Social Accountability

More than just a new buzz-word, social accountability is a vital consideration for the management
of companies doing business outside the United States. Ensuring that our corporate reputation is
maintained and that our company's business functions in a lawful, humane, safe and ethical
environment with respect to local and international laws and conventions are sound business
practices.
Shirts of Bamboo requires that all of our international suppliers adhere to Social Accountability
Standards as measured and assessed through a social accountability audit utilizing the SA 8000
standards.

SA 8000 Background

SA8000 is a consensus standard that encourages companies and other organizations to develop,
maintain and apply social, ethical, and acceptable workplace practices within their sphere of
influence. SA8000 is an initiative of the Council on Economic Priorities Accreditation Agency
(CEPPA), an affiliate of the Council on Economic Priorities. In short, the SA8000 standard seeks to
ensure certain benchmarks are applied to workplace practices through accredited and independent
third party auditing. The overall mission of SA8000 is to improve working conditions globally. For
a detailed breakdown of the areas covered, see below.

Detailed Information on SA8000

With ever increasing frequency, companies are coming under scrutiny from governments,
customers, trade unions, human-rights groups, and others to prove that their activities are conducted
in a way which is socially acceptable to those who may be touched by it.

The notion of 'social accountability' is not a new one. International organizations, trade unions,
human-rights lobbyists and regulators have long strove to eliminate the inequities of the workplace.
Child labor and prison/forced labor continue to be pivotal issues in many areas of the world. Most
of us will buy goods manufactured under conditions that we would never admit. Illegal labor and
discriminatory practices are still usual, even in the 'developed world'.

Several initiatives have been developed to tackle the issue of ethical business behavior, among the
most relevant are:

OECD Guidelines for Multinational Enterprises

The Caux Principles
Principles for Corporate Global Responsibility (UK, Canada and US)
Ethical Trade Initiative (UK)
The International Code of Ethics for Canadian Business
Corporate Code of Responsibility for Transnational Companies (New Zealand)
However, these are not standards against which companies can be gauged. Filling this gap SA8000,
or 'Social Accountability 8000' was published in October 1997. As a complement a guidance
document was drafted, meant to aid in the interpretation and implementation of SA8000.

Similarly to ISO9000 and ISO14000 (the international quality and environmental management
systems series of standards, respectively) SA8000 is formulated to allow audit and certification by a
third-party certification body. However, and unlike the ISO9000 and ISO 14000 series, this new
standard embraces not only system requirements but also tangible performance requirements.

A scheme for SA8000 accreditation and certification has been set up, to provide a corporate focused
solution and, by making use of independent auditors, try to achieve the credibility absent from some
other initiatives in this field. The SA8000 principles intend to have a supply chain effect, being
applied internally within a company but also used as a tool to manage suppliers.

In an age dominated by the media, public image has become a pivotal concern. In such a context for
many companies just behaving ethically is no longer enough. SA8000 certification aims at
providing external evidence that a company is "doing the right things right."

Where Does SA8000 Originate?

SA8000 results from a four-year work launched by the Council on Economic Priorities
Accreditation Agency (CEPPA), an agency of the Council on Economic Priorities (CEP). The CEP
is a non-governmental organization in the field of corporate social responsibility; it was established
in 1969 and is based in New York.

The advisory board of the CEPPA has representatives from a broad spectrum of organizations,
including manufacturing and service companies, financial institutions, management services
companies, customer and supplier corporations, other non-governmental organizations, trade unions
and academia. Among those contributing to the development of the standard were representatives
from Toys "R" Us, Avon Products, OTTO-Versand, KPMG, Body Shop, Amnesty International,
National Child Labour Committee, Sainsbury's, University of Texas, Belgian Workers Federation,
Abrinq, International Textile Garment and Leather Workers Federation, Eileen Fisher, Grupo
M.S.A., Amalgamated Bank, Reebok and SGS-ICS.

The development of SA8000 was not a governmental or sectorial scheme, and allegedly efforts
were made for it not to be dominated by any individual interest group, however it is evident that the
advisory board is largely dominated by representatives from the business and financial milieu.

The goal of the CEPPA was to publish an auditable international standard for socially responsible
business. The standard reflects the conventions of the International Labor Organization (notably the
seven core conventions), the Universal Declaration of Human Rights and the UN Convention on the
Rights of the Child. The standard also demands compliance with national and other applicable laws,
regulations and other requirements to which the company subscribes.

This standard is meant to be applied across the north-south world divide, irrespective of the
organizations size, ownership (public, private, etc.) or whether it is profit or not-for-profit.

SA8000 aims at encouraging companies and other organizations to implement maintain and
improve socially correct workplace practices in all the domains they can control or affect. A
significant number of organizations have introduced 'rules of conduct', but in most cases they are
rather subjective and difficult to audit. SA8000 is inspired on a ISO9001 management system and
therefore is designed for audit ability.

What's Covered in SA8000?

SA8000 has nominally been developed to advance the cause of socially responsible business. It is a
four part document. The first three parts deal with scope, interpretation and definitions. The fourth
part enumerates minimum requirements concerning child labor, forced labor, health and safety,
freedom of association and collective bargaining, discrimination, disciplinary practices, working
hours and compensation, as well as the management systems to achieve these requirements. These
requirements are summarized below.

Nevertheless, the standard's requirements say nothing about the quality of the product or service;
that is clearly outside their scope. The product or service may be mediocre, but if it was produced in
an SA8000-certified site, basic rules of working conditions have been honored.

Child Labor
Child labor is banned, allowing only for the exceptions included in ILO convention 138 and
recommendation 146. Requirements are established for minimum age (15), work hours, young
workers (those under 18), school attendance, workplace conditions and remediation of children.
Forced Labor
The use or support of involuntary, or under menace of penalty labour, is not allowed - as established
in ILO conventions 29 and 105. The frequent practice of controlling workers by sequestering their
documents (e.g., passports, work permits) is also forbidden.
Occupational Health & Safety
The standard imposes the appointment of a senior management representative for the H&S of all
personnel. This representative shall be accountable for the implementation of the H&S clauses of
the standard.
SA8000 has requirements regarding healthy and safe working environment; risk detection and
prevention of accidents and injury; regular H&S training; clean, safe and sanitary support facilities
as well as access to potable water.
Freedom of Association and Right to Collective Bargaining
The right of the personnel to create and become members of trade unions of their choice must be
respected by the employer, according to ILO convention 87. The company must also allow for
collective bargaining.
In those countries where local laws affect these rights, the company should attempt to find 'parallel
means' to enforce them.
Following ILO convention 135 the standard protects the personnel representatives, by allowing
them access to fellow workers and preventing their discrimination.
Discrimination
Following ILO conventions 100 and 111, no discrimination in hiring, compensation, access to
training, promotion, termination, retirement, is permitted on the basis of: Race, Caste, National
origin, Religion, Disability, Gender, Sexual orientation, Union membership, or Political affiliation.
The employer cannot interfere in the exercise of the rights of personnel to observe tenets or
practices, or to meet needs relating to any of the previously listed categories.
The occurrence of behavior, which is deemed sexually coercive, threatening, abusive or
exploitative, shall not be allowed by the company.
Disciplinary Practices
Companies abiding to SA8000 must not use or support the use of corporal punishment, mental, or
physical coercion or verbal abuse.
Working Hours
Compliance with applicable laws and industry standards is demanded. Working time must not be
more than 48 hours per week (on a regular basis) and never in excess of 60 hours per week.
Overtime shall occur only on an exceptional and voluntary basis and be remunerated at a premium
rate. Workers shall have at least one day of rest in every seven.
Compensation
The workers' payment shall not only meet legal and industry minima, but also meet basic needs plus
some discretionary income. No disciplinary deductions are allowed. Regular and detailed
information on wages and benefits must be supplied to the workers.
No false apprenticeship schemes or other attempts to bypass labour laws, social security legislation
and regulations are permitted.
Management Systems
Assuming a posture similar to ISO9001, based on corporate responsibility, control, and continuous
improvement, SA8000 requires top management to act in the following areas: Policy for social
accountability, Management review, Company representatives, Planning and implementation,
Control of suppliers, Concerns and corrective actions, Outside communication, Access for
verification, and Records.