CSR
Corporate Social Responsibility
Nguyen A Chau
BACKGROUND
•CORPORATE RESPONSIBILITIES
(Social Compliance)
•CORPORATE SOCIAL RESPONCIBILITIES
Media coverage
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Continuing media attention on working conditions
and wages of laborers in factories
Brands/retailers with a product focus on marketing to
children have been a prominent target for negative
media attention
Labor practices receiving media attention include:
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•
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Utilizing child labor
Paying low wages
Long work hours
Unsafe working conditions
Environmental issues
Recent impacts
Wal-mart?
Source: Internet
Recent impacts
GAP Inc.,?
Source: www.time.com
Recent impacts - Vietnam
VEDAN
Source: Internet
Recent impacts - Vietnam
THANG LOI TEXTILE
Source: Internet
…and much more
NGOs involvements
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•
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ILO – International Labor Organization
FLA – Fair Labor Association
Human Right Watch
Clean Clothes
• Others
Why are Brands/Retailers concerned?
• Brands/Retailers express a commitment to “Do the
Right Thing”
ü A standard of excellence in every aspect of their businesses and
in every corner of the world
ü Ethical and responsible conduct in all of their operations
ü Respect for the rights of all individuals
ü Respect for the environment
• Brands/Retailers expect the same commitment from
their supply chain
•
CODE OF CONDUCT
•
ETHICAL STANDARDS
What is Social Compliance?
• Definition of Social Compliance
ü
Adherence with the standards
applicable to employment,
manufacturing, and environmental
conditions
• US and European Multinational
brands/retailers
ü
ü
ü
Manufacture and import products in
developing countries
Expect factories to treat their
employees with human decency
Expect suppliers to comply with local
labor laws and standards
Why are supply contractors concerned?
§ Long adhered to quality standards
§ Recognize adherence to social standards is a current requirement
of buyers (brands/retailers)
§ Recognize the same product quality standards must apply to
social standards
§ Directly impacted by damage to brands’/retailers’ images:
Ø Negative media attention can reduce demand
Ø Reduced orders can result in fewer jobs
Ø Reduced demand can result in factories going out of business
Supply Chain Relationships
§ A supply chain consists of the
organizations involved in producing
a product
§ Brands/Retailers are directly
impacted by the actions of their
supply chain partners in the area of
social compliance
§ A brand/retailer’s supply chain can
consist of various types of
manufacturing relationships
Supply Chain Relationships
Sample Manufacturing Structure
Subcontractor
Brand/Retailer
Contract Manufacturers
Subcontractor
Brand/Retailer
Licensees
Manufacturing
Licensees
Licensee Used
Manufacturers
Social Compliance Development
v
v
v
v
1970’s:
1980’s:
1990’s:
2000’s:
Pricing
Pricing + Quality
Pricing + Quality + Environment
Pricing + Quality + Environment + Social Compliance
2005 – 2006 - 2008
PRICE
DELIVERY
2008 -
CSR
QUALITY
COMPLIANCE
Compliance audits
• Internal audits
• Third party audits
v
v
v
v
v
v
STR
ITS
BV
OneStep
SCSA
Others
Social Compliance in Vietnam
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Unsafe working condition
Long working hours
Low wages
Insufficient mandatory
benefits
Disciplines
Management system
Environmental issues
Strikes
Social Compliance in Vietnam
CSR Programs
• Safe working condition
Employees
• Good benefits
• Less hours
•Job secures
• Respects
Environment
• Environmental friendly
• Hazardous controls
• Wastes discharge
CSR
REPUTATION
Sustainable
Community
• Cleaner production
• Recycles
• Energy saving
• Awareness Education programs
• Scholarships
• Community funding
• Charity work
CSR Programs
CSR Programs
CSR Programs
CSR Programs
Factory Improvement Program (FIP)
CSR Programs
Factory Improvement Program (FIP)
CSR Programs
…Go green
CSR Programs
Scholarship
Nike Golf – Mini stadium in
Dong Nai