Social audit industry criticised for protecting brands' reputations while failing to protect garment worker safety & improve working conditions; Includes auditing company responses

 

Credit: Clean Clothes Campaign

In September 2019, Clean Clothes Campaign released a report criticising the social audit industry and alleging that it has served to protect brands' reputations and profits while failing to meet its purported mission of protecting workers’ safety and improving working conditions in global garment supply chains. The report details alleged auditing failures, including the deadly 2012 Ali Enterprises factory fire in Pakistan and the 2013 Rana Plaza factory collapse in Bangladesh. In particular, the report focuses on social compliance initiatives such as Social Accountability International, WRAP, the FLA, and Amfori BSCI, and auditing firms ALGI, Bureau Veritas, TÜV Rheinland, UL, RINA, ELEVATE and SGS, which it claims are "corporate-controlled".

The report claims the social audit industry has blocked more effective models for protecting workers and improving working conditions, such as those that include mandatory transparency and binding commitments to remediation. The report concludes by making recommendations to garment industry stakeholders, including calls for more transparency, accountability, and genuine worker involvement.

Business & Human Rights Resource Centre invited ALGI, Bureau Veritas, TÜV Rheinland, UL, RINA, ELEVATE and SGS to respond to the report's allegations that social auditing companies are protecting brands and failing workers in the garment industry, and the subsequent recommendations. ELEVATE and ALGI responded and their full responses can be found below. RINA referred to a 2018 statement, linked below. UL responded after publication of our 2 October Weekly Update and the response is below. Bureau Veritas, TÜV Rheinland and SGS did not respond.

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Company response
9 October 2019

UL's response

Author: UL

Thank you for the opportunity to review and respond to the Clean Clothes report.

 UL fosters safe living and working conditions for people everywhere and our mission is to make the world a safer place. Our principles of integrity, honesty, quality and fairness are core to what we do around the world. Our work is regularly audited by outside organizations to ensure compliance.

UL’s Responsible Sourcing group prides itself on our competency-based auditor training program and our ISO 17020 accredited global quality management system.

UL advocates and supports the creation of industry standards, including audit scope, auditor credentials, and auditing firm ethics and integrity infrastructure. UL continually makes meaningful enhancements to our audit programs, including continual enhancements to our audit tools, supplier guidance materials, as well as the development of corrective action and remediation programs. As an independent safety science organization, UL is committed to advancing the continuum of the social compliance industry.

UL believes we have an important role in advancing the wellbeing of workers around the world. Again, we appreciate the engagement opportunity on this very important issue.

Company response
1 October 2019

ELEVATE's response

Author: ELEVATE

... On 19 September, just-style.com... included commentary from... “ELEVATE CEO Ian Spaulding: ‘As the report indicates, ELEVATE has championed the 'beyond audit' model which addresses the shortfalls of programmes that focus only on conventional audits via the implementation of robust and proven improvement programmes.’ ‘We are aligned with, and fully support, the report's recommendation that audits and monitoring initiatives need to engage workers in a meaningful way. This is at the heart of ELEVATE's worker engagement tools which identify social and labor risks directly from workers... and helps promote more effective remediation.’"

... ELEVATE acknowledges that social audits are not designed to capture sensitive labor and human rights violations such as forced labor and harassment... To capture more reliable data on sensitive topics... ELEVATE has made its anonymous ELEVATE Worker Sentiment Survey standard... in 8 of the company’s top assessment countries where over 80% of ELEVATE audits are conducted. This coverage is expanding...

... The outcomes of the... [Alliance for Bangladesh Worker Safety] five-year program... include: •Completion of 93% of remediation across Alliance-affiliated factories • 428 factories completed... initial Corrective Actions Plans • Nearly 1.6 million workers were trained to protect themselves in case of fire emergency. The Alliance introduced the Amader Kotha Helpline, access to finance through work with IFC and USAID and - for factories that had to be closed - actually paid to workers lost wages...

[T]he social auditing industry has made solid gains over the last 20 years, but much improvement is still needed to keep workers and workplaces safe and thriving...

Our approach to worker engagement at ELEVATE is described in the linked document

[The full response is attached]

Download the full document here

Company response
1 October 2019

RINA's response

Author: RINA

Reference is made to your message dated 24 September 2019.

The reconstruction of the factual circumstances and of the role of our company in the Baldia casualty is totally incorrect, unproved and, in many respects, based on wrong assumptions.

Please refer to the statement on our website at https://www.rina.org/en/press-note

Company response
30 September 2019

ALGI's response

Author: ALGI

... We would like to clarify some errors and make some observations about the case that we believe can strengthen your understanding of the case...

... [C]laims on our website about “transparency and confidentiality”... refers to our services, meaning that our reporting is transparent, and the information collected is maintained within the participating parties according data protection protocols. This has nothing to do with our internal financial records or internal information. That part of the business is evaluated few times a year by external independent bodies...

[T]he assessment to the Russell [Athletics facility in Honduras]... was organized 11 years ago by the FLA, in November 2008 not in 2012... [D]espite many efforts and application of multiple techniques, it was impossible for us to detect objective evidence to conclude a unionbusting practice by the enterprise.  We reviewed payroll, contracts, dismissal records, hiring and firing procedures, minutes of committees, and repeatedly interviewed 6 management representatives. We also interviewed 77 workers on-site and off-site. We also did off-site interviews to Confederación General de Trabajadores (CGT) delegate, union workers, the Regional Director of Ministry of Labor at San Pedro Sula, the Regional Supervisor and a labor inspector. Despite our efforts, our conclusion only showed objective evidence for financial conditions that lead to the closure of the factory. This finding was seconded by an additional financial audit by the FLA, that also concluded that the closure followed economic reasons...

[The full response is attached]

Download the full document here

Company non-response
29 September 2019

Bureau Veritas did not respond

Author: Bureau Veritas

Company non-response
29 September 2019

SGS did not respond

Author: SGS

Company non-response
29 September 2019

TÜV Rheinland did not respond

Author: TÜV Rheinland

Report
9 September 2019

Report alleges "systemic failures of corporate-controlled social auditing"

Author: Clean Clothes Campaign

"FIG LEAF FOR FASHION: How social auditing protects brands and fails workers", September 2019

...Evidence presented throughout the report clearly shows how the social audit industry has failed spectacularly in its proffered mission of protecting workers’ safety and improving working conditions. Instead, it has protected the image and reputation of brands and their business models, while standing in the way of more effective models that include mandatory transparency and binding commitments to remediation.

The report offers glaring examples of corporate negligence through case examples from the past decade including the Ali Enterprises factory fire in Pakistan in September 2012... the devastating collapse of the Rana Plaza building in Bangladesh in April 2013... and the July 2017 boiler explosion in the Multifabs factory in Bangladesh... Each of these factories had been assessed and declared safe by several of the prevailing auditing companies, including TÜV Rheinland, Bureau Veritas, and RINA, using the standard, methodology and guidance of leading compliance initiatives such as amfori BSCI and SAI...

These foreseeable and avoidable disasters exemplify systemic failures of corporate-controlled social auditing; an industry which in the words of one auditor goes “as far as the brands want us to go”. This industry is operating with impunity... [and] these initiatives continue to grow, with revenues and profits of the industry key players increasing over the years, in tandem with the growing number of audited factories. The industry has been able to keep these many failings under the radar because of its notorious lack of transparency and... accountability... The structural causes of these social auditing failings... are explored throughout the report, with extensive recommendations offered to numerous industry stakeholders, including calls for more transparency, accountability, and genuine worker involvement...

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