Redefining social responsibility

That the multinational sportswear company Adidas should buy socks from a Chinese sweatshop that employs children is hardly news. Brand-name apparel firms are notorious for exploiting third-world workers.

But change is afoot when Adidas pays independent investigators to uncover such human rights abuses, voluntarily publicizes them on a website, and insists that its supplier shape up.

Adidas is one of seven multinational clothing and footwear companies whose overseas operations are scrutinized in a groundbreaking report just published by the Fair Labor Association (FLA), a Washington-based coalition of businesses, labor rights activists, and US universities.

"This marks a breakthrough in corporate accountability to the public," says FLA Executive Director Auret van Heerden in Geneva. "Working together, companies and critics have taken a big step beyond talking about social responsibility and are starting to get the facts into public view."

It has taken a while. The idea for the FLA was born seven years ago, in the wake of a public outcry in the US over Wal-mart's use of child labor in Honduras. The group was founded by Adidas-Salomon, Levi Strauss, Eddie Bauer, Liz Claiborne, Nike, Phillips-Van Heusen, and Reebok, working alongside human rights activists.

Their first public report details violations of labor, environmental, and health and safety standards - ranging from the shocking to the mundane - in factories that supply brand-name labels from Vietnam to Mexico.

One firm in the Philippines that makes jeans for Levi Strauss was found by independent auditors to deduct 30 percent of a seamstress's wages if she arrived 31 minutes late for work. The Hong Kong sweatshop supplying socks to Adidas employed children,fired its workers if they didn't show up for five days, and withheld 60 percent of their wages until the end of the year to stop them from leaving.

An Indonesian firm making goods for Reebok didn't think it necessary to put finger guards on sewing machines. Chinese factories routinely confiscate new workers' residency papers, making it hard for them to leave.

Equally important, however, the report's "tracking charts" also set out the steps that suppliers have taken to correct their faults. "When we find violations, as we inevitably do, we want the companies to fix them, to improve their suppliers' performance, not just to walk away," says Mr. van Heerden. "Too many companies just end their contracts with a supplier when they find violations: our message is 'don't terminate, remediate'."

"This is not a 'gotcha' system," adds Michael Posner, head of the Lawyers Committee for Human Rights in New York, and an FLA board member. "We know there are problems. The point is to remedy them."

Even that reluctance to apportion blame, however, has not yet attracted many brand-name companies. Only 13 are currently in the program, including just one retailer, Nordstrom.

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