Promoting Effective Labor Monitoring Standards A Verité and CREA Initiative October 2010 Verité CREA 44 Belchertown Road P.O. Box 2507 Amherst, MA USA 01002 HartFord, CT USA 06146 Table of Contents Introduction.............................................................................................................................................................. 3 Program Goal........................................................................................................................................................ 3 Methodology ........................................................................................................................................................ 4 Project Summary by Phase ....................................................................................................................................... 5 Phase I, Objective I: Stakeholder Consultations and Dialogue ............................................................................. 5 Survey............................................................................................................................................................... 6 Survey Results .................................................................................................................................................. 6 Communication and Outreach......................................................................................................................... 7 Phase I, Objective II: Initiation oF Standards Portal ............................................................................................. 9 Social Auditor Standards Wiki.......................................................................................................................... 9 Expert Committee .......................................................................................................................................... 11 Standards Launch........................................................................................................................................... 12 Phase II: Pilot Testing and Promulgation of a Training Plan .............................................................................. 13 Phase III: Establish Process For Updating the Standards.................................................................................... 14 Conclusions and Recommendations....................................................................................................................... 15 Annex I: Results and Analysis of the Social Auditor Standards Survey ................................................................ 176 Annex II: Social Auditor Standards..................................................................................................................... 9796 Annex III: Training and Institutionalization Survey Results.............................................................................. 11110 Annex IV: Summary of Stakeholder Comments on the DraFt Standards ......................................................... 13129 Annex V: Project Timeline to End oF Project........................................................................................................ 150 Annex VI: Project Team and Major Stakeholders Consulted ........................................................................... 15250 Verité Promoting Effective Labor Monitoring Standards | 2 Introduction Today's global economy is Focusing increased attention on social accountability, good corporate citizenship and ethical sourcing. Consumers in the US and Europe now demand higher social standards from corporations and their brands. A wide range of businesses actively use social auditors to ensure their suppliers follow international labor norms. “Social audits” provide the original base-line inFormation used by companies to engage with supply chain partners on labor, environmental, and other social concerns. Social audits can also serve an important inFormation gathering and verification role as companies seek to embed social compliance into daily business strategy and perFormance and also manage risk. Yet while companies increasingly use monitoring as a core Function to meet demands For corporate accountability, monitors and monitoring organizations face deep and worrisome challenges in terms of credibility, standardization and reliability. Corporate CSR eFForts have been undermined by fundamental weaknesses in the staFFing, process and outputs oF many social audits conducted by the increasing number oF monitoring companies entering the Field. Some monitor training programs exist, but they are oFten speciFic to and oriented around separate Codes rather than fundamental, broadly applicable skills. This limits their usefulness in meeting the challenges faced by the broader social monitoring industry. In the face oF civil society challenges to the credibility oF social monitoring, there remains a need and increasingly strong demand for a broadly accepted program by which the universal qualiFications, skills and knowledge needed For eFFective monitoring, across industries and audit models, are standardized, trained to, assessed and veriFied. Many groups worldwide have a direct interest and stake in social auditing as the Foundation oF social compliance efForts. In the past ten years, a wide range oF actors from the private and not-for-profit sectors have expressed interest in bringing long-deserved, credible standards of recognition For the Fast-growing and vital proFession oF social auditing. Based on input From brands and monitoring organizations, the US Depart oF State's OFFice oF International Labor AfFairs and Corporate Social Responsibility launched a Request For Proposal for the Promote EFFective Labor Monitoring Standards Project in 2006. Verité and the Center For ReFlection, Education and Action (CREA) won the bid. The original project dates were November 6, 2007 to November 30, 2009. However, the project was extended to June 30, 2010. Program Goal The short-term and long terms goals of this project included: • Broad promulgation -- and acceptance among private sector and civil society organizations -- oF a robust, universal Body oF Standards against which the knowledge and skills oF social monitors across industries can be evaluated; • Pilot testing and promulgation oF a plan For mandatory and elective training courses by which individual monitors will be certiFied to the emergent Body oF Standards; and Verité Promoting Effective Labor Monitoring Standards | 3 • Establishment oF a process by which the Standards will be vetted and updated on a regular basis, embedded in an independent institution that markets and manages the training and certiFication system. The project included three phases, based on the goals above: Phase I: Objecve I - Build buy-in among key brands, global NGO monitors and for-profit monitoring firms and introduce process to broad group of stakeholders, including overseas stakeholders Objecve II - Iniaon of standards portal to facilitate communicaEon about standards and receive feedback Phase II: Pilot tesng and promulgaon of a plan for mandatory and elecEve training courses by which individual monitors will be cerfied to the emergent Body of Standards. Phase III: Establishment of a process by which the Standards will be veQed and updated on a regular basis embedded in an independent insEtuon that markets and manages the training and cerEficaEon system. The process was open to all interested participants, regardless oF their participation in other multi-brand or multi-stakeholder initiatives. Methodology Verité and CREA compiled the results oF previous discussions on social auditing standards to inForm and shape the Project. The Project developed a list of six key categories to explore and discuss, corresponding to the topics that provoked the most discussion at previous social auditor stakeholder meetings: Post Audit Ethical Issues Issues Skills & Structural Competencies Issues Social Experience & Knowledge Auditor Credenals Standards Verité Promoting Effective Labor Monitoring Standards | 4 At the same time, the Project compared and contrasted existing auditing standards such as BEAC, EICC, IRCA, ISEAL, and SA 8000 to inForm project activities in terms oF auditor levels, training requirements, auditor categories, and certiFication requirements. Project Summary by Phase The Following section provides a summary oF Project accomplishments and activities by phase and objective. A chronological list oF activities is Found in Annex V. Phase I, Objective I: Stakeholder Consultations and Dialogue As discussed in the methodology section above, the First two Objective I: Activities Overview Project activities were an analysis of existing social auditing • Consultations with stakeholders activities to determine the main monitoring issues and key • Review existing auditing standards concerns, and an analysis oF existing social auditing standards to • Issues Identification spot similarities among the difFerent standards and areas oF non- • Develop survey instrument alignment. This desk research coincided with extensive • Pre-test of survey stakeholder meetings with brands, NGOs, unions, • Launch survey multistakeholder groups, and monitoring organizations, including • Survey analysis the following groups: • Dissemination oF results • practitioners (monitoring groups), including: o large, for-profit global monitoring companies such as Intertek Testing Services, Specialized Technology Resources-