Commission on Sustainable Development Background Paper No. 2 Sixth Session 20 April - 1 May 1998 TRADE UNIONS AT CSD98 International Confederation of Free Trade Unions (ICFTU) Trade Union Advisory Council - OECD (TUAC) This paper forms part of an integrated trade union document covering the four themes of the "Business and Industry" Segment of the CSD. The paper was originally written with an introduction and conclusion with each section flowing into each other in a logical manner. However, for the purposes of the CSD the sections of the paper have been regrouped to accommodate printing of material into four sections. What follows is the "Table of Contents" of the original trade union paper, showing in which of the four printed sections its various parts have been placed. INTRODUCTION (Background Paper No. 2) Globalization of Production and Consumption (Placed at the Beginning of the "Responsible Entrepreneurship" section) The introduction discusses the prospects of sustainable development in an era of globalization and outlines the necessary climate for trade and investment which is needed to foster "Responsible Entrepreneurship" or to enable management tools to yield measurable changes in the workplaces of the world. It argues that International solutions for employment and transition programs are necessary as a prerequisite to effective and local trade union involvement. Part 1: MANAGEMENT TOOLS AND STRATEGIES (Background Paper No. 6) The Trade Union Perspective on "Effective" Management Tools Workers and their trade unions must be central to any meaningful change involving the workplace. The section examines the way trade unions are currently working through joint workplace mechanisms, including Eco-Audits as a means of extending advances in occupational health and safety to environmental protection. The section looks at the need to challenge ways of doing things in the workplace in communities. Part 2: RESPONSIBLE ENTREPRENEURSHIP (Background Paper No. 2) The Trade Union Perspective on "Responsible Leadership for Change" A view of "Responsible Business Practice" is provided and explains why trade unions wish to work with employers and governments in providing leadership for change. Responsible practice recognizes the need for accountability and includes target-setting and reporting based on criteria of trust, credibility, transparency, and applicability to smaller enterprises, as well as the participation of workers and trade unions. It also must recognize a role for public policy and government in promoting and supporting responsible leadership for change. Part 3: TECHNOLOGY TRANSFER AND ASSESSMENT (Background Paper No. 10) The Trade Union Perspective on "Cooperation and Capacity Building" The section explains the reasons why support for or resistance to certain types of technological change occur depending on the purposes for which they are employed. There is a particular focus on chemicals as an example where broad-based "capacity building" can occur. A the trade union approach to assessing technology or technology transfer is reviewed and the implications for employment and workers' well- being are highlighted. The key role of training, education and information sharing are discussed. Part 4: WATER AND CLEANER PRODUCTION (Background Paper No. 14) A Practical Approach to the Problem of Water This section looks at the workplace practicalities of addressing the problem of water and outlines the challenges that are posed in addressing any issue from a workplace point of view. The section deviates from others by avoiding theoretical discussions about issues and looks at "What Needs To Be Done" now in making progress on Water. This discussion leads into Part five (printed at the end of the water section) which reviews the implications of the trade union approach on water for other pressing issues, including climate change. Part 5 : THE CHALLENGE OF PARTNERSHIP FOR CHANGE (Background Paper No. 14) (Included in the water section) This section presents the challenges posed by working with trade unions and the reviews the changes that are needed to make the workplace a central focus for sustainable development. There is a need for cooperation in "workplace partnerships" if real change to the patterns of production and consumption is to occur. The process for commencing the dialogue with international business is outlined. Commission on Sustainable Development Background Paper No. 2 Sixth Session 20 April - 1 May 1998 RESPONSIBLE LEADERSHIP FOR CHANGE International Confederation of Free Trade Unions (ICFTU) Trade Union Advisory Committee - OECD (TUAC) I. INTRODUCTION: GLOBALISATION OF PRODUCTION AND CONSUMPTION A. Prospects for sustainable development in an era of globalisation a. Facing a new era of globalisation 1. Threats to the global environment due to unsustainable patterns of consumption and production are increasingly global in origin and impact. Increasing globalisation of economic and political decision-making means that any change in these patterns must be made in an increasingly competitive global trading and investment system. 2. Over the past two decades, the world economic and trading system has changed, from one of governance by nation states to one dominated by multinational corporations (MNCs) and international finance institutions. The overwhelming power of MNCs can be seen in the fact that they have a hand in two-thirds of world trade in goods and services. Foreign Direct Investment (FDI) has also skyrocketed, with $1.4 trillion of investment in foreign affiliates reported for 1996 alone. 3. Trade unions are concerned that intensified competition could drive a "race to the bottom" in labor, social and environmental standards, as it has already in so many cases. The OECD has recognised the problem this poses for sustainable development and has made it the focus of its April 1998 Environment Ministers meeting in Paris. 4. Increased competition is affecting the globalisation-environment relationship. How will business and governments respond? The OECD has concluded that environmental policies and national priorities do not necessarily need to be at odds with competitiveness and that the relationship between the stringency of environmental standards and economic competitiveness is insignificant. It adds, however, that the threat of industrial relocation is often used and is sometimes enough to sway policy-makers over environmental regulation. b. Globalisation of production, trade and investment yields deteriorating employment patterns and increased poverty 5. Trade unions are campaigning worldwide to ensure that measures to open up world trade and investment are accompanied by increased respect for recognised core international labor standards and environmental standards. 6. A standard argument is that trade liberalisation will actually lead to a proper balance between environmental protection and accelerated economic growth. This view is challenged by the fact that growth in global trade implies growth in production and consumption and that global competition will force down environmental standards, reinforcing the patterns that gave rise to the ecological crises we now face. 7. On average, developing countries have a per capita GNP only 6% that of industrialised countries, and almost one third - 1.3 billion people - lives in absolute poverty. The global distribution of income is also getting worse. 8. Excessive consumption and unsustainable lifestyles in the richer nations place huge stress on global resources. At the same time, extreme poverty pushes people towards short-term, desperate patterns, putting pressure on ecosystems, which their governments cannot address. As these environmental effects are usually local, the poor suffer most directly. 9. A loss of secure and decent employment in almost all countries is producing more poverty and job anxiety. A decline in the formal manufacturing sector, increasing informalization and underemployment are becoming the rule, as employers respond to intensified competition by reducing labor costs and introducing greater "flexibility" in the workplace. Established producers are slashing standards, to the detriment of working life and the community. UNCTAD Identifies Seven Problems with Globalisation Rapid liberalisation has resulted in an increased concentration of wealth in the hands of a few, stagnant investment, rising unemployment and reduced income for an increasing proportion of the world's population. The United Nations Conference on Trade and Development (UNCTAD) says that slow growth and rising inequalities are becoming permanent features of the world economy: - The world economy is growing too slowly to generate sufficient employment with adequate pay or to alleviate poverty. - Gaps between the rich and poor continue to widen. In 1965, average GNP per capita for the top 20% of the world's population was 30 times that of the poorest 20%; in 1990, it doubled to 60 times. - The rich have gained everywhere in comparison to both the poor and the middle-income earners. - Finance is gaining over industry, and rentiers over investors. - The share of income accruing to capital has gained over that assigned to labor as profit shares have risen everywhere. - Job and income insecurity are spreading, as corporate restructuring, labor shedding and wage repression are on the increase. - The wage gap between skilled and unskilled labor is growing, along with an absolute drop in the real wages of unskilled workers (20% to 30% in some cases). 10. There is no end of examples where terms and conditions of employment, as well as social and environmental standards, are being forced to new lows. At the same time, the world has seen an assault on human rights, which overlap with environmental concerns. A Steadily Worsening Condition for the World's Environment The 1997 UN Special General Assembly confirmed that, during the first five years of the CSD, the world fell short of national and global targets, and the global crisis that prompted the 1992 Rio Conference has deepened. Trade unions are increasing efforts to protect the environment. At CSD5, the ICFTU committed itself to a programme of "Collective Engagement". "As active trade unionists, we find the lack of progress disappointing, but are not prepared to accept defeat. We know that Agenda 21 gave rise to unprecedented activity by trade unions in thousands of workplaces around the world, as workers decided to do something positive, fully aware of limited resources, deep-seated patterns of unsustainable development, and resistance from governments and social partners." In its Statement to the OECD Environment Ministers in 1996, the Trade Union Advisory Committee referred to a "sense of urgency for action to shift production and consumption patterns onto a sustainable path", and called for "the active involvement of the public and closer co-operation between industry, trade unions, non-governmental organisations and government. A new "Partnership for Change" needs to be developed." B. Implications of Globalisation for our Search for Solutions a. Globalisation makes international solutions necessary 11. The opening of global markets must not prevent the regulation of economic activities to protect society and the environment. Trade unions will work for an international regulatory regime, which covers the products of trade at all levels, as well as the processes by which they are made. They will also work for multilateral agreements for trade and investment that incorporate environmental protection and labor standards. It is not acceptable for the poor and workers to be viewed as flexible factors of production, or for the environment to be sued as a free commodity. We call for strong multilateral rules to govern trade, as opposed to deregulation. Where no international rules exist, national regulations for both environmental protection and community stability are needed. 12. Restrictions on the rights of workers, activists and common people have reached an all-time high, as are the forces of oppression and resistance to change. We are committed to working with international bodies to define sustainable development solutions. We are further committed to working with governments, business, NGOs and the Major Groups defined in Agenda 21. We will work with the OECD to find solutions to the special problems of both developing and industrialised countries, with the CSD to continue international dialogue on Agenda 21, and with the ILO as the forum in which governments, workers and employers can engage in tripartite, co-operative decision-making. 13. However, governments have a responsibility to ensure that multilateralism works for everybody and not just a small elite. To this end, the Multilateral Agreement on Investment being negotiated at the OECD must include a binding clause committing governments to avoid strategies for attracting investment that involve the lowering or non-enforcement of domestic and internationally agreed labor standards. A similar clause must be enacted for environmental standards. At the same time, work must begin at the WTO on ways to include a "social clause" in international trade agreements. b. Effective responses require attention to employment and transition measures 14. The 1997 Session of the CSD agreed that, "The implementation of policies aiming at sustainable development, ... may enhance the opportunities for job creation, thus helping to achieve the fundamental goal of eradicating poverty." 15. Globalisation makes it crucial to clarify the effects that environmental policies have on employment. Studies on the direct and indirect employment effects of environmental regulations and standards are long overdue for: employment costs of delaying changes, opportunities in environmental technologies and projects, tax policies, environmental skills training and financial accounting which recognises environmental effects. 16. Given the intensity of industrial production and consumption, industrialised countries are responsible for much of the world's pollution and resource use and must, therefore, take the lead with action plans that recognise basic social and economic needs in non-industrialised countries. As well, if the message of "Responsible Corporate Behaviour" is to be taken seriously, business and governments must take action against such atrocities as sweatshops, child labor, unsafe plants, exploitative agricultural practices and Export Processing Zones, where labor and other standards are oppressed. 17. The cause of women must also be raised. Their knowledge and experience in managing natural resources and controlling environmental effects as direct consumers of basic resources add to this ethical imperative. IN COPENHAGEN A 1995 Summit on Social Development Committed the World to: - The goal of eradicating poverty in the world through decisive national actions and international co-operation as an ethical, social, political and economic imperative of mankind; - Promoting the goal of full employment "as a basic priority of our economic and social policies," and enabling all men and women to attain secure and sustainable livelihoods through freely chosen productive employment and work; - Accelerating the economic, social and human resource development of Africa and the least-developed countries. 18. As sustainable employment has become such a central issue in the quest for sustainability, transition mechanisms are needed, along with the appropriate financial instruments, if workers are to participate wholeheartedly in Agenda 21 efforts. Responses to the ecological crises and conversion to sustainable patterns must include equitable distribution and recovery of costs. There is a need for programmes to provide for: full union participation in transition decision-making, income protection, access to new jobs, educational assistance and support for affected communities. This must be accompanied by provisions to compensate for layoffs and displacements. While there is still time to develop transition programmes, planning must begin immediately. The ICFTU From an Address to the United Nations Special General Assembly, June 1997, by the ICFTU General-Secretary, Bill Jordan. In calculating job loss, disruptions caused by measures to mitigate effects of climate change must be distinguished from disruptions caused by reducing emissions and other positive "interventions." A tendency to focus only on job loss and disruptions caused by positive measures should be avoided, as the costs of inaction could be substantially more. Since three-quarters of greenhouse gas emissions come from the manufacturing industry, energy production and supply, as well as from the transportation and construction sectors, and since industrialised nations have contributed the vast majority to these, it is understandable that these workers will feel most threatened. c. International agencies are a vital means for promoting dialogue 19. The ILO has developed a system of international labor standards and sustainable development indicators as guidelines for legislation and a stimulus for action on human rights, working conditions, social security and occupational health and safety. This includes standards for: (a) Education and Training; (b) Environment and Occupational Health and Safety; (c) Basic Trade Union Rights; (d) Economic Development and Security of Income; (e) Social Development; (f) Equality of Opportunity and Treatment. 20. While all countries have not yet adopted the full range of instruments, these are useful to trade unions, business and governments as a means of influencing tripartism and national laws. 21. The mechanisms employed by the OECD to develop agreement over sustainable development questions must also be considered as vital to trade unions, business and the NGOs. Trade unions will seek an expanded role in decisions to develop concrete workplace tools to implement sustainable development targets. The notion of "ecological footprint" developed at the OECD is one example amongst many of the way in which this body is instrumental in promoting change to patterns of production and consumption. 22. Global action must begin locally as a means of promoting empowerment in the workplace and the community. For trade unions, sustainable development is a workplace issue, and workable solutions will occur only if workers and their representatives are involved. II. THE MEANING OF "RESPONSIBLE BUSINESS PRACTICE" 23. With the deepening ecological crises facing the world and its peoples, trade unions look to business and government to work with them on programmes for change. The challenge is to provide leadership, and while this CSD Session has chosen to refer to "Responsible Entrepreneurship," trade unions prefer the title "Responsible Leadership for Change," as it accommodates the idea of shared responsibility with other parties in the workplace and community. Trade unions want and expect business to take a leadership role, but they also expect to work collaboratively to ensure that this leadership becomes effective. A. Changing the way things are done 24. Trade unions have identified "responsible leadership" as practiced by business, government and others, and have found concrete ways to work with these "partners" to promote change towards sustainable practices. Responsible leadership goes beyond (I) paying taxes, wages and donating to NGOs; or (ii) committing resources to address ecological degradation and unemployment. 25. It recognizes that social and environmental problems are symptoms of a more basic malaise that require a fundamental change in the way business is done, and requires new strategies that link social needs with business interests. Trade unions are pleased that a "Corporate Responsibility Movement" is making headway, with more employers discovering that better health and safety conditions, shorter working hours, more consultative methods - can actually improve economic performance. Others have gone further, demanding to see evidence of "responsible practice" from contractors and upstream suppliers. 26. Solutions, alternative visions, concrete examples and models which demonstrate "good practice" must be shared for inspiration. We can also show that countries, which have fulfilled social development conditions, are the ones that have maintained economic performance with globalisation. In short, employers and governments must take the lead, but there is an important role that trade unions with our history of "collective engagement" can play in the process. In the Philippines Positive Action on the Environment Was Led by One of the Country's Largest Employers An agreement between the Congress of Independent Organisations-Associated Labor Unions and San Miguel Corporation on a trend-setting clause in their collective agreement for the brewing industry provides a framework for labor-management co-operation in all matters relating to the environment. A Labor-Management Committee is responsible for cleaner production, environmental protection and rehabilitation, and has allayed workers' fears that "environmental" bargaining will have a negative effect on such terms as wages. The employer has already implemented company-wide environmental programmes for in-plant air, waste minimization and recycling, and reforestation, and has planned an environment education programme for all of its employees. The breakthrough also affirmed the strong leadership shown by the government of the Philippines, the first in Asia to establish a National Sustainable Development Committee following Rio, and the valuable assistance of the ILO. B. The impact of responsible practices on employment 27. Evidence shows that there is a potential "pay-off" for sustainable practices in efficiency, savings and increased productivity. In its 6E manual, the Swedish TCO says that companies with integrated environmental programmes consider that the resulting benefits far outweigh the costs in reduced energy consumption, lower environmental costs, reduced overall insurance costs, goodwill, efficient job processes and increased motivation of employees. 28. There is also evidence of a potential for jobs and profits in "green industries"; i.e., new industries which either benefit the environment directly or provide a less harmful alternative to current practices. However, we have yet to see its potential for actual growth in other areas. The fact that the World Business Council for Sustainable Development is publicising opportunities in "green" business in products is a welcome sign. Trade unions remain skeptical of claims that this area can absorb the vast numbers of workers who are likely to be displaced by environmental crises and the anticipated structural changes that are being planned. The International Confederation of Free Trade Unions Raises the Issue of Employment at the Kyoto Conference on Climate Change At the 1997 Kyoto Conference on Climate Change, the ICFTU alerted delegates to the "grave danger that environmental and employment policies could point in opposite directions" and said that to avoid this, any global programme for climate change must include a sustainable employment strategy. "Because few policy-makers have considered the impact on workers and workplaces of cutting greenhouse gas emissions, working people could find themselves either facing dislocation because of global warming or facing large-scale changes in employment because of measures taken to reduce emissions. While new jobs in `green' industries, such as energy saving in buildings, will be created, it is not clear what training and adjustments are needed. Employment transition measures linked to target-setting must be clear and equitable, to overcome resistance from the sectors in both industrialised and developing countries which will suffer most." 29. However, the nine following areas that have been identified as ripe for "green" expansion are worthy of further research, development and policy support: (a) Air pollution control (removal of emissions from air); (b) Water and wastewater treatment; e.g., purify drinking water, clean sewage and remove pollutants from industrial wastewater, etc.; (c) Waste management: the collection, disposal, recycling and treatment of domestic and industrial wastes; (d) Contaminated land remediation; (e) Energy management systems and technologies; (f) Environmental monitoring; (g) Environmental services; e.g., consultancy and laboratory; (h) Noise and vibration control; (I) Marine pollution control. IN AUSTRALIA Unions Work with Environmental Organisations, Companies and Industrial Associations to Identify and Develop "Green Jobs" In 1993, the Australian Council of Trade Unions and the Australian Conservation Federation launched Green Jobs in Industry to respond to rising concerns over unemployment and the environment. The Green Jobs Unit published a study which showed that job creation and environmental protection are mutually supportive; that while total employment in Australia actually shrank between 1988-1993, green employment almost doubled, with environmental services becoming the basis of a "green economy." The Green Jobs Unit also launched programmes to promote environmental management in companies that provided green jobs to unemployed Australians. The Cut Waste and Energy Initiative assisted business in reducing waste and energy use by providing skilled personnel on a subsidised wage, utilising government programmes and services. 30. Unhappily, environmental policy and agreements continue to be developed with little attention to the employment loss that could result. This has predictably caused "Jobs-vs.-Environment" debates and conflicts. 31. An OECD analysis of mechanisms through which environmental policies impact on employment concluded that, apart from isolated cases of plant closure and relocation, "there is no reason to believe that they have led to massive and systematic job losses. As for net effects on employment, economic models show only a very small overall effect, which on the whole is slightly positive." 32. According to the OECD, certain industries, such as energy and wood pulp, may continue to experience job loss, as will specific plants and regions in which production has been particularly unsustainable and the "environmental deficit" extreme. Likewise, employment impact on total job content varies with such factors as duration and scope; i.e., what may be true on an international level may not hold true nationally or locally over the short term. 33. There are also lessons for responsible businesses and policy-makers who could do much more to even out and balance impacts so that a "slightly positive" effect is experienced. For example, environmentally friendly alternatives should be developed and situated to absorb the negative effects of shutdowns or job loss resulting from environmental policy decisions. However, as will be discussed in the next section of this document, a more in-depth evaluation is required to assess the impact of new technologies which replace labor-intensive approaches. III. PROVIDING STANDARDS FOR RESPONSIBLE BUSINESS PRACTICE: SOCIAL CLAUSES AND CODES OF CONDUCT A. Responsible practice recognises that human rights and social development go hand-in-hand with cleaner production 34. Responsible business practice recognises that the environment cannot be separated from other concerns facing workers in their workplaces and communities. Trade unions are reminded every day that their environmental efforts must be part of a broader plan that involves organising and collective bargaining, freedom of association, human rights, economic policy, development work, education, women's issues, occupational health and safety. Indicators of Sustainable Development have been developed by the ILO's Worker Education & Environment project to assist in development of sustainable development priorities based on the interactions of the: (a) Environmental indicators of development; (b) Political indicators of development; (c) Economic development and security; (d) Social development; (e) Equality of opportunity and treatment of disadvantaged groups; (f) Education and training; (g) International development. B. Distinguishing between intergovernmental agreements and codes of conduct 35. The trade union movement has responded to globalisation by proposing Labor Standards as part of any agreements advanced by the WTO, the MAI and other agencies of globalisation. At its 1996 Congress, the ICFTU advanced its own Model Clause as a standard against which international agreements may be measured. In addition, it has endorsed the ILO Indicators of Social Change for Sustainable Development as a guide. The International Confederation of Free Trade Unions Calls for a Workers' Rights Clause in International Trade Agreements The ICFTU's 1996 World Congress called for a workers' rights clause ("social clause") to be included in the World Trade Organisation (WTO) and all international agreements: "The contracting parties agree to take steps to ensure the observance of the minimum labor standards specified by an advisory committee to be established by the WTO and the ILO, including the five standards guaranteed in the following highly ratified ILO Conventions: Convention 87 on freedom of association, Convention 98 on the right to organise and collective bargaining, Conventions 29 and 105 on the abolition of forced labor, Conventions 111 and 100 on the prevention of discrimination in employment and equal remuneration for work of equal value, and Convention 138 on the minimum age for employment." 36. ILO Standards address basic human rights of workers that are often the targets of repression, exploitation and discrimination. The ICFTU has asked that these Standards be considered a "floor" of workers' rights, to be incorporated into any agreements, globally and at any level of development. A primary aim of such standards is to prevent multinational companies (MNCs) from playing off one potential host country against another in search of a government prepared to ignore human rights. They encourage a sustainable process of foreign investment that brings increased benefits to the host country by curtailing exploitation and cut-throat competition and thereby allowing labor conditions to be gradually improved as trade increases. 37. At the World Trade Organisation Ministerial Summit held in Singapore in December 1996, the ICFTU was unable to establish a Working Party on these issues due to the hard-line opposition of a few countries that refused to accept any mention of labor standards in the Ministerial Declaration. Nevertheless, the draft Declaration provides the first-ever endorsement by the WTO, or its predecessor the GATT, of core labor standards - a small but significant step forward and a basis for the next WTO ministerial meeting 18-20 May 1998 in Geneva. 38. Because we have yet to be successful in implementing adequate social clauses into international agreements, we continue to promote specific Codes of Conduct that only partially achieve the same results. They target specific workplaces where virtually all indicators of sustainable development are ignored: labor standards, human rights, health and safety and the environment. 39. The tragic fire at the Kadar Toy Factory in Thailand in 1993 drew attention to the need for such Codes, and in the last 5 or 6 years, the number of unilaterally adopted Codes of Conduct have multiplied, involving some of the largest companies and recognised brand names. Unfortunately, too many workers ostensibly protected by a Code, suffer brutal conditions because they lack trade union involvement and the independent monitoring necessary to implement it. It is virtually impossible to protect workers without trade unions; yet many Codes avoid any mention of them. As well, Codes vary greatly in scope and suffer numerous other deficiencies. IN SOUTHERN AFRICAN COUNTRIES Trade Union Centres Take on Export Processing Zones The SATUCC Regional Programme of Work on Environmental Issues in Export Processing Zones in co-operation with the Training and Research Support Centre in Harare aims to: - Identify, analyse and discuss key policy, legal and institutional issues for environment and sustainable development arising out of Export Processing Zones (EPZs) in Southern Africa; - Examine the experiences of unions with respect to EPZs, their response to issues raised by workers and unions, options for more effective monitoring and articulation of positive and negative features of EPZs and more effective advocacy by unions and SATUCC of policy positions on environment and sustainable development in EPZs; - Build an information and advocacy programme with the involved unions that will enhance negotiation of union policy on environment and sustainable development in EPZs; - Link unions with professionals, researchers and research institutions in their respective countries to inform and support union work on EPZs; - Prepare materials to support union advocacy on sustainable development issues and EPZs for Southern Africa Development Community (SADC) and international use. IN ITALY Trade Unions Achieve a Code of Conduct for Toy Manufacturing An agreement between Artsana and three Italian trade union centres (CGIL, CISL and UIL) on a code of conduct committing the company and its subcontractors to respect basic workers' rights and ensure workplace standards. Artsana is a leading multinationals in the toy industry, employing 3,100 workers in 14 plants in Italy and more than 800 employees abroad. As well, its Chicco products are made in China by subcontractors. The code of conduct provides for full Freedom of Association and collective bargaining as enshrined in ILO Conventions 87 and 98. It forbids the use of child and bonded labor and discrimination in pay and employment, and binds Artsana s suppliers to decent pay and working conditions for their workers, in line with national legislation. The Agreement is monitored through on-site inspections carried out with trade union officials and is subject to an annual assessment. Subcontractors must renew their "declaration of compliance" with the Code every year and if found to be failing by its terms, would face cancellation of their contracts. IV. RESPONSIBLE PRACTICE INCLUDES ACCOUNTABILITY A. Promoting accountability through target-setting and reporting 40. Corporate accountability is an essential condition of responsible practice, as it ensures business is answerable to workers, citizens and government for social and environmental costs and benefits beyond the monetary bottom line. Proper accountability depends on reporting that starts at the workplace, relates to goals set by local authorities and feeds into national and international monitoring and reporting systems. We therefore challenge governments and the CSD to: (a) Acknowledge the importance of accountability to make business and industry answerable to workers and society. (b) Develop or improve workplace, community and governmental mechanisms designed to ensure greater accountability of business and industry. (c) Establish mechanisms to monitor and assess corporate practice, beginning at the workplace, with a central role for all levels of government. (d) Strengthen access to information to allow workers, community members and government to evaluate the effect of corporate decisions and practices. This must apply to foreign operations and include information on subsidies, tax breaks and other incentives to corporations and industries. (e) Reform unsustainable subsidies and tax breaks, and make wrongdoers liable. As well, enact ecological tax reform and appropriate liability laws. (f) Promote international agreements and mechanisms to protect workers and local communities from "corporate blackmail," and encourage "good neighbour" practices with clean production as a standard. (g) Reduce political influence of corporations on government. IN BRAZIL Chemical Unions Achieve a National Accord for Accountability Negotiations between the country's chemical industry and trade unions have produced an unprecedented agreement that provides detailed guidelines and procedures for the environmental control of benzene involving full participation of workers and their unions. A "Benzene Accord" was signed in 1995 by the National Confederation of Industry, the Brazilian Association of Chemical Industries, the Brazilian Synergy Institute, the Industrial Union of Chemical Products and Petrochemical End Products of the State of Sao Paulo, the National Confederation of Industrial Workers, the National Confederation of Metal Workers, the Central Union of Workers, the Union Force, the Jorge Duprat Figueiredo Foundation for Occupational Health & Safety, and the Ministries of Labor, Health and Social Assistance. In the Accord, a Technical Standard defines benzene as a carcinogen and provides a Technological Reference Value (TRV) that Brazilian workers, employers and government consider to be safe. Workers are given equal representation on a Permanent National Commission on Benzene to oversee developments, monitor compliance, promote studies, supplement laws and regulations, provide for alternative control measures and issue Certificates for the Controlled Use of Benzene. The Accord is administered at the plant level by a Representative Group of Benzene Workers (GTP) which has full responsibility for programmes, including worker training. Full employer co-operation with the GTP is required, including access to information and records and provision of office and equipment, and heavy penalties are provided for violations. IN GERMANY Unions Promote Sustainability in the Context of Social Partnership Since 1987, the German Chemical Workers' Union (IG Chemie) has worked with Associations of the Chemical Industry to enact a Declaration (Kommunique) that empowers works councils to conclude agreements on environmental protection, and extend their rights of access to information on environmental issues and to participation. The Agreement calls for improved monitoring of chemical substances, more responsibility for economic councils and health and safety committees, a joint Union-Association body (GIBUCI) to organise the exchange of information and training, and ongoing discussion to promote sustainable development into the future. Over 60 works agreements have extended the rights of works councils beyond safety matters to participation in strategic decision-making as it affects the environment. Additional Union initiatives have widened the scope of information-sharing with other unions in Germany and Europe, as well as with the host communities. The 1987 Declaration adds another chapter to a tradition of Social Partnership, which forms a pillar of German Basic Law, based on Freedom of Association, worker participation and development and the social welfare state. IN THE PHILIPPINES The Trade Union Congress of the Philippines formed a Joint Labor Forum on Environmentally Sustainable Development to promote the exchange of information and co-operation among trade unions. A Memorandum of Understanding provides for a common trade union agenda on sustainable development, with policy issues and programme priorities for advocacy, leading to joint or individual programmes at the national, regional, local, community and workplace level for: - The effective and meaningful representation of workers in government and tripartite bodies concerned with the protection of the environment; - The inclusion of green provisions in Collective Bargaining Agreements reflecting ILO Conventions and Recommendations; - The ratification of ILO Conventions related to the environment and occupational safety and health; - Increasing the awareness of workers through information and education campaigns on the environment; - Developing an effective mechanism for inter-union co-operation on environment-related programmes and initiatives, beginning with efforts to monitor compliance of environment-related ILO standards; - The creation of a Green Fund. B. Accountability must be based on trust, credibility, transparency and applicability, and provide assurances similar to those in occupational health and safety 41. Last June's Special Session of the UN General Assembly reached an agreement that governments would encourage "voluntary reporting" by business and industry on the impact their practices have on the health and well-being of communities and environment. Trade unions have good reason to doubt the efficacy and reliability of this brand of accountability, especially where assessments are conducted "internally." In too many cases, it has only diverted demands for objective, third-party assessments conducted by independent inspectors. 42. Reporting, and the processes which are part of it, must be trustworthy, credible and transparent to be of any value. The consensus, which is crucial to change production and consumption patterns, is destroyed wherever proper information is withheld and decisions made behind closed doors. Proper reporting is a necessary precondition for the protection workers have won in the area of occupational health and safety, in which the following principles were established: 43. A "Right-to-Know" that extends from the workplace to consumers and the community. Everyone who is affected by the workplace must have a right to know the environmental impact of products and processes which are involved, the right to independent advice and the right to be consulted on the environmental strategies of their employers. This only occurs where there is proper reporting, as well as education and training. 44. Some countries have promulgated clear and unambiguous legislation and regulations requiring hazardous materials information systems that specify employers' obligation to ensure the provision of information about hazardous materials or "controlled products" to which workers may be exposed. In too many cases, however, potentially harmful materials and physical agents, as well as foods, manufactured and other products are excluded. As well, workers are not sufficiently protected where other weaker legislation covers potentially harmful materials. As well, dispensation is too often allowed for "confidential business information." Right-to-Know laws typically require: (a) Supplier Labels on all containers of controlled products that clearly identify the product and the supplier, display a warning symbol, alert to the risk, prescribe precautionary and first aid measures, and refer to an MSDS; (b) Worksite Labels displayed on controlled products produced at the worksite or on containers in which they are stored; (c) Material Safety Data Sheets (MSDSs), readily available to all workers, covering both "supplier" and worksite or "employer"-produced substances, to provide complete and up-to-date detailed information about all aspects of the controlled product; i.e., its ingredients, properties, hazards and methods of control and treatment; (d) Worker Education to ensure that workers know about the "controlled products," their properties, hazards they pose, protection and treatment, as well as training in procedures for safe handling, storage and disposal, emergencies and "fugitive emission." 45. In addition, unions have won health and safety advances in such areas as: (a) "Whistle-blower" protection in which workers' right to report environmental violations to the authorities without risk to their employment is enshrined in both the law and the collective agreement. In some cases, it allows such reports only after the employer has failed to act on "notice"; and (b) A Right-to-Refuse work which is believed to pose an imminent danger to health and safety. This is now included in legislation and collective agreements in a great many countries and jurisdictions and includes provisions which prohibit any retaliation or threat of discipline by the employer to ensure that workers feel secure about this right. In many jurisdictions, this principle has been specified as a "duty" on both employee and employer and stipulates that no other workers may be pressed into the refused work assignment. Similar legal protection is now sought for workplace environmental problems. V. RESPONSIBLE PRACTICE INVOLVES WORKERS AND TRADE UNIONS 46. Our experiences reinforce the importance of participation by well-briefed workers and trade union representatives. When union members and management can confidently take issues forward together, then positive change will occur. This makes it all the more important that environmentally sustainable change is put on the agenda at every workplace. 47. A strong endorsement for the role of Workers and Their Trade Unions was received at the "Environment for Europe" Ministerial Conference in April 1993 when Ministers of Environment endorsed an Environmental Action Programme for Central and Eastern Europe (EAP), a framework for identifying the highest priority actions and for developing realistic, efficient and cost-effective solutions leading to Cleaner Production (CP). 48. As part of the EAP, a Best Practices Guide for Cleaner Production Programmes in Central and Eastern Europe was produced which points out that "In the implementation and dissemination of the cleaner production programmes, trade unions have much the same interest as enterprise managers, such as profitable and productive workplaces. Trade unions also have a strong interest in the health and safety conditions affecting their members in the workplace..." The Guide also noted that "Co-operation between senior managers of an enterprise and trade unions is essential to the credibility of a CP programme. Both parties must be committed to the concept, to establishing an appropriate organisational structure to implement an enterprise-wide programme and to motivating employees to participate." 49. The EAP encourages the implementation of policies and projects, starting with small, manageable steps such as "good housekeeping," improvement of process technology and modest pollution controls. Noting that a key obstacle to change is a widespread lack of awareness and "know-how" among managers and employees, it outlines the following major objectives: (a) Raise awareness among workers and trade unions about the benefits deriving from implementing CP programmes and investments; (b) Present key elements which are necessary for engaging workers and trade unions in the design and implementation of CP programmes and projects and multiplying their positive results; (c) Support the development of effective dialogue and co-operation between national governments, industrial managers and trade unions, as well as other relevant stakeholders. IN HUNGARY Trade Unions Actively Engage in Cleaner Production Local trade unions at the Tisza Chemical plastics complex (TVK) have participated in a cleaner production programme to introduce an environment management system that meets the requirements of ISO 14000. A waste management programme has significantly reduced energy demand and industrial water consumption and was part of an effort to clean up the river Tisza, which flows near the plant. The Federation of Chemical Workers' Unions of Hungary says its members have an interest in the environment as employees and inhabitants of the town. "A continuous dialogue with trade unions is necessary on the close connection of ecology, competition, employment and social problems, especially on the importance of the working environment and its role in the prevention of early disablement, qualification of products and production processes." Trade Union - Yukos Oil Agreement (Russian Federation) Yukos Oil and the Inter-Regional Trade Union Organisation (IRTUO) at Yukos have signed a collective agreement for 110,000 members that promotes the active participation of workers and the union in the company's environmental protection programmes. Under the terms of the joint ecology agreement, union enterprise committees have: - Participated in a unified system of environmental monitoring and pollution prevention; - Participated in workplace eco-audits and CP programmes; - Organised workplace ecology education and training programmes; - Organised ecology competitions, whereby CP proposals by workers receive eco-bonuses; - Organised union volunteers for tree planting projects in disused oil fields; - Received training on ecology issues and have powers to monitor and report on pollution problems as part of an on-going CP programme at Yukos Oil. As well, IRTUO has launched an environmental information campaign aimed at its members and the community. The corporation claims that cost-savings have resulted and has established an ecology reserve fund, which is partly used to raise awareness of ecology issues. VI. RESPONSIBLE LEADERSHIP FOR CHANGE INVOLVES PUBLIC POLICY AND GOVERNMENT A. Reaffirming the role of governments and public policy 50. Governments and public policy have a crucial role to play in promoting all of the social and environmental objectives of sustainable development. Regulations, litigation and fines have a proven record of motivating responsible practices. Unfortunately, as with occupational health and safety, they are too often not enforced. As well, international trade and investment priorities often override national and local regulations, allowing corporations to choose for themselves when and where to respect environmental and labor laws. 51. Reports prepared for the CSD acknowledge that the high standards of public health and education in developed countries can be attributed to early State provision of water and sanitation services, health-care systems and universal schooling. What is required are similarly aggressive government initiatives and policy frameworks to promote sustainable development objectives and provide for worker and trade union participation. 52. Recognising that a lack of union rights is a major barrier to trade union involvement on workplace issues, governments must ensure that trade unions have similar rights on environmental issues as exist in most countries for health and safety. Collective bargaining on environmental issues is a growing trend and provides an important route for active trade union involvement. Removing barriers to collective bargaining and equipping unions with the "know-how" and skills to bargain these issues would provide a major boost to sustainable development. 53. Public policy must extend to eco-auditing and reporting, as it requires the confidence and co-operation of workers. Involvement of trade unions should be assured by law, from a full-audit team to post-audit discussions with management, reporting, monitoring and follow-up. IN ITALY Trade Unions Achieve Improvements to Community Environments Action by Italy's three trade union centres, the CISL, UIL and CGIL, have led to environmental legislation in Italy, which reinforces voluntary agreements between social partners. Environmental issues are now addressed through a "negotiation model" involving (I) information, training and communication; (ii) negotiated agreements for joint committees, environmental auditing and reporting; and (iii) participation of workers and the community. At least three such agreements have been signed, including one to improve the seriously polluted water resources of the region by limiting discharges, cleaning up surface waters and improving the overall administration of resources in the region surrounding Venice. In the industrial zone of Portoscuso, state, community and union organisations developed a regional plan to clean up extreme air, water and soil pollution seriously affecting the area. A permanent Round Table was established to cover the long-term implementation of the agreement, headed by the Department of Environment and involving unions. 54. Government action is more necessary than ever in a globalised economy, where boundaries between environmental effects and economic effects become less distinct. According to the OECD, "National" environmental imperatives warrant at least three forms of intervention: (a) National policies to internalize the environmental costs of those domestic externalities which have no international competitiveness implications; (b) Co-operative arrangements with other governments on common policies to address those implications; (c) Co-operative arrangements with other governments on common policies for addressing transfrontier/global environmental externalities. B. Responsible practice depends on financial and regulatory instruments that recognise environmental costs 55. Trade unions recognise that economic instruments such as eco-taxes can contribute to environmental protection, especially when used in conjunction with accounting that accommodates environmental "externalities," and acceptable substitutes for products and services that encourage change in consumption patterns. Central to any acceptance of such schemes, however, will be the way in which financial mechanisms are used; i.e., whether they safeguard employment and fund proper transition programmes for workers. Conditions for trade union support will have to be clarified in the near future, especially for sectors on the front line; i.e., the manufacturing industry, energy production and supply, as well as from transportation and construction sectors in industrialised nations, where secure jobs are most at risk. 56. Business must begin by accepting shared responsibility through taxes on environmentally damaging production. However, such "Greenhouse-Taxes" can have significant negative impacts on employment and must be offset by measures to ensure that social costs are minimized and shared equitably, and that revenues are used to compensate effects on income distribution and environmental initiatives. Where unions have supported such financial instruments, they have also insisted that they be levied on production or import of substances and energy, which are directly related to environmental problems, not on use or disposal. Since much of this tax will be passed on to consumers, "differential energy pricing" must ensure that basic needs are priced differently than excess needs. They must also be in the form of "dedicated revenue" or a Loop Tax, whereby revenue is spent on climate protection measures and "green job creation" instead of becoming merely another source of government revenue. 57. Finally, the need for financial instruments like "green taxes" will not be fully appreciated until the concept of "natural resource" or "environmental" accounting is broadened to include a valuation for all the true "costs" of current production and consumption patterns. For too long, unsustainable patterns have been shielded by a form of myopic accounting that simply ignored major impacts and "deficits," that were dumped onto society, into the environment, and even into other nations and regions of the earth, as a direct consequence of the way business was done. The OECD has provided direction on "Natural Resource Accounting" (inset) as a guide. The OECD Provides Definitions for Natural Resource Accounting and "Green GDP" Natural resource accounting is seen as a tool to demonstrate linkages between the environment and the economy, to correct distortions in standard measures of national "growth" and "welfare." Green GDP measures are based on quantitative indicators of national performance based on data relating to the availability and use of natural and environmental resources (stocks and flows) and incorporating qualitative judgments as to what constitutes economic, environmental and sometimes social welfare. (OECD, Sustainable Consumption and Production, 1997)
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Date last posted: 8 December 1999 15:15:30