1. Training workshop “Global Supply Chains and Trade Union Strategies” 29 February – March 11, 2016 in Lomé, Togo Presentation: Regulatory Frameworks Approaches of the OECD, UN… Insa Ben Said Dia, Labour Education Specialist Decent Work Team, Eastern and Southern Africa, International Labour Office, Pretoria dia@ilo.org

2. PLAN for the PRESENTATION: 1.Regarding the OECD Guide 2.United Nations 3.Development of Private Voluntary Initiatives (PVIs): CODES OF CONDUCT 4.Framework agreements

3. OECD guidelines for MNEs Adopted in 1976 and revised in 2000 The Guidelines are: –Recommendations addressed by the governments to the multinationals; –Voluntary principles and standards of responsible conduct of firms. Major components:National Contact Points (NCPs), Trade Union Advisory Committee to the OECD…

4. Sum-up from the 2000s Extended coverage –All fundamental standards; environmental performance; human rights; corruption; interests of consumers –Global demand, not just in the countries of the OECD Strengthening of the National Contact Points (NCPs) –Dealing with the requests, helping to solve problems and reporting through meeting each year regarding national experiences –Promoting the guidelines for their effective implementation New player: NGOs Let us cite a concrete example of an OECD Guide that addresses extraction of ores and other raw materials in the Democratic Republic of the Congo for the exercise of risk-based due diligence.

5. 1. The Guide addresses the extraction of ores and other raw materials The five stages of the exercise of risk-based due diligence Stage 1 Strengthen its expertise regarding the exercise of due diligence, its internal systems and the keeping of its records, in particular with the help of a chain of accountability and/or a traceability system Stage 2 Undertake an assessment of the risks presented by the mines, the transport routes, the ore trading points and the suppliers, separately or in cooperation with its customers Stage 3 Adopt measures for risk mitigation and submit its supply chain to a periodic monitoring of risks Stage 4 Participate in the audit programmes as they are put into place Stage 5 Draw up annual reports on its diligence efforts and make them available on the company’s premises and website. 5

6. 1. Stages to be taken into account Put solid systems in place for monitoring of the supply chain; pass on major intelligence to the buyers in the sector, as well as to the state public authorities and regional institutions responsible for regulating the trade in ores; Assess the situation on the mining sites, along the transport routes and at the trading points, in order to make sure that the supply areas and suppliers are free of any link with a conflict; report on the exercise of its duty of diligence. 6

7. Draft a public statement that commits you to apply the OECD guide on the duty of diligence, risks incurred in the event of non- compliance, and how to address them once they are identified If you are not able to do it, entrust the task to a manager and allow them to get access to the pertinent documents and to the operations carried out to observe the various stages of the duty of diligence Inform all of the customers, suppliers and transporters linked to your activities of mining or of trade in ores that they must endorse the DD. If they do not do so, at a minimum you may if necessary reconsider your procurement decisions within the exercise of your duty of diligence Build close relationships with the partners or local networks that have activities about supply chains, by participating in training workshops 7 1. What to do prior to taking a procurement decision?

8. 8 1. Chain of accountability or traceability system According to the OECD Guide on the duty of diligence, the “chain of accountability” refers to the documents allowing one to identify the firms and persons who have custody in turn of the ores along the supply chain. “Traceability” refers to the fact of locating the ores throughout the sector, from the mine of origin to the point of export.

9. If you export ores from the Great Lakes region, you are obliged to be subject at least once a year to a third-party audit within the framework of the Regional Certification Mechanism of the CIRGL (International Conference on the Great Lakes Region). These audits consist in checking that all of the materials exported under cover of a regional certificate from the CIRGL come from a “clean” (which is to say “green”) mining site, and that they have been transported, processed and exported in line with the standards of the CIRGL and the OECD (which is to say, without giving rise to violations of human rights or contributing to the financing of armed groups). Consequently, the CIRGL audits also bear on the mining sites, the trading centres, the transport routes as well as the firms and persons related to the CIRGL who intervene in the supply chain, in order to check that the ores are produced and traded in a responsible way, without contributing to a conflict. 9 1. Audits covered by the Regional Certification Mechanism of the CIRGL

10. An increase in investment in the agriculture sector is expected in the years ahead, mainly in the developing countries. Companies in the agricultural sector may create jobs in the developing countries and bring to them the experience, technology and financial capacities needed to increase sustainable agricultural production and improve the supply chains, thus ensuring greater food security. But they may also be confronted throughout their agricultural supply chain with ethical dilemmas and challenges in complying with internationally recognized principles that demand responsible behaviour on the part of firms. This is particularly the case in the countries the governments of which are weak and where land rights are not secure. 1. The OECD is also interested in agricultural supply chains

11. New players such as institutional investors are more and more part of the agricultural supply chains. A not insignificant number of investors is interested in property markets where the regulatory frameworks are quite weak, entailing heightened risks of non-compliance with the internationally recognized Principles of Responsible Conduct (PRC). The OECD has sought by means of a document to guide the firms involved in the agricultural supply chains in understanding the existing PRCs, with the objective of agricultural investments benefiting the firms, governments and local communities for poverty alleviation. … continued

12. – The agricultural supply chain encompasses all of the activities, organizations, stakeholders, technology, information, resources and services associated with agricultural production, from supplying agricultural inputs (seeds, etc.) up to production and distribution. – Due diligence. This refers to all of the checks that a potential buyer or investor carries out prior to a transaction, with the aim of getting a clear idea of the economic state of a firm. Broadly, due diligence is the level of attention, care, prudence, firmness and action that may be expected on the part a reasonable person in their management of risk. This concept may help the firms to ensure that they respect international and national law, as well as the PRCs (Principles of Responsible Conduct). 1. Agricultural Supply Chain and DD

13. Labour rights: The firm undertakes to observe the international legal standards, first and foremost freedom of association and the right to collective bargaining. The firm ensures decent wages and endeavours to improve the working conditions in general, as well as promoting the meaningful participation of women in decision-making. The field of health: The firm undertakes to prevent threats to human health resulting from its operation or that may derive from the consumption, use or storage of its products or services, as well as to protect the health and safety of the communities affected by its activities. Environmental protection and sustainable use of natural resources: The firm undertakes to establish and maintain, in coordination with the responsible national agencies and other parties, an Environmental and Social Management System (ESMS) appropriate to the nature and scale of its activities. 1. The model suggested by the OECD, which includes ten points: three for us workers

14. Several specialized agencies of the United Nations are involved in the effort for fulfillment of decent work; some, like UNOPS, even lay down preconditions of supporting certain policies. UNOPS works only with suppliers that respect its policies and procedures as regards procurement, and share its respect for fundamental human rights, social justice, dignity and the worth of the human person, with equal rights for men and women; these are values enshrined in the Charter of the United Nations and the UN’s Supplier Code of Conduct. 2. United Nations

15. Other international instruments ILO Conventions and oversight mechanism Tripartite Declaration concerning Multinational Enterprises and its follow-up United Nations The Global Compact By means of private voluntary initiatives “Old” code of conduct “New”code of conduct Framework agreements Policies and strategies for the trade unions

16. ILO Conventions and oversight mechanism As regards ratified Conventions. –Article 22 Report - Reviewed by the CEACR –Article 24:Representation –Article 26:Complaint Those that are not ratified –Article 19(5)(e) Report Regarding freedom of association –special procedure through the Committee on Freedom of Association Annual review of unratified fundamental standards General Survey ILO Declaration +

17. Tripartite ILO declaration of principles concerning multinational enterprises Adopted in 1977 by the GB (amended in 2000) as a voluntary instrument for: –Regulating the conduct of the multinationals; –Defining the aspects of the relationships of the multinationals with the host countries, in particular on the issues linked to social aspects at work; –Improving the social effects and the positive work of the activities of the multinationals.

18. ITS FOLLOW-UP A procedure adopted by the GB in 1980 (revised in 1986), as a promotional tool for: –providing support on presentation of interpretation requests or in the event of dispute on the meaning/enforcement of its provisions; Survey –The expected effect of the principles of the Declaration is “monitored” by a periodic survey

19. United Nations: the Global Compact (1) Value shared for the global market, promotion of global citizenship Nine Principles –Human rights 1. The firms must support and respect the protection of internationally proclaimed human rights, and 2. Make sure that they are not complicit in human rights violations.

20. United Nations: the Global Compact (2) - Labour 3. The firms are invited to respect freedom of association and the effective recognition of the right to collective bargaining; 4. Elimination of all forms of forced or compulsory labour; 5. Effective abolition of child labour; 6. Elimination of discrimination in respect of employment and occupation. - Environment 7. The firms are invited to apply the precautionary principle when faced with environmental challenges; 8. Take initiatives to promote greater environmental responsibility; 9. Encourage the development and dissemination of environmentally friendly technologies.

21. Development of Private Voluntary Initiatives (PVIs): Codes of Conduct As a response by the international community to the rise of the multinationals Alternative trade organizations Social labelling (SL) Codes of Conduct (CoC) New codes of conduct (NCoC) Framework agreements (FAs) 1970 1990

22. Definition of the New Code of Conduct “Commitments voluntarily made by companies, associations or other entities which put forth standards and principles for the conduct of business activities in the marketplace”. (“Workers’ tool or PR ploy?” by Dr. I. Wick)

23. New Code of Conduct Four major characteristics A totally private voluntary initiative (VI) Response to the situation of poor working conditions created by the inability of the national governments and the international community; international demand Cross-cutting application to the suppliers and subcontractors

24. Codes of Conduct (recurring problems) Labour Standards148 Environment145 Consumer protection117 Corruption56 Competition50 Access to information45 Science and technology26 Taxation1

25. Codes of Conduct:Contents Satisfactory work environment75.7 In accordance with the law65.5 Elimination of discrimination or sexual harassment60.8 Compensation45.3 Prohibition against child labour43.2 Obligations for suppliers and subcontractors41.2 Prohibition against forced labour38.5 Training32.4 Working hours31.8 Freedom of association29.7

26. Codes of Conduct: Contents (continued) Specific reference to human rights25.0 Follow-up24.3 Right to information13.5 Reference to the ILO codes10.1 Promotion8.8 Information provided a reasonable time in advance3.4 Elimination of excessive use of temporary jobs3.4 Flexible reporting on the work environment0.7

27. Codes of conduct and freedom of association Codes of ConductInternational framework agreements Unilateral actionsNegotiations between workers and management Not all of the fundamental labour standards are necessarily recognized All of the fundamental labour standards are explicitly recognized Infrequently take the suppliers into account Generally include the suppliers Monitoring, when envisaged, is under the control of management The unions are called on to participate in the implementation process Weak basis for dialogueSolid basis for dialogue between the trade unions and the management

28. Three important aspects for the CoC and FA Ability of the international trade union federations to engage in compliance by the largest number of multinationals with FA or the codes of conduct Ability of the multinationals to control the subcontractors or supply chains Practical application (implementation) of the codes of conduct or of FA in the regions, countries and local communities

29. Why are new codes important for the trade unions? New codes are on “work practice” Most of the firms adopt CoC without involving the unions A good excuse to do without a union! Great potentials, but also danger Well applied, the codes may establish the ILS as a mandatory international framework for responsible business conduct INVOLVING THE TRADE UNIONS: VITAL

30. “Instruments negotiated between a multinational enterprise and a Global Union Federation (GUF) concerning the international operations (or conduct) of the company”. The main purpose of the framework agreements is to establish an ongoing relationship between the MNE and the GUFs, so as to regulate the “principles” of industrial relations and good work practices. Framework agreements

31. EXAMPLES OF WELL-KNOWN FRAMEWORK AGREEMENTS IUF - Danone (1988), AccorHotels Group (1995), Nestlé (1996), Del Monte (2000) and Chiquita (2001); IFBWW - Ikea (1998), Faber-Castell (2000), Hochtief (2000) ICEM - Statoil (1998), Freudenberg (2000) UNI -Telefonica (2000), OTE (2001), Carrefour (2001)

32. Trade unions: Policy and strategy Putting in place institutional mechanisms and expertise to fully make use of all of the international instruments: –Regular reports; –Complaint procedures in the event of an infringement; –Multilateral approaches to issue resolution. Importance of the international, subregional and regional systems of communication and of the connected trade union networks.

33. WWW.ITCILO.IT/ACTRAV PROGRAMME FOR WORKERS ACTIVITIES OF THE ILO TURIN CENTRE THANK YOU ACTRAV WWW.ITCILO.IT/ACTRAV Lomé, Togo, February 2016