This daylong discussion, attended by roughly 40 scholars and practitioners from universities, labor organizations, corporations and NGOs, focused on how companies can move beyond monitoring and compliance to build socially and environmentally responsible supply chains.

At two workshops in 2008, the group discussed a few key strategies, leading Josh Cohen and Rick Locke to seek funding for a new research center. These included:

1. Scaling up codes of conduct
2. Reinvigorating national regulation
3. Combining labor standards and trade rules

The event on January 29th covered the following topics, summarized below:

Panel 1.   Recent research on ethical consumption

• Michael Hiscox, Jens Hainmueller, Sandra Sequeira (Harvard)
• Margeret Levi (University of Washington)
• Yotam Margalit (Stanford University)
• Dara O’Rourke (GoodGuide, UC Berkeley)

Selected findings:

• The Average “Fair Trade” effect is 9%, based on a coffee experiment with Whole  Foods
• Consumers are willing to pay some premium for social labels (7.3-13.1%)
• Berkeley: Personal health and wellness and the environment outrank labor concerns for consumers of products listed on GoodGuide.com

Panel  2.   Best practices in the environmental area that might be carried over to labor/trade

• Edgar Blanco (MIT)
• Bonnie Nixon (HP)
• Erica Plambeck (Stanford)
• Charles Sabel (Columbia)

Selected discussion points:

•  Compliance-based regulation no longer works; there are new roles for NGOs, government, and public-private partnerships in creating incentives for suppliers
• Suppliers care most about volume and length of contracts; since not everyone is Wal-Mart, buyers may need to come together to encourage ethical behavior

Panel 3.   New regulatory strategies in labor markets in emerging economies

• Salo Vinocur Coslovsky, Massachusetts Institute of Technology
• Mary Gallagher, University of Michigan
• Andrew Schrank, University of New Mexico
• Rick Locke, Massachusetts Institute of Technology

Selected discussion points:

• Evidence from Brazil shows that law enforcement operates in parallel with private auditors in monitoring suppliers, becoming “shock troops of sustainable development”; some issues require state regulation
• There may be trade-offs between bureaucratic efficiency and equity in a compliance system, as in the Dominican Republic
• In some cases, the state’s role is to delegate work so private sector can police more effectively

Panel 4.   Looking Forward

• Caitlin Morris (Nike)
• Marcela Manubens (Phillips-Van Heusen)

Selected discussion points:

• Key issue is how to tie labor and environmental agenda together; for some companies, environmentalism is self-interest—materials like bamboo often resonate with designers. But who makes the bamboo shirt is less of an issue. One option is to derive cost savings from environmental policies and direct that money to programs for workers.
• Big question: in an entry-level sector, how far across the spectrum from minimum or entry-level to living wage do we go? How do we measure progress? Is it a 3% increase in labor value /product each year?
• Another issue in need of further exploration: where upgrading doesn’t reach lower down in the supply chain. There’s got to be a virtuous circle where technical upgrading and labor issues can be joined
• Environmental issues have won the battle because regulatory environment incents companies to care about it, and consumers care, too—it’s become hip. Maybe what’s needed is to institutionalize the “triple bottom line” approach to business such that companies with good labor policies get tax breaks.

» Notes and Presentations (password protected)

Co-sponsored with the Global Supply Chain Management Forum

Before coming to CDDRL, Miriam Abu Sharkh was employed at the United Nation's specialized agency for work, the International Labour Organization, in Geneva, Switzerland. As the People's Security Coordinator (P4), she analyzed and managed large household surveys from Argentina to Sri Lanka. She also worked on the Report on the World Social Situation for the United Nation's Department of Economic and Social Affairs in New York. Previously, she had also been a consultant for the German national development agency (Gesellschaft für Technische Zusammenarbeit, GTZ) in Germany where she focused on integrating core labor standards into German technical cooperation.

She has written on the spread and effect of human rights related labour standards as well as on welfare regimes, gender discrimination, child labour, social movements and work satisfaction.

Currently, she holds a grant by the German National Science Foundation (Deutsche Forschungsgemeinschaft) to study the evolvement of worldwide patterns of gender discrimination in the labor market, specifically the effects of international treaties. These questions are addressed in longitudinal, cross-national studies from the 1950´s to today.

This research builds on her previous work as a Post-doctoral Fellow at CDDRL as well as her dissertation on child labor for which she received a "Summa cum Laude" ( Freie Universität Berlin, Germany-joint dissertation committee with Stanford University). After discussing various labor standard initiatives, the dissertation analyzes when and why countries ratify the International Labour Organization's Minimum Age Convention outlawing child labour via event history models. It then examines the effect of ratification on child labor rates over three decades through a panel analyses. While her dissertation employed quantitative methods, her Diplom thesis (Freie Universität Berlin, Germany) builds on extensive fieldwork in South Africa examining the genesis, strategies, and structures of the South African women's movement.

She has traveled extensity, both professionally and privately, loves to dive and sail and speaks German, Spanish and French as well as rudimentary Arabic.

Her current research interests include labor related international human rights, especially child labour and (non-)discrimination, social movements and work satisfaction.

Many resource dependent states have to varying degrees, failed to provide for the welfare of their own populations, could threaten global energy markets, and could pose security risks for the United States and other countries.  Many are in Africa, but also Central Asia (Turkmenistan, Kazakhstan, Azerbaijan), Southeast Asia (Cambodia, Burma, East Timor), and South America (Bolivia, Colombia, Ecuador) Some have only recently become – or are about to become – significant resource exporters.  Many have histories of conflict and poor governance.  The recent boom and decline in commodity prices – the largest price shock since the 1970s – will almost certainly cause them special difficulties.  The growing role of India and China, as commodity importers and investors, makes the policy landscape even more challenging.

We believe there is much the new administration can learn from both academic research, and recent global initiatives, about how to address the challenge of poorly governed states that are dependent on oil, gas, and mineral exports.  Over the last eight years there has been a wealth of new research on the special problems that resource dependence can cause in low-income countries – including violent conflict, authoritarian rule, economic volatility, and disappointing growth.  The better we understand the causes of these problems, the more we can learn about how to mitigate them.

There has also been a new set of policy initiatives to address these issues: the Kimberley Process, the Extractive Industries Transparency Initiative, the World Bank’s new “EITI plus plus,” Norway’s Oil for Development initiative, and the incipient Resource Charter.  NGOs have played an important role in most of these initiatives; key players include Global Witness, the Publish What You Pay campaign, the Revenue Watch Institute, Oxfam America, and an extensive network of civil society organizations in the resource-rich countries themselves.

Some of these initiatives have been remarkably successful.  The campaign against ‘blood diamonds,’ through the Kimberley Process, has reduced the trade in illicit diamonds to a fraction of its former level, and may have helped curtail conflicts in Angola, Liberia, and Sierra Leone.  Many other initiatives are so new they have not been have not been carefully evaluated.

This workshop is designed to bring together people in the academic and policy worlds to identify lessons from this research, and from these policy initiatives, that can inform US policy towards resource-dependent poorly states in the new administration.

» Workshop memos (password protected)