In Paris this week on an official visit, Azerbaijan’s autocratic President Ilham Aliyev has already scored one photo op. Anyone reading yesterday’s Azeri media could see dozens of photos of Aliyev posing with leaders of top French companies, including Airbus, Suez, and Credit Agricole.

Azerbaijan's President Ilham Aliyev (L) shakes hands with his French counterpart Francois Hollande as they visit a local French school under construction in Baku, May 11, 2014.

© 2014 Reuters

Today, President Hollande will receive President Aliyev and host an official dinner at Palais de l’Elysee. Again, Parisian photo ops abound. But amid the flashing cameras, one has to wonder where Azerbaijan’s repression of critics and the jailing of opponents fits in the new relationship between Paris and Baku?

In the past few years, Azerbaijani authorities have aggressively gone after the country’s once vibrant civil society, jailing dozens of activists, journalists, and political opponents. It also adopted draconian legislation making it virtually impossible for independent non-governmental organizations to operate.

One year ago, as Azerbaijan’s economy started to suffer from falling oil prices, several of those detained on political grounds were released. That was an important first step, but hopes for progress were short-lived.

Many of those released face travel bans or obstacles to their activities. Dozens are still locked up on political grounds, including opposition activist Ilgar Mammadov, despite repeated calls by the Strasbourg-based Council of Europe for his immediate release. And more activists have been thrown in jail. Recently, one of the country’s most popular journalists and bloggers, Mehman Huseynov, was sentenced to two years in prison for allegedly defaming the police, in response to his brave public denouncement of the police abuses he suffered.

When visiting Paris, Brussels, or other European capitals, President Aliyev hopes to get more business opportunities and investment in Azerbaijan. But he prefers to ignore that the people of Azerbaijan want human rights protections, transparency, and good governance. Those standing up for these values are routinely exposed to attacks and harassment.

Yet what more clear message that Azerbaijan’s crackdown cannot be ignored by potential investors than last week’s decision by the Extractive Industries Transparency Initiative (EITI), an international coalition promoting better governance of resource-rich countries, to suspend Azerbaijan – precisely because of its actions against civil society.

President Hollande should reject a narrative that only finance and economy matter in Azerbaijan. Human rights should be as central to France’s foreign policy as other topics.

Hollande should publicly call for the release of Ilgar Mammadov and all those detained in retaliation for their activism and criticism. A failure to explicitly support human rights principles would be the worst message to those unjustly waiting behind bars.

Author: Human Rights Watch
Posted: January 1, 1970, 12:00 am

Arvind Ganesan is the director of Human Rights Watch’s Business and Human Rights Division. He leads the organization’s work to expose human rights abuses linked to business and other economic activity, hold institutions accountable, and develop standards to prevent future abuses. This work has included research and advocacy on awide range of issues includingthe extractive industries; public and private security providers; international financial institutions; freedom of expression and information through the internet; labor rights; supply chain monitoring and due diligence regimes; corruption; sanctions; and predatory practices against the poor. Ganesan’s work has covered countries such as Angola, Azerbaijan, Burma, China, Colombia, the Democratic Republic of Congo, Equatorial Guinea, India, Indonesia, the United States, and Nigeria. His recent research has focused on predatory lending practices and governance issues on Native American reservations in the United States. He has written numerous reports, op-eds, and other articles and is widely cited by the media.

Ganesan has also worked to develop industry standards to ensure companies and other institutions respect human rights. He is a founder of the Voluntary Principles on Security and Human Rights for the oil, gas, and mining industries and is a founding member of the Global Network Initiative (GNI) for the internet and telecommunications industries, where he also serves on the board. Ganesan has helped to develop standards for international financial institutions such as the World Bank, and regularly engages governments in an effort to develop mandatory rules or strengthen existing standards such as the Kimberley Process. He serves on the board of EGJustice, a nongovernmental organization that promotes good governance in Equatorial Guinea, and is a member of the International Corporate Accountability Roundtable (ICAR)’s steering committee.

Before joining Human Rights Watch, Ganesan worked as a medical researcher. He attended the University of Oklahoma.

Posted: January 1, 1970, 12:00 am

“Sometimes I just can’t sleep without pills. I keep remembering how many people died that day.”

Shabana, her name changed to protect her privacy, survived three days buried in the rubble of Rana Plaza, an eight-story building with five garment factories that collapsed in Bangladesh in 2013.

Relatives cry for loved ones trapped in the collapsed Rana Plaza building outside Dhaka on April 24, 2013.

(c) 2013 Reuters

Four years later, Shabana is still struggling to piece her life back together. She has nightmares. Depression hampers her life and ability to work. Setting foot inside a garment factory is unthinkable. She is now a domestic worker.

There was barely any publicly available information about the apparel brands that were using the Rana Plaza factories. Activists searched through the rubble for labels and interviewed survivors.

For decades, such secrecy has been the norm in the garment industry. While a handful of companies, like Adidas, Nike, Levi’s, Puma, and Patagonia, began publishing details more than a decade ago, others have recently joined. By the end of 2016, at least 29 apparel companies were disclosing some information about their source factories. Yet, company commitments to transparency about supplier information are inconsistent, with widely varying standards for what they choose to disclose. Many brands have held out completely.

Last year, a coalition of labor and human rights organizations endorsed the Transparency Pledge, which sets a minimum standard for publishing supply chain information. The coalition contacted 72 apparel and footwear companies, urging them to carry out the pledge. The pledge reflects existing corporate practices on disclosure, and aims to foster a level playing field in the industry.

Seventeen companies will fully align their disclosure practices with the pledge by the end of 2017. Many others are moving in the right direction. But the industry still has a long way to go. Well-known brands and retailers like Forever21, Urban Outfitters, Walmart, Primark, and Armani are among those yet to embrace transparency.

Supply chain transparency complements other measures for worker safety and rights like the Bangladesh Accord on Fire and Building Safety. Numerous brands are part of the accord and publish their supplier information.

Companies that are reluctant to adopt the Transparency Pledge sometimes claim it is a competitive disadvantage. But increasingly, their competitors are dispelling this myth.

Shabana sewed clothes in a Rana Plaza factory. But she and most other workers didn’t know the brands. “Workers should know about brands so they can tell their true stories,” she says.

Posted: January 1, 1970, 12:00 am

(Nairobi, April 21, 2017) – Equatorial Guinean authorities should immediately release two men who head the country’s leading human rights organization, seven human rights and transparency organizations said.

The police detained Enrique Asumu and Alfredo Okenve, who head the Center for Development Studies and Initiatives (CEID), on April 17, 2017, and have exceeded the 72-hour period that Equatorial Guinean law permits them to detain a person without charge.

“The authorities have a long history of harassing, arbitrarily detaining, and generally interfering with the work of human rights defenders in Equatorial Guinea,” said Tutu Alicante, executive director of EG Justice, which monitors human rights abuses in Equatorial Guinea. “This latest incident shows the authorities’ willingness to trample on the country’s due process laws to intimidate and silence dissent.”

Alfredo Okenve was a speaker at the International Anti-Corruption Conference held in Panamá in December 2016

The organizations raising their concerns about the detention are Human Rights Watch, EG Justice, Publish What You Pay, Transparency International, the UNCAC Coalition, Amnesty International, and the International Anti-Corruption Conference.

Asumu is the president, and Okenve vice president, of CEID. On April 16, authorities prevented Asumu from boarding a flight from the country’s island capital, Malabo, to the mainland city of Bata, claiming they were acting on the orders of the minister of national security, said a colleague of Asumu’s who was present and Asumu’s lawyer.

The following day, Asumu and Okenye visited the ministry’s offices, which are housed in same building as the Central Police Station in Malabo. The national security minister interrogated the two men in his office for more than five hours, said two colleagues who accompanied them to the meeting and waited outside. After the meeting ended, at about 6 p.m., the authorities prevented Asumu and Okenve from leaving the building, and they continue to hold them there.

The police have permitted the colleagues, as well as family members, to visit Asumu and Okenve, and have allowed them access to their lawyers. But the authorities have not brought them before a judge, which the law requires within 24 hours. Nor have the authorities charged them, which under Equatorial Guinean law must take place within 72 hours.

The Ministry of the Interior ordered CEID to suspend its activities indefinitely in March 2016. Colleagues who have spoken with Asumu and Okenve said that the authorities have threatened to fine them 10 million CFA francs (US$16,000) for violating this order.

The ministry issued the order after shutting down a youth meeting that it contends included statements by participants that constituted incitement, a charge CEID maintains is false and politically motivated. The organization appealed the suspension order, but received no response, a representative from the organization said.

The organization announced that it would resume its activities in September 2016. A representative of the organization contended that the April 2016 suspension of its operations was effective only for three months. Since then, it has organized events attended by representatives from various government ministries.

The government of Equatorial Guinea is applying to join the Extractive Industries Transparency Initiative (EITI), an effort that brings together governments, companies, and nongovernmental groups to encourage better governance of resource-rich countries by fostering open public debate about the use of oil, gas, and mining revenues. The EITI requires member governments to foster “an enabling environment for civil society” and to “refrain from actions which result in narrowing or restricting public debate in relation to implementation of the EITI.”

Equatorial Guinea has been dogged by corruption scandals exacerbated by the lack of transparency related to natural resource revenues. The suspension of the country’s leading organization promoting transparency and respect for human rights, and the detention of its leadership, send the wrong signal about the government’s commitment to combatting corruption, the groups said.

“These detentions make the government’s promises to respect civil society as part of its bid to join EITI ring hollow,” said Elisa Peter, executive director of Publish What You Pay. “They threaten to topple the country’s EITI candidacy and send the message that the government will not tolerate independent voices.”

When CEID resumed its activities in September 2016, it also resumed its role as a member of the national steering committee that involves government officials, oil companies, and civil society as the first stage in applying for EITI membership. The national steering committee last met on April 12, and the minister of mines attended an event the human rights group held on April 14 in celebration of its twentieth anniversary.

“The government works with CEID when it wants to feign respect for civil society, but then keeps this suspension order hanging over it like the sword of Damocles,” said Sarah Saadoun, a business and human rights researcher at Human Rights Watch. “By bullying two of the country’s most respected human rights defenders, the government seems to be trying to silence civil society at a moment of rising anger over the country’s deepening economic crisis.”

Posted: January 1, 1970, 12:00 am
 
(London) – More apparel and footwear companies should join 17 leading apparel brands that have aligned with an important new transparency pledge, a coalition of unions and human rights and labor rights advocates said in a joint report issued today. The pledge commits companies to publish information that will enable advocates, workers, and consumers to find out where their products are made.
 
The 40-page report, “Follow the Thread: The Need for Supply Chain Transparency in the Garment and Footwear Industry,” comes just ahead of the fourth anniversary of the Rana Plaza building collapse disaster in Bangladesh. It calls for companies to adopt the Apparel and Footwear Supply Chain Transparency Pledge. Companies that align with the pledge agree to publish information identifying the factories that produce their goods, addressing a key obstacle to rooting out abusive labor practices across the industry and helping to prevent disasters like the Rana Plaza collapse.
 
The coalition contacted 72 companies and asked them to adopt and carry out the pledge. The report details their responses and measures their current supply chain transparency practices against the pledge.
 
 
“A basic level of supply chain transparency in the garment industry should be the norm in the 21st century,” said Aruna Kashyap, senior counsel for the women’s rights division at Human Rights Watch. “Openness about a company’s supply chain is better for workers, better for human rights, and shows that companies care about preventing abuse in their supply chains.”
 
The Rana Plaza building collapse on April 24, 2013 killed over 1,100 garment workers and injured more than 2,000. It was preceded by two large factory fires – one in Pakistan’s Ali Enterprises factory and another in Bangladesh’s Tazreen Fashions factory – that killed more than 350 workers and seriously injured many others. Afterward, labor advocates could not determine which companies’ products were made at these factories and had to hunt for the brand labels from the factory sites and interview surviving workers to determine who was responsible
 
By the end of 2016, at least 29 global apparel companies had published some information about the factories that manufacture their products. To build on this momentum, in 2016, a nine-member coalition of labor and human rights organizations and global unions endorsed the Transparency Pledge. Its aim is to create a level playing field in the industry and move it toward a minimum standard for publishing supplier factory information.
 

 

The coalition consists of Clean Clothes Campaign, Human Rights Watch, IndustriALL Global Union, the International Corporate Accountability Roundtable, the International Labor Rights Forum, the International Trade Union Confederation, the Maquila Solidarity Network, UNI Global Union, and the Worker Rights Consortium.

Coalition members wrote to 72 companies – including 23 industry leaders that were already publishing supplier factory information – urging them to adopt and carry out the Transparency Pledge standards. At the time, many apparel companies, including some that source from countries with persistent labor rights problems, were not publishing any supplier factory information.

Related Content

 
The Transparency Pledge draws upon existing good practices of global apparel companies and sets a floor, not ceiling, for supply chain transparency. It asks apparel companies to publish important information about supplier factories and their authorized subcontractors. These efforts to publish supplier factory information help assert workers’ human rights, advance ethical business practices and human rights due diligence in apparel supply chains, and build stakeholder trust, in line with the United Nations Guiding Principles on Business and Human Rights.
 
Many significant investors have begun to urge apparel companies to make their supplier information public. Most recently, the Corporate Human Rights Benchmark, endorsed by 85 investors representing US$5.3 trillion in assets, score-carded apparel companies’ supply chain transparency, requiring them to publish at least the names of factories that produced for them.
 
“After Rana Plaza and other disasters, human rights groups, unions, and some companies and investors have seen how important transparency is for preventing abuses and for efforts at accountability,” said Ben Vanpeperstraete, lobby and advocacy coordinator at the Clean Clothes Campaign International Office. “Companies need to put transparency into practice to show that they respect human rights and decent working conditions.”
 
Transparency is a powerful tool for promoting corporate accountability for garment workers’ rights in global supply chains, the coalition said. It allows workers and labor and human rights advocates to alert the company to rights abuses in its supplier factories. Information about brands’ supplier factories facilitates faster access to grievance redress mechanisms for human rights abuses.
 
Of the 72 companies that the coalition contacted, 17 will be in full alignment with the pledge standards by December 2017.
 
Many other companies fell short of the pledge standards: five fall just short of the pledge, 18 are moving in the right direction by disclosing at least the names and addresses of cut-make-trim factories, and seven are taking small steps toward publishing supplier factory information – for example, a part of their supplier factories, or at least the names of their supplier factories by country of manufacture, by December 2017.
 
Another 25 apparel companies do not publish information about factories that manufacture their products. Those companies either did not respond or made no commitment to publish any of the information requested.
 
The coalition urges companies that have not aligned with the pledge to do so by December and to help galvanize the apparel industry toward a basic threshold level of supply chain transparency.
 
“Adhering to a minimum level of supply chain transparency in the pledge is important for accountability efforts,” said Judy Gearhart, executive director at the International Labor Rights Forum. “Companies can do more, but they should at least start with this basic step.”
 
Some companies claimed that disclosure would put them at a commercial disadvantage. But that justification is clearly contradicted by the other companies that are publishing such information, the groups said. As Esprit, one of the companies that made a commitment to align with the pledge, said, “[R]eleasing this information is not comfortable for many companies, but the time has come to do it.”
 
Apparel Companies in Full Pledge or Close to Full Pledge Alignment
Apparel companies that had previously published supply chain information and made a commitment to publish additional supplier factory information by December 2017 in full alignment with the pledge standards are adidas, C&A, Cotton On Group, Esprit, G-Star RAW, H&M Group, Hanesbrands, Levis, Lindex, Nike, and Patagonia.
 
Apparel companies that had previously not published any supplier factory information and have made a commitment to publish information in full alignment with the pledge are ASICS, ASOS, Clarks, New Look, Next, and Pentland Brands. These global apparel companies will help break new ground by promoting an industry-wide minimum standard for supply chain transparency.
 
John Lewis, Marks and Spencer, Tesco, Gap, and Mountain Equipment Co-op adhere to transparency practices that fall just short of the pledge standards.
 
In the Right Direction
Coles, Columbia Sportswear, Disney, Hudson’s Bay Company, Kmart and Target Australia, and Woolworths Australia were already publishing the names and street addresses of supplier factories and have not made additional commitments to meet pledge standards. Puma and New Balance were publishing the names and addresses of supplier factories and have made a commitment to add more details to align more closely with the pledge standards.
 
ALDI North and ALDI South, Arcadia Group, Benetton, Debenhams, LIDL, Tchibo, Under Armour, and VF Corporation are taking steps in the right direction and have begun or will begin to publish names and street addresses of at least all cut-make-trim factories in 2017. Fast Retailing published the names and addresses of its UNIQLO brand’s “core factory list” in 2017.
 
Small Steps Toward Publishing Supplier Factory Information
Target USA had previously published the names of their supplier factories with country of manufacture but made no commitment to do more. In 2017, Mizuno, Abercrombie & Fitch, Loblaw, and PVH Corporation have taken steps to publish the names of suppliers, but only with the country of manufacture.
 
BESTSELLER and Decathlon have promised that they will publish supplier factory information in 2017 without specifying precisely what will be included. 
 
No Commitment to Publishing Supplier Factory Information
American Eagle Outfitters, Canadian Tire, Carrefour, Desigual, DICK’S Sporting Goods, Foot Locker, Hugo Boss, KiK, MANGO, Morrison’s, Primark, Sainsbury’s, The Children’s Place, and Walmart did not make a commitment to publish supplier factory information. Inditex declined to publish supplier factory information but makes this data available to IndustriALL and its affiliates as part of its reporting under its Global Framework Agreement.
 
Armani, Carter’s, Forever 21, Matalan, Ralph Lauren Corporation, Rip Curl, River Island, Shop Direct, Sports Direct, and Urban Outfitters did not respond to the coalition and do not publish any supply chain information.
 
Brands that have signed global framework agreements with IndustriALL and publish some supplier factory information:
H&M Group and Mizuno; Tchibo will begin publishing in 2017.
 
Brands that are part of the Bangladesh Accord on Fire and Building Safety and publish supplier factory information:
Accord members that have been publishing supplier factory information are adidas, C&A, Cotton On Group, Esprit, G-Star RAW, H&M Group, Kmart Australia, Lindex, Marks and Spencer, Puma, Target Australia, and Woolworths.
 
Accord members that have begun or will begin publishing some supplier factory information in 2017 are Abercrombie & Fitch, ALDI North and ALDI South, BESTSELLER, Debenhams, Fast Retailing, John Lewis, New Look, Next, LIDL, Loblaw, PVH Corporation, Tchibo, and Tesco.
 
Brands that are part of the German Partnership for Sustainable Textiles (the Textil Bündnis) and publish their supplier factory information:
Adidas, C&A, Esprit, H&M, and Puma; others including ALDI North and ALDI South, LIDL, and Tchibo began or will begin publishing supplier factory information in 2017.
 
 
Current/Anticipated Disclosure by December 31, 2017 vs. Pledge Standards
Company Headquarters Published supplier factory--cut-make-trim (CMT) and subcontractor-- information prior to Pledge Letter? Supplier factory information published meets or will meet Full Pledge by December 2017? Names and street addresses of CMT factories and their subcontractors Worker numbers Product types Parent company information Frequency of disclosures Time Frame to Implement Pledge
Abercrombie & Fitch US None Not full Pledge, but will begin publishing supplier factory information in 2017. Names of tier-1 factories (CMT for woven, denim, knit, sweater, intimates,and accessoroies) with country of manufacture, but without street address. No No No 2 times per year 2017
Adidas Germany Names of all tier-1 factories, including those used by licensees as well as authorized subcontractors, by country and city. Names of all tier-2 wet process suppliers, by country and city. Separate lists of supplier factories used for the Olympic Games. Full Pledge alignment. Yes Yes Yes Yes 2 times per year 2017
ALDI North and ALDI South Germany None Not full Pledge, but will begin publishing supplier factory information in 2017. Names and addresses of tier-1 (CMT) factories but not their subcontractors. No No No 1+ times per year 2017
American Eagle Outfitters US None No commitment to publish supplier factory information. No No No No NA NA
Arcadia Group UK None Not full Pledge, but will begin publishing supplier factory information in 2017. Names and addresses of tier-1 (CMT) factories but disclosure of authorized subcontractors will need more time. No No No 1+ times per year NA
Armani Italy None No response to coalition letter. No No No No NA NA
ASICS Japan None Full Pledge alignment. Yes Yes Yes Yes 1 time per year 2017
ASOS UK None Full Pledge alignment. Yes Yes Yes Yes 6 times per year 2017
Benetton Italy None Not full Pledge, but will begin publishing supplier factory information in 2017. Names and addresses of tier-1 (CMT) factories but not their subcontractors. No Yes No 1 time per year NA
BESTSELLER Denmark None Not full Pledge, but will begin publishing supplier factory information in 2017. Company stated that tier-1 (CMT) factories will be published but did not provide more information about what precisely will be disclosed for each factory. No information No information No information No information 2017
C&A Netherlands Names and addresses of all CMT factories. Excluded: Brazil, Mexico, and processing factories. Full Pledge alignment. Yes Yes Yes Yes 2 times per year 2017
Canadian Tire Canada None No commitment to publish supplier factory information. No No No No NA NA
Carrefour France None No commitment to publish supplier factory information. No No No No NA NA
Carter's US None No response to coalition letter. No No No No NA NA
Clarks UK None Full Pledge alignment. Yes Yes Yes Yes 2 times per year A vast majoirity of the supplier factory information will be published in 2017. Five percent of non-footwear accessories to be published in 2018.
Coles Australia Names and addresses of CMT factories, but not subcontractors. Company states that its supplier factories use minimal subcontracting. No additional commitments to meet Pledge standards; maintaining status quo. Names and addresses of CMT factories, but not subcontractors. Company states that its supplier factories use minimal subcontracting. No No No 1 time per year NA
Columbia Sportswear US Names and addresses of factories from which they directly source and any external subcontractors engaged to perform finishing processes (mostly limited to collegiate suppliers since the others have in-house capacity). No additional commitments to meet Pledge standards; maintaining status quo. Yes No No No 1 time per year NA
Cotton On Group Australia Names and addresses of CMT factories used by top 20 suppliers. Full Pledge alignment. Yes Yes Yes Yes Multiple 2017
Debenhams UK None Not full Pledge, but will begin publishing supplier factory information in 2017. Names and addresses of tier-1 factories which includes all CMT factories; some external processing such as embroidering and washing may not be included. Yes No No No information 2017
Decathlon France None Not full Pledge, but will begin publishing supplier factory information in 2017. Company did not provide more information about what precisely will be disclosed for each factory. No information No information No information No information 2017
Desigual Spain None No commitment to publish supplier factory information. No No No No NA NA
DICK'S Sporting Goods US None No commitment to publish supplier factory information. No No No No NA NA
Disney US Names and addresses of all facilities part of Disney's vertical supply chain and any facility in its vertical supply chains where Disney intellectual property is located, which includes any laundry, printing, embroidery facility if Disney intellectual property is incorporated into that finished product or component. No additional commitments to meet Pledge standards; maintaining status quo. Names and addresses of all facilities in its vertical supply chain, including subcontractors, where Disney intellectual property is located. No No No 1 time per year NA
Esprit Germany Names and addresses of CMT factoriesand their authorized subcontractors. Full Pledge alignment. Yes Yes Yes Yes 2 times per year 2017
Fast Retailing Japan None Not full Pledge, but will begin publishing supplier factory information in 2017. Published name and addresses of "Core Factories"producing for UNIQLO brand, representing 80 percent of the total volume of orders for UNIQLO brand. Plans to publish a list of GU's "major partner factories" in 2017. No clear commitment to publish subcontractors in 2017. No No No 1 time per year 2017
Foot Locker US Previously disclosed names and addresses for suppliers of collegiate apparel line that is currently inactive. No commitment to publish current own-brand supplier factory information. No No No No NA NA
Forever 21 US None No response to coalition letter. No No No No NA NA
G-Star RAW Netherlands Names, addresses, product types, parent company, and worker numbers for CMT factories. Full Pledge alignment. Yes Yes Yes Yes 2 times per year 2017
Gap US Names and addresses of CMT factories and their authorized subcontractors. Almost full Pledge alignment. Yes Yes Yes No 2 times per year Gap did not make any new commitments to align with the Pledge by December 2017. The company updated its supplier factory information to be more closely aligned with the Pledge.
H&M Group Sweden Names and addresses of supplier factories and vendors (suppliers), processing factories, and some fabric suppliers. Full Pledge alignment. Yes Yes Yes Yes 4 times per year 2017
Hanesbrands US Names and addresses of collegiate suppliers and owned factories. Full Pledge alignment. Yes Yes Yes Yes 4 times per year 2017
Hudson's Bay Company Canada Names and addresses of some, but not all, supplier factories. No additional commitments to meet Pledge standards; maintaining status quo. Names and addresses of some, but not all, CMT factories. No No No 1 time per year NA
Hugo Boss Germany None No commitment to publish supplier factory information. No No No No NA NA
Inditex Spain CMT factories not published. Names and addresses of direct and indirect wet processing factories published. No commitment to publish supplier factory information. No No No No NA NA
John Lewis UK None Almost full Pledge alignment. Yes Yes Yes No 2 times per year 2017
KiK Germany None No commitment to publish supplier factory information. No No No No NA NA
Kmart Australia Australia Names and addresses of factories in "high risk" countries. No response to coalition letter. Names and addresses of factories in "high risk" countries. No No No No information NA
Levi Strauss US Names and addresses of CMT factories and authorized subcontractors. Full Pledge alignment. Yes Yes Yes Yes 2 times per year 2017
LIDL Germany None Not full Pledge, but will begin publishing supplier factory information in 2017. Names and addresses of tier-1 factories which includes all CMT, but does not include all processing facilities. No No No 2 times per year 2017
Lindex Sweden Names and addresses of CMT factories. Full Pledge alignment. Yes Yes Yes Yes 1 time per year 2017
Loblaw Canada None Not full Pledge, but will begin publishing supplier factory information in 2017. Names of all factories where they Òsource apparel and footwear directlyÓ with country of manufacture but not street address. No No No 2 times per year 2017
MANGO Spain None No commitment to publish supplier factory information. No No No No NA NA
Marks and Spencer (M&S) UK Names and street addresses, worker numbers, gender breakdown, and product types. Almost full Pledge alignment. M&S will continue with its Plan A disclosure commitments and add processing factories and also make its existing disclosure available in a searchable format. Yes Yes Yes No 2 times per year 2017
Matalan UK None No response to coalition letter. No No No No NA NA
Mizuno Japan None Not full Pledge, but will begin publishing supplier factory information in 2017. Names along with country of manufacture of "Core Suppliers," that is, 125 factories disclosed of 464 tier-1 suppliers as reported on Mizuno website. No Yes No No information Began disclosure in 2017.
Morrison's UK None No commitment to publish supplier factory information. No No No No NA NA
Mountain Equipment Co-op (MEC) Canada Names and addresses of all CMT factories and some processing facilities. Almost full Pledge alignment. Names and addresses of all CMT factories and some processing facilities. Yes Yes Yes 2 times per year Additional details for CMT factories to meet Pledge standards will be published in 2017. Names and other details of authorized printers will be added subsequently.
New Balance US Names and addresses of direct supplier factories, excluding US wholly-owned facilities. Not full Pledge, but will add product type, and update annually in searchable format. Names and addresses of direct supplier factories, excluding US wholly-owned facilities. No Yes No 1 time per year 2017
New Look UK None Full Pledge alignment. Yes Yes Yes Yes At least annual 2017
Next UK None Full Pledge alignment. Yes Yes Yes Yes 2 times per year 2017
Nike US Names, addresses, product category, worker numbers, gender and migrant worker breakdown, and authorized subcontractor. Full Pledge alignment. Yes Yes Yes Yes 4 times per year 2017
Patagonia US Names, addresses, product category, worker numbers, gender breakdown, and parent companies of CMT and authorized subcontractors. Some fabric suppliers indicated. One cotton farm also disclosed. Full Pledge alignment. Yes Yes Yes Yes 1 time per year 2017
Pentland Brands UK None Full Pledge alignment. Yes Yes Yes Yes 2 times per year 2017
Primark UK None No commitment to publish supplier factory information. No No No No NA NA
Puma Germany Name of factory by country, city for tier-1 "core suppliers" and tier-2 material and component suppliers. Almost full Pledge alignment for tier-1 "core suppliers" factories. Names and addresses of tier-1 "core suppliers" amounting to 80 percent of their total business volume. But authorized subcontractors (if any) are not included in the definition of "core suppliers." Yes Yes No 1 time per year 2017
PVH Corporation US None Not full Pledge, but will begin publishing supplier factory information in 2017. Names of CMT factories along with country of manufacture but without street address. No No No 2 times per year 2017
Ralph Lauren Corporation US None No response to coalition letter. No No No No NA NA
Rip Curl Australia None No response to coalition letter. No No No No NA NA
River Island UK None No response to coalition letter. No No No No NA NA
Sainsbury's UK None No commitment to publish supplier factory information. No No No No NA NA
Shop Direct UK None No response to coalition letter. No No No No NA NA
Sports Direct UK None No response to coalition letter. No No No No NA NA
Target Australia Australia Based on information on its website, Target Australia appears to disclose the names and addresses of CMT factories. No response to coalition letter. Names and addresses of CMT factories appear to be disclosed. The coalition has no information about percentage of supplier factories disclosed or other exclusions, if any. No No No Company website says "regular basis." NA
Target USA US Names and countries of CMT suppliers, textile and wet processing factories. No additional commitments to meet Pledge standards; maintaining status quo. Names of CMT factories along with country of manufacture but without street address. No No No 4 times per year NA
Tchibo Germany None Not full Pledge, but will begin publishing supplier factory information in 2017. Names and addresses for CMT factories. Yes Yes No No information NA
Tesco UK Names and addresses of Bangladesh supplier factories only. Almost full Pledge alignment. Yes Yes Yes No 2 times per year 2017
The Children's Place US None No commitment to publish supplier factory information. No No No No NA NA
Under Armour US Only suppliers factories for collegiate apparel. Not full Pledge, but will begin publishing supplier factory information in 2017. Names and addresses for all CMT factories (but not embellishers or subcontractors). Yes Yes Yes No information Pledge details for CMT factories will be published in 2017.
Urban Outfitters US None No response to coalition letter. No No No No NA NA
VF Corporation US Names of factories by country for all VF brands of all VF-owned and operated, and direct sourced, tier-1 supplier factories. Not full Pledge, but will include street addresses to align more with the Pledge. Names and addresses of all CMT factories but not those used by licensees and subcontractors. No No No Regular 2017
Walmart US None No commitment to publish supplier factory information. No No No No NA NA
Woolworths Australia Names and addresses of all sites in Bangladesh are disclosed, and overall more than 40 percent of the supply chain (for apparel and footwear) is published. No additional commitments to meet Pledge standards; maintaining status quo. Names and addresses of all sites in Bangladesh are disclosed, and overall more than 40 percent of the supply chain (for apparel and footwear) is published. No No No 4 times per year NA
Posted: January 1, 1970, 12:00 am

Summary

The garment and footwear industry stretches around the world.[1] Clothes and shoes sold in stores in the US, Canada, Europe, and other parts of the world typically travel across the globe. They are cut and stitched in factories in Asia, Eastern Europe, Latin America, or other regions. Factory workers in Bangladesh or Romania could have made clothes only weeks ago that consumers elsewhere are eagerly picking up.

When global supply chains are opaque, consumers often lack meaningful information about where their apparel was made. A T-shirt label might say “Made in China,” but in which of the country’s thousands of factories was this garment made? And under what conditions for workers?

There is a growing trend of global apparel companies adopting supply chain transparency[2]—starting with publishing the names, addresses, and other important information about factories manufacturing their branded products. Such transparency is a powerful tool for promoting corporate accountability for garment workers’ rights in global supply chains.

Transparency can ensure identification of global apparel companies whose branded products are made in factories where bosses abuse workers’ rights. Garment workers, unions, and nongovernmental organizations can call on these apparel companies to take steps to ensure that abuses stop and workers get remedies.

Publishing supply chain information builds the trust of workers, consumers, labor advocates, and investors, and sends a strong message that the apparel company does not fear being held accountable when labor rights abuses are found in its supply chain. It makes a company’s assertion that it is concerned about labor practices in its supplier factories more credible.[3]

The need for information about factories involved in production for global brands has become painfully clear in recent years through deadly incidents that have plagued the garment industry.

A man removes clothing bearing a brand label from the devastated area of the collapsed Rana Plaza building in Dhaka, Bangladesh, on Friday, April 26, 2013.

©2013 Jeff Holt/Bloomberg via Getty Images

The Rana Plaza building collapse in Bangladesh on April 24, 2013 killed over 1,100 garment workers and injured more than 2,000. In the year before the collapse, two factory fires—one in Pakistan’s Ali Enterprises factory and another in Bangladesh’s Tazreen Fashions factory—killed more than 350 workers and left many others with serious disabilities. These were the deadliest garment factory fires in nearly a century.

Until these tragedies occurred, virtually no public information was available concerning apparel companies that were sourcing from the factories involved. The only way to identify these apparel companies and advocate for accountability was to interview survivors and rummage through the rubble afterward to find brand labels.

A system of corporate accountability that requires people to scramble on the ground for brand labels is the antithesis of “transparency.”

Over the past decade, a growing number of global apparel companies have published information on their websites about factories that manufacture their branded products. For more than a decade, adidas, Levi Strauss, Nike, Patagonia, and Puma have been publishing information on their supplier factories. Over time, more apparel companies and retailers with own-brand products joined them,[4] posting some information about supplier factories on their websites.

As more companies adopt supply chain transparency, it is becoming a cornerstone of responsible business conduct in the garment sector. Increasingly, brands and retail chains are beginning to understand that being an ethical business requires them to publish where their own-brand clothes or footwear are being made.

Tracing Supply Chain Transparency in the Garment Industry

Until less than two decades ago, no major apparel company published its global supplier factories network. The companies viewed the identity of supplier factories as sensitive business information, and thought disclosure would put them at a competitive disadvantage.

In the late 1990s and early 2000s, major apparel brands Nike and adidas began disclosing the names and addresses of factories that produced US collegiate apparel.[5] This was a result of a campaign led by a campus network, United Students Against Sweatshops (USAS), in dozens of universities. Universities included supply chain disclosure as part of their licensing agreements with top athletic apparel companies that produced their college logo apparel.

Subsequently, in 2005, Nike and adidas went further by publishing information about all of their supplier factories for all productsnot just collegiate licensed apparel.

Over the past decade, a growing number of other global apparel companies, including North American companies with no connection to the US collegiate apparel sector like Levi Strauss and Patagonia, as well as some European apparel companies, began publishing supplier factory information.

***

Apparel Companies Publishing Supplier Factory Information in 2016

As of December 2016, the following apparel companies were among those that published some supply chain information about their branded products:

adidas, C&A, Columbia Sportswear, Cotton On Group, Disney, Esprit, Forever New, Fruit of the Loom, Gap Inc., G-Star RAW, Hanesbrands, H&M Group, Hudson’s Bay Company, Jeanswest, Levi Strauss, Lindex, Marks and Spencer, Mountain Equipment Co-op, New Balance, Nike, Pacific Brands, PAS Group, Patagonia, Puma, Specialty Fashion Group, Target USA, VF Corporation, Wesfarmers Group (Kmart and Target Australia, and Coles), and Woolworths.

This is not a comprehensive list.[6]

This report takes stock of supply chain transparency in the garment industry four years after the industry disasters in Bangladesh and Pakistan that shook the global garment industry. To build momentum toward supply chain transparency and develop industry minimum standards, a coalition of labor and human rights groups asked 72 companies to agree to implement a simple Transparency Pledge. It also asked that companies declining to commit to the Pledge provide reasons for choosing not to do so.[7] Where companies engaged with the coalition, the coalition also sought additional information about their existing transparency practices. This report explains the logic and the urgency behind the Pledge and describes the responses we received from the companies contacted.[8] Further information about the apparel companies contacted, the reasons for choosing them, and the coalition’s engagement process is outlined in Appendix I.

Supply chain transparency practices vary immensely among companies. Among those apparel companies that embrace transparency, the details they publish are inconsistent.[9] Many other companies refuse to publish supplier factory information at all, or divulge only scant information. Some companies attempt to justify non-disclosure on commercial grounds. But their explanations are belied by the experiences of other similarly situated companies that do publish and have shown that the benefits of disclosure outweigh perceived risks.[10]

Ultimately apparel companies can do far more than implement the Pledge to ensure respect for human rights in their supply chains. Nonetheless, this is one important step in a holistic effort to improve corporate accountability in the garment industry.

Civil Society Coalition on Garment Industry Transparency

In 2016, nine labor and human rights organizations formed a coalition to advocate for transparency in apparel supply chains. Coalition members are:

  • Global unions: IndustriALL Global Union, International Trade Union Confederation, and UNI Global Union.
  • International labor and human rights organizations that focus on the apparel
    sector: Human Rights Watch, Clean Clothes Campaign, Maquila Solidarity Network, Worker Rights Consortium, International Corporate Accountability Roundtable, and International Labor Rights Forum.
  • The coalition endorsed the Transparency Pledge as a minimum standard for supply chain disclosure. The Pledge is based on existing, positive industry practices. See below for more information on the Pledge.

I. The Case for Supply Chain Transparency

Supply chain transparency—starting with publishing names, addresses, and other important information about factories producing for global apparel companies—is a powerful tool to assert workers’ human rights, advance ethical business practices, and build stakeholder trust. Consumers should know where the products they purchase are made. Workers should also know which apparel company’s branded products they are making.

Companies have a responsibility to take steps to prevent human rights risks throughout their supply chains, and to identify and address any abuses that arise despite those preventative efforts. In order to live up to that responsibility, they should adopt industry good practices.

By publishing factory names, street addresses, and other important information, global apparel companies allow workers and labor and human rights advocates to alert apparel companies to labor rights or other abuses in their supplier factories.

An apparel company that does not publish its supplier factory information contributes to possible delays in workers or other stakeholders being able to access the company’s complaint mechanisms or other remedies. Workers and labor rights advocates often expend substantial time and effort trying to collect brand labels or using other methods to determine which companies are sourcing from factories where human rights abuses are occurring. Meanwhile, they lose valuable time and put workers at risk of retaliation and continued exposure to dangerous or abusive working conditions. Such delays reduce the overall effectiveness of grievance redress mechanisms that apparel companies and other parties put in place.

Disclosing names, addresses, and other relevant information about supplier factories helps make it possible to determine whether a brand has sufficient leverage or influence in a particular factory or country to achieve remediation of worker rights abuses.

Supply chain transparency can also help check unauthorized subcontracting, in which factories that contract with apparel companies meet production demands by farming out some of the work, often to smaller, less regulated factories where labor rights abuses are common. This is a persistent challenge in the garment industry. If apparel companies published the names and addresses of all authorized supplier factories and their subcontract facilities, workers and other interested parties would know which factories are authorized to produce for the company and which are not. 

Publishing supplier factory information can also help apparel companies avoid reputational harm. For example, workers may not know that a given apparel company has terminated business with a factory well before labor rights problems arose, and could seek a remedy from the wrong company. Many factories publish information on their websites about their business relationships with major brands that may be outdated and misleading. By publishing supplier factory information themselves, and updating it regularly, apparel companies would reduce the risk that they could be wrongly associated with abusive conditions in factories with which they long before cut business ties.

Moreover, it is difficult for companies to continually identify persistent labor rights problems in specific supplier factories, to detect unauthorized subcontracting, and to regularly verify progress toward corrective action if they limit their sources of information to purely business-led human rights due diligence procedures. These include inspections and labor compliance audits by apparel companies’ own social compliance staff and third-party monitors engaged by them.   

Brand inspectors and third-party monitors—even those that are diligent and professional—are at best able to visit factories periodically and for short periods. The quality and accuracy of third-party monitoring reports depend largely on the methodology used in the assessments, the independence of the assessors from the factory and the apparel company, and the weight given to testimonies from workers and other interested parties. These tools are not sufficient in and of themselves to detect all instances of abuse, unauthorized subcontracting, and other problems. Factory disclosure makes it possible for apparel companies to receive credible information from workers and worker rights advocates between periodic factory audits.

An easily achievable standard of disclosure is for apparel companies to publish on their company websites factory names and addresses (including country, city, and street address). Many leading apparel companies have already done this. In Section III, we describe additional steps apparel companies can and should take to make their supply chains more transparent.

Publishing supply chain information is consistent with a company’s responsibilities under the UN Guiding Principles on Business and Human Rights (UN Guiding Principles), a set of guidelines that lay out steps companies should take to prevent, address, and remedy human rights abuses linked to business operations. The principles state that companies have a responsibility to “identify, prevent, mitigate and account for” adverse human rights impacts of their business operations, and to regularly report on progress made.[11]

The UN Guiding Principles also say that businesses should externally communicate how they address their human rights impacts in “a form and frequency that … are accessible to its intended audiences.”[12] The commentary on the Guiding Principles states that the “responsibility to respect human rights requires that business enterprises have in place policies and processes through which they can both know and show [emphasis added] that they respect human rights in practice.” Further, “[s]howing involves communication, providing a measure of transparency and accountability to individuals or groups who may be impacted and to other relevant stakeholders, including investors.”[13]

In some jurisdictions, companies that publish supplier factory information can also help facilitate compliance with legal obligations under laws like the California Transparency in Supply Chains Act of 2010; “sweat-free” procurement laws adopted in dozens of US cities and a few states; the UK Modern Slavery Act 2015; and the French law on the corporate duty of vigilance, 2017.[14]

The transparency of global supply chains is also increasingly recognized by investors as a metric for evaluating the robustness of business human rights practices. The Corporate Human Rights Benchmark (CHRB), a collaborative effort by business and human rights organizations and investors, developed a public scorecard for the human rights practices of apparel, agricultural, and extractive companies. The benchmark has been endorsed by 85 investors representing US$5.3 trillion in assets.[15] CHRB’s indicators include whether the company publishes supply chain information.

Specifically, the CHRB scorecard assesses whether “[t]he Company maps its suppliers and discloses its mapping publicly [emphasis added].” Apparel companies are given two specific scores depending on whether “[t]he company indicates that it maps its suppliers beyond tier one, including direct and indirect suppliers, and describes how it goes about this” and whether “[t]he Company also discloses the mapping for the most significant parts of its supply chain and explains how it has defined what are the most significant parts of its supply chain.”[16] In order to assess the latter, companies were required to publish at least the names of its supplier factories for the 2016 pilot benchmark.[17]

Kevin Thomas, director of shareholder engagement of SHARE Canada, a nonprofit organization that represents institutional investors in Canadian and other international companies in apparel and other sectors, said that in 2016 at least 20 shareholder resolutions related to supply chains and human rights practices were filed in the US. He said:

[I]nvestors are looking for evidence that demonstrates that the company is effectively identifying human rights risks in its own operations and in the supply chain, and has an effective system to address those risks when they are identified. It’s important that the company not only report on its policies and systems, but also the outcomes of its work – what is it finding, and how is it fixing it. Factory disclosure is a part of that process. [T]he company’s willingness to disclose demonstrates to shareholders that it is confident in its due diligence process. [I]t also assists the company in catching unauthorized subcontracting, as well as developing useful relationships with stakeholders that can assist the company in identifying problem areas and solutions.[18]

II. The Transparency Pledge

The objective of the Transparency Pledge is to help the garment industry reach a common minimum standard for supply chain disclosures by getting companies to publish standardized, meaningful information on all factories in the manufacturing phase of their supply chains. The civil society coalition that developed the Pledge based it on published factory lists of leading apparel companies and developed a set of minimum supply chain disclosure standards. These build on good practices in the industry.

The Apparel and Footwear Supply Chain Transparency Pledge

(“The Transparency Pledge”)

This Transparency Pledge helps demonstrate apparel and footwear companies’ commitment towards greater transparency in their manufacturing supply chain.

Transparency of a company’s manufacturing supply chain better enables a company to collaborate with civil society in identifying, assessing, and avoiding actual or potential adverse human rights impacts. This is a critical step that strengthens a company’s human rights due diligence.

Each company participating in this Transparency Pledge commits to taking at least the following steps within three months of committing to it: 

Publish Manufacturing Sites

The company will publish on its website on a regular basis (such as twice a year) a list naming all sites that manufacture its products. The list should provide the following information in English:

  1. The full name of all authorized production units and processing facilities.*
  2. The site addresses.
  3. The parent company of the business at the site.
  4. Type of products made.**
  5. Worker numbers at each site.***

Companies will publish the above information in a spreadsheet or other searchable format.

The three-month time frame was extended to December 2017 based on the coalition’s engagement with apparel companies. See Appendix I for details.

* Processing factories include printing, embroidery, laundry, and so on.

** Please indicate the broad category—apparel, footwear, home textile, accessories.

*** Please indicate whether the site falls under the following categories by number of workers: Less than 1,000 workers; 1,001 to 5,000 workers; 5,001 to 10,000 workers; More than 10,000 workers.

The Pledge focuses on the “manufacturing phase” of an apparel company’s supply chain, which comprises all factories authorized by the company to produce (that is, cut-make-trim, or CMT) along with others subcontracted by these CMT factories to perform “finishing” processes.[19]

The Pledge aims for consistency in disclosures, which is sorely needed, as shown by an analysis carried out by coalition members of supply chain information published by September 2016 by 23 global apparel companies. In the absence of standards, companies adopt different approaches to transparency, sometimes excluding important information that makes it effective. This analysis informed the content of the Transparency Pledge, as explained in Appendix II.

Why Minimum Standards for Disclosure

Based on an analysis of apparel companies’ disclosure practices, it became clear that without minimum standards, companies’ efforts toward supply chain disclosures suffered from a range of deficiencies:

  • A lack of a common understanding of what constituted the first tier of a brand’s supply chain. For example, not disclosing any information about authorized subcontractors like external printers, embroiderers, and laundries that are essential to producing a finished product, without which it cannot be sold.
  • Publishing only a part of all cut-make-trim supplier factories, without specifying what was included.
  • Omitting factories’ street addresses, making it impossible to know where in a given country or city a factory was located.
  • Excluding names and addresses of factories used by licensees or agents.
  • Not specifying if supplier factory information was published for all or only some brands owned by the apparel company.
  • Not specifying whether the disclosure was for all or only some types of products.
  • Not describing what was being excluded from the disclosure.
  • Not stating what percentage of their total sourcing volume and supplier factories was published, the date the information was last updated, and how frequently such updates were made public.
  • Not publishing this data in downloadable and searchable formats.

Key Pointers for Publishing Supplier Factory Information

When publishing supplier factory information, global apparel companies should pay close attention to the manner in which they provide it. The following guiding points are important to make disclosure effective:

Easy Access

  • Make information easily and freely accessible on their websites.
  • Make information available in formats that have downloadable files and enable machine-readable searches to cut down on the time needed to manually sift through these lists.

Clarity

  • Clearly state what precisely is being published and what definitions are being used. (For example, describe how the company defines terms like “tier-1”; “core manufacturing partners.”)
  • Clearly state whether all authorized subcontractors used by cut-make-trim factories for processes to complete a brand’s products are being published.
  • Indicate the aggregate volume of business that is captured by the disclosure and the percentage of total supplier factories published. (For example, “The factories named represent 80 percent of the factories where the company’s products are manufactured, and are responsible for production of 90 percent of the brand’s products.”)
  • Indicate exclusions from disclosures, if any, and impending plans to expand disclosures. (For example, whether it excludes factories used by licensees, agents, and discloses information for only some or all brands.)

Regular Updates

  • Specify the date when the information was last updated and how frequently the information is publicly updated.

What the Transparency Pledge Does Not Do

The Pledge does not attempt to define the full extent of transparency in the garment industry. It deals with a narrow yet critical part of transparency in apparel supply chains. The full range of transparency practices in the garment industry should be broader and more holistic. Several aspects—ranging from grievance redress procedures and brand efforts to mitigate or remediate human rights problems, including the effectiveness of brands’ compliance programs with respect to worker wages, hours of work, and their freedom of association—stand to benefit from greater transparency.

The Pledge does not set a ceiling, but rather a floor, on what brands should publicly report. The coalition hopes that human rights and environmental advocates, governments, companies, investors, and other stakeholders in the sector will work to deepen and broaden transparency beyond what is included in the Pledge.

Some brands have already taken steps that prove more is possible. They have published more details beyond just a factory name and address, indicating the precise number of workers in the factory, the gender breakdown of the workforce, and other details for every factory disclosed.[20] A very small number of apparel companies have published the textile factories where fabric used in their garments is made and more information beyond the “manufacturing phase” of the supply chain.[21]

 

III. Apparel Company Responses

The civil society coalition that developed the Transparency Pledge contacted 72 apparel and footwear companies asking them to sign on to and implement the Pledge. This section captures responses received as of April 7, 2017.[22]

There were a wide range of responses, which the coalition has grouped into three categories:

  • First, some companies already embrace supply chain transparency and either agreed to add more factory details to meet the Pledge standards or to align their practices more closely with those standards.
  • Second, some companies already publish supplier factory information but declined to add more details to align their disclosure practices with the Pledge standards, or failed to respond to the coalition letter. In the same category are other companies that reported that they intend to begin disclosing more supplier factory information but whose commitments fell far short of the Pledge standards.
  • Third, some companies either did not commit to publishing any supplier factory information or did not respond at all.

These categories are based on commitments made by apparel companies—many of which have promised to begin publishing information for the first time—that they have indicated will be implemented in 2017. An update to this report will be issued in 2018 providing more details about apparel company disclosures and additional responses. Where appropriate the list of companies in each category will be revised, based on the disclosures and commitments that these companies make in the interim period.

Full Pledge or Close to Full Alignment with Pledge

Seventeen apparel companies agreed to publish all supplier factory information requested, meeting all the Pledge standards.[23] Another five companies fell just short of the Pledge standards.

Full Alignment with the Pledge

Apparel companies that previously published supply chain information and committed to publishing additional supplier factory information in full alignment with the Pledge standards are adidas, C&A, Cotton On, Esprit, G-Star RAW, Hanesbrands, H&M, Levis, Lindex, Nike, and Patagonia.

Apparel companies that had previously not published any supplier factory information and have committed to publishing this in full alignment with the Pledge are ASICS, ASOS, Clarks, New Look, Next, and the Pentland Brands.

The commitments of these global apparel companies help break new ground by promoting an industry-wide minimum standard for supply chain transparency.

Just Missing the Pledge Standard

Since its first disclosure in September 2016, Gap updated its information, which now incorporates almost all aspects of the Pledge.[24] Marks and Spencer[25] and Tesco[26] outlined their plans to add more information to their current factory disclosure, which would bring them closer to alignment with the Pledge standard. John Lewis committed to publishing supplier factory information in 2017 in accordance with almost the full Pledge.[27] None of these companies committed to publishing information about parent companies of factories as requested.

Mountain Equipment Co-op added information in accordance with Pledge standards for cut-make-trim factories with a commitment to adding authorized subcontractors in the future.[28]

Some Transparency, More Needed

Some apparel companies (identified in textboxes below) already publish the names and addresses of their supplier factories, but do not disclose other information in line with the Pledge standards, and did not commit to doing more. Others have committed to taking steps to publish supplier factory information but with scant detail or without specifying what precisely they will disclose.

An apparel company should, at the very least, publish the minimum information needed to demonstrate that it “knows and shows” a key part of its supply chain: the names and addresses of all its cut-make-trim factories and authorized subcontractors that undertake processes needed to finish the product.

In the Right Direction

Columbia Sportswear and Disney have been publishing the names and addresses of their cut-make-trim suppliers and authorized subcontractors.[29] But they did not explicitly commit to doing more.[30]

New Balance, which was already publishing factory names and addresses, committed to adding product categories.[31]

PUMA added street addresses, worker numbers, and product categories for all factories it currently publishes.[32]

Coles publishes the names and addresses of its non-food suppliers (not only apparel) from India and China, which the company says includes all supplier factories, but it did not commit to doing more.[33]

Under Armour committed to publishing information for all cut-make-trim factories in accordance with Pledge standards in 2017.[34]

ALDI North and ALDI South published the names and street addresses of their tier-1 suppliers.[35]

LIDL committed to beginning disclosure in 2017, which would list the names and street addresses for all tier-1 factories producing own-brand products.[36]

Tchibo committed to publishing the names, addresses, and product types of cut-make-trim factories in 2017.[37]

VF Corporation committed to adding factory street addresses to its existing publication of owned and operated and tier-1 supplier factory names,[38] but this excludes “licensee and sub-contractor factories.”[39]

Debenhams committed to publishing in 2017 the names and addresses of its tier-1 factories along with worker numbers by gender breakdown.[40]

Benetton published its tier-1 factories in 2017 listing the names, addresses, and product category.[41]

Arcadia Group has committed to publish the names and addresses of all cut-make-trim factories in 2017.[42]

Many Factories Still Missing from Disclosure Lists

The apparel companies named below publish the names and addresses of some factories. But these companies still leave out many cut-make-trim factories and their authorized subcontractor facilities from their factory lists.

Woolworths has suppliers across many countries and responded that it already publishes the names and addresses of all factories in Bangladesh and “overall more than 40 percent” of its apparel supply chain.[43] Their subcontractor facilities are currently only partially disclosed (i.e. for Bangladesh) and the company says it is improving visibility of subcontractors in other countries.[44]

Based on the information given on their respective websites, Kmart Australia appears to publish all apparel factories in “high risk” countries that directly produce Kmart products[45] and Target Australia appears to publish the names and addresses of cut-make-trim factories.[46] But because these companies did not respond to the coalition’s letter, the coalition has no information about the percentage of supplier factories they disclose and whether authorized subcontractors are included.[47]

The Hudson’s Bay Company did not commit to adding more disclosures to its existing factory list, which carries the names and addresses of some, but not all, of its cut-make-trim supplier factories.[48]

Fast Retailing began disclosing the names and addresses of its “core factories list” producing for UNIQLO, the largest of its brands, for the first time in 2017.[49]

Other companies named in the text box below already disclose or have indicated they support some degree of supply chain transparency. But they either disclose or have committed to disclosing only factory names without street addresses. Some have only stated that they plan to begin disclosing in 2017, without indicating what precisely they will disclose.

Beginning to Disclose

Target USA was already disclosing factory names by country and city for manufacturing, textile, and wet-processing factories but did not respond in substance to the coalition’s letter asking for more information to be published about supplier factories.[50]

Mizuno committed to publishing its “core factory list” in January 2017 with “names, location, and product category,” but published the information without including factory street addresses.[51] This list also appears to include only a minority of all Mizuno’s apparel supplier factories.[52] Abercrombie & Fitch and PVH Corporation communicated their decisions to publish all tier-1 factory names by country only.[53] Loblaw similarly committed to publish names of all factories where they “source apparel and footwear directly” and to include the country of manufacture but not the factory address.[54]

Beginning Disclosure, But Details Unknown

BESTSELLER and Decathlon committed to beginning publishing supplier factory information in 2017 but did not specify the details of their disclosure.[55] 

No Commitment to Publish

Some companies gave little or no response to letters requesting information about their disclosure practices or plans, or the Transparency Pledge.

Of the apparel companies and retailers with own-apparel brands who had previously not published any information for cut-make-trim factories, 10 did not send any response to the coalition’s letter.[56] Another 15 did not commit to publish supplier factory information.[57]

No Commitment to Make their Factory List Public

Apparel companies that responded but did not indicate any impending commitment to publishing their supplier factories are American Eagle Outfitters, DICK’S Sporting Goods, Foot Locker,[58] The Children’s Place, Walmart, Canadian Tire, Desigual, MANGO, KiK, Hugo Boss, Carrefour, Morrison’s, Primark, and Sainsbury’s.

Inditex declined to publish supplier factory information but makes this data available to IndustriALL and its affiliates as part of the reporting under its Global Framework Agreement.[59] 

Failed to Respond to Coalition’s Call for Transparency

Armani, Carter’s, Forever 21, Urban Outfitters, Ralph Lauren Corporation, Matalan, River Island, Sports Direct, Shop Direct, and Rip Curl did not send any response to the coalition.

Debunking the So-Called Barriers to Transparency

Competitive Disadvantage

A few brands—KiK, Inditex, DICK’s Sporting Goods, and The Children’s Place—that declined to publish their supplier factory information cited competitive advantage.[60] However, many other large apparel companies and retailers with own-brand apparel products have published supplier factory information for years.[61] Five companies have published this information for more than a decade.[62] Garment industry giants are increasingly choosing to publish their supplier information, proving that transparency can easily coexist with being competitive.

In some cases, supplier factories already openly advertise on their websites the names of brands they produce for, even where a brand does not.[63]

Many apparel companies are also part of initiatives like the Fair Factories Clearinghouse and Sedex, where they voluntarily disclose and share non-competitive information with other brands, including supplier names, audit reports, and so on, even where they do not do so publicly.[64]

Moreover, apparel companies that import products into US markets are subject to the US law, which requires that customs authorities collect information on each shipping container that enters a US port, including the shipper (typically in the case of garments the overseas supplier) and the consignee (typically the apparel company or its agent).[65] Online subscription databases purchase this trade data and market it in searchable formats, allowing users, including competitors, to gather information about suppliers to apparel companies that import goods into the US.[66] But the costs of accessing such subscription-based databases are prohibitive for workers and many civil society organizations. While apparel companies can easily purchase subscriptions, workers and many labor advocates around the world cannot afford them. Despite the availability of these records, some companies are known to use various means of shielding their own names and their suppliers’ names from appearing in this data.

Anti-Competition Law

KiK declined to publish information about their supplier factories, raising anti-competition concerns among others.[67] However, other brands selling products in Germany or other EU countries are governed by the same laws as KiK. They have been disclosing supplier information for many years; and more brands operating there have committed to begin public disclosure. These include companies that already disclose supplier factory information, such as adidas, C&A, Columbia Sportswear, Disney, Esprit, H&M, Levi’s, Nike, Patagonia, and Puma; and others that have committed to beginning disclosure in 2017, such as ALDI North and ALDI South, BESTSELLER, Fast Retailing, LIDL, and Tchibo.

Moving Beyond Private Disclosure

In response to the coalition’s recommendation that brands publicly disclose their supplier information, a few brands declined, citing their participation in other initiatives, like the Bangladesh Accord on Fire and Building Safety or global framework agreements (GFA) with IndustriALL and UNI Global Union.

When implemented effectively, such initiatives serve important human rights due diligence purposes. For example, the Bangladesh Accord requires brands to confidentially disclose their supplier factory information to the initiative’s Steering Committee and staff, which makes public the names of all factories covered by the Accord and their performance on building safety issues, but without disclosing the specific brands that are supplied by each factory. An apparel company’s global framework agreement with IndustriALL typically requires the company to disclose its factory lists to the global union. This creates a basis for the union to engage with the company on the behavior of particular supplier factories.

However, none of these agreements prevent brands from publishing their supplier factory information. A number of brands (named in the text box below) participate in the Bangladesh Accord and publish their supplier factory information. Apparel companies H&M, Tchibo, and Mizuno have shown that private, confidential reporting within the framework of legally binding agreements can and should complement publishing supplier factory information.

Brands that Do Both: Publish Supplier Information and Participate in Other Initiatives

Bangladesh Accord members that have been publishing supplier factory information include adidas, C&A, Cotton On, Esprit, G-Star RAW, H&M, Kmart Australia, Lindex, Marks and Spencer, Puma, Target Australia, and Woolworths.

Accord members that will begin some disclosure in 2017 are Abercrombie & Fitch, ALDI North and ALDI South, BESTSELLER, Debenhams, Fast Retailing, John Lewis, Next, New Look, Loblaw, LIDL, PVH, Tesco, and Tchibo. A number of brands that are a part of the German Partnership for Sustainable Textiles (the Textil Bündnis) publish their supplier information: adidas, C&A, Esprit, H&M, and Puma; others like ALDI North and ALDI South and LIDL began publishing supplier factory information in 2017; Tchibo will also publish its supplier factory information in 2017.

A number of brands that are a part of the German Partnership for Sustainable Textiles (the Textil Bündnis) publish their supplier information: adidas, C&A, Esprit, H&M, and Puma; others like ALDI North and ALDI South and LIDL began publishing supplier factory information in 2017; Tchibo will also publish its supplier factory information in 2017.

MANGO, in response to outreach about the Transparency Pledge, offered an alternative: disclosing only to members of the coalition that spearheaded the Pledge, or to parties that register with the company.[68] These proposals fall short of the level of supply chain transparency needed in the industry. Private disclosure of this type is not sustainable, and does little to improve human rights due diligence in global apparel supply chains.

IV. The Way Forward

Supply chain transparency is an important first step toward more meaningful corporate accountability. As Esprit, one of the global apparel companies that committed to improve its disclosure practices to align with the Pledge, said: “[R]eleasing this information is not comfortable for many companies, but the time has come to do it.”[69]

A number of companies have responded positively to the coalition’s letter committing to add more information in accordance with the Pledge standards. More companies should step out of their comfort zone and join the transparency trend. They should commit to the Transparency Pledge standards.

Multi-stakeholder initiatives should also endorse the Transparency Pledge as a minimum standard for apparel supply chain transparency for their member companies, and publicly scorecard members on transparency practices.

Investors should also endorse the Transparency Pledge as part of broader efforts to promote effective human rights due diligence tools that are industry good practice and in accordance with the UN Guiding Principles on Business and Human Rights.

The Transparency Pledge is an important first step, but is not the end of the story. Far more can and should be done to promote deeper and wider transparency and human rights in garment industry supply chains. 

All global apparel companies, including those acknowledged in this report as committing to the Pledge or close, should periodically review and upgrade their transparency practices.

These efforts should include expanding traceability and transparency beyond the cut-make-trim manufacturing phase to other aspects of the supply chain, including manufacture of yarn, fabric, and other inputs, and the production of raw materials like cotton.

While supply chain transparency is widely recognized as an important pillar on which corporate accountability is built, transparency alone does not result in improved working conditions or accountability. Brands should adopt transparent practices and complement them with other steps to strengthen human rights due diligence in their supply chains.

Countries where global apparel companies do business should pass legislation that promotes mandatory human rights due diligence in the global supply chains of companies, including mandatory publication of supplier information. These should build on the California Transparency in Supply Chains Act, “sweat-free” procurement laws adopted by dozens of local governments in the US, the UK Modern Slavery Act and the 2017 French law on corporate duty of vigilance.[70] Such legislation will go a long way in creating a level playing field in the garment industry.

[The coalition invites additional endorsements from labor and human rights organizations, apparel companies, and investors interested in supporting the move for industry-wide minimum standards for transparency in garment supply chains, starting with the Transparency Pledge. Inquiries may be sent to: transparency@hrw.org or any coalition member.]

Acknowledgments

This report was authored and edited by the following people:

Human Rights Watch: Aruna Kashyap, senior counsel and Janet Walsh, acting director, Women’s Rights Division; Arvind Ganesan, director, Business and Human Rights Division; Chris Albin-Lackey, senior legal advisor; Tom Porteous, deputy program director; and Danielle Haas, senior editor, Program Office.

Maquila Solidarity Network: Lynda Yanz, executive director; and Robert Jeffcott, policy analyst.

Clean Clothes Campaign (International Office): Ben Vanpeperstraete, lobby and advocacy coordinator; and Christie Miedema, campaign and outreach coordinator.

International Corporate Accountability Roundtable: Nicole Vander Meulen, legal and policy associate.

Worker Rights Consortium: Scott Nova, executive director; and Ben Hensler, general counsel and deputy director.

International Labor Rights Forum: Judy Gearhart, executive director; and Liana Foxvog, director of organizing and communications.

International Trade Union Confederation: Alison Tate, director of economic and social policy.

IndustriALL Global Union

A number of people contributed to this collective advocacy effort by coordinating outreach with brand representatives. They include:

  • Clean Clothes Campaign: Ben Vanpeperstraete, Dominique Muller, Laura Ceresna, Deborah Lucchetti, Ineke Zeldenrust, Frieda de Koninck, and Helle Løvstø Severinsen.
  • Human Rights Watch: Aruna Kashyap.
  • IndustriALL Global Union.
  • International Trade Union Confederation.
  • Maquila Solidarity Network: Lynda Yanz and Robert Jeffcott.
  • UNI Global Union.
  • Worker Rights Consortium: Ben Hensler and Scott Nova.

Human Rights Watch also acknowledges the contribution of Shubhangi Bhadada, a consultant who helped with desk research, and Kate Larsen, a former Human Rights Watch consultant.

Alexandra Kotowski et Annerieke Smaak, coordinatrice senior de la division Droits des Femmes de Human Rights Watch, ont assisté Helen Griffiths, la coordinatrice de la division des Droits de l’Enfant de Human Rights Watch pour le travail de contact avec les entreprises. Kate Segal, coordinatrice de la division Droits des Femmes de Human Rights Watch, et Olivia Hunter, coordinatrice de la divisions Photos et Publications, ainsi que Rafael Jimenez, concepteur graphique, ont assisté dans le lay-out et la publication de ce rapport.

***

Current/Anticipated Disclosure by December 31, 2017 vs. Pledge Standards
Company Headquarters Published supplier factory--cut-make-trim (CMT) and subcontractor-- information prior to Pledge Letter? Supplier factory information published meets or will meet Full Pledge by December 2017? Names and street addresses of CMT factories and their subcontractors Worker numbers Product types Parent company information Frequency of disclosures Time Frame to Implement Pledge
Abercrombie & Fitch US None Not full Pledge, but will begin publishing supplier factory information in 2017. Names of tier-1 factories (CMT for woven, denim, knit, sweater, intimates,and accessoroies) with country of manufacture, but without street address. No No No 2 times per year 2017
Adidas Germany Names of all tier-1 factories, including those used by licensees as well as authorized subcontractors, by country and city. Names of all tier-2 wet process suppliers, by country and city. Separate lists of supplier factories used for the Olympic Games. Full Pledge alignment. Yes Yes Yes Yes 2 times per year 2017
ALDI North and ALDI South Germany None Not full Pledge, but will begin publishing supplier factory information in 2017. Names and addresses of tier-1 (CMT) factories but not their subcontractors. No No No 1+ times per year 2017
American Eagle Outfitters US None No commitment to publish supplier factory information. No No No No NA NA
Arcadia Group UK None Not full Pledge, but will begin publishing supplier factory information in 2017. Names and addresses of tier-1 (CMT) factories but disclosure of authorized subcontractors will need more time. No No No 1+ times per year NA
Armani Italy None No response to coalition letter. No No No No NA NA
ASICS Japan None Full Pledge alignment. Yes Yes Yes Yes 1 time per year 2017
ASOS UK None Full Pledge alignment. Yes Yes Yes Yes 6 times per year 2017
Benetton Italy None Not full Pledge, but will begin publishing supplier factory information in 2017. Names and addresses of tier-1 (CMT) factories but not their subcontractors. No Yes No 1 time per year NA
BESTSELLER Denmark None Not full Pledge, but will begin publishing supplier factory information in 2017. Company stated that tier-1 (CMT) factories will be published but did not provide more information about what precisely will be disclosed for each factory. No information No information No information No information 2017
C&A Netherlands Names and addresses of all CMT factories. Excluded: Brazil, Mexico, and processing factories. Full Pledge alignment. Yes Yes Yes Yes 2 times per year 2017
Canadian Tire Canada None No commitment to publish supplier factory information. No No No No NA NA
Carrefour France None No commitment to publish supplier factory information. No No No No NA NA
Carter's US None No response to coalition letter. No No No No NA NA
Clarks UK None Full Pledge alignment. Yes Yes Yes Yes 2 times per year A vast majoirity of the supplier factory information will be published in 2017. Five percent of non-footwear accessories to be published in 2018.
Coles Australia Names and addresses of CMT factories, but not subcontractors. Company states that its supplier factories use minimal subcontracting. No additional commitments to meet Pledge standards; maintaining status quo. Names and addresses of CMT factories, but not subcontractors. Company states that its supplier factories use minimal subcontracting. No No No 1 time per year NA
Columbia Sportswear US Names and addresses of factories from which they directly source and any external subcontractors engaged to perform finishing processes (mostly limited to collegiate suppliers since the others have in-house capacity). No additional commitments to meet Pledge standards; maintaining status quo. Yes No No No 1 time per year NA
Cotton On Group Australia Names and addresses of CMT factories used by top 20 suppliers. Full Pledge alignment. Yes Yes Yes Yes Multiple 2017
Debenhams UK None Not full Pledge, but will begin publishing supplier factory information in 2017. Names and addresses of tier-1 factories which includes all CMT factories; some external processing such as embroidering and washing may not be included. Yes No No No information 2017
Decathlon France None Not full Pledge, but will begin publishing supplier factory information in 2017. Company did not provide more information about what precisely will be disclosed for each factory. No information No information No information No information 2017
Desigual Spain None No commitment to publish supplier factory information. No No No No NA NA
DICK'S Sporting Goods US None No commitment to publish supplier factory information. No No No No NA NA
Disney US Names and addresses of all facilities part of Disney's vertical supply chain and any facility in its vertical supply chains where Disney intellectual property is located, which includes any laundry, printing, embroidery facility if Disney intellectual property is incorporated into that finished product or component. No additional commitments to meet Pledge standards; maintaining status quo. Names and addresses of all facilities in its vertical supply chain, including subcontractors, where Disney intellectual property is located. No No No 1 time per year NA
Esprit Germany Names and addresses of CMT factoriesand their authorized subcontractors. Full Pledge alignment. Yes Yes Yes Yes 2 times per year 2017
Fast Retailing Japan None Not full Pledge, but will begin publishing supplier factory information in 2017. Published name and addresses of "Core Factories"producing for UNIQLO brand, representing 80 percent of the total volume of orders for UNIQLO brand. Plans to publish a list of GU's "major partner factories" in 2017. No clear commitment to publish subcontractors in 2017. No No No 1 time per year 2017
Foot Locker US Previously disclosed names and addresses for suppliers of collegiate apparel line that is currently inactive. No commitment to publish current own-brand supplier factory information. No No No No NA NA
Forever 21 US None No response to coalition letter. No No No No NA NA
G-Star RAW Netherlands Names, addresses, product types, parent company, and worker numbers for CMT factories. Full Pledge alignment. Yes Yes Yes Yes 2 times per year 2017
Gap US Names and addresses of CMT factories and their authorized subcontractors. Almost full Pledge alignment. Yes Yes Yes No 2 times per year Gap did not make any new commitments to align with the Pledge by December 2017. The company updated its supplier factory information to be more closely aligned with the Pledge.
H&M Group Sweden Names and addresses of supplier factories and vendors (suppliers), processing factories, and some fabric suppliers. Full Pledge alignment. Yes Yes Yes Yes 4 times per year 2017
Hanesbrands US Names and addresses of collegiate suppliers and owned factories. Full Pledge alignment. Yes Yes Yes Yes 4 times per year 2017
Hudson's Bay Company Canada Names and addresses of some, but not all, supplier factories. No additional commitments to meet Pledge standards; maintaining status quo. Names and addresses of some, but not all, CMT factories. No No No 1 time per year NA
Hugo Boss Germany None No commitment to publish supplier factory information. No No No No NA NA
Inditex Spain CMT factories not published. Names and addresses of direct and indirect wet processing factories published. No commitment to publish supplier factory information. No No No No NA NA
John Lewis UK None Almost full Pledge alignment. Yes Yes Yes No 2 times per year 2017
KiK Germany None No commitment to publish supplier factory information. No No No No NA NA
Kmart Australia Australia Names and addresses of factories in "high risk" countries. No response to coalition letter. Names and addresses of factories in "high risk" countries. No No No No information NA
Levi Strauss US Names and addresses of CMT factories and authorized subcontractors. Full Pledge alignment. Yes Yes Yes Yes 2 times per year 2017
LIDL Germany None Not full Pledge, but will begin publishing supplier factory information in 2017. Names and addresses of tier-1 factories which includes all CMT, but does not include all processing facilities. No No No 2 times per year 2017
Lindex Sweden Names and addresses of CMT factories. Full Pledge alignment. Yes Yes Yes Yes 1 time per year 2017
Loblaw Canada None Not full Pledge, but will begin publishing supplier factory information in 2017. Names of all factories where they Òsource apparel and footwear directlyÓ with country of manufacture but not street address. No No No 2 times per year 2017
MANGO Spain None No commitment to publish supplier factory information. No No No No NA NA
Marks and Spencer (M&S) UK Names and street addresses, worker numbers, gender breakdown, and product types. Almost full Pledge alignment. M&S will continue with its Plan A disclosure commitments and add processing factories and also make its existing disclosure available in a searchable format. Yes Yes Yes No 2 times per year 2017
Matalan UK None No response to coalition letter. No No No No NA NA
Mizuno Japan None Not full Pledge, but will begin publishing supplier factory information in 2017. Names along with country of manufacture of "Core Suppliers," that is, 125 factories disclosed of 464 tier-1 suppliers as reported on Mizuno website. No Yes No No information Began disclosure in 2017.
Morrison's UK None No commitment to publish supplier factory information. No No No No NA NA
Mountain Equipment Co-op (MEC) Canada Names and addresses of all CMT factories and some processing facilities. Almost full Pledge alignment. Names and addresses of all CMT factories and some processing facilities. Yes Yes Yes 2 times per year Additional details for CMT factories to meet Pledge standards will be published in 2017. Names and other details of authorized printers will be added subsequently.
New Balance US Names and addresses of direct supplier factories, excluding US wholly-owned facilities. Not full Pledge, but will add product type, and update annually in searchable format. Names and addresses of direct supplier factories, excluding US wholly-owned facilities. No Yes No 1 time per year 2017
New Look UK None Full Pledge alignment. Yes Yes Yes Yes At least annual 2017
Next UK None Full Pledge alignment. Yes Yes Yes Yes 2 times per year 2017
Nike US Names, addresses, product category, worker numbers, gender and migrant worker breakdown, and authorized subcontractor. Full Pledge alignment. Yes Yes Yes Yes 4 times per year 2017
Patagonia US Names, addresses, product category, worker numbers, gender breakdown, and parent companies of CMT and authorized subcontractors. Some fabric suppliers indicated. One cotton farm also disclosed. Full Pledge alignment. Yes Yes Yes Yes 1 time per year 2017
Pentland Brands UK None Full Pledge alignment. Yes Yes Yes Yes 2 times per year 2017
Primark UK None No commitment to publish supplier factory information. No No No No NA NA
Puma Germany Name of factory by country, city for tier-1 "core suppliers" and tier-2 material and component suppliers. Almost full Pledge alignment for tier-1 "core suppliers" factories. Names and addresses of tier-1 "core suppliers" amounting to 80 percent of their total business volume. But authorized subcontractors (if any) are not included in the definition of "core suppliers." Yes Yes No 1 time per year 2017
PVH Corporation US None Not full Pledge, but will begin publishing supplier factory information in 2017. Names of CMT factories along with country of manufacture but without street address. No No No 2 times per year 2017
Ralph Lauren Corporation US None No response to coalition letter. No No No No NA NA
Rip Curl Australia None No response to coalition letter. No No No No NA NA
River Island UK None No response to coalition letter. No No No No NA NA
Sainsbury's UK None No commitment to publish supplier factory information. No No No No NA NA
Shop Direct UK None No response to coalition letter. No No No No NA NA
Sports Direct UK None No response to coalition letter. No No No No NA NA
Target Australia Australia Based on information on its website, Target Australia appears to disclose the names and addresses of CMT factories. No response to coalition letter. Names and addresses of CMT factories appear to be disclosed. The coalition has no information about percentage of supplier factories disclosed or other exclusions, if any. No No No Company website says "regular basis." NA
Target USA US Names and countries of CMT suppliers, textile and wet processing factories. No additional commitments to meet Pledge standards; maintaining status quo. Names of CMT factories along with country of manufacture but without street address. No No No 4 times per year NA
Tchibo Germany None Not full Pledge, but will begin publishing supplier factory information in 2017. Names and addresses for CMT factories. Yes Yes No No information NA
Tesco UK Names and addresses of Bangladesh supplier factories only. Almost full Pledge alignment. Yes Yes Yes No 2 times per year 2017
The Children's Place US None No commitment to publish supplier factory information. No No No No NA NA
Under Armour US Only suppliers factories for collegiate apparel. Not full Pledge, but will begin publishing supplier factory information in 2017. Names and addresses for all CMT factories (but not embellishers or subcontractors). Yes Yes Yes No information Pledge details for CMT factories will be published in 2017.
Urban Outfitters US None No response to coalition letter. No No No No NA NA
VF Corporation US Names of factories by country for all VF brands of all VF-owned and operated, and direct sourced, tier-1 supplier factories. Not full Pledge, but will include street addresses to align more with the Pledge. Names and addresses of all CMT factories but not those used by licensees and subcontractors. No No No Regular 2017
Walmart US None No commitment to publish supplier factory information. No No No No NA NA
Woolworths Australia Names and addresses of all sites in Bangladesh are disclosed, and overall more than 40 percent of the supply chain (for apparel and footwear) is published. No additional commitments to meet Pledge standards; maintaining status quo. Names and addresses of all sites in Bangladesh are disclosed, and overall more than 40 percent of the supply chain (for apparel and footwear) is published. No No No 4 times per year NA

 

[1] The terms garment industry, apparel industry, and garment and footwear industry are used interchangeably in this report. All references to the garment or apparel industry also include the footwear industry.

[2] This report uses the phrase “global apparel companies” or “apparel companies” to refer to companies, retailers, and supermarkets that sell their branded clothing and footwear products. Many global apparel companies, including adidas, H&M, Levi Strauss, and VF Corporation, own multiple brands.

[3] The phrase “supplier factory” refers to a factory engaged in the production of apparel and footwear. This term is distinct from “suppliers,” which some apparel companies use to mean “vendors.”

[4] Retailers and supermarkets typically sell apparel and footwear belonging to a number of different brands, only some of which they own. For example, a shoe retail chain may sell its own-brand shoes as well as other name brands, like adidas, Nike, and Puma.

[5] William McCall, “Nike Discloses Factory Locations,” Washington Post, October 8, 1999, http://www.washingtonpost.com/wp-srv/aponline/19991008/aponline182943_000.htm (accessed March 21, 2017).

[6] Apart from information compiled by advocacy groups, there is no centrally available public repository that tracks which apparel companies are publicly disclosing information about their supplier factories. This list incorporates the latest information released by Fashion Revolution about the names of brands that make their supplier factory information public: Fashion Revolution, “Transparency is Trending,” March 2017, http://fashionrevolution.org/transparency-is-trending/ (accessed March 20, 2017).

For information about US companies licensed to produce collegiate apparel and making these supplier factory names public, see Worker Rights Consortium, “Factory Database,” http://www.workersrights.org/search/ (accessed April 1, 2017); and International Labor Rights Forum, “Tracking Corporate Accountability in the Apparel Industry,” April 5, 2017, http://laborrights.org/apparelcompanychart (accessed April 6, 2017).

[7] For more information, see Section III, “The Transparency Pledge.”

[8] Ibid. See also Section IV, “Apparel Company Responses.”

[9] See Section III, Transparency Pledge, and Appendix III (available online).

[10] See Section IV, “Debunking the So-Called Barriers to Transparency.”

[11] United Nations, UN Guiding Principles on Business and Human Rights: Implementing the United Nations “Protect, Respect and Remedy” Framework (UN Guiding Principles), 2011, http://www.ohchr.org/Documents/Publications/GuidingPrinciplesBusinessHR_EN.pdf (accessed February 10, 2017).

[12] Ibid, p. 23.

[13] Ibid, p. 24.

[14] The California Transparency in Supply Chains Act of 2010, http://www.leginfo.ca.gov/pub/09-10/bill/sen/sb_0651-0700/sb_657_bill_20100930_chaptered.pdf (accessed February 18, 2017); for a list of US cities with sweat-free procurement policies and codes of conduct, see Sweatfree Purchasing Consortium, “Resource Library,” http://buysweatfree.org/resource_library (accessed March 28, 2017); UK Modern Slavery Act 2015, http://www.legislation.gov.uk/ukpga/2015/30/contents/enacted (accessed February 18, 2017); the French law on corporate duty of vigilance, http://www.assemblee-nationale.fr/14/ta/ta0924.asp (accessed March 2. 2017).

[15] Corporate Human Rights Benchmark, 2016, https://business-humanrights.org/en/corporate-human-rights-benchmark (accessed February 18, 2017). The benchmark was developed by a steering committee comprised of six organizations. These include Aviva Investors, Calvert Investments, The Dutch Association of Investors for Sustainable Development (VBDO), and Vigeo Eiris, a group that also advises on responsible investment.

The benchmark is endorsed in the UN Guiding Principles Reporting Framework Investor Statement, http://www.ungpreporting.org/early-adopters/investor-statement/ (accessed February 18, 2017).

[16] Corporate Human Rights Benchmark, Corporate Human Rights Benchmark Pilot Methodology 2016, March 2016, https://business-humanrights.org/sites/default/files/CHRB_report_06_singles.pdf (accessed February 18, 2017), p. 97.

[17] Email communications from Eniko Horvath, senior researcher, Business and Human Rights Resource Center, to Human Rights Watch, March 27 and March 28, 2017. The Business and Human Rights Resource Center is one of the organizations that is part of the CHRB’s Methodology Group.

[18] Email communication from Kevin Thomas, SHARE, to Human Rights Watch, February 24, 2017.

[19] The Pledge does not use the first and second tier terminology to avoid confusion because different brands define tiers differently. Where a CMT factory does not have the in-house capacity to undertake printing, embroidery and other embellishments, laundry, and related processes without which a product cannot be readied for shipment, typically the factory outsources these functions to other specialist factories. These authorized subcontractors should also be disclosed.

[20] For example, Nike, “Nike Manufacturing Map,” http://manufacturingmap.nikeinc.com/ (accessed August 23, 2016). For every factory disclosed, Nike publishes information about number of workers, percentage of female workers, and percentage of migrant workers; Marks and Spencer (M&S), “M&S Supplier Map,” https://interactivemap.marksandspencer.com/ (accessed August 23, 2016). For every factory disclosed, M&S publishes information about product type, number of workers, and percentage of male and female workers; Patagonia, “The Footprint Chronicles,” http://www.patagonia.com/footprint.html (accessed August 23, 2016).

[21] H&M Group, “Supplier List,” http://sustainability.hm.com/en/sustainability/downloads-resources/resources/supplier-list.html (accessed August 23, 2016). H&M disclosed a number of fabric and yarn mills that supplied the factories producing apparel. Patagonia, “The Footprint Chronicles.” Patagonia disclosed a number of textile mills in its supply chain as well as one cotton farm.

[22] For information after this date, visit the brand website for any new developments.

[23] In evaluating company responses to the Pledge, the coalition has opted for flexibility on frequency of updates to supplier factory lists. As explained in more detail in Appendix II, this decision was based on its discussions with companies.

[24] Email communication from Gap to the coalition, March 22, 2017.

[25] Email communication from Marks and Spencer to the coalition, December 20, 2016. Marks and Spencer did not commit to additional disclosures in response to the Pledge. They informed the coalition that their existing plans already intended to extend disclosures in January 2017. This will add “[B]eauty suppliers and Homeware suppliers, which will complete the public transparency of … entire first tier product Global clothing and home supply chains.” Marks and Spencer also stated that its representatives were “[a]lready in discussions of how to improve and increase the level of transparency. This includes adding 2nd tier processing sites and some raw materials and we will keep you posted throughout 2017 on these plans.”    

[26] Email communication from Tesco to the coalition, March 16, 2017.

[27] Email communication from John Lewis to the coalition, November 1, 2016.

[28] Mountain Equipment Co-op committed to adding all details as requested in the Pledge for all its “first tier” factories whose names and addresses it was already disclosing. It also noted that it was collecting information about external printers used by its authorized cut-make-trim (CMT) factories. But these would be disclosed as part of its ongoing efforts to deepen supply chain transparency and will happen over the next three years.

[29] Letter from Columbia Sportswear to the coalition, December 20, 2016 (on file with the coalition). Even though Columbia did not commit to additional disclosures in response to the Pledge, it stated that the company was “[c]ommitted to continuously improving transparency … and were open to further dialogue … about it.” Email communication from Disney to the coalition, December 21, 2016. Disney declined to add more details or commit to the full Pledge, stating that “Disney’s facility list is the largest list published to date, with over 6,000 facilities identified,” but said they “remain open to further dialogue about transparency practices.”

[30] Ibid.

[31] Email communication from New Balance to the coalition, February 22, 2017.

[32] “Puma Global Core Factory List 2017,” http://about.puma.com/damfiles/default/sustainability/supply-chain/manufacturing-map/PUMA-Global-Core-FTY-List-2017_final.pdf-dfb64160fd36df1141c4cac5d3ad248d.pdf (accessed April 7, 2017). Letter from Puma to the coalition, December 19, 2016; email communication from Puma to the coalition, March 21, 2017. Puma’s core factory list covers 80 percent of its business volume for tier-1 suppliers but also tier-2 material and component suppliers. However, it does not include tier-1 subcontractors (if they exist) since those do not fall under Puma’s definition of “core supplier.”

[33] “Coles non-food suppliers,” https://www.coles.com.au/about-coles/ethical-sourcing/non-food-suppliers (accessed April 1, 2017). Email communications from Coles to the coalition, December 6, 2016 and March 16, 2017. Coles stated that the majority of its production was done in-house by its cut-make-trim suppliers and that reliance on subcontractors was minimal. All subcontractors were not disclosed. 

[34] Email communications from Under Armour to the coalition, December 20, 2016 and March 7, 2017.

[35] Email communication from ALDI North and ALDI South to the coalition, December 20, 2016. ALDI North and ALDI South stated that the companies were taking measures to restructure their supply chain and “aim to set internal goals regarding increased supply chain transparency,” and subsequently published their factory lists. ALDI North Factories List, http://www.aldi-nord.de/print/01_verantwortung/ALDI_Nord_Hauptproduktionsstaetten_Lieferanten.pdf (accessed April 1, 2017); ALDI South Factories List, https://unternehmen.aldi-sued.de/de/verantwortung/lieferkette/transparenz-in-der-lieferkette/ (accessed April 1, 2017). Email communications from ALDI North and ALDI South to the coalition, March 20 and March 29, 2017. ALDI North and ALDI South defined tier-1 “mainly as CMT factories (of which many do have processes like laundry, printing, embroidery, etc.).”

[36] LIDL, “Disclosure of main production facilities for textiles & footwear worldwide,” https://www.lidl.de/de/transparenz-in-der-lieferkette/s7376023 (accessed April 1, 2017). Email communications from LIDL to the coalition, November 21, 2016 and February 28, 2017. LIDL includes within its definition of tier-1 manufacturing stages depending on vertical integration or contractual arrangement. These may include some processes like printing, washing, and so on, but not all authorized subcontractors.

[37] Email communication from Tchibo to the coalition, March 30, 2017.

[38] Email communication from VF Corporation to the coalition, February 20, 2017.

[39] See VF Corporation, “Factory List,” http://responsiblesourcing.vfc.com/factories-list/ (accessed February 27, 2017).

[40] Email communications from Debanhams to the coalition, November 7, 2016 and March 17, 2017. Debanhams defined tier-1 as cut-make-trim factories including those with in-house capacity to perform processes like laundry, printing, etc. 

[41] “Benetton Supplier List 2016,” http://static.benettongroup.com/wp-content/uploads/2015/06/Benetton_Supplier_List_2016.pdf (accessed April 4, 2017).

[42] Email communication from Arcadia Group to the coalition, April 7, 2017.

[43] Email communication from Woolworths to the coalition, March 3, 2017.

[44] Ibid. In response to a clarification asking whether all manufacturing and processing sites were disclosed, the company said: “Partially - we have good visibility of this in Bangladesh and are focused on improving this in other markets.” Email communication from Woolworths to the coalition, January 30, 2017. Woolworths committed to exploring whether Pledge standards can be integrated into its ongoing review of its ethical sourcing strategy, but the company did not provide a time frame for when this review is expected to be completed.

[45] Kmart Australia, “Factory List,” http://www.kmart.com.au/ethical-factories (accessed March 5, 2017). Kmart Australia says on its website that its factory list includes “all apparel and general merchandise factories in high risk countries [emphasis added] that directly produce [emphasis added] Kmart Australia products.”

[46] Target Factory Partner List, https://www.target.com.au/company/about-us/ethical-sourcing/factory-list (accessed March 5, 2017).

[47] At time of writing, Kmart Australia and Target Australia had not responded to the coalition’s letter.

[48] Letter from the Hudson’s Bay Company to the coalition, November 4, 2017 (on file with the coalition).

[49] Email communications from Fast Retailing to the coalition, March 22 and March 27, 2017. Fast Retailing stated, “Though not an exhaustive list of UNIQLO factories, it does indeed show all of the factories that UNIQLO currently engages in a long-term, continuous nature, accounting for the vast majority of our production.” In 2017, the company will be expanding its factory list to include another brand, GU’s “major partner factories.”

[50] This is based on information provided by Target USA on its website. “Global Factories List (as of March 24, 2017)” https://corporate.target.com/_media/TargetCorp/csr/pdf/Target-Global-Factory-List-Q1-2017.pdf (accessed April 7, 2017). On its website, Target states, “Target publishes a list of all factories, as well as textile and wet processing facilities producing Target owned-brand products.… This list is subject to change and updates will be provided on a quarterly basis.” Target USA began publishing supplier factory information before the coalition wrote to the company. The company did not respond to the coalition’s letter.

[51] Letter from Mizuno to the coalition, November 14, 2016 and email communication from Mizuno to the coalition, January 31, 2017 (on file with coalition).

[52] “Mizuno Core Factory List as of January, 2016,” http://media.mizuno.com/~/media/Files/com/csr/partner/17_0131_en.pdf (accessed January 31, 2017). Mizuno’s disclosure list has 125 factories, while their website says that there are “240 factories, which constitute … main contract manufacturing,” and further that Mizuno has “464 factories that are Tier 1 suppliers.” The definition of Tier 1 is not included on its disclosure page.

[53] Email communication from Abercrombie & Fitch to the coalition, November 6, 2016; email communication from PVH Corporation to the coalition, April 4, 2017.

[54] Email communication from Loblaw to the coalition, November 7, 2016; “Loblaw Apparel Supply Chain Disclosure, February 2017,” http://www.loblaw.ca/content/dam/lclcorp/pdfs/Responsibility/LCL%20Apparel%20Supply%20Chain%20Disclosure%20V1%20EN%20(Feb117)FINAL.pdf (accessed March 20, 2017).

[55] Email communication from BESTSELLER to the coalition, February 24, 2017. The company committed to disclosing all “tier one” suppliers and said, “Tier 1 are CMT,” excluding authorized subcontractors from within its scope. The company did not have more details about what precisely would be disclosed about its CMT suppliers. Email communications from Decathlon to the coalition, November 3, 2016 and February 14, 2017.

[56] Emails acknowledging receipt of the coalition’s letter with a preliminary response that the company is discussing the letter without a clear indication of the company’s position on supply chain transparency have been counted as not having responded.

[57] Details of company responses sent on company letterhead are available as an Annex online.

[58] Letter from Foot Locker to the coalition, November 4, 2016 (on file with the coalition). Foot Locker has previously disclosed the names and addresses of its cut-make-trim supplier factories that produced goods licensed by US colleges and universities and did not commit to adding more information about factories that produce its other own-brand products. This information was made publicly available on the website of the Worker Rights Consortium, http://www.workersrights.org/search/index.asp?search=results&licensee=Team+Edition+Apparel (accessed April 6, 2017). It appears, however, that Foot Locker is no longer marketing this line of apparel, and, relatedly, no longer discloses any supplier factory information.

[59] Letter from Inditex to the coalition, November 7, 2016 (on file with the coalition). Inditex publishes its direct and indirect wet processing supplier list, https://www.wateractionplan.com/documents/186210/199857/6.1.INDITEX+SUPPLY+CHAIN_WET_PROCESS_v1May2016.pdf/90f1e765-5ca2-4cc3-9215-88e0f1cc12a4 (accessed April 1, 2017). See below for more information about brands like H&M, Mizuno, and Tchibo that have global framework agreements with IndustriALL and publish or have committed to publishing supplier factory information.

[60] Letter from KiK to the coalition, November 7, 2016; letter from Inditex to the coalition, November 7, 2016 (on file with the coalition); email communication from DICK’s Sporting Goods to the coalition, March 6, 2017; email communication from The Children’s Place to the coalition, March 20, 2017.

[61] See Text Box in the Summary for a list of apparel companies that publish supplier factory information.

[62] adidas, Levi’s, Nike, Puma, and Patagonia.

[63] For example, Rupashi Group, http://rupashigroup.com/ (accessed March 3, 2017 and screenshot on file with Human Rights Watch). The group states on its website that it produces for Forever 21, Zara, and other brands that do not publish their supplier factory information; Ha-Meem Group, http://www.hameemgroup.net/ (accessed March 3, 2017 and screenshot on file with Human Rights Watch). The group states on its website that it produces for Zara, Mango, and American Eagle Outfitters among other brands that do not publicly post information on their websites. 

[64] Fair Factories Clearinghouse, “Benefits of Membership,” http://www.fairfactories.org/Home/Benefits-of-Membership (accessed February 23, 2017); Sedex, http://www.sedexglobal.com/ (accessed February 23, 2017).

[65] 19 US Code § 1484, Entry of Merchandise, https://www.law.cornell.edu/uscode/text/19/1484 (accessed March 21, 2017).

[66] Subscription databases exercise rights under the US Freedom of Information Act to purchase trade data from US Customs and market it in searchable formats to users, including competitors’ apparel companies. See for example, Import Genius, “Our Clients,” https://www.importgenius.com/how-it-works/our-clients (accessed February 18, 2017). Import Genius lists sourcing professionals as part of its clientele and says: “Hundreds of importers use our service to view the U.S. shipping history for overseas suppliers in any industry.… They can search by company name or product keywords to identify the manufacturers already supplying their competitors, from world-class brands to small-time importers.” In fact, Import Genius clearly says that it serves “competitive intelligence analysts,” providing “unrivaled access into the supply chain activities of … major competitors.” Panjiva, https://panjiva.com/ (accessed February 18, 2017). Panjiva advertises that one of the database’s advantages is to “[u]nderstand [the] market share by seeing where … competitors source their goods, and which entities are involved in the shipment of goods.”

[67] Letter from KiK to the coalition, November 7, 2016 (on file with the coalition).

[68] Email communication from MANGO to the coalition, November 24, 2016. MANGO said it was developing a system to create a username and password upon request to its CSR department through which supplier information can be accessed by “any organisation that may be interested, as long as they do not have any competitive conflict.”

[69] Letter from Esprit to the coalition, November 23, 2016 (on file with the coalition).

[70] See for example, ITUC, “Closing the loopholes—How legislators can build on the UK Modern Slavery Act,” https://www.ituc-csi.org/IMG/pdf/uk_modern_slavery_act.pdf (accessed March 7, 2017).

Author: Human Rights Watch
Posted: January 1, 1970, 12:00 am

 

The Transparency Pledge

The objective of the Transparency Pledge is to help the garment industry reach a common minimum standard for supply chain disclosures by getting companies to publish standardized, meaningful information on all factories in the manufacturing phase of their supply chains. The civil society coalition that developed the Pledge surveyed published factory lists of leading apparel companies and developed a set of minimum supply chain disclosure standards that build on good practices in the industry.

Each company participating in this Transparency Pledge commits to taking at least the following steps within three months of signing it:

Publish Manufacturing Sites

The company will publish on its website on a regular basis (such as twice a year) a list naming all sites that manufacture its products. The list should provide the following information in English:

  1. The full name of all authorized production units and processing facilities
  2. The site addresses.
  3. The parent company of the business at the site.
  4. Type of products made.
  5. Worker numbers at each site.

Companies will publish the above information in a spreadsheet or other searchable format. 

 

Posted: January 1, 1970, 12:00 am

The United States Department of Justice has ordered a review of all agreements, known as “consent decrees,” between the department and various US cities. These agreements were formed after its investigations turned up evidence of unlawful law enforcement practices. The fear is that Attorney General Jeff Sessions – who in a memo stated: “It is not the responsibility of the federal government to manage non-federal law enforcement agencies” – wants to overturn them.

Missouri State Troopers in riot gear stand in formation outside the Ferguson Police Department in Ferguson, Missouri, November 24, 2014.

© 2014 Reuters

Much of the public opposition to the review in Baltimore and other affected cities has focused on how it could halt critical police reform. But it also could roll back changes to a lesser-known insidious problem – one that creates deep fissures between communities and the police. It’s the practice of municipalities imposing heavy fees and fines on their poorest residents.

Take Ferguson, Missouri, where the police killing of Michael Brown led to protests and riots. A Justice Department investigation found the city brought in more money leveling municipal fines and fees against people than it did through property taxes. In 2013, the city had 21,135 people but 32,975 arrest warrants pending for nonviolent offenses, according to National Public Radio. City ordinances had fined defendants for failing to appear in court and even imprisoned some who didn’t pay without determining if they could pay. This sense that the justice system was rigged helped fuel the protests.

A consent decree between the Justice Department and Ferguson eliminated these draconian ordinances. It required that courts, before fining a defendant, assess whether the person could pay. The court must accept partial payments and could no longer issue arrest warrants to collect court debt. The agreement also required the city prosecutor to eliminate certain types of pending fees and forgive fines that went beyond the original amount for a violation. As a result, Ferguson recently reported that it had discharged over US$1.75 million in pending fines. The consent decree also mandated structural changes, like taking away prosecutorial powers from court staff and moving supervision of the Ferguson Municipal Court from the city finance director to the state court system.

These and other consent-decree requirements aim to bring Ferguson into compliance with state and federal law. Federal law empowers the Justice Department to negotiate and enforce such decrees when local systems of control and accountability fail to protect citizens. Most importantly, these decrees – despite shortcomings in protecting rights – could start to foster a sense of justice as well as trust between police and citizens, and thus increase public safety. Heavy-handed attempts to reverse them would undermine these important goals.

Author: Human Rights Watch
Posted: January 1, 1970, 12:00 am

 

Testimony to the Senate Foreign Affairs Committee, Subcommittee on African Affairs and Global Health Policy Regarding Dodd-Frank Section 1502

Chairman Flake, Ranking Member Booker and other members of the subcommittee,

Thank you very much for the opportunity to testify today on Dodd-Frank Section 1502 and its impact on addressing the trade in “Conflict Minerals.” Human Rights Watch has documented abuses in the Democratic Republic of Congo since the fall of Mobutu Sese Seko and throughout the country’s vicious civil war and the violence and abuses that continue. 

Since 2005, we have documented the pernicious effect that the trade in gold has had on civilians in eastern Congo. Numerous armed groups, foreign-backed rebels, and at times the Congolese army have killed, raped, pillaged, and forcibly conscripted child soldiers as they sought to gain or maintain control of lucrative gold mines, which in turn helped finance their abusive movements. We’ve also documented how a major mining company paid a rebel group to explore for gold in its concession area in 2005.

It is for these reasons that Human Rights Watch supported and continues to support Dodd-Frank 1502. We never saw it as a panacea to stop the abuses or violence in Congo completely. Rather, we saw it as an important tool to help address a specific goal:  stopping the flow of funds to abusive armed groups who were exploiting Congo’s lucrative mining resources through increased transparency and accountability. 

Today, we are here because Dodd-Frank 1502 may be suspended or even revoked. We know legislation can sometimes be a blunt tool and that it can have unintended consequences. With that in mind, we welcome a discussion on how Section 1502 can fulfill its objectives more efficiently; however, we strongly believe that its suspension or revocation would be damaging for security, human rights, and for responsible companies. To be crystal clear: if the president suspends the law or if Congress revokes it, we believe that the repercussions would be very serious.

This hearing comes at a critical time in Congo. Over the past two years, government officials and security forces have carried out a brutal campaign of repression against those opposed to President Joseph Kabila’s efforts to stay in power beyond the December 19, 2016 end of his constitutionally mandated two-term limit. Scores of peaceful protesters have been killed, pro-democracy activists and opposition leaders have been imprisoned, and media outlets have been shuttered. After significant pressure from the international community —including targeted US sanctions against top officials and other strong measures backed by this Congress—President Kabila made some important concessions in an end-of-the year deal mediated by the Catholic Church.

This agreement calls for presidential elections to be held by the end of this year and says clearly that there will be no changes to the constitution or a referendum to allow Kabila to run for a third term. Yet implementation of the deal has stalled, as violence between militia groups and the Congolese security forces have escalated in many parts of the country, along with an alarming increase in human rights violations. Some of these situations are directly linked to Kabila staying in power beyond the end of his constitutional mandate. Kabila has agreed to hold elections and step down from power, and the prospects for stability likely hinge on whether he abides by that commitment. Continued US engagement and strong pressure on Kabila to do so is critical. 

Last month, two members of the UN Group of Experts on Congo, Michael Sharp, an American, and Zaida Catalán, from Sweden, were killed while investigating large-scale human rights abuses in Congo’s central Kasai region. It remains unclear who was responsible for the murders. The Group of Experts has been instrumental over the years in exposing the links between the trade in natural resources, armed groups, sanctions-busting, and the violence in Congo.

In this context, suspending or eliminating Dodd-Frank 1502 would make an already explosive situation in Congo worse. Abusive armed groups, factions of the security forces, and other opaque mafia-like networks allegedly linked to government officials could then easily return to the lucrative mines in eastern Congo to finance their activities. This could lead to new security problems throughout the volatile region—where some of Congo’s nine neighboring countries have illegally benefitted from the country’s vast mineral wealth. And it could also create direct security risks for the United States, which has a clear interest in promoting a more stable and peaceful central Africa region.

Suspending Dodd-Frank 1502 would also harm responsible American companies that have embraced the law and the principles that underpin it, including some of this country’s most successful and well-known companies, such as Apple, Intel, and Tiffany. They and others would suddenly be placed at a competitive disadvantage against other companies that prefer to operate opaquely in a way that could fund armed groups. Eliminating the rule would punish responsible companies and reward irresponsible ones by creating a “race to the bottom,” legalizing opaque sourcing of conflict minerals while disadvantaging companies that choose to keep their supply chains clean.

In the absence of 1502, it is possible that civil society groups could end up pressing for targeted sanctions on the Congolese minerals sector if it becomes clear that abusive armed groups are profiting from this trade. Such targeted sanctions are typically the approach the international community has taken in recent years to address similar problems. While understandable, this is a much more draconian approach than the transparency and auditing procedures 1502 require. These are serious consequences for Congo, for major US companies, and for human rights.   

Suspending 1502 Will Make It Easier to Fund Armed Groups Secretly

The fundamental purpose of Dodd-Frank 1502 is to keep money out of the hands of armed groups that trade in and profit from certain minerals. Human rights groups, responsible companies, and the US government have shared this goal for many years. It is important not to lose this aspect of the law: it is a rare instance where key institutions in and out of government agree on what the problems is, want to stop it, and have managed to put a law in place to help do it. That is something Congress and the administration should support.

Without the law, it would be easier for abusive armed groups to fund themselves secretly, which could help to further destabilize parts of Congo. In mid-March, Bloomberg news reported that the Congolese Minister of Mines, Martin Kabwelulu, wrote the US Securities and Exchange Commission, warning that eliminating 1502 would lead to an “escalation in the activities of non-state armed groups.” The US has sought for decades to help de-escalate these activities; removing a tool that can help do that undercuts longstanding US foreign policy objectives.

This problem could be exacerbated by the administration’s possible budget cuts for UN peacekeeping in Congo and by possible further cuts to other foreign assistance to Congo. The combination of suspending or eliminating 1502 while cutting support to peacekeeping and other foreign assistance could make it easier for abusive armed groups to make money from conflict minerals while simultaneously reducing funds to entities meant to curtail conflict and foster stability.

Considering Congress’ longstanding interest in Congo, the fragile situation on the ground, and the billions of dollars the US has spent on peacekeeping efforts in the country, this scenario would be extraordinarily counterproductive to US geopolitical and security interests.

While imperfect, Dodd Frank has already had some tangible positive effects for the people of eastern Congo and those seeking greater transparency. Since 2012, mining at the Kalimbi tin mine in Nyabibwe, South Kivu, for example, has had a functional traceability scheme, which allows for the continuous production of tin that benefits the local workers, and not the abusive armed groups or corrupt army or government officials.  

Global Witness reported that in 2012, the Congolese government suspended the operations of two Chinese companies because they failed to carry out proper due diligence and suspected they may be sourcing from armed groups.  But it is troubling that the same year, Global Witness reported that two Congolese army officers were caught trying to smuggle more than 1,000 pounds of minerals, including coltan. The government refused to press charges, but the officer who stopped them and tried to stop the smuggling was suspended from his post. At present, however, we have some indications that Congolese government officials are starting to take actions to prevent mineral wealth from illegally profiting armed groups or army officers.

It is also important to remember the types of groups that could be emboldened and enriched without the transparency and systems Dodd-Frank requires. Human Rights Watch and others have documented the abuses by several armed groups that benefited from this trade and the harm they have caused. This includes the armed group known as the Nduma Defense of Congo-Renové (NDC-R), one of the most abusive groups operating in eastern Congo that benefits greatly from the uncontrolled and illicit exploitation of gold there. Traceability efforts so far have had a much greater impact on tin, tantalum, and tungsten than on gold. The NDC-R has committed serious human rights violations, including the killings of dozens of civilians and recruitment of children over the past two years.

Last month, my colleagues were in eastern Congo’s Walikale territory in North Kivu and met with several former child soldiers from NDC-R and miners. They told us how the group led by Guidon Shimiray Mwissa is systemically taxing the lucrative gold trade in dozens of mining sites. By holding a monopoly on things like alcohol and cigarettes in the mining pits and illegally taxing those who work in or near the mines, Guidon is making over $20,000 a month. According to some of his former cadres, he’s also allegedly trading gold for weapons.  

Suspending Dodd-Frank 1502 would make it easier for other abusive armed groups and corrupt officials to enrich themselves the way Guidon is by making the trade even more opaque and easier to do business with armed groups. This would make an already bad situation even worse.

Suspending or Eliminating Dodd-Frank 1502 Will Disadvantage Responsible US Companies

Suspending or revoking Dodd-Frank 1502 would hurt some of the United States’ leading companies, such as Tiffany, Intel, and Apple.  These firms have taken meaningful steps to keep their supply chains free from links to abuses in Congo and would be placed at a competitive disadvantage against companies inclined to operate less responsibly. 

Responsible companies have worked hard to comply with the requirements of 1502. In March 2016, Apple announced that 100 percent of its conflict mineral supply chain had been audited to ensure compliance with Dodd-Frank 1502. That move was widely praised by human rights groups. While its supplies were not fully conflict-free, it has achieved the kind of oversight needed to eliminate conflict minerals from its supply chain. It took the company about six years of steady work on the ground and with its suppliers to meet this goal. But Apple is not just focusing on its legal requirements; it is also trying to clean up its cobalt supply chain after facing scrutiny over problems in it.

Intel began to examine conflict minerals in 2008 and has reported that its microprocessors have been conflict free since 2013. The company has said that it was on track to make its entire product base conflict-free. It took several years for the company to get control over its supply chains and build the capacity to source from properly audited mines.  

Also, Intel commissioned an important study on Millennials’ attitudes towards conflict minerals. The survey provides useful insights into the minds of key consumers. 97 percent of those surveyed believed that companies should “act in a way that benefits society.” Almost 70 percent would avoid companies that they think are not socially responsible. About 70 percent cared about conflict minerals once they learned about them, and a similar percentage said that how a company dealt with conflict minerals would influence whether they bought its products. Dodd-Frank 1502 gives consumers the information they need to make decisions, helps companies meet those expectations, and isolates companies that do not.

Tiffany & Co., one of the world’s most recognizable and prestigious jewelry companies, has also invested a considerable amount of time and resources to ensure that it monitors its supply chain to exclude conflict minerals.  It conducts detailed reviews of its global supply chains.  It works, like other companies, with programs to support conflict-free smelters and other initiatives. The company has made the investment to ensure its products are conflict-free.

Each of these companies is an American icon and a leader in their industries. And each of them does not want Dodd-Frank 1502 or comparable regulation to go away. 

When it became apparent that 1502 might be suspended, Tiffany issued a statement noting “we firmly believe that the continued existence of Federal regulation that addresses the sourcing of conflict minerals provides an important framework for industry, laying the foundation for protection of human rights and responsible sourcing efforts in Congo and beyond. We urge Congress to support legislation that effectively promotes due diligence and transparency for the sourcing of all conflict metals and gemstones.”

Richline Group, a jeweler owned by Warren Buffet’s Berkshire Hathaway, has also come out in support of 1502 and noted that “Section 1502 has proven to be an important and effective first step in the effort to create a conflict-free mining industry in Congo that benefits legitimate business rather than extortion and violence” and said “we fully support the continued implementation of Section 1502.”

From personal experience, I know that the CEO of one of these companies had strong reservations against Dodd-Frank 1502 when it first became law, but ultimately saw that it was something the company could and would implement it in part because it was far less costly and laborious than he originally expected and because it was the right thing for the company to do. 

The support from major companies highlights a perverse consequence that suspending or repealing Dodd-Frank would cause:  it would create an uneven playing field placing major US companies at a competitive disadvantage relative to companies that did not want to disclose their supply chains, or worse still, do not care whether their activities led to the secret funding of armed groups in Congo. In this sense repealing 1502 would create a perverse incentive to behave less responsibly, and would harm the efforts of responsible companies. Tiffany, Apple, Intel, and Richline have said they believe keeping conflict minerals out of their supply chain is the right thing to do and that they will continue to do it. But without regulation, they will bear a steep cost for being responsible. Dodd-Frank levels the playing field and makes sure responsible companies are not penalized for doing the right thing while requiring others to meet minimum standards. 

Additionally, 129 investors with assets worth approximately $5 trillion under management have also urged the US government to keep the law in place and to ensure its continued implementation and enforcement.

The US should maintain the same path it has successfully pursued over decades:  be the first country to enact a strong law ensuring that companies act responsibly and then work diligently to make sure others do the same. This is what the US did with the Foreign Corrupt Practices Act. It passed the law in 1977, worked to get other countries to pass similar statutes, and now there is an important global anti-corruption regime that includes many countries with strong anti-corruption laws of their own. Multilateral institutions like the Organization for Economic Cooperation and Development (OECD) and the UN have also developed their own standards. The US played a leading role in these efforts—in part because it led by example.

This approach has also been true with 1502. US adoption of 1502 led the EU and OECD, for example, to start developing their own standards on conflict minerals that will, at least in the case of the EU, apply to a broad swath of companies beyond US jurisdiction. Just this March, the European Parliament approved new conflict minerals regulations. That approach creates a race to the top where US companies lead, versus suspending 1502 and creating a race to the bottom where US companies are hurt.

Five years after the rules went into force, there is progress. There are more than 200 conflict-free smelters and major companies, as noted previously, are working towards full compliance and do not want the rule to end. And other jurisdictions are developing their own, similar, rules. 

Internationally, the London Bullion Market Association and the Dubai Multi-Commodities Center are putting policies into place to deal with illicit funds derived from minerals. In Congo, the International Tin Supply Chain Initiative is also working to support company due diligence. These are relatively new initiatives and their efficacy is not yet known, but they are examples of the momentum 1502 is creating and what could be lost if is eliminated.

On the ground, significant parts of Congolese civil society generally support the law. As Dr. Denis Mukwege wrote in the New York Times in 2015, “A conflict-free minerals industry would greatly benefit the people of Congo and contribute to ending the unspeakable violence they have endured for years. The legislative tools to help make this a reality are available to international policy makers, but they must be enacted and enforced.” Those views are echoed by a number of civil society groups.

Challenges with Dodd-Frank 1502

There are very compelling reasons to keep 1502, but we do not want to downplay the fact that this law has had its challenges, claim that implementation of the law has been perfect, or suggest that it is the sole answer to conflict and abuse in eastern Congo.

During the period after Dodd Frank became law in 2010 and before its implementing rules were finalized in 2012, uncertainty, misinformation, and other factors led to adverse consequences on the ground. That uncertainty before the final rules were issued led to a de facto boycott as companies avoided sourcing from Congo. There is also evidence that mineral-related violence during that time did not subside. 

However, those problems are not solely due to Dodd-Frank 1502. The Kabila government exacerbated the negative economic impacts when it ordered a six-month halt to all mining in the Kivus in 2010. Between 2010 and 2012, the period between enactment of 1502 and implementation of its final rules, companies chose to boycott Congo since nothing in the law required that companies stop doing business with Congo. These measures, coupled with the uncertainty over Dodd-Frank’s final rules, created problems.

There are still reports of problems facing artisanal miners, including low prices affecting artisanal coltan miners.

Another key issue is that US companies are still slow to comply with the law. In 2015, Global Witness and Amnesty International reported that as much as 80 percent of covered companies were not properly disclosing and auditing their conflict minerals supply chain. This is an important area for growth and development—as it could help strengthen the positive impact of the law and enable a more level playing field for all companies down the road.

The Way Forward

We support constructive proposals to ensure Dodd-Frank 1502 is more efficient and effective.  Suspending or scrapping the law will not do this and will instead disadvantage responsible companies, while likely creating more instability in parts of Congo and making it easier for abusive armed groups to pay for their activities. 

If industry groups or companies have specific ideas on how to make 1502 more efficient or effective, you should make sure they are sharing them. There are already indications that costs of implementing 1502 are decreasing significantly as new tools are developed to make it easier to comply. ELM Sustainability Partners did an assessment of the law and found that the total industry costs are about 15-26 percent of the original costs that the SEC reported. Meanwhile, eastern Congo reported record highs for conflict-free exports of tin and tantalum in 2016.

You should also request a study—perhaps from the GAO—on how to promote conflict-free minerals on the ground, and stronger incentives to promote and reward responsible companies.

Unfortunately, the main industry critics, namely the National Association of Manufacturers, have not put forward specific proposals that would tweak 1502 to make it more effective. Many organizations are regularly discussing implementation with key companies and have listened closely to their concerns and challenges.

As a general principal, we believe that responsible companies in any sector should be rewarded for safeguarding human rights in their operations and others should be incentivized to do the same. Broadly, the cost of capital should be lower for responsible compliant companies than noncompliant ones and the opportunities for responsible companies should be greater. 

In that context, we would encourage you to support proposals that have been made by industry associations to advantage 1502 compliant companies in government procurement and efforts by responsible investors to favor and support those companies over others. And while we are not experts on tax policy, it is worth Congress and others examining how to use tax credits or comparable incentives to help support 1502 implementation because it could help lower the costs of implementation for companies.

Finally, we suggest Congress encourage efforts to support and promote conflict-free smelters on the ground. The principal way to do this is to make sure more companies are complying and sourcing from responsible mining and smelting sources. Given that the US is still the largest donor to the World Bank, it would be worth examining how that institution can help the Congolese government and industry grow a conflict-free market.

Conclusion

The situation in Congo is complex. But it is highly likely that suspending Dodd-Frank 1502 or eliminating it will contribute to greater instability, create a competitive disadvantage for responsible companies, and it could create a troubling paradox where, as US aid to Congo and UN peacekeeping may decline, the opportunity for abusive armed groups to make money off from conflict minerals will increase. The US would also fall behind its peers on an issue where it set the global example–this is not what Congress should seek to encourage or support.  

Instead, we hope the administration and Congress will seek to refine 1502, support responsible companies, and look at holistic approaches to keeping conflict mineral revenues out of the hands of abusive armed groups, whether they be militias, rebels, mafias, or government.

Posted: January 1, 1970, 12:00 am

Dear Minister,

Please accept our regards on behalf of Human Rights Watch. Human Rights Watch is an international nongovernmental human rights organization that conducts research and advocacy in about 90 countries around the world on a wide variety of human rights issues, including human rights abuses that occur in the context of global supply chains.

This year’s G20 summit, and the preceding Labor and Employment Ministerial Meeting, are important opportunities to advance the political commitment by G20 countries to protect human rights in global supply chains. We believe that the German Presidency of the G20, and your ministry in particular, could play a crucial role in shaping a strong agenda around global supply chains, building on Germany’s past leadership around this issue at the G7 and the International Labour Organization (ILO). We are therefore writing to make recommendations for the Ministerial Declaration as well as the final G20 Declaration.

Human Rights Watch has found that governments often fail to fulfill their duty to protect human rights through effective regulation of business activity, both domestically and abroad. It has also found that many businesses’ insufficient human rights safeguards have allowed abuses to proliferate. We have documented a wide range of human rights problems in the context of global supply chains. These include, for example, labor rights abuses and anti-union tactics against factory workers producing branded apparel and footwear, hazardous child labor in farms growing tobacco purchased by international cigarette manufacturers, and deadly accidents killing artisanal miners digging gold that is destined for the global market.

According to the United Nations Guiding Principles on Business and Human Rights, companies have a responsibility to carry out effective human rights due diligence, which includes an objective assessment of a company’s human rights risks coupled with effective steps to mitigate or avoid those risks. Companies also have a responsibility to help ensure that people who suffer abuses are able to access appropriate remedies. The UN Guiding Principles establish a useful framework to guide the conduct of responsible businesses. Yet, voluntary standards are not enough to ensure the protection of rights in supply chains. The standard’s voluntary nature means that there is no penalty for companies that choose to ignore it or fail to make serious efforts to live up to it. Where human rights due diligence has become mandatory through law and regulation, this has spurred companies into positive action, for example on public reporting.

In the context of the upcoming G20 Summit, Human Rights Watch therefore urges you to include robust commitments towards human rights due diligence in the draft Ministerial Declaration that you will be preparing and reviewing at the Employment Working Group meeting on 27-28 March in Geneva. We are also urging you to ensure that such commitments are fully included in the final G20 Declaration. In particular, we are recommending that:

  • G20 governments commit to making human rights due diligence in global supply chains a legal requirement for companies, building on models developed by the United Kingdom, France, and the Netherlands. The main elements of human rights due diligence should be based on the UN Guiding Principles on Business and Human Rights.
  • G20 governments commit to legally requiring companies to publicly disclose their suppliers and report publicly on human rights due diligence efforts they are undertaking throughout their global operations.
  • G20 governments express support for the decision of the 2016 International Labour Conference to review current ILO standards and to consider whether additional standards are needed to better protect human rights in global supply chains.
  • G20 governments commit to making independent grievance mechanisms and remedy available and accessible for workers in global supply chains. Grievance mechanisms should be based on the principles for non-judicial grievance mechanisms laid out in the UN Guiding Principles on Business and Human Rights and build on good practices developed for existing grievance mechanisms, including the Compliance Advisor Ombudsman at the International Finance Corporation (IFC). A grievance mechanism should include conflict resolution approaches and offer an independent investigation function as well as periodic public updates about the measures taken to address the human rights abuses.
  • G20 governments commit to promoting and protecting space for civil society, trade unions, and communities to expose and demand an end to human rights violations in the context of global supply chains.
  • G20 governments endorse the UN Guiding Principles on Business and Human Rights and commit to developing substantive national action plans for implementation, if they have not done so.
  • G20 governments commit to adhering to the Organisation for Economic Co-operation and Development (OECD) Guidelines for Multinational Enterprises, ensure that their National Contact Point (NCP) systems are independent and capable of delivering effective remedy, and commit to mandatory NCP peer review.
  • G20 governments commit to expanding the G7 Vision Zero Fund, a multi donor fund to prevent work-related deaths and strengthen the application of ILO standards in global supply chains, to all G20 countries.

We would be happy to discuss these recommendations further with you and look forward to hearing from you.

Wenzel Michalski            Juliane Kippenberg

Germany director             Associate children’s rights director

Human Rights Watch       Human Rights Watch

Posted: January 1, 1970, 12:00 am

The Extractive Industries Transparency Initiative (EITI), an international coalition promoting better governance of resource-rich countries, has suspended Azerbaijan for failing to ease its crackdown on civil society groups.

Following years of scrutiny, and several warnings, the EITI decided Azerbaijan had failed to make progress on promises to reform laws shackling the country’s nongovernmental groups. Azerbaijan responded by cancelling its EITI membership.

Oil derricks are silhouetted against the rising sun on an oilfield in Baku, on January 24, 2013.

© 2013 Reuters

The EITI, a coalition of governments, companies, and nongovernmental groups, fosters open public debate about the use of oil, gas, and mining revenues. The EITI requires member governments to foster “an enabling environment for civil society” and to “refrain from actions which result in narrowing or restricting public debate in relation to implementation of the EITI.”

Azerbaijan once touted its achievements in the EITI as the first fully-compliant country in the initiative since 2009. But in the past few years, Azerbaijan has systematically dismantled the country’s once vibrant civil society through the arrests and convictions of many activists, human rights defenders, and journalists on bogus politically motivated charges, as well as by laws and regulations restricting the activities of independent groups and their ability to secure funding.

Recognizing that the government’s crackdown on independent groups ran contrary to its EITI commitments, the initiative downgraded Azerbaijan from a full member to a candidate country in April 2015. And in October 2016, EITI gave Azerbaijan four months to eliminate legal and bureaucratic obstacles inhibiting civil society engagement in the initiative.

Although in January 2017, Azerbaijan undertook some superficial regulatory changes, it failed to address fundamental issues, leading to its suspension.

The authorities have continued to repeatedly harass and jail activists who advocate for good governance and transparency. Earlier this month, Azerbaijan imprisoned one of the country’s most popular journalists, Mehman Huseynov, who exposed high-level government corruption.

Azerbaijan’s decision to quit the EITI is regrettable, but it underlines Baku’s lack of genuine commitment to the governance principles, especially regarding civil society, embodied in the EITI. The decision should also raise red flags for international financial institutions – World Bank, European Bank for Reconstruction and Development, European Investment Bank, Asia Development Bank, and others – which have publicly endorsed the EITI and committed to participation, transparency, and accountability.

In this environment of no effective public scrutiny, they should not fund projects benefiting Azerbaijan’s extractive industry or fund the government except for projects designed to directly address the urgent social and economic needs of the people. Otherwise, at best, they will be turning a blind eye to Azerbaijan’s crackdown. At worst they will be acquiescing to it.

Author: Human Rights Watch
Posted: January 1, 1970, 12:00 am

February 10, 2017

Extractive Industries Transparency Initiative

International Secretariat

Ruseløkkveien 26, 0251

Oslo, Norway

For distribution to Extractive Industries Transparency Initiative Board Members

Dear Board Members,

We, the undersigned organizations, are writing in advance of the Extractive Industries Transparency Initiative's (EITI) Board meeting on March 8-9, where the board will review Azerbaijan's compliance with the corrective actions in relation to civil society outlined at the EITI October 2016 Board meeting. The government of Azerbaijan has not implemented the board’s recommendations and continues to show serious disregard for the principles on civil society engagement enshrined in the EITI Standard and the civil society protocol. For these reasons, Azerbaijan is not compliant with the EITI Standard on civil society engagement, and we urge you to suspend Azerbaijan from EITI.

As you are aware, in October 2016, the EITI Board gave Azerbaijan four months until the next EITI Board meeting to address a number of legislative and operational obstacles to civil society engagement in the Initiative. Specifically, corrective actions set forth by the Board oblige Azerbaijan to eliminate the requirements for:

  1. Non-governmental organizations (NGOs) to obtain an extract [registration certificate] every two years confirming their registration, which serves as the basis for NGOs’ operation;
  2. Non-governmental organizations to register grants with the Ministry of Justice; and
  3. foreign donors to register individual grants with the authorities and obtain an opinion on the purposefulness (expediency) of the grant.

According to the Board's decision “failure to take corrective actions to the satisfaction of the Board will result in suspension in accordance with the EITI Standard.”

Over the past few months, the Azerbaijani government has introduced some changes to regulations governing the work of NGOs. However, the changes are limited to only certain rules and do not address the fundamental legislative obstacles identified by the EITI Board itself as needing to be amended. The changes in practice offer limited prospects for fundamentally improving the operating environment for independent civil society groups.

In January 2017, the Cabinet of Ministers adopted two decisions introducing changes to the Rules for Registration of Grant Agreements (Decisions) and the Rules for Foreign Donors’ Acquisition of the Right to Give Grants on the Territory of Azerbaijan Republic. The Cabinet of Ministers’ recent decisions follow the October 2016 Presidential Decree on Simplification of Registration of Foreign Grants in Azerbaijan, introduced shortly before the October EITI Board meeting. The decree called for the application of a “one stop shop” approach for foreign grants registration.

The new regulations simplify some procedures for registration of foreign grants and reduce the number of required documents. The new rules merge donor registration and NGO grant registration into one process overseen by the Ministry of Justice. The changes also eliminate the prohibition on NGOs signing grant contracts with a foreign donor who has not obtained the right to provide grants in Azerbaijan. Also, a foreign donor or an NGO grant recipient are no longer required to secure prior approval for grant registration from the Ministry of Finance, including an opinion on the financial expediency of the grant project. Now, the Ministry of Justice must seek a Ministry of Finance opinion on the grant project, following an NGO request to the Ministry of Justice for grant registration after a donor and NGO have signed grant agreement.

These regulatory changes simplify certain procedural aspects pertaining to registration of foreign grants. However, they do not address the legal requirement for NGOs to register grants, do not eliminate the requirement for the Ministry of Finance to provide an opinion on the expediency of each grant from a foreign donor, and the multi-step complex registration procedure for grants and foreign donors remains in place.

Most importantly, the regulatory changes do not eliminate the discretion of the authorities to arbitrarily deny grant registration. Nor do the regulatory changes address the deeply entrenched legal barriers to effective functioning of NGOs.

The Law on Grants and the Law on State Registration and State Register of Legal Entities, which are the sources of the three key legislative issues identified by the EITI Board in the corrective actions, remain unchanged. As a result:

  • NGOs still need to register all changes, including minor changes, to their founding documents and obtain an extract [registration certificate] every two years (non-fulfillment of EITI Board requirement (a));
  • NGOs must register grants with the Ministry of Justice (non-fulfillment of EITI board requirement (b)); and
  • Foreign donors are required to register every grant individually and an opinion on the purposefulness (expediency) of the grant remains a requirement (non-fulfillment of EITI board requirement (c)).

Notwithstanding criticism of Azerbaijan’s legislation restricting NGOs ability to work and secure funding, from numerous authoritative bodies including various UN agencies, several parts of the Council of Europe, the Open Government Partnership and others, as well as ample opportunities to reform legislation paralysing the work of independent civil society, the government of Azerbaijan chooses not to honour its obligations under the EITI Standard and international human rights law and maintains the restrictive legislation.

Even after the EITI Board’s downgrading of Azerbaijan's status in EITI in April 2015, and the requirement for Azerbaijan to implement a number of corrective actions to ensure an enabling environment for civil society to meaningfully participate in EITI, the authorities continued to enact regulations further stifling independent civil society.

Moreover, in addition to this restrictive legislative and regulatory environment, the Azerbaijani authorities continue to harass activists who advocate for good governance, preventing civil society from participating in public debate and decision-making, including with regard to the extractive industries. Currently, two members of the EITI Azerbaijan Civil Society Coalition are imprisoned, and several other members have been forced to flee the country, fearing politically motivated prosecutions.

Most recently, on January 25, 2017 an Azerbaijani court sentenced Fuad Gahramanli, a member of the EITI Azerbaijan Civil Society Coalition, to 10 years in prison on false charges of inciting the public to disobey the government, making appeals against the government, and incitement of national, racial, social, or religious hostility, in retaliation for his Facebook posts criticizing government policies. Amnesty International considers Gahramanli to be a prisoner of conscience, prosecuted in retaliation for peacefully exercising his right to freedom of expression. Another member of the EITI Azerbaijan Civil Society Coalition, Asif Yusifli, is serving a six-year prison sentence, following his conviction in 2015, on trumped-up fraud and forgery charges.

The authorities refuse to issue Oktay Gulaliyev, an active member of the EITI coalition, an international passport, effectively placing him under a travel ban, despite the fact that the authorities dropped spurious criminal charges against him a few days before the October 2016 EITI board meeting. The authorities have refused to register Gulaliyev’s human rights NGO, Public Association for Democratic Reform, despite his repeated attempts to register since 1999. In October 2016, the Ministry of Justice, without consulting Gulaliyev, registered the organization under a different name, the Public Union on Support to Development, with the completely different mandate of financial analysis and reporting. Gulaliyev officially complained to the Ministry of Justice about these changes that he did not authorize, but received no response.

In late October 2016, the authorities claimed they had registered 17 other organizations participating in the EITI Azerbaijan NGO Coalition. However, there is no information publicly available about these registered organizations. The authorities have not responded to numerous requests by EITI coalition members for information about the identity of these groups. The Ministry of Justice denies registration to many NGOs, including at least 30 independent NGOs members of the EITI Azerbaijan NGO Coalition.

We applaud the EITI Board’s commitment to fostering an enabling legal and operational environment for civil society in Azerbaijan, and consider EITI Board Chair Fredrik Reinfeldt’s recent visit to Baku an important signal of the Board’s commitments to these issues.

As described above, Azerbaijan has once again failed to implement the corrective actions outlined by the EITI Board and amend the legislative and operational barriers to the work of NGOs. The restrictive legislative framework negatively impacts the ability of groups in the EITI coalition and many other organizations to function. The superficial changes in the rules of registration of foreign grants fail to address the fundamental issues that led to downgrading Azerbaijan’s status in EITI in 2015 and the specific, non-negotiable corrective actions set by the EITI Board in October 2016.

We therefore call on the members of the EITI Board to abide by EITI commitments to civil society and the pledge set forth at the October 2016 EITI Board meeting, and suspend Azerbaijan's membership for its failure to implement the corrective actions established by the Board, and for its continued intentional arbitrary interference in the activities of independent non-governmental organizations.

By overlooking Azerbaijan’s failure to comply with a very clear set of corrective actions established by the Board, the credibility of the EITI validation process, particularly with regard to the EITI’s commitment to civil society participation within the initiative, would be severely undermined.

We thank you for your attention to this crucial matter.

Sincerely,          

Article 19

CEE Bankwatch Network

Civil Rights Defenders

Counter Balance            

Crude Accountability

Freedom House

Freedom Now

Front Line Defenders

Helsinki Foundation for Human Rights

Human Rights First

Human Rights House Foundation

Human Rights Watch

Institute for Reporters’ Freedom and Safety

International Media Support

International Partnership for Human Rights

NESEHNUTI - Independent Social Ecological Movement

Netherlands Helsinki Commitee

Norwegian Helsinki Committee

PEN America

PEN International

Reporters Without Borders (RSF)

World Organisation Against Torture (OMCT)

Posted: January 1, 1970, 12:00 am

(London) – The Extractive Industries Transparency Initiative (EITI), a prominent international coalition, should suspend Azerbaijan’s membership for failing to carry out key reforms, a coalition of 21 groups including Human Rights Watch, ARTICLE 19, and International Media Support said today. The EITI, during its board meeting in Bogota, Colombia, on March 8 and 9, 2017, will review Azerbaijan’s efforts to ease its repression of civil society groups as the EITI had required.

“The Azerbaijani government is snubbing the EITI by ignoring its requirements for reforms and by systematically dismantling the country’s independent civil society,” said Giorgi Gogia, South Caucasus director at Human Rights Watch. “Following numerous reviews and warnings, the EITI should suspend Azerbaijan’s further participation until the government makes serious, lasting changes to allow nongovernmental groups to operate freely in Azerbaijan.”

The EITI brings together governments, companies, and nongovernmental groups to encourage better governance of resource-rich countries by fostering open public debate about the use of oil, gas, and mining revenues. The EITI requires member governments to foster “an enabling environment for civil society” and to “refrain from actions which result in narrowing or restricting public debate in relation to implementation of the EITI.”

An Azerbaijan state flag flutters in the wind on an oil platform in the Caspian Sea east of Baku, January 22, 2013. 

© 2013 Reuters

At its most recent board meeting, in October 2016, the EITI gave Azerbaijan four months to eliminate legal and bureaucratic obstacles inhibiting civil society engagement in the initiative. It required Azerbaijan to simplify procedures for registration of nongovernmental organizations and for the receipt and registration of grants from foreign donors. The reforms would eliminate some mechanisms for the government to interfere with and stop the work of independent groups. The EITI had downgraded Azerbaijan from a full member to a candidate country in April 2015, due to the government’s interference with independent civil society.

A joint letter signed by 22 human rights groups worldwide and sent to EITI board members on February 10, 2017 assessed the Azerbaijan government’s lack of progress on the reforms identified by the EITI and called on the board to suspend Azerbaijan.

In January, Azerbaijan’s Cabinet of Ministers adopted two decisions changing regulations for donor organizations and grant registrations. While the new regulations simplify some procedures for grant registration and reduce the number of required documents, they do not repeal the restrictive laws and fail to meet the EITI’s demands, the groups said.

“Superficial regulatory changes don’t address the fundamental issues that led to downgrading Azerbaijan’s status in the EITI, or the specific corrective actions set by the board,” said Katie Morris, head of Europe and Central Asia for ARTICLE 19. “The credibility of the EITI validation process requires the initiative to suspend Azerbaijan for its failure to comply with the initiative’s commitment to civil society participation.”

The Azerbaijani authorities repeatedly harass activists who advocate good governance and transparency, preventing civil society groups from participating in public debate and advocacy, including on extractive industries, the pillar of Azerbaijan’s economy. Two members of the local civil society coalition that participates in the EITI remain jailed on spurious charges, and several other members have been forced to flee the country, fearing politically motivated prosecutions.

“Local groups in Azerbaijan are counting on the EITI to remain principled and stand up for them and their essential contributions to public accountability and transparency,” said Gulnara Akhundova, head of global response at International Media Support. “Azerbaijan’s embattled civil society deserves nothing less than clear and unbiased support from EITI’s international board.”

Posted: January 1, 1970, 12:00 am