for impact and scalability together.

There are examples for industrial approaches – the ACCORD and Alliance in Bangladesh is a positive step by the industry but also demonstrates another problem about private regulation – the role of the state

If we look more broadly, research demonstrates that industry or sectoral approaches vs enterprise approaches have greater impact

A study by the OECD examined 35 OECD countries and changes to bargaining systems between 1980 and 2015.  And the findings contradict earlier arguments (including by OECD) in favor of decentralization:

Sectoral/centralized systems produce better results for overall employment, with lower inequality and better labor market outcomes for youth, women and low-skilled workers.

At New Conversations Project we understand the complexities of working together. Legal constraints of tort and anti-competition laws are obstacles to some brands and retailers. The multitude of stakeholders at various levels of the supply chain from the investment world to the NGOs and labour movement– are all challenges that can be addressed by people of good will.   

For real due diligence we need to focus on impact not effort.

We need:

  1. To end Practice Multiplicity - Brands, retailers, Investors, MSI’s, NGOs and Labour need to come together and create common approaches
  2. To End Behavioral Invisibility – The stakeholders need to create unified standards for auditing and approach to remediation.  Brand -Supplier collaboration growing out of longer-term relationship can build trust and reduce audit falsification
  3. To end Causal Complexity we need more transparency of the supply chain –Brands, MSIs and evaluators need to share their data with researchers so we can study causes and examine the crucible factors that impact workers’ lives

And all of this takes meaningful Social Dialogue - at all levels – globally, regionally, country based at the enterprise level to have impact.

So 4th and finally workers around the world need you - to be part of meaningful Social Dialogue.

NCP and FWF are launching a research and engagement project on the future of Social Dialogue in the 21st Century Supply Chain. Following the NCP model, we are digging deep to understand obstacles and opportunities. Looking at Practice and Results and in the near future engaging with many of you - Labour, Brands, Suppliers, MSIs, NGOs and the investment world.

We need to understand the obstacles, new approaches and learn from experiences.  We need to come together, act together and and change workers lives so our values, practices and outcomes are aligned. And we need you to be part of that process.

Thank you.