Don't ask on CSR, act

2 August 2009

03 August 2009 | Helen Gilbert

Buyers must do more to ensure international supply chains are ethically sound, industry experts have warned.

It follows the publication of two damning reports, which revealed that suppliers continue to be involved in unethical practices overseas.

An investigation by campaign group Global Witness found European and Asian firms were buying minerals from the Democratic Republic of Congo (DRC) that were funding armed groups and fuelling conflict.

The body wrote to 200 companies and found most had no controls to stop "conflict minerals" - including cassiterite (tin ore), coltan and gold - from entering the supply chain.

"Companies say they only buy from licensed exporters, when they know full well that their middlemen buy from armed groups," said Patrick Alley, Global Witness director.

The report, Faced with a gun, what can you do?, called on companies to carry out due diligence to ensure they are not funding warring parties.

Anneke Van Woudenberg, senior researcher on the DRC for Human Rights Watch urged purchasers to take a hands-on approach. "They cannot just ask for commitment or statements. They have to actively go out and check," she told SM.

Meanwhile, Wal-Mart's supply chain standards in China have been blasted after a Chinese Labor Watch report found staff being exploited in two factories. Investigations into the Huasheng Packaging Factory and Hantai Shoe Factory found serious violations of worker rights, including inhumane overtime systems, and a system to cheat Wal-Mart audits.

A Wal-Mart spokesperson said: "We have launched an immediate investigation."

SMaug2009

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