Last year, Impactt was commissioned by the Asian Development Bank to co-ordinate a study into the impact of the global economic slowdown on value chain labour markets in Asia. Impactt worked with partners in ADB, ILO, and GTZ as well as local research partners in People’s Republic of China, Indonesia, Thailand and Vietnam to research the impacts of the downturn. The work culminated in a paper presented by our very own Rosey Hurst at the Asia-wide Regional High-level Meeting on the Impact of the Global Economic Slowdown on Poverty and Sustainable Development in Asia and the Pacific.

In the paper we found that of all the sectors studied: “the Vietnamese footwear industry has been hardest hit in terms of fall in demand, job losses and reduction in working hours…[and] Across all sectors temporary and migrant workers are the most vulnerable to retrenchment and changes in their wages and working hours.”

ADB has now announced the launching of anew Asia-Pacific Poverty Network Website (AsiaPovNet),  which they state is: “a knowledge hub on poverty reduction and inclusive growth in the region. It is a database on research and operational work of distinguished regional and national think tank institutions, governments, and multi- and bilateral development organizations.”

The first edition of the Asia-Pacific newsletter on poverty reduction and inclusive growth (AsiaPovNews) features Impactt’s paper together with other papers presented at the conference.

We are very proud to have been involved in these high level discussions on the policy implications of the downturn and are looking forward to seeing how Asian governments will respond to the lessons of the downturn.

Network Clothing is one of the leading manufacturers of handmade crochet and knitwear garments. Since 1994, the company has supplied leading UK and international retailers. Network Clothing has a network of around 3,000 home workers within its supply chain, around 1,000 of whom are active at any given time. Most of the home workers are based in and around Shantou, Guangdong.

Brands and retailers are increasingly demanding greater visibility over homeworking within global supply chains.    Network Clothing identified the need to gain a better understanding of the role that homeworkers play within its supply chain to mitigate any associated risk to the business.   

Network Clothing commissioned Impactt to:

• Map its supply chain in Shantou and track how product is moved from factory to home worker.
• Understand who is working in their supply chains and under what conditions.
• Gauge the impact of homeworking on the workers’ lives, families and communities.
• Identify existing problems and areas that could be improved.
• Understand and develop any necessary control measures to protect home workers.

Impactt mapped Network Clothing’s supply chain and identified two communities of homeworkers who were significantly affected by Network Clothing’s operations.  In-depth community assessments were conducted to understand homeworkers’ situation and socio-economic circumstances. Particular focus was applied to:

• Establishing their level of take-home pay and what this can procure.
• Identifying the benefits which this work brings them and their families.
• Understanding what other options are open to these workers and why they choose this work.
• Understanding the concerns they have about the work.

The community assessments utilised a participatory worker-centred approach to provide a real insight into the situation of the homeworkers. The outputs from this research helped Network Clothing begin to make meaningful improvements in the working conditions and the socio-economic situation of homeworkers.

Whilst issues exist in this supply chain, it was clear that homework provides significant benefit to workers, in particular where workers have few other options to earn money.  In many cases, crocheting skills have been passed from generation to generation and provide valuable income to families and communities which may otherwise be solely reliant on agriculture or remittances.   Workers spoke positively about their work and the benefits it brings.

The news will be welcomed by business groups who have long held that a working week which can be flexible and extended if workers wish to, is essential to the economic prosperity of the UK. Trade unions and campaign groups continue to claim that this is a myth, and hold up other European countries such as France and the Netherlands as shining examples of how to prosper with a good work / life balance.

The Government claims the collapse of talks as a victory to the UK in Europe, continuing to assert that the right of a worker to determine his or her own working hours is vital.

In Impactt’s experience vulnerable workers tend to work excessive hours in high risk industries, which is enabled by the use of the opt-out. We are disappointed that political in-fighting may have prevented MEPs from securing further protection for such workers from exploitation.

As you will have seen from our blogs of the past few weeks, the attention in the UAE on labour standards for migrant construction workers has been immense.

There was a depth of discussion and debate about labour standards over the three days, but the issues that came up repeatedly included:

• What does CSR mean in the UAE and what are the responsibilities of business and government?
• Conditions in accommodation and welfare camps and how to maintain reasonable standards
• Health and safety for construction workers on site
• Training and skills development, especially in times of economic crisis
• Repatriation of workers who have lost their jobs

While discussion is good and necessary, it was great to see the Ministry of Labour announce  two initiatives that will directly impact the lives of workers – the development of a central electronic payment system and internationally recognised minimum standards for worker accommodation across Dubai.

In terms of private sector initiatives, the presentations (x 3!) from Build Safe UAE stood out as a shining light of practical collaboration to address health and safety issues. While the presentations at the GCC summit from the Labour Solidarity Center and the Builder and Wood Workers International union, ensured that the call for free unions and worker representation was also made.

The General Consul of India in Dubai made an important contribution to the debate at the GCC conference by talking about his office’s efforts to prepare workers pre-departure from their home country, monitor and support them whilst they are here and ensure they are returned safely. His presentation can be found here.

The dialogue underway at this week’s conferences reflects the changing tone of the Ministry of Labour here and the recognition by businesses that something has to be done. In Impactt’s perspective, there were two overriding themes, both of which have proved critical in addressing poor labour conditions in other countries:

• The importance of partnership – between business and the governments of both host and sending countries.
• The need for ongoing transparency and openness – admitting the problems and discussing the solutions in an open forum is a new thing in the UAE and we need to see more of it!

Impactt applauds all actors in the UAE for taking the first steps on the road to improved labour standards. We also encourage them to look at the work being done in the US and the UK, who face similar issues, and learn from their experiences – and mistakes!

Author: Jaana Quaintance

Following the publication of Impactt’s 10th Anniversary Report, “Progress Not Perfection“ last year, we are delighted to publish our first annual report “Getting Smarter: Ethical Trading in the Downturn“.

High energy prices, food inflation, financial turmoil, recession and consumers tightening their belts – 2008 proved to be a challenging year.  The situation poses obvious but important questions for companies: how should they tackle the challenges of ethical trade and labour standards in a downturn?  Is work on upholding labour standards an optional extra to be discarded when times are hard?  Or have ethical issues moved to a point where they are considered core to operations?

Economic hard times present difficulties to all of us, from the CEOs of corporations to buyers, suppliers and the workers along the supply chain.  It is more important than ever to ensure that work on labour standards earns its place at the table, by demonstrating that products and services delivered by workers who have decent jobs provide better quality and value to businesses and consumers than those made by workers whose rights are infringed.  The challenge for everyone working in ethical trade is to develop ingenious and cost effective solutions which achieve the win-win of better business and better jobs all along the supply chain.  The task is getting harder, we need to get smarter.

Impactt strives to find creative ways to improve working conditions in supply chains to bring clear business benefits; we have developed case studies on 4 key projects from the year that do just that:

• Bangladesh Ethical Factory: A model for sustainably increasing wages and reducing working hours.
• Practical Child Labour Solutions: Building consensus on effective child labour remediation – getting working children back to school.
• Building Local Capacity: Expanding the capacity of local organisations to work with employers and employees to improve labour practices.
• Better Buying: Integrating ethical trade into the core operations of business.

The report also presents the findings from Impactt’s assessments of 98 production sites during the year to August 2008, which draws on testimony from 1,500 workers in 11 countries.

We hope the report provides interesting and inspiring reading, we look forward to your comments.

A spokesperson from the Ministry reported on Friday that they are conducting an education programme for migrant workers. This is said to involve both educational seminars in labour camps and the development of a workbook setting out the obligations of employers, what the employee should expect and what action they should do if they are not met.

In addition, the Ministry reported that they are to extend their Indian information campaign about phony recruitment agencies that take advantage of workers in Andhra Pradesh and Rajasthan, where awareness of abuses is low.

Impactt welcomes such initiatives by the Ministry, as they recognise the need to address the gap in information available and accessible to workers. By providing workers with the tools to understand their legal rights in their own language, violations are less likely to occur and where they do, the government is more likely to be aware of them.

By educating people in their home country, before they arrive in the UAE, and monitoring the recruitment process from the outset, the Ministry are tackling some of the problems at source. Overall, this announcement demonstrates that the Ministry has recognised that inspections cannot be the whole answer and is taking a realistic and hands-on approach to improving the lives of Dubai’s thousands of migrant workers.

To strengthen this approach still further, Impactt recommends two further initiatives.  First that the Ministry consult workers to ensure that policies and programmes meet workers needs. Second that the ministry provide a free, independent and widely publicised whistle-blowing helpline in workers’ own languages so workers can report abuses without fear of reprisal, and the government can act quickly to improve the situation.

After last year’s Primark on the Rack, BBC Panorama has been investigating labour standards again. This time the BBC exposé focuses on the conditions of migrant workers building luxury estates in Dubai. Dubai is a by-word for 1^st world seven-star living, with developments endorsed by footballer Michael Owen, cricketer Andrew Flintoff and celebrity chef Jamie Oliver. But behind the façade migrant workers face 3^rd world wages and conditions.

Eighty percent of Dubai’s population are migrants, mainly from the Asian sub-continent, lured to Dubai by employment agents selling the dream of making good money of 1500 dirham (£277.54) a month. But, on arrival, the dream rapidly becomes a nightmare. Wages are less than half the promised level, Panorama exposed workers being paid £120 per month, working 12 hour shifts, six days a week. At these rates workers could only afford to eat meat two or three times a month. And it gets worse, Panorama also found workers working unpaid to repay the £2000 ‘transit fees’ they owe to the employment agency for getting them the ‘dream job’ in the first place.

In labour camps belonging to Arabtec Construction, a sub-contractor to the Jumeriah Golf Estates, Panorama found workers accommodation overflowing with sewage and persuaded a recruitment agent to tell her story

And things are getting worse, the global financial downturn has led to thousands of workers losing their jobs and being sent back to their home countries prematurely. Not only do they often still owe the employment agents their ‘transit fee’, but their home economies are suffering from the reduction in remittances being sent back on a monthly basis.

Impactt’s own experience in Dubai underlines that migrant workers’ jobs are very poor quality.  Far from being better off than they would be at home, the balance has tipped and a migrant job is often the gateway to poverty and despair.   

Clearly something must be done, and we believe that it is possible to make change. There are cost-effective ways for companies using migrant labour to have an impact on basic conditions for workers, particularly in accommodation standards, payment of transit fees and working hours. All that is needed is the determination to change the current business model.

As a first step, it is vital to establish an industry-wide dialogue to harness the power of the construction giants, the contractors and the UAE government to create a new framework for managing migrant labour in Dubai. This should recognise the mutual dependency that exists between the industry and the workers, and be a vehicle for tackling the issues highlighted by the Panorama programme.

The Impactt Middle East and North Africa office opens in Dubai next week and will be constantly surrounded by migrant workers – in fact we overlook two buildings which are under construction. You can expect regular updates on the conditions these workers face and our efforts to improve them.

Many workers’ groups and unions such as the AFL-CIO argue that The Employee Free Choice Act is a landmark step in the fight for workers’ rights. It enables workers and unions to push for recognition, despite resistance from employers. But others argue that the act restricts the right of workers to a free and secret ballot, by imposing a ‘card check‘.

The Bill is intended to amend the existing National Labour Relations Act to make it easier for unions to gain recognition. The aim of the act is to increase workers’ opportunities to organise to improve their working and living conditions, and to reduce the power of businesses to stall the process or retaliate against workers who attempt to organise.

The Bill provides for workers to file a petition to have an organisation recognised for the purposes of collective bargaining, without the requirement of holding an election. Unions claim that the organisation of elections can be used by employers to delay the process of recognition and intimidate and coerce workers to prevent them from voting in favour of a union.

The Bill would require that the petition show the majority of workers within the bargaining unit have authorised an organisation to represent them. Once the organisation has been authorised, it and the employer would have 90 days in which they can conclude a collective bargaining agreement. If they are not able to come to an agreement, they must go through mediation and, if necessary, arbitration in order to do so.

The Bill requires that employers do not engage in anti-union campaigning activities during the recognition or bargaining processes or act in a discriminatory way towards union members and activists. If the employer engages in such activities then they would potentially be subject to remedial actions such as fines or paying workers back pay.

One contentious issue (aside from businesses’ concerns that forced recognition of unions would sound a death knell for them in a time of economic recession) seems to be that the views of named workers are revealed through a ‘card check’ or ‘majority authorisation ballot’. However, under the current system majority authorisation is required to show that there is support for the union, but does not result in recognition. Instead the site moves to a secret ballot, while the employer is in possession of signed authorisation slips from all workers who are in support of the union.

By enforcing recognition after the majority authorisation, without requiring a ballot, unions are far more likely to be recognised and there is no opportunity for employers to affect the decisions of employees. In Impactt’s view this is a step forward in US trade union law, which should strengthen workers’ bargaining power and allow them greater opportunities to protect their own interests.

Impactt’s own research has shown that where there are effective unions in place at a work site, workers are more likely to be paid the minimum wage and overtime premiums, and be treated fairly. They are also less likely to work excessive hours or be fined. The promotion of good labour standards is facilitated most effectively through a representative union. In Impactt’s opinion, the strengthening of workers’ ability to unionise will promote workers’ rights and improve labour standards across the USA.   

We are delighted that our network has extended into the Middle East and North African region.  This expansion will be headed up by Jaana Quaintance, Senior Project Manager – Middle East and North Africa, who will be based in Dubai from April 2009. Prior to her move, Jaana has worked in the UK team for four years. She is an experienced project manager and auditor and has lead on strategy development for large corporate clients.

Impactt understands the pressures faced by multinational companies in addressing labour standards issues in global supply chains. The opening of the Dubai office reflects a new trend in global sourcing for our European clients towards Morocco, Egypt and for American clients Middle Eastern countries such as Jordan. Nearly ten million migrant workers, most of them unskilled or semi-skilled, work in Gulf States. An estimated 3.11 million foreign workers are employed in the United Arab Emirates alone. The majority of these are manual and construction workers with jobs vulnerable to falls in demand and a lack of employment protection.

Some of the challenges our clients are facing in the Middle East include: poor health and safety, child labour (particularly in the agricultural sector), racial discrimination, extreme hours and opposition to trade union rights. During the economic downturn other challenges might include workers being dismissed, the widespread payment of an agency fee to secure a job and the low wages earned for long hours.

Morocco and Tunisia are ranked fourth and fifth in terms of garment export value to the EU.  ITUC General Secretary Guy Ryder has commented that: “the whole of Moroccan industry, and in particular the textile and clothing sectors must change its working practices, which all too often contravene labour legislation”.

Homeworking and subcontracting are both prevalent resulting in a lack of transparency down the supply chain. Improving transparency is particularly important in countries with known child labour. L’Union Marocaine du Travail (UMT), a key union in Morocco, estimates that between 5-10,000 children between the ages of 8 and 14 work in the artisan carpet industry and between 2,000 and 3,000 work in the export-oriented carpet industry.

Follow Jaana and the issues she is working on in further blogs on the Impactt website.

The Declaration represents the fundamental rights to which all people, children and workers are entitled, and the cornerstone in a series of international law mechanisms to promote and enforce these rights. It is as controversial today as it was 60 years ago when world leaders gathered in Paris to sign it.

Many who work in ethical trade think only of labour rights; those laid down and enforced by the International Labour Organisation. It is true that the ILO does pre-date the UDHR, and the United Nations even. However, the UDHR has become the base document for all human rights instruments, even of those ILO conventions that pre-date it.

Impactt would like to mark the occasion with a series of blogs on the work that we are doing, to uphold the articles in the UDHR that relate to labour rights. The key articles include:

Article 3 – The right to life, liberty and security of person.
Article 4 – Prohibition of slavery or servitude in all its forms.
Article 5 – Prohibition of torture or cruel, inhumane or degrading treatment or punishment.
Article 7 – Right to equality before the law.
Article 22 – Right to social security from the state.
Article 23 – The right to work, free choice of employment, just and favourable conditions of work, equal pay for work of equal value, just and favourable remuneration which enables an existence worthy of human dignity for himself and his family, the right to form and join trade unions.
Article 24 – The right to rest and leisure time.
Article 25 – The right to a standard of living adequate for the health and well-being of himself and his family including food, clothing, housing, medical and social services.
Article 30 – Prohibition of activities or acts aimed at the destruction of any of the rights and freedoms of the UDHR by any state, group or person.

The enforcement of these, and the other articles in the Declaration is still sporadic and far more work is required. Impactt is confident in the growing popular and corporate interest in the enforcement of these rights and the potential improvements that these will bring.

A new network to promote good working practices in developing countries will be launched today, 4^th December, at the Ethical Trade Initiative Food Group meeting.

The Local Resources Network is an online community for organisations working to improve employment conditions in factories, on farms and in work sites worldwide. The network is intended to link corporate and NGO members sourcing from developing countries with local partners (Local resources) who have expertise in managing projects and conducting workplace remediation.  Local resources may be NGOs, Trade Unions, auditors, social scientists or specialists with expertise in relevant topics such as child labour remediation.

The network is designed to provide a link between interested parties and to facilitate:

• Workplace remediation projects (productivity improvement, child labour remediation etc.)
• Discussions on specific workplace topics
• Sharing of information and experience
• Capacity building for local resources on country and industry topics.

The website will allow organisations to upload a profile, publicise their experience and skills in workplace remediation and establish contacts with potential project partners.

The sponsors of the Local Resources Network are:

The Local Resources Network was set up by Impactt limited and is currently being managed by the Ethical Trading Initiative (ETI).  For further information on the network and to find out how to join, please follow the link to the website.

Last year, Bangladesh exported garment products worth $10.69 billion (£6.03bn). However, while the industry continues to grow, the 2 million workers, mostly women who are at the heart of its boom have not been touched by the benefits of this growth.

Increasing prices of essential goods, salaries well below ‘living wage’ levels and limited trade union action are some of the main reasons behind the growing worker unrest which threatens the industry.

On 12 April, over 20,000 workers rioted in Dhaka, demanding higher wages. Police used tear gas and batons to break up the protests and at least 50 workers were injured. A key issue that led to the protests was the rising price of rice which has doubled in the past year. Households are estimated to spend nearly 70% of their income on food.

On 13 Aug, over 5,000 workers staged a demonstration in Dhaka demanding a pay rise. When their demands were ignored, they ransacked the factory, clashed with factory officials and blocked one of the main highways for 3 hours.

Violent protests such as these are not one-off incidents, but seem to have been woven into the fabric of the Bangladeshi garment industry. While the search for solutions continues, so does the blame game. According to ‘Sammilito Garment Sramik Federation’, a platform of garment factory workers, the agitation is caused due to rising prices of essential commodities. Opposing this view, many factory owners claim that administrative failures of the government, ‘conspirancies’ from the outside and poor implementation of law and order are to blame.

The list of causes seems to be endless and there are obviously no easy answers. But it is important that the debate and efforts do not lose sight of the key issue: prices are soaring; the minimum wage is not enough to meet basic needs and the plight of garment workers in Bangladesh continues unabated.

• A clear set of operational principles setting out the ground rules for efficient and ethical purchasing.
• scorecards for buyers and suppliers to incentivise efficiency and better ethical behaviour

These give players in the garment industry the opportunity to create a virtuous circle, ‘better, cheaper, faster, more ethical’, delivering commercial targets, efficiencies, labour standards targets and reputational risk reduction. The report is based on interviews with retailers, sourcing offices, agents, manufacturers and workers. The research was conducted in the UK, Hong Kong, China, Bangladesh and Cambodia.Impactt and Traidcraft hope that the recommendations in this report will help sourcing directors in fashion brands to deliver the goods for business and workers.

Tomorrow (12th June) is the World Day Against Child Labour, and hundreds of organisations around the world are marking the day with activities to raise awareness that Education is the right response against child labour.

Impactt’s report, Progress not Perfection highlighted the increasing incidence of child labour. Over the last couple of years, we have found children working in around 20% of the factories we have visited, with a total of nearly 600 individual children.  These children have been forced into work by a variety of circumstances.  The background theme is poverty, with the child usually being pushed into work by a catastrophic event in the family, the death of a parent or the pressing need to pay for medicine or the collapse of the family home.  In general, these children’s experience of education has not been very positive, children talk about poor facilities, boring lessons and often harsh punishments from teachers.

Tremendous work is being done to tackle these root causes of child labour, by UNICEF, IPEC, Save the Children and others – we at Impactt have been focussing on the individual level, on getting the children we find back to school, one-by-one.  It’s not easy – sometimes there is difficulty in proving the age of the child, sometimes the factory manager will try to make the children disappear before we can act, sometimes the child doesn’t want to go back to school, sometimes the parents are against it, sometimes no-one is willing to pay for the costs of education, and of maintaining the income of the child whilst they are in school.  Once a child is back at school, there are always loads of reasons why they may be tempted to go back to work.  Our experience in dealing with individual cases of child labour has prompted us to put together a set of draft procedures giving step-by-step guidance on what to do if child labour is found and how to organise remediation to give it the best possible chance of success. 

Over the past 3 months, we have been consulting with academics, local NGOs, international NGOs, trade unions, international bodies and companies themselves on the content of these guidelines and have received some immensely valuable comments from more that 70 organisations, including, amongst others, the University of Manchester, ITGLWF, ILO-IPEC, international and local NGOs and a broad range of practitioners from retailers and brands around the world. We are holding two meetings in June to discuss key areas of agreement and disagreement and to hammer out the detail of an agreed set of procedures.  We had our first meeting on Wednesday at the RSA in London. Impactt, representatives from 20 retailers and brands from the UK and continental Europe, as well as a representative from UNICEF met to share experience and develop the Operational Procedures further. In a couple of weeks, a group of practitioners will gather in Hong Kong to provide their insights. 

We hope that this process will result in some generally agreed procedures so that, when children are found in factory work, the tools will be there to support swift and decisive action, to maximise the chances of those individual children getting out of the workplace and into the classroom, so that they can build better life chances for themselves and their families.

If you are interested in knowing more, please email Magali@impacttlimited.com

Here at Impactt, we believe that the issues facing these workers have been anything but overlooked in the past years. There has been a steady increase in the number of reports of the issues faced by migrant workers in the UK. The British public may rightfully feel bombarded with news reports, articles and commentaries about the suffering of our considerable migrant workforce.

What causes the greatest concern is the number of industries that fall outside of the remit of the increasingly successful Gangmasters Licensing Agency (GLA). Recent BBC productions have shown that migrant workers are not travelling to the UK merely to work in fields and pack houses. The Open University and BBC series ‘Meet the Immigrants‘ illustrates the breadth of industries which utilise the influx of migrant workers; from pizza delivery companies to taxi ranks and hotels; migrant workers are contributing to the UK economy in more ways than just agriculture.

Asked to comment on the murky world of Britain’s low wage migrant workers, Paul Whitehouse, explained how his agency was powerless to stop gangmasters in sectors outside of agriculture, food-processing, fishing and shell-fishing. Mr Whitehouse stated: “I have absolutely no doubt the Government passed this law because it believes it is wrong for people to be exploited…. I cannot see why if you work in one area you should be protected, but not in another.”

This intervention was a contribution to a continuing debate which has been raging over what sectors the Gangmasters Licensing Act should cover. Recently, the TUC General Council called for the Act to cover other industries such as construction, after research by Sheffield University estimated that there are over 10,000 gangmasters in operation in unlicensed sectors of the British economy.

We at Impactt believe that regulation and continued debate about the rights of migrant workers will only serve to increase pressure on those groups capable of changing the lot of vulnerable workers such as migrants and long term agency workers. The media, trade unions, NGOs and social enterprises such as Impactt need to maintain the pressure on stakeholders to ensure that all workers are treated fairly whilst at home, and abroad.

For the past couple of weeks the media has been full of stories about food inflation and its devastating impact on the developing world.  

Last week the World Bank and the IMF released reports indicating that we are facing a potential ‘food price crisis’ and thousands of people may starve.

There have been riots in Bangladesh, Cameroon, Egypt, Ethiopia, Haiti, Indonesia, Mexico and the Philippines. In Bangladesh 10,000 garment workers rioted on Saturday, vandalising factories and smashing cars in anger at low wages and high food prices. This could be an indication of more trouble to come.

Robert B Zoellick, President of the World Bank warned last week that “33 countries around the world face potential unrest because of the acute hike in food and energy prices.” He went on to estimate that the food price surge could mean the loss of 7 years in the fight against global poverty. At the same event, Dominique Strauss-Kahn, Head of the IMF, warned of mass starvation and dire consequences if food prices continued to rise.

In recent months across the developing world the prices for food staples such as rice, corn and wheat have all reached record highs. In the last two months alone the price of rice has skyrocketed, rising by about 75% globally. Wheat has risen by 120% in the last year.

The impacts have been uneven, but it seems East Asia has been hit the hardest. In Bangladesh the real price of rice reached a 19 year high as it rose by 70% this year. China, India, Vietnam and Cambodia have already responded by imposing tariffs and export bans, leading economists to predict worse to come.

The situation has been blamed on a number of factors, including:

• Rising cost of fuel and fertilisers;
• Climate change, drought and unpredictable weather patterns;
• Increased demand for biofuels, which leads to competing pressures for land;
• Changes in the diets of people in China and India, as the wealthy switch from carbohydrates to meat, which is more expensive and resource intensive to produce.

Of course, it is the poor across the developing world who are suffering the most. According to the World Bank, the poor spend as much as 75% of their income on food. Juan Jose Daboub, a senior Director at the World Bank, has said “In virtually every East Asian country, high food prices are…contributing to a significant decline in the real incomes of the poor.”

Unfortunately many of the workers in the supply chains of western multinationals, whilst perhaps not being the poorest of the poor in their communities, are struggling to maintain their livelihoods. The rioting in Bangladesh confirms that garment workers are suffering under the pressure.

Impactt has been looking at whether minimum wage provisions around the world constitute a ‘Living Wage’. For the 88 countries we investigated, we concluded that in only 23 countries did the Minimum Wage constitute a ‘Living Wage‘.

Food inflation on staple foods such as rice and wheat is running at such a level in some developing countries, that even massive and regular increases in the minimum wage are not enough to meet workers needs, and make something as vital as basic foods affordable. Wage increases that match, or exceed, inflation rates, or even food inflation rates, are only making up for past increases and are not tackling the continuing issue of increased prices.

Companies, NGOs and audit agencies should be aware that minimum wage provisions are increasingly unlikely to support workers’ livelihoods. It is more important than ever that workers earn a living wage and that wages stay ahead of inflation.

Companies should be responding directly to the crisis by implementing living wage programmes and looking to purchasing practices to help alleviate the pressure on workers. Buyers must be aware that the price paid for their last order, may not be sufficient for the next.

It appears that the labelling scheme may be based on the Rugmark model which monitors child labour in the carpet industry. The tracking may be similar to the Dutch initiative ‘Made-By’, who employ the use of distinctive blue buttons and an online tracking service to increase consumer visibility in retailers’ supply chains.  

We welcome both these initiatives, but would urge GAP to prioritise equally the rehabilitation and education of children involved in the garment industry. I would prefer to buy a garment which was labelled child labour free, if I was certain that any children who had previously worked in the supply chain were happily in school and improving their life chances.  Maybe GAP could consider sharing the grades and progress of former child workers to demonstrate a truly responsible approach to making the world a better place.

A consumer survey was published last week which found that many consumers do not believe fashion retailers’ claims on ethical sourcing. It also stated that the most important issue to consumers was whether or not there were underage or child workers making the products that they were buying.

The study, published by TNS Worldpanel Fashion, asked 7,000 people about the ethical credentials claimed by UK retailers. 45% said that they were sceptical. It suggested that older buyers (over 55) were more interested in ethical claims than those under the age of 25.

Our own experience shows that customers are pleasantly surprised to hear how much work certain fashion retailers are doing on ethics. More people are checking the labels for information. More people are becoming more discriminating in which claims they choose to believe.

Here at Impactt we welcome increased consumer interest. We welcome the exposes and the media coverage, but it would be great if retailers, brands, NGOs, unions and journalists could report more credible good news stories to customers – more stories to show that by working hard on these issues we can all make a difference to the lives of the people making the stuff we buy.