The recent article in the February edition of People Management on ‘The Real Supply Chain’, coupled with the horse meat fiasco, effectively highlights the fact that, more often than not, we have no idea of what we might be buying. Retailers have a real struggle on their hands.
Consumers have changed their spending, trying to stretch their precious pounds as far as they can, preferring to spend at larger shops with more buying power and ever lower prices. While saving what little they are able to might help consumers fight back against the recession, the consequence of this change in spending can have serious repercussions on suppliers and the supply chain.
As more companies find ways to offer their products or services at lower prices they have begun to outsource to new markets in China, Southeast Asia, Vietnam, and Indonesia. On the heels of horse meat supply chain worries, there is now a similar worry emerging involving the risk of exploitative people practices both internally and in external supply chains, outlining the need for regulated ‘People practices’ overseas. Well-known brands such as Apple and Zara have both experienced the fall-out resulting from poor working standards suffered by foreign workers – often times due to their suppliers having used unapproved sub-contractors to fill orders. This has resulted in reports of fatal factory accidents, underage interns (some as young as 14), and lengthy worker disputes.
The question is: when outsourcing overseas, to what degree do organisations feel they are free from the moral obligation to provide workers with basic rights of health and safety? Furthermore, should they be held responsible for the welfare of employees of unauthorised sub-contractors? This can be a tricky issue of where to draw the line between letting cultural differences remain and implementing international standards to ensure an acceptable level of working conditions. So, should consumers also be held responsible for buying products that they know might have come from a factory abroad where conditions are extremely poor? Unfortunately it is a widespread issue of ‘not my problem’. And whilst this attitude remains, it’s very hard to change at source.
There have been improvements and the introduction of organisations to audit international standards for overseas suppliers such as the Fair Labor Association and the Ethical Trading Initiative will have an impact. HR can contribute in more of an influencing role, but the biggest impact for change comes from consumers. Choosing what we buy, and knowing where they have originated will hopefully result in the support of more standardised policies and practices in emerging markets.
Shana Bonneteau is Recruitment Team Assistant