Better Work: Promoting Labour Standards through Responsible Competitiveness

The following article appeared in AccountAbility's latest report entitled "The State of Responsible Competitiveness 2007: Making sustainable development count in global markets". The article discusses the partnership between the International Labour Organization and the International Finance Corporation for improving labour standards in global supply chains. Pages 78-83

By Ros Harvey, Houria Sammari, and Annemarie Meisling

Can a developing country compete in trade by offering good working conditions instead of courting businesses that do not respect workers’ rights? An attempt to turn the race to the bottom on its head is being launched
through a partnership between the International Labour Organisation (ILO) and IFC (International Finance Corporation). Better Work builds on lessons from the ILO’s Better Factories Cambodia Project, which monitors and reports on working conditions in the export garment industry in Cambodia. Benefiting from this initiative, the Cambodian industry has grown substantially, with employment nearing 340,000 workers, up by 28% from January, 2005.

Background

ILO and IFC launched Better Work in August 2006 with the goal of improving labour standards performance and competitiveness in global supply chains. The partnership involves the development of both global
tools and country-level projects. It offers sustainable solutions that build cooperation between government, employer and worker organisations, and international buyers.

Improving labour standards in global supply chains is an important part of a pro-poor development strategy. Where workers’ rights and entitlements are protected, the benefits of trade are more equally distributed. Better
Work supports enterprises in implementing core international labour standards and national labour laws. This improves the ability of enterprises to compete in global markets where many buyers demand that their
suppliers comply with international and national labour standards. Improved labour standard performance also helps enterprises become more competitive through higher productivity and quality, thereby reinforcing
supplier support for the improvements.

Better Work builds on the experiences of both IFC and ILO. IFC is the private sector financing arm of the World Bank Group and has recently developed Performance Standards on Labour for its investment operations.
ILO is the specialised labour agency of the United Nations. Better Work combines the expertise of ILO in labour standards and their application within the framework of IFC-supported private sector development. Both bring credibility and their strengths to the programme.

Better work products

Country level projects

Country projects typically combine independent assessments of enterprises with advisory and training services to support improvements through workplace cooperation. This is done through industry-based schemes that focus on developing enterprise-level programmes. Factory information can then be shared with buyers through the Better Work Information Management System (IMS). It allows buyers to reduce their own auditing activities and redirect resources to resolving problems and developing sustainable solutions. The key to success of the project is the support of the relevant employers’ organisations and trade unions, as well as of the national government and international buyers.

Better Work country projects will deliver training consisting of classroom-based instruction as well as advisory services for enterprises. The programme has been designed to maximise the impact of training through support for implementation at the enterprise level. Since the skills of trainers and managers are critical to the success of this initiative, Better Work will establish certified training programmes for trainers and enterprise advisors, a support network, an inter-active web-based community of practice to support practitioners, and a professional development programme for these target groups.

Country projects are designed to be sustainable and of a significant scale. One of the objectives of the programme is to establish independent organisations that will continue operating after funding of the project comes to an end. Typically, within five years the projects are expected to become self-financing. A sustainability strategy and financing plan are built into the project from the outset, which include payment of fees for services by enterprises participating in the programme and capacity building of local service providers – the global programme will then be responsible for ongoing quality control once country projects are independent and for
adapting new generation products relevant to the country programme.

Global level tools

Better Work is built around a range of practical tools to help enterprises improve their labour standards performance and competitiveness. They include:

• an Information Management System (IMS) to capture information on compliance and remediation efforts, which can also be adapted to support self-assessments, country projects, and public sector labour administration;

• a global portal providing information in different languages and for different countries and sectors, as well as supporting virtual communities of practice to involve stakeholders in programme development;
• a compliance assessment with core international labour standards and national labour law that also allows enterprises to track the impact of improving labour standards on quality and productivity indicators;
• training resources, including a 12-month modular training programme, single issue seminars, induction training kits, and first-level supervisor training;
• tools for raising worker awareness on rights and responsibilities using innovative techniques such as soap operas and comic books;
• work books for mini projects to address common problems in enterprises targeted to small and medium size enterprises; and
• labour model policies and procedures and good practice guides.
  

The Better Work tools are designed to be practical and easy to use and to demonstrate benefits of better workplace cooperation for employers and workers. They will be available globally and adapted for use in
different sectors as part of country projects. More tools will be developed as the programme unfolds.

A small global team supports the ongoing development of global tools and roll out of Better Work on a country level. The team is also responsible for managing impact assessment reporting, knowledge management, coordination, stakeholder engagement, ongoing quality control, resource mobilisation, strategic management, and policy advice.

Measuring impact

IFC and ILO are designing a comprehensive monitoring and evaluation framework to measure impacts at the factory, industry, country, and global level. Each country project will include impact assessment studies. These are expected to strengthen the business case for improving labour standards performance, which is an important part of the overall strategy of the programme. Ongoing monitoring will also allow participants to adapt tools and techniques over time. The evaluation will look at:

• Labour standards compliance;
• productivity and quality performance;
• economic components, such as employment, foreign direct investment, and exports; and
• human and social development.
  

Better Work aims to bring benefits to a range of people and organisations in the following ways:

• workers, through better protection of their rights, improved working conditions, and ongoing opportunities for employment;
• industry, through a credible means to demonstrate labour standards compliance to international buyers, enhanced reputation, reduced worker turnover and improved productivity, improved competitiveness, and reduced number of social audits;
• international buyers, through credible information on labour standards compliance in supplier factories, support for suppliers to take action to remediate compliance gaps, reduced risk of labour violations in the supply chain that can impact brand value, reduced auditing costs; and more competitive suppliers with better productivity and quality;
• countries, through potential export and tax base growth, increased employment, a more competitive industry, and benefits from trade agreements that reward good labour standards performance; and
• consumers, around the world who care about goods that are produced under decent working conditions.

Next steps

In the first stage of the programme, three pilot country projects are being explored in Vietnam, Jordan, and Lesotho. After initial launch of one or more of these projects, Better Work will expand to other countries.
Country projects adapt the global tools and develop new ones, which in turn will be made available to the global BetterWork community. This way, Better Work tools will be adapted and developed for different sectors and regions.

The choice of countries and sectors for country projects is very important. The programme intends to develop projects in sectors such as agribusiness, textile and apparel, light manufacturing, transport, construction, and
electronics. IFC and ILO have been approached by multiple countries interested in participating in Better Work and will develop regional strategies to ensure effective roll-out. One such example is the planned expansion
into African agribusiness in 2008. For more information, please visit www.betterwork.org.

About the authors

Ros Harvey is the Global Programme Manager of the global Better Work programme. Ms. Harvey takes up this post after three years as the manager of the ILO’s Factories Cambodia project. Under her leadership the project developed a range on innovative tools and approaches to monitoring and remediation in the export garment industry. Ms. Harvey has worked for 25 years on labour, development and social justice issues – the last 15 years at the international level.

Houria Sammari is currently leading the Social Responsibility area in IFC’s Environmental and Social Development Department. Social Responsibility develops innovative products and approaches in the area of Corporate Social Responsibility to benefit IFC clients and the wider private sector. Areas of activities include local community development and stakeholder engagement, sustainability strategy and reporting, and business and human rights with a strong focus on labor.

Annemarie Meisling is a Private Sector Development Specialist in IFC and IFC Program Coordinator of the Better
Work Program. In addition, Ms. Meisling is working for the Foreign Investment Advisory Services (FIAS) – a joint service of the World Bank and IFC – on corporate social responsibility in China's information and telecommunication sector.