Last week Impactt attended an interesting event called ‘Putting market access into practice: Reaching the bottom billion through corporate supply and distribution chains.’ The event, organised by ODI, DFID and Business Action for Africa explored how supply and distribution chains can be harnessed to expand opportunities for the poor while delivering key business benefits.

Speakers included Andy Wales (Head of Sustainable Development- SABMiller), David Croft (Sustainability Director- Cadbury),  and Euan Wilmshurst (Stakeholder Engagement Manager- The Coca Cola Company). Caroline Ashley (Overseas Development Institute) acted as a respondent.

One of the key themes discussed was that the sustainability agenda is no longer confined to CSR or PR departments within organisations but has moved into core strategy and day-to-day business practice. It’s no longer just about doing good. It’s about realising that small growers, workers and communities lie at the heart of supply chains and helping them build sustainable futures is vital for the sustainability and success of the supply chain itself. As Euan Wilmshurst put it ‘Our business is only as sustainable as the communities in which we operate.’ This commitment to sustainability is also reflected in Cadbury’s £44 million investment in cocoa farms across Ghana, India, Indonesia and the Caribbean through the Cadbury Cocoa Partnership.

Another key theme discussed was the importance of effective local partnerships in delivering successful projects on the ground. Impactt whole-heartedly echoes this view and this year we launched the ‘Local Resources Network’- an online community which links companies with local resources (NGOs, trade unions, auditors, social scientists, other specialists) in their sourcing countries.

But while it was encouraging to see the positive work companies like SABMiller, Cadbury, Coca Cola and others are engaged in, the event also raised some critical questions. Why don’t we have more and bigger examples of supply chain reform? Can the pace of progress be faster? Why don’t we have more cooperation among competitors on this issue? How scalable and replicable are current projects?

The speakers pointed out that there are challenges of cost, scale and knowledge and of course the fact that real, long term sustainable projects simply need time. As always, there are no easy answers. But it was very encouraging to see a room full of brands, NGOs, academics, campaigners, students and development experts genuinely convinced in the power of supply chains to promote development. We hope brands will continue pushing the agenda, further integrating ethics with core business and driving real, sustainable change in their supply chains.

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 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.