Monday, April 26, 2010

Palm oil players taking the sustainability route to IPO

Palm oil producers seem to have started recognising the reputational benefit of sustainability. You know this when their Initial Public Offering (offering shares to public in order to get listed on a stock exchange) advertisement mentions their commitment to sustainability.

Global Palm Resources Holdings Limited, a little known palm oil company with operations in Indonesia, has taken out IPO advertisements in newspapers as it seeks listing on the Singapore Stock Exchange.

The IPO ad has a banner headline which reads: "Benefiting People and the Planet." Then the body text has two main parts: "Investment highlights, and Our Environment Policy."

The environment policy section states that the company adopts a zero burning policy in clearing land for planting, it's moving toward zero waste management, has proposed co-composting method of treating empty palm fruit bunches and the mill effluent to reduce methane emission, and has applied for membership to the Roundtable on Sustainable Palm Oil (RSPO).

Their website has a CSR link which tells you that the company has applied for membership to RSPO on 11 March 2010. Now that is about six weeks before their IPO opened for sale on the 22nd April.

A press release from the company on the IPO has this headline: "Global Palm Resources Holdings Limited, a palm oil producer with a focus on environment and community,to list on SGX Main Board"

However, the company does not mention if its CSR claims are substantiated by any independent audit, verification or certification, or if there is any endorsement by respectable stakeholders or NGOs.

The company says it plans to double the size of palm plantations with the money raised from the IPO.

Elsewhere, Greenpeace activists dressed as Orang-utans descended on Nestle annual general meeting in Lausanne, Switzerland, protesting against the chocolate-maker's alleged role in the destruction of Indonesia's rainforests by not committing to buying palm oil from sustainable sources.

Thursday, April 22, 2010

When the devil runs Prada

Fashion industry has often been suspected of widespread sexual harassment. The Italian fashion brand Prada is now at the receiving end in Japan where employees are accusing the senior company executives of perpetrating sexual discrimination and sexual harassment in the name of "brand image." Read it here.

But workplace sexual harassment in Japan does not make headlines even though it is suspected to be widespread and acceptable. The mainstream Japanese media has by and large ignored the Prada lawsuit. The Japan Times, an online news portal, though had this detailed coverage.

Workplace sexual harassment is quite common in Asia. But businesses don't recognise this as a problem. Most Asian countries either do not have legislation or do not enforce laws to address workplace harassment. In recent years, the issue has received increased attention due to campaigning by women rights organisations. But businesses as well as governments have not shown any eagerness to respond.

We did a story on workplace sexual harassment in Ethical Corporation magazine in October 2oo8. See the report here.

Aware, a Singapore-based women rights organisation, has developed a training programme for companies to create awareness about the problem of workplace sexual harassment and ways to prevent and address it. In a couple of hours from now, the programme will be launched in a seminar. I will be attending it as a panelist and will be sharing corporate responsibility perspective on workplace sexual harassment. Their training information can be found here.

Monday, April 19, 2010

Climate inaction can reverse China's economic progress, says new report

Three decades of social and economic achievements in China can be reversed if the country does not address the negative impacts of climate change and environmental degradation, says the latest China Human Development Report. The report was commissioned by UNDP in partnership with Renmin University of China.

“Most of the energy-consuming assets needed between now and 2020 have yet to be built,” concludes the report. “China’s success in moving towards low carbon development will be shaped by the types of investments, choices of technologies and organizational decisions that are made in the near future.”

The report says that China’s low carbon policies should include accelerating the phase-out of obsolete production, equipment, industries and products and aggressively expanding low carbon energy such as wind, biomass and solar energy. The report suggests that the priority should be given to energy-saving in production and construction.

China needs to make greater efforts in training, institution building, R&D and oversight in the low carbon field, according to the report.

The report calls for “setting the stage for the introductions of a cap and trade system in the medium and long term, based on a national carbon intensity target, and an enhanced system for monitoring and enforcement.”

It also recommends “establishing a credible and robust system for GHG accounting and statistics as a basis for policy-making as well as for monitoring and enforcement.”

See full report here.

Microsoft accused of abusive working conditions in China supplier factory

Two weeks ago I wrote on this blog how eager Microsoft was to expand buisness in China taking advantage of Google's decision to exit. This week is about activists discovering substandard working conditions in a Microsoft supplier factory in China.

The National Labour Committee, a US-based labour rights campaigner, said in a report last week that it found abusive working conditions in KYE Systems Corp, a Taiwanese-owned factory in Dongguan, China. KYE factory has been making products for Microsoft, its largest buyer, since 2003 including Microsoft Life Cam VX-7000; Basic Optical Mouse and Wireless Notebook Laser Mouse 6000, according to the report.

Other customers of KYE include Hewlett Packard, Best Buy, Samsung, Foxconn, Acer, Wi/IFC/Logitech and Asus-Rd.

The NLC report resulted from a three-year investigation into working conditions in the factory which also produced a number of pictures secretly shipped out from the site.

The report alleges that:
KYE recruits hundreds of "work-study" students 16 and 17 years of age, who work 15-hour shifts, six and seven days a week making webcams, mice and other computer peripherals. Some of the workers appear to be just 14 or 15 years old.

Along with the students, KYE prefers to hire only women 18 to 25 years old, who are considered easier to discipline and control.

Workers report that before the recession, they were at the factory 97 hours a week, while working 80 ½ hours. In 2009, workers were at the factory 83 hours a week, while toiling 68 hours.

Workers are paid 65 cents an hour, which falls to a take-home wage of 52 cents an hour after deductions for factory food.

Workers have to report early, unpaid, for military-like drills. Management controls every second of their lives.

The work pace is grueling as workers race to complete their mandatory goal of 2000 Microsoft mice per shift. During the long summer, factory temperatures reach 86 degrees and the workers are drenched in sweat.

Security guards sexually harass the young women. Workers are prohibited from talking, listening to music or going to the bathroom during working hours. Freedom of movement is restricted and workers can only leave the factory compound during regulated hours.

Fourteen workers share each primitive, dirty dorm room, sleeping on narrow bunk beds. To "shower" workers fetch hot water in a small plastic bucket for a sponge bath. Workers report that the food is awful.

See the full report here.

Microsoft, embarassed by the expose, has said it is sending factory auditors to investigate the matter. The factory owners have denied all allegations.

Hope the episode will result in Microsoft taking some solid steps to prevent such allegations in the future. The company will need to be completely transparent about what it finds during own investigations at the factory and how it plans to fix the problem.

Promoting sexting?
The week was tough on Microsoft, really. Apart from being accused of abusive working conditions in China, the technology giant was attacked by another set of activists who said the advertising campaign for the company's just launched Kin line of phones was promoting sexting among young people. See the promotional video here which has offended people.

Microsoft was quick to say it was withdrawing the ad.

Tuesday, April 13, 2010

Condom responsibility

Lamprecht AG, a Swiss condom manufacturer, has launched smaller sized condoms for young teenagers. The company says the new product is in response to increasing incidence of teenage pregnancies and spread of sexually transmitted diseases in Switzerland.

A local NGO -AIDS Hilfe Switzerland- dedicated to promoting AIDS awareness persuaded the company to start manufacturing smaller condoms. Currently, these kiddy condoms- named Ceylor Hotshot Condom- are for sale in Switzerland only.

Teen pregnancy rates and sexually induced diseases have been on the rise in many countries. There have been reports that kids as young as 12 years old are becoming sexually active. Blame it on the internet, influence of movies and TV serials and sexy advertisements that children are exposed to from the young age.

Sex education from even younger age is becoming necessary. Teaching kids abstinence is something parents and educators must do. But is that enough? Perhaps not. How about teaching safe sex? Religious leaders and moralists don't like this idea. But rationalists would advocate abstinence as the first choice followed by practicing safe sex if the first choice is not made. Condoms obviously will play a crucial role in ensuring safe sex.

But the problem with condoms is that they come in adult sizes. When kids as young as 12-13 years try to use them, they are oversized for them and easily come off.

Lamprecht AG's teenage condoms are aimed at addressing the size problem. Will or should the condom industry leader SSL International, the UK-based maker of Durex, follow suit? Their decision to produce and market smaller size condoms could potentially prevent pregnancies and sexually transmitted diseases among children and young teenagers.

Lamprecht's decision to make smaller condoms has gone unopposed so far. How will the religious leaders and moralists respond if a company like SSL says it will introduce condoms for young boys? Are there any real reputational risks for the company if such a decision is made?

The issue for parents is that should they take into account condom expense in deciding the pocket money for their boys?

Condoms have a history of opposition in their 400 years of existence. But the opposition has increasingly turned into acceptance over the centuries. Should condom manufacturers be afraid of opposition anymore?

Making smaller condoms available however is only part of the issue. Educating youngsters to use condom during every encounter is no easy task. Should condom manufacturers fund NGOs promoting safe sex among kids that includes the use of condoms? A real slippery issue for companies.

Saturday, April 10, 2010

China bad for Google, good for Microsoft

China's demanding internet censorship regime has forced Google to shut its search services in China. At least, this is what Google would like us to believe.

Then how is it that the same censorship rules are good enough for Microsoft, Yahoo and other internet companies which are still bullish on China. Within days after Google shut their search services on China site, Microsoft announced an expansion plan for its own search service Bing. Bing unsuccessfully competes with Google for market share in the search business. Google's absence in China can be an opportunity for Microsoft to inch up Bing's market share.

Google wanted Microsoft and other US internet companies to rally behind the exit decision to increase pressure on China. But that has not happened. Now Google is accusing Microsoft and others of putting profit before everything else.

Indeed, Microsoft has openly said they would continue to do business with China and obey the local laws.

Google and Microsoft both are founding members of Global Network Initiative, a non-profit grouping to encourage technology companies to adopt human rights and privacy rights policies. Their opposing stand on China is a bad news for the GNI and raises questions about its future.

Google had said that "Google and more than twenty other U.S. companies had been the victims of a sophisticated cyber attack originating from China, and that during our investigation into these attacks we had uncovered evidence to suggest that the Gmail accounts of dozens of human rights activists connected with China were being routinely accessed by third parties."

None of the other US 20 companies has spoken up. They quitely continue to do business with the Chinese. Do they have human rights policies?

China is a lucrative market. Companies would not like to jeopardise their prospects in China by criticising the government policies or by championing human rights. That does not make business sense. They won't change this approach unless their more enlightened customers in the US and Europe punish them for their China actions.

Another possibility is that the US lawmakers may use the Google saga to introduce a bill that will seek to prevent technology companies from doing business in China if China does not rationalise its human rights and privacy policies.

For now Google is alone in its fight for privacy of users. But, is that the real story? Everyone knows that even after years of trying hard, Google was not able to beat Baidu, China's local search giant. China is the only market where Google is not number one. Observers say that Google's decision to leave China has more to do with its failure to win market share rather than privacy and human rights concerns. Is it a case of grapes are sour?

See here Google's official position on their exit from China.

Sunday, April 04, 2010

Sexual harassment at workplace seminar

Association of Women for Action and Research (AWARE), a Singapore-based rights organisation, is organising a free seminar on "sexual harassment: protecting your organisation" on the 22nd April. The event is to launch AWARE's training programme for companies on sexual harassment.

The event is particularly useful for HR policy makers, corporate responsibility professionals, corporate counsels and anyone with an interest in the workplace harassment issue. For more details, see here.

Aware is the first women rights NGO in Singapore to have developed a workplace sexual harassment training programme for companies after several years of research.

In 2007 and 2008, AWARE conducted a survey of sexual harassment at the workplace. The NGO also gathered information about companies’ sexual harassment practices and policies, and recommendations on legal recourse for victims of workplace sexual harassment.

Key survey findings were:

-More than 50% of respondents said they had experienced some form of sexual harassment at their workplace.

-1 in 4 knew of people who had experienced some form of sexual harassment.

-Of those who experienced sexual harassment, 34% of women respondents and 19.2% of men respondents reported being harassed several times.

Singapore companies have shown remarkable reluctance to recognize that sexual harassment is a real issue that needs to be addressed by way of a firm policy and action.

AWARE's new training programme is an opportunity for all companies to make use of the training and introduce long overdue policy on sexual harassment.