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CRÉDITOS ESPECIALES Crédito revolvente / Revolving Credit Crédito de cláusula roja / Red Clause Crédito de cláusula verde/Green Clause Crédito Transferible Crédito Back to Back Crédito Stand By
17. Exportando con Responsabilidad Ariane van Beuzekom Consultora CBI
Aim of this presentation Organic Fair Trade CSR Novel Foods
Organic Organic production Labelling Market impact
Organic production Organic production: "a system of managing agricultural holdings that uses a variety of more environmentally friendly crop farming practices and involves major restrictions on the use of fertilisers and pesticides” Strict rules for production. Examples for agriculture: Use of organic seeds Soil fertility and biological activity through natural means Use of substances on “positive lists” Examples processing: Non-agricultural ingredients are limited (Annex VI) GMOs not allowed Irradiation not allowed
Labelling as “organic” Preconditions: at least 95% of the product's ingredients have been organically produced; the product complies with the rules of the official inspection scheme; the product has come directly from the producer or preparer in a sealed package; the product bears the name of the producer, and the name or code of the inspection body.
Organic labels Many organic labels Different requirements Different markets Different certifiers See document Overview of organic labels for food on the EU marketOverview of organic labels for food on the EU market
Organic cotton Growing without synthetic chemicals In some cases also organic production process Taken up by big brands
Market impact Growing niche market For more information, see the CBI market surveys
Fundamental Criteria A fair and sustainable price, guaranteeing a fair wage covering the costs of sustainable production and living. This price needs to be at as high as the Fair Trade minimum price and premium where they have been defined by the international Fair Trade associations
Fairtrade organisation Fairtrade Producer Standards –social, environmental and economic development (labour conditions) Fairtrade Product Standards –coffee, tea, rice, bananas, mangoes, cocoa, cotton, sugar, honey, fruit juices, nuts, fresh fruit, quinoa, herbs and spices, wine and footballs
FLO Facts and Figures FLO is working as per end of 2007 with: 632 Fairtrade Certified Producer Organisations, representing over 1,4 million farmers and workers, in 58 countries in Africa, Asia and Latin America. In 2006, consumers worldwide bought 1,6 billion Euros worth of Fairtrade Certified Products, 42 % more than the year before.
FLO Producer Networks Africa Fairtrade Network (AFN) –WebsiteWebsite Coordinadora Latinoamericana y del Caribe de Comercio Justo (CLAC) –WebsiteWebsite Network of Asian Producers (NAP)
Other Fair Trade - IFAT Self-Assessment against the Fair Trade organisations standards IFAT Code of Practice 10 standards for Fair Trade support organisations Peer review between trading partners –share their Self-Assessment reports External verification –random % of Self Assessment reports reviewed No product standards No specific producer standards http://www.ifat.org/
IFAT 1. Creating opportunities for economically disadvantaged producers 2. Transparency and accountability 3. Capacity building 4. Promoting Fair Trade 5. Payment of a fair price 6. Gender Equity 7. Working conditions 8. Child Labour 9. The Environment 10.Trade Relations
Other Fair Trade Coming out of the Environmental and Sustainability Movement –FairWild –ISSC MAP –BioTrade No specific Product Standards No specific Producer Standards
Other Fair Trade Rainforest Alliance –Have specific product standards Made-by fashion label –umbrella label –organic cotton –sewing factories have a social code of conduct (SA8000) –the entire production chain –mainstream markets
CSR Corporate social responsibility CSR Trends and developments
CSR requirements: Social issues Social accountability Social accountability is the assessment and ongoing monitoring of working conditions in manufacturing environments. European buyers are held responsible for the social conditions in the companies abroad they are sourcing from
Where do you find social requirements? EU buyers’ requirements: Ethical codes of conduct Social label requirements Social management systems Different approaches: Official (3rd party) audits of signed codes Requests for certification Informal audits by Quality control staff Code of conduct but no control Nothing……
Contents: ILO Conventions Private sector uses several of the 185 ILO Conventions Fundamental Conventions are a minimum in international trade Suppliers should at least be aware and be working on improvement to the minimum level European buyers often prepared to support improvement. Suppliers: have an implementation plan
The basis: Fundamental ILO Conventions Freedom of Association 87 Freedom of Association and Protection of the Right to Organise Convention, 1948. 87 Freedom of Association and Protection of the Right to Organise Convention, 1948. 98 Right to Organise and Collective Bargaining Convention, 1949 98 Right to Organise and Collective Bargaining Convention, 1949 Abolition of Forced Labour 29 Forced Labour Convention, 1930 105 Abolition of Forced Labour Convention, 1957 Equality 100 Equal Remuneration Convention, 1951 111Discrimination (employment and Occupation) Convention, 1958 111Discrimination (employment and Occupation) Convention, 1958 Elimination of Child Labour 138Minimum Age Convention, 1973 182Worst Forms of Child Labour Convention, 1999
Also important: Occupational health and safety ILO convention 155 and recommendation 164 Hours of work and overtime Wages
ILO ILOSA8000 ETI MPS Collective bargaining (fundamental) XX x x Free association (fundamental) X X x x Discrimination (fundamental) X X x x Equal remuneration (fundamental) X X x x Forced labour (fundamental) X X x x Child labour (fundamental) X X x x Minimum wage/living wage X Xx x Maternity protection X Harassment or abuseX X Health and safety X X x x Working hours X X x x Vocational Rehabilitation & employment X X x Home Work X X x Regular employment x x Harsh or inhumane treatment x Management systems X Compensation X Pesticides and chemicals x Protection of the environment x
Sainsbury’s Social Principles “As we broaden our supplier base, especially in developing countries, we are conscious of the need to take some share of the responsibility for social development and for the welfare of employees who produce the goods we sell.” “In building partnerships with our suppliers, we seek to work with companies who share our values and who are prepared to commit themselves to this Code.”
Sainsbury’s Social Principles Fair terms of trading In the conduct of its business, Sainsbury’s will deal openly and fairly with suppliers, adhere to contract terms and avoid the exercise of undue pressure. Protection of children In accordance with relevant ILO conventions, children may only be employed in circumstances which fully safeguard them from potential exploitation, which protect them from moral or physical hazard and long term damage to health and which do not disrupt their education.
Sainsbury’s Social Principles Health and safety Policies and procedures for health and safety will be established which are appropriate to the industry. In the absence of legal requirements these will reflect a clear awareness of obvious hazards and a general regard for the well-being of employees. Such policies and procedures will apply also to any living accommodation provided in association with employment.
Sainsbury’s Social Principles Equal opportunities Whilst being sensitive to cultural differences we expect the development of equal opportunities in employment without discrimination on grounds of race, religion, and gender or other arbitrary means. Freedom of association Employees shall be free to join lawful associations; forced labour or coercion at work is unacceptable.
Sainsbury’s Social Principles Freedom of employment Employees should not be forced into involuntary labour. Hours of work and wages Pay will not be lower than that required by local law or, in the absence of law, that paid generally within the industry. Wages should always be enough to meet basic needs and to provide some discretionary income, as well as having regard to what is needed to maintain family life above subsistence level.
Meeting buyers’ requirements Showing compliance Auditing and Management systems BSCI SA8000 OHSAS 18001 GLOBALGAP Codes and Labeling Sector codes, corporate codes Ethical Trading Initiative Labels
Business Social Compliance Iniatiative An auditing system, not a certificate Background: adequate laws are in place - but not properly implemented and enforced Lack of awareness So far retailers conduct social compliance audits in their purchasing markets mainly on the basis of different audit systems and criteria Lack of credibility Lack of transparency Lack of efficiency High costs No synergies Too many different systems More or less similar standards Different tools Different processes
Objectives Improve social standards in all supplier countries for all consumer goods Provide a predictable monitoring system Realise economic advantages for suppliers and members International forum for the exchange of knowledge and views Cooperation with any other equivalent system
BSCI The BSCI is intended as a sector-solution for retail but is also open to importers and manufacturers of consumer goods. All kinds of consumer goods, initial focus on textiles, clothing, shoes and toys. BSCI membership is open to all European and non-European companies and associations. Buyers call for BSCI audits, not suppliers
BSCI Performance level: mainly social requirements and a few basic environmental requirements The social requirements are based on relevant ILO Conventions and United Nations human rights: internationally recognised and applied. Based on the SA8000 management system, two phases of implementation. –phase 1: comply with basic regulations –phase 2: additional requirements with final level of SA8000 certification.
BSCI Phase 1: Compliance to basic regulations National legal requirements, with respect to: –Commercial operators –Working times –Compensation –Social security contributions –Minimum age employees –Ban on forced labour –Disciplinary measures –Freedom of association and collective bargaining –Ban on discrimination –Working conditions –Health and safety
BSCI Phase 2: Compliance to additional requirements on the SA8000 level –Policy –Planning and implementation –Management review –Control of subcontractors / suppliers / sub-suppliers –Control of home workers –Compensation –Child labour –Evasion –Outside communication
Standard audit for all products: Site inspection, inspection of documents and interviews with management and employees Social audit report: audit result, indication of corrective actions Based on social performance: corrective action plan Before final audit: self-audit, based on an assessment list Audit by SA8000 accredited certifiers on the base of SA8000 certification
Market impact A rather new initiative → Market impact of BSCI is expected to be substantial Advantage of BSCI –can be applied to all consumer goods –different certification schemes not necessary –existing schemes may be recognised by BSCI –broad support from the private sector Disadvantage –Only upon request of a EU trading partner
SA 8000 International management system for improving working conditions Modelled as ISO standards First auditable social standard and creates a process that is independent Certification by means of independent verification Applicable to all industries Performance-based provisions, which set standards for each of the 9 topics (CoC)
SA 8000 Standards based on ILO and other human rights conventions 9 core areas: –1. child labour –2. forced labour –3. health and safety –4. compensation –5. working hours –6. discrimination –7. discipline –8. free association and collective bargaining –9. management systems
SA 8000 Benefits of adopting SA8000: improved staff morale more reliable business partnerships enhanced competitiveness less staff turnover better worker-manager communication
SA 8000 Market impact The impact of SA8000 is growing in numbers, amount of countries and amount of sectors Starting with toy manufacturers, manufacturers of garments, manufacturers of plastics and manufacturers of pharmaceuticals, the system is becoming a multi-sectoral instrument 2002: 83 facilities, 31 industries, 30 countries 2004: 492 facilities, 51 industries, 40 countries 2007: 1112 facilities, 71 industries, 51 countries
Ethical Trading Initiative UK multi stakeholder initiative to improve working conditions at companies operating within the chain ETI was specifically set up for traders supplying the British market, i.e. Sainsbury’s and Tesco The ETI promotes the implementation of a code of conduct at the level of suppliers, sub contractors and home workers wherever possible Not focused on specific products or companies When joining the ETI, members commit to implement the Base Code in their supply chains and to reporting annually on their progress in doing so
Ethical Trading Initiative The ETI Base Code: nine provisions: 1. Employment is freely chosen 2. Freedom of association and the right to collective bargaining is respected 3. Working conditions are safe and hygienic 4. Child labour shall not be used 5. Living wages are paid 6. Working hours are not excessive 7. No discrimination is practised 8. Regular employment is provided 9. No harsh or inhumane treatment General principles concerning implementation
Novel Foods Regulation Regulation (EC) 258/97 lays down the definitions of novel foods in the EU as well as the procedures required for foods considered novel Novel foods: foods with a safe history of food use, unknown to the EU, prior to the legislation of 15 May 1997 Aim: to protect EU consumers’ health
Novel Foods Scope Products with a new or intentionally modified primary molecular structure Products consisting of micro-organisms, fungi or algae Products consisting of, or isolated from plants or isolated from animals Products whose nutritional value, metabolism or level of undesirable substances has been significantly changed by the production process Traditional foods, i.e. food products with a history of safe use from outside the EU The Regulation does not apply to food additives, flavourings or extraction solvents and not to genetically modified organisms (GMOs): separate legislation
Novel Foods or not? Find out if the food was already consumed in any of the EU Member States before 1997. If yes: no novel food Find out if the food is currently consumed. If yes: procedure of notification may apply If not yet consumed: novel food Examples: yacon, lucuma, camu camu, baobab
Novel Foods application procedure Application in the Member State where the product is to be placed on the market for the first time. Initial assessment by Member State’s competent authority. Initial assessment forwarded to Member States for comments or objections. If no objections: no additional assessments required If objections: additional assessment required.
Novel Foods content application A well-documented history of safe use outside the EU, indicating absence of toxicity. A safety test on animals or humans may also be necessary. A description of the production chain addressing the absence of contaminants. Hygiene aspects in the production are also addressed here. Additional toxicological research may be necessary Potential shifts in nutrition patterns. Will the new exotic product replace the use of an existing product and what consequences will this have for nutrition patterns?
Novel Foods revision Revision has been adopted Food safety testing procedures simplified Needed: justification as a traditional food and data of history of safe use Authorisation not for a single applicant but the whole market Application through EFSA Draft Regulation: ec.europa.eu/food/food/biotechnology/novelfood/initia tives_en.htm