The Human Cost of Greening the Supply Chain

Sidney Vianna

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By Conrad MacKerron
The greening of corporate America has a darker side that seems to tolerate dangerous conditions for workers. The emerging solar and renewable energy industries will bring green collar jobs to areas of the U.S. in desperate need of them. But corporations are still paying scant attention to the needs of the people in the global supply chain emerging markets where most manufacturing has shifted. Let's look at the revved up Chinese economy where so many of our goods are now made. China has an occupational safety law. But it's only five years old and honored more in the breach than the observance. And it shows in the toll on workers' lives.

China has the highest rate of death from work-related illnesses of any country. According to the International Labor Organization, 380,000 Chinese workers died of occupational illness in 2005 and millions more live with fatal diseases or with limbs missing from job-related accidents. The Toyota Prius has become one of the most visible symbols of environmental consciousness. But a recent report from the National Labor Committee alleged abusive working conditions in Japanese factories assembling the Prius. The report said a third of assembly line workers are poorly paid temps, and that its parts supply chain is "riddled with sweatshop abuse", including the trafficking of tens of thousands of foreign guest workers. Many of them are working 16-hour shifts.

And two years ago, Bloomberg Markets linked Toyota, GM and Ford to slave labor conditions in making the pig iron for the steel that ends up in their vehicles. Solar panel installation may produce good jobs here. But producing those panels involves dangerous chemicals. The Washington Post recently reported that a supplier to solar panel maker Suntech Power dumped poisonous silicon tetrachloride, a byproduct of polysilicon manufacture, onto fields in Henan Province in China, rather than recycling it. As major companies from Wal-Mart to Dell to Nike serve up an array of promises to green their supply chains, we need to know who is paying attention to worker health and safety. U.S. firms often negotiate tough deals with suppliers at rates so low that goods can't be produced without resorting to abusive or unsafe working conditions. We're not just talking about discount retailers but also high end brands. It’s unclear if the multinationals are expecting factory owners to pay all the costs of improving safety and environmental conditions in their plants. Improvement is absolutely needed. But is it fair to put the onus on global suppliers in developing countries? Their profits are often already squeezed to the bone by their powerful customers. And what happens to their investment if a big U.S. brand decides to pull its contract and source from another factory the next year because labor is cheaper there? Legislation has helped make the US workplace increasingly safe. In the last 35 years, workplace fatalities here have dropped by 60 percent. Injury rates have gone down by 40 percent. But many investors have basically looked the other way as Western companies pursued a generation of global outsourcing of labor without insisting that our hard-won U.S. rules of workplace safety and fairness be applied to the global supply chain.

For the green technology juggernaut to have true social credibility, companies must insist on investing in best environmental practices, safeguarding the well being of workers by enforcing best labor practices, and public disclosure of progress on both fronts. About Conrad MacKerron Conrad MacKerron is the Director of the Corporate Social Responsibility Program at the As You Sow Foundation based in San Francisco, CA.
Comments anyone?
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Jen Kirley

Quality and Auditing Expert
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Frankly, I did not see anything surprising in that article.
Me neither. China is in its own turbocharged version of an Industrial Revolution that differs from ours in that there are exponentially more chemicals and processes in which to be exposed to risk than in the turn-of-century U.S. and Britain.

It's said we tolerate it, and I think it's fair to say that's true unless you want to call it something else, like apathy, or disconnected feeling, or "better they get sick than me" mentality.

But what would intolerance look like? The conditions in which these articles are made (also decidedly "non-green" industries like lead production for car batteries) are not evident in the article being purchased. One could instead choose the brand next to the suspect item, but one doesn't likely know what conditions it was manufactured in either.

One could say "Well we should be making that stuff here" but get shouted down by the argument that our safety and environmental laws make doing business prohibitively costly.

So, to keep our costs down we turn a blind eye to the moment-by-moment tragedies involved with offshoring our industry. Then we complain we have no decent jobs anymore, and ask "Why isn't government/congress/Obama doing something about it?"

It's starting to turn around. China is starting to realize it can't keep on poisoning itself to make money. When it finally does crack down and treat safety and environmental controls as we do, costs will go up and we might as well resume making stuff here - if anyone remembers how by then.
Personally, I don't think that is greening the supply chain. Just moving your suppliers to another back yard (that might even be dirtier), is not greening, its just moving.

But there is a way to green the supply chain without endangering or losing employees.... and without going broke.......


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We got a taste of this issue back when Japanese competition first became an industrial issue (yes, it wasn't all Deming), and they have likely had to change environmental issues much quicker due to their limited land mass. Not really sure how their workforce transition transpired. If you recall the days that people we clamoring for Japanese tariffs for cheap materials, and thought that was bad...China is much, much bigger with many, many more people to employ at low wages. There is still a lot of other Pacific Rim countries in the same boat, and now even more developing nations on other continents going through the same transitions. As people fuss about CO2, there have been huge strides in controlling much more threatening wastes, including de-proliferation of toxic organic solvents. Remember trichloroethane and methylene choride? Remember cleaning circuit boards in freon? Remember when carbon tetrachloride was a household chemical? Remember lead paint? If you don't, then it just shows how well we did.
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