Fostering decent work for sustainable global supply chains

Society expects companies to act responsibly, and there is one primary reason for this: global business activities can contribute to human rights violations, labour abuses and environmental degradation globally. The case of the collapse of the Rana Plaza building which housed numerous garment factories exporting to G20 countries, killing over 1000 workers is well known. But there are many other cases of damage to people and the environment linked to global supply chains. But responsible business conduct is good for business: Research demonstrates that “high sustainability” companies with strong environmental and social governance systems, outperformed “low sustainability” companies, as measured by stock performance and in real accounting terms. Companies – which are increasingly operating across countries and geographies – benefit from common expectations and standards on how to conduct business. But for this to work, it is essential that all of our companies play by the same rules. G20 countries can help create this level playing field by putting in place appropriate standards which companies must implement throughout their supply chains. And this is happening: there are currently 47 countries including 17 from the G20 which adhere to the OECD MNE Guidelines and they are turning this into law. France for instance, just recently adopted a law on companies’ due diligence which mandates supply chain due diligence in accordance with the Guidelines. The law would apply to all French companies employing 5 000 employees or more domestically or 10 000 employees or more internationally. The German National Action Plan on Business and Human Rights finalized last December aims for “at least 50% of all companies based in Germany with over 500 employees to have integrated the elements of human due diligence described in Chapter III into their business processes by 2020.”

And the business sector is following through: nearly 1,700 investors from over 50 countries and representing US$62 trillion have signed on to the UN principles for responsible Investment. This is why we have developed and launched just two months ago a paper providing guidance for Institutional investors on due diligence. And we are working closely with your countries’ industries which want to advance this agenda. For instance, we are supporting the development of a Chinese Guidance – aligned with OECD sector guidance –by the China Chamber of Commerce of Metals, Minerals and Chemicals Importers & Exporters in 2016. This shows that businesses from all your countries are catching up! But, we must continue to build the moment: we need all G20 countries to put in place strong policy framework for your companies to behave responsibly.

Source:

https://www.oecd.org/g20/g20-labour-and-employment-ministers-meeting-fostering-decent-work-for-sustainable-global-supply-chains.htm