Human Rights

How to Safeguard Foreign Workers

Textilindustrie in China
Textile workers in Huaibei, Anhui province, China. Photo: DPA
  • Why it matters

    Why it matters

    More than half of Germans say they are willing to spend more money on products from firms that are committed to society and the environment.

  • Facts

    Facts

    • Tchibo is the first German retailer to sign a framework contract with the global trade union federation IndustriALL to improve transparency on workers’ rights abroad.
    • After a deadly factory collapse in 2013, many textile retailers agreed to the “Bangladesh Accord,” for improving building safety and fire protection in factories abroad.
    • But many companies still release little information on working conditions, something a new draft law for corporate responsibility could change.
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    Audio

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The chief executive of Tchibo has a clear goal for workers who produce goods for the German retailer.

“We want to achieve wages that guarantee a secure existence for all textile industry workers in producing countries,” Markus Conrad said.

And he’s now taken an important step toward that goal. Tchibo is the first German merchandising company to sign a framework contract with the global trade union federation IndustriALL. The two parties want to improve working conditions, including the right to organize unions in producing countries.

“Our experience shows when employees are more content, we also receive better products.”

Achim Lohrie, director of corporate responsibility at Tchibo

The general secretary of IndustriALL, Jyrki Raina, said the company has long been an important partner.

“Tchibo played an essential role in pushing processes forward for industry-wide wage negotiations for workers,” he said.

One example of that was the “Bangladesh Accord” on building safety and fire protection in factories, signed by many German textile companies in reaction to the 2013 Rana Plaza factory collapse that killed 1,127 in Dhaka, Bangladesh.

In the future, Tchibo will involve local unions in all on-site training programs.

“We want to help create an atmosphere of trust,” said Achim Lohrie, director of corporate responsibility at Tchibo. “Our experience shows when employees are more content, we also receive better products.”

And the German high-street retailer is one of a growing list of companies keen to flaunt that their respect for human rights, working conditions and social concerns.

One big reason for this graudal shift is consumers: In a recent Nielsen market research survey, 52 percent of Germans said they would spend more money on products from firms that are committed to society and the environment.

Tchibo, one of Germany’s largest consumer goods retailers, rates high in the latest study of sustainability reports by the Institute for Ecological Economy Research, or IÖW.

The company ranks sixth among German companies as a “progressive issuer of reports on delivery chains.”

“A few large commercial enterprises and insurance companies remain reticent.”

Gerd Scholl, researcher

The institute says the best sustainability reports among the largest 150 German companies were published by BMW, Miele and the KfW Banking Group.

The researchers praised BMW for reporting management approaches, goals and policies for all essential areas and for documenting them with comprehensive operating figures.

The institute did separate research on small and mid-sized firms: The top positions were occupied by organic foods producer Lebensbaum, outdoor merchandiser Vaude, and the producer of concrete and natural stone Rinn.

The IÖW draws up its ratings list with the corporate federation Future, under commission from the Federal Labor Ministry.

Its study shows an increasing number of companies file sustainability reports. Of the 150 largest German companies, 72 publish either their own documents or integrated annual reports. That’s 16 more than in 2011.

But overall, the institute still sees plenty of room for improvement in sustainability reporting. “A few large commercial enterprises and insurance companies remain reticent,” said researcher Gerd Scholl.

For example, companies like Alte Leipziger, Amazon Germany, the Schwarz Group, Signal Iduna and the Theo Müller Group release little information on working conditions at their firms.

Some, however, could soon be forced to provide at least some transparency.

Last week, the German cabinet approved a draft for implementing Corporate Social Responsibility guidelines for the European Union. It would force large firms to regularly present reports on social and environmental standards, as well as on human rights.

Tchibo’s CEO Mr. Lohrie thinks it’s a good idea.

“We support transparency,” he said. “The public has the right to know the degree of sustainability with which individual companies operate.”

 

Florian Kolf leads a team of reporters covering the retail, consumer goods, luxury and fashion markets. To contact the author: kolf@handelsblatt.com

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