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Global Partnerships: Opening the Way toward Economic Justice and World Peace

On the streets of Seattle in 1999, protestors put the World Trade Organization in the spotlight and got tangled in violent confrontations with police. Tragically, many people were injured. I don’t doubt that some of the protestors really wanted to change the system for the better. They just went about it in the wrong manner.

When I joined the Religious Society of Friends, soon after my horrible combat experiences in World War II, my Episcopalian mother gave me some sage advice: “Lee, do not be violent about your nonviolence.”

Margaret L. Thomas was right in many important respects. Her advice applies to international business as well as to the Peace Testimony. For many years, I have been trying to get Quakers and Quaker organizations to see the positive side of international business. I have been urging them to quit being confrontational about it. I believe that demonstrations and boycotts are a kind of “nonviolent violence” that my mother was talking about. Instead we should be planting the seeds of positive partnerships.

Building partnerships is the clear and commonsense alternative to confrontation. (See “The Relevance of Partnerships,” FJ May 2003.) On the local level, partnerships between labor and management can engender social and economic justice. One effective way to achieve this is through “SA8000,” a demanding voluntary system of standards based on International Labor Organization conventions and the UN Universal Declaration of Human Rights and the Convention on Rights of the Child. Workers are paid a decent living wage, and are treated decently. On a global level, partnerships can help achieve world peace. We do not go to war with our trading partners.

I am not an apologist for international business, nor do I claim that it is perfect in any way. Yet, I believe that too little credit is given to companies that are making strong inroads promoting fair wages and good working conditions the world over. Confrontation on the streets of Seattle and elsewhere calls into question the moral integrity of all international business, and paints all companies with the same broad brush of negativity. That unfairly biases people against all business.

Yes, we have greedy and insensitive business people. The Enrons and WorldComs of the world have proven that beyond a shadow of a doubt. But the fact is that most business people know that if you run an ethical business, you’re much more likely to run a successful business. That message has not been lost on the likes of Toys R Us, Avon, Chiquita, and Dole. They are the best known U.S. companies that are committed to getting all of their sources compliant with SA8000 as soon as is practical. Progress is a little better in Europe. This is not enough, but it is a good start.

SA8000 grew out of an international multi‐stakeholder advisory board convened in 1996 by Social Accountability International. Businesses have gotten used to adhering to externally demanding standards because of the International Organization for Standardization (ISO) standards for product quality and environmental performance. SA8000 adopted that same guiding principle. SA8000 requires the following:

  • No child labor (under age 15)
  • No forced labor
  • A safe and healthy work environment
  • Freedom of association
  • No discrimination based on gender, caste, race, etc.
  • No corporal punishment or abuse
  • No more than 48 hours per week with voluntary overtime of no more than 12 hours at premium pay; always one day off per week
  • A living wage with a little for discretionary spending
  • A management system to provide for continuous improvement

SA8000 does not require immediate compliance and wouldn’t succeed if it did. But it does require a company to make continuous, meaningful progress toward the established standards. One extremely important standard is a living wage, which is calculated to ensure a worker can afford to pay for good nutrition (based on a diet of 2,200 calories per day). The standards also call for a worker to have the freedom to join a union. But in China unions are illegal. Gender discrimination is condemned under SA8000, but how quickly can it be a force for change in the Islamic world where such discrimination is widespread?

SA8000 does not provide a panacea for all of the injustices. But it is a growing movement and as of this writing 353 factories have been certified as compliant.

To be certified, a company must have a certification audit by an auditor judged to be independent by Social Accountability International. Most of us do not like to be subjected to demands and criticism. SA8000’s certification process may make more than a few companies uncomfortable, if not downright defensive. But in the wake of Enron and other corporate scandals, there is a huge demand for transparency. That transparency runs across the board from financial reporting to disclosures on how business treats its employees. This is a healthy process for world business.

International business can decidedly be a force for world peace. Even though China is a ruthless dictatorship and has weapons of mass destruction, we are not at war with them. One compelling reason for this is that China is a substantial trading partner.

No one in good conscience could argue that sweatshops contribute to world peace. While I was its CEO, Vermont American Corporation refused to buy pliers from a sweatshop in what was then Nanking. In Nanking, I saw a factory that was absolutely deplorable. The dust in the grinding room was so thick that you could hardly see. Silicosis had been discovered at the turn of the 20th century, so the plant’s operators should have known breathing this dust could cause terrible consequences for the workers. In fact, silicosis still kills thousands of people every year, according to a 2000 report from the World Health Organization. Nevertheless, the workers were breathing the silica dust in this grinding room. There were no safeguards employed there. This was not only unhealthful, it was appalling.

Also at that factory, I witnessed a woman holding a chisel and a man hitting the head of that chisel with a sledge‐hammer. She had no protection for her hands. How long would it be before he missed? I was outraged. Our company refused to be involved in the exploitation of workers. There is some business we just plain don’t need.

Plant conditions in China today have improved somewhat. At my new company, Universal Woods, we buy jewelry boxes from a Chinese supplier. We were very careful to see that these Chinese workers were getting a living wage, had a safety program, and were not made to breathe unhealthy sawdust in the plant. In addition, the plant’s largest customer, the Swedish company IKEA, has a full‐time employee at that plant to make sure things are running smoothly and that people are treated decently. And the Swedish government, which seems to be a more positive force for ethical international business than most, is looking over IKEA’s shoulder. It doesn’t want to be associated with a sweatshop, and neither do we. In the absence of IKEA we’d have to pay for independent audits of this plant.

Universal Woods has only about 40 people, yet we are proving that size doesn’t matter when it comes to building partnerships for economic justice and world peace. Our CEO is a Quaker, Paul Neumann, son of the late Nancy and Louis Neumann of Miami Meeting in Waynesville, Ohio. Paul and I have been business partners for more than 20 years. And although he is about 30 years my junior, he is one of my best mentors. He has a remarkable ability to develop partnerships that have helped us to build a significant worldwide distribution network for our little company.

International business must be done right. Fortunately, several forces are encouraging that. First, those of us that are top executives have consciences. Second, the ethical investing movement has grown to the point that it has an impact on corporate share prices. Third, there are a lot of concerned consumers. These consumers need a lot more education than they are getting before they are going to be an effective force.

The late Leon H. Sullivan, a Baptist minister in Philadelphia, proved that partnerships could be forged with international corporations. He was a board member of General Motors Corp. in the 1970s. In 1977, a group of 12 U.S. companies under Leon Sullivan’s leadership formulated a code of corporate conduct to govern the operation of their South African subsidiaries. Known as the “Sullivan Principles,” this code promoted racial equality in employment practices in South Africa and developed programs to improve the lives of black citizens of that formerly polarized society. By 1984, about 140 U.S. companies had endorsed the Sullivan Principles. Later, he supported the withdrawal of investments from South Africa until the apartheid system was eliminated.

Following are three queries:

  1. As a consumer, are you careful to buy merchandise made under humane conditions?
  2. Are you doing what you can to encourage companies to improve working conditions and other conditions of employment where they do business?
  3. Are you careful not to stereotype all businesses, unions, or other organizations in the same negative way, realizing that each should stand on its own merits?

I urge Friends and Friends organizations to try to form partnerships with business people and businesses to make globalization work for peace. We should all want a more compassionate capitalism. But the only way to get it is through partnerships. And partnerships are the only way I can conceive that we stand a chance to reduce terrorism and to eliminate the motive for going to war.
Let’s get the dialogue started!

Lee B. Thomas Jr. is a founding member of Louisville (Ky.) Meeting, which celebrated its 50th anniversary in May 2004. He served as president and CEO of Vermont American Corporation, 1962-84 and chair of the board, 1984-89. He is currently chair of Universal Woods Inc. and executive in residence at Bellarmine University in Louisville. He served on the board of the Council on Economic Priorities in New York City for more than 30 years until 2000, and was chair at the time it negotiated the SA8000 universal workplace standards for global business in Geneva, Switzerland, in 1997. He also has served for many years on the Louisville Council on Foreign Relations.

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