Corporate Social Responsibility (CSR) Reviews

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With stakeholders and customers becoming more aware of companies’ hiring practices and work conditions, companies need to ensure now more than ever that their products and supply chain are free from child labor and unethical labor conditions and practices. IIECL is dedicated to helping companies, organizations and governments to become more responsible. By offering corporate social responsibility (CSR) reviews and related services, IIECL not only identifies risks and potentially hazardous and poor working conditions for children and adults, but also provides an action plan to reduce risks, improve practices, and become more socially responsible. Further, IIECL provides technical assistance and capacity building to improve the company’s own internal monitoring/audit, human resource management and procedures that enable the company to more fully realize their corporate policies and codes of conduct throughout their supply chain.

What is CSR?

Corporate social responsibility (CSR) is a business’ commitment to embrace ethical practices, legal standards, international norms and respect for the greater public interest.  The more a corporation sets out to reduce the negative impacts of their corporate actions on its workers and the environment, the more it is able to demonstrate its social responsibility.

How are CSR & Child Labor Issues Related?

Many companies are under the false impression that if a product is certified then their product is free from child labor and the company is acting in a socially responsible manner.  Unfortunately, that is not the case and an increasing number of companies are finding this out the hard way when child labor is found in a product’s supply chain and creates a consumer and public relations nightmare.  Child labor is a difficult and persistent problem that frequently goes undetected during the certification process and many compliance audits and reviews.  Because certifying agencies typically specialize in certain areas (i.e., the environment) they may be weak in critical areas that identify child labor.  Certification agencies often have not modified their audit processes or trained their auditors adequately to identify child labor.  As a result, while certifications are needed and can help a company be on a path towards corporate social responsibility, additional assistance may be needed to properly identify and address child labor issues when performing reviews and certification.  IIECL specializes in child labor issues and fixing the problems that contribute to child labor, thus providing a service that allows a company to become more socially responsible.

Why are CSR Reviews Necessary?

The principles and objectives that define corporate social responsibility constitute strategic drivers for a corporation’s sustainability, thus affecting the company’s reputation, human capital, operational efficiency and legal security.  The tighter a corporation integrates corporate social responsibility principles in its managerial behavior, the better a corporation is able to control its risks and to turn them into catalysts towards a sustainable business performance.

There is growing evidence that good practices enhance reputation, resulting in improved staff morale, leading to higher motivation, productivity, and the ability to attract and retain the best skills. It strengthens the license to operate, giving improved access to new markets, consumers and investors, creates more stable operating environments and promotes better community relations.  Companies that adopt explicit and appropriate human rights principles and goals along with mechanisms for their implementation and reporting are better prepared to prevent human rights abuses and to deal effectively with allegations of wrongdoing that may arise.

Conversely, companies implicated in human rights disputes often see their reputations and brand images suffer, sometimes resulting in the loss of share value, increase of insurance costs, as well as lawsuits, or consumer boycotts.  There can be legal, financial and reputational consequences for enterprises failing to meet the responsibility to respect human rights. Such failure may also hamper an enterprise’s ability to recruit and retain staff, to gain permits, investment, new project opportunities or similar benefits essential to successful, sustainable business.

As a result, where a business poses a risk to human rights, it increasingly also raises a risk to its own long-term interests. The respect of fundamental human rights standards in the society is crucial to a company’s reputation.

What does IIECL’s CSR Review Entail?

IIECL utilizes the International Organization for Standardization’s (ISO) 26000 social responsibility standards, which were created to benefit businesses, communities, and governments by ensuring that an industry’s products and services are safe, reliable and of good quality.  IIECL uses these standards to guide the corporate social responsibility review and provide all the stakeholders involved with an industry (i.e., industry-related companies, farm workers and labor unions, plantation and farm owners, governmental officials, NGOs, etc.) with a more unified understanding of the state of child labor within the industry and how all of the stakeholders have an influence on ending child labor and improving work conditions for all workers in the rubber industry.

For example, companies need to understand the issues of the NGOs, unions, government and clients to be transparent with their actions and in compliance with their own policies. Stakeholders need to speak the language of the companies, to get a holistic approach on CSR with a focus on child labor, health and safety and community involvement. They need to understand how the companies are evaluated by the rating agencies (or under ISO 26000) to be more efficient to monitor the issues of child labor and to raise the concern to the relevant people within companies, unions, media, rating agencies, etc.

IIECL uses ISO’s 26000 guidelines as the basis to analyze management systems according to the:

  1. Relevance of Policies (P)
  2. Coherence and Efficiency of Implementation (I)
  3. Effectiveness of Results (R)

The relevance of a company’s policies is measured by the visibility of the objectives, the completeness of their content, and the managerial support for these objectives. The efficiency of implementation is measured by the tangibility, adequacy, controls, and reporting about the means allocated within the global perimeter of operations. The effectiveness of the results is analyzed by evaluating stakeholder’s appreciation of the company’s managerial commitments, the occurrence of controversies and allegations, the responsiveness of the companies, and by the evolution of key performance indicators over time.

IIECL’s CSR review provides a thorough assessment that highlights key areas of risks with the implementation of policies throughout the supply chain, including an in-depth review of human resource practices and where risks of the worst forms of child labor exist.  This includes a focus on what worst forms of child labor exist and factors contributing to and steps to removing these risks.  It is important to understand the company policies, the strengths and weaknesses related to child labor, and to promote the companies to use more effective policies, such as in their community involvement and working collaboratively with other key stakeholders.

A part of the CSR review is an analysis of the company’s policies and their supply chain wide implementation. It is important to understand the company policies and their strengths and weaknesses related to child labor, and to promote the company to use more effective policies, such as in their community involvement and working collaboratively with other key stakeholders.

As part of the CSR review, IIECL will conduct a Supply Chain and Stakeholder Mapping analysis. The purpose of mapping the supply chain is to identify where child labor risks exist throughout the supply chain, which will assist in developing and/or improving policies, guidelines and a more effective internal monitoring mechanism that ensures child labor does not exist in commodity’s production.  This is a more effective approach to addressing remediation of child laborers when they are identified. The assessment team will map the commodity supply chain including cultivation, collection and harvesting; the processing facilities and buying centers; third-party service providers; farmers; and subcontractors.

IIECL conducts a risk assessment to identify the key areas on the farms and supply chain where job hazards and risks exist, who might be harmed and how, and evaluate the risks and precautions that could be undertaken to prevent them. The focus will be primarily on activities that are typically performed by children and youth. The risk assessment will include an examination of current occupational safety and health programs that exist (if any), its adequacy to address risk, and identification of specific areas where improvements are needed.

Contributing to both the risk assessment and CSR review, a task mapping analysis will be performed and includes direct observation of tasks and job site analysis of the primary work activities performed for each task in the production of the specified commodity. The results of this analysis will aid to strengthen the farms’ human resource management systems and approach to addressing worker health and safety. The task mapping includes a review of equipment and tools used and protective gear that is available and in use. The process includes collecting information through observations, conducting individual and group interviews (recorded by videotape or camera) and verifying the accuracy of the assessments between adult and young workers. A participatory process is used with workers to assess their recognition and understanding of risks associated with the work activities they perform and incidences and severity of accidents and injuries that have occurred. The task mapping is critical to the development of an effective worker safety and health training and education tools intended for low literacy smallholder farmers and workers. These are critical to ensuring the effective implementation of a occupational safety and health program. Further, the analysis aids in understanding effective ways in which to communicate risks for the targeted groups.

Drawn from the results of these studies will be the development of a framework for a basic occupational safety and health program for use by plantations and smallholder farmers of the specific commodity. Further, the results of the analysis will help to identify areas where youth of legal working age under 18, may be able to engage in formative light work activities, with the permission of their parents, that does not place their health, safety or morals at risk, that does not interfere with education, but promotes vocational learning in the commodity’s production and other youth development activities.

Additionally, IIECL will identify programs that have an impact on child labor in order to propose an action plan that is not redundant of other child labor eradication programs that currently exist in the country where the company receives its products.  Additional programs will also be examined because there may be a causal effects from other aspects related to child labor, such as human trafficking, forced labor, wages and benefits, and health and safety issues.  IIECL will generate a report on the strengths and weaknesses of existing programs related to child labor and develop a plan of action to complete or work with the programs and stakeholders. The coordination of all these programs is fundamental to have an impact on child labor in a long term.

Once IIECL completes its CSR review, it will provide its consumers with a score based on the relevance of their policies, coherence of implementation, and results. The score (0 to 100) is established by consolidating the individual scores overall. This approach allows IIECL to appreciate an individual company’s performance as well as compare this performance to the performance of other companies in order to create benchmarks for Policies, Implementation, and Results. On each of these variables, the review reveals innovative practices, controversies and, more generally, the terms and the level of interest displayed by the company towards the CSR objectives for which the company is accountable.

During a CSR review IIECL works to find the root causes of possible social irresponsibility within the management system and by receiving input from all the stakeholders.  This enables IIECL to glean the language of the company and understand their business operations.  As a result, the company gains an understanding of where their risks lay, what strategies or guidelines are needed to ensure effective implementation of their policy, and the way they are evaluated on CSR by a rating agency. IIECL can demonstrate that the company can alleviate the risk to compliance with national and international laws, agreements or standards and their reputation related to child labor, which is the catalyst or teeth for them to address child labor.

What can IIECL do after the CSR review to help a company address its child labor risks?

Following a CSR review, IIECL can provide companies with a variety of services and plans.  IIECL can provide companies with a detailed plan to eliminate child labor within their supply chain and on their farms.  IIECL can create a Human Resource (HR) management training program to assist farm and industry HR personnel to enhance hiring practices that do not promote the opportunity for child labor to exist.  IICL can provide technical support and assistance to the HR personnel and conduct Monitoring and Evaluation services to ensure HR continues to practice safe hiring procedures that do not put children and workers in harm’s way.

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