Is certification reducing transparency and accountability in the supply chain?

Another scandal in a major global supply chain broke last month, with BBC News’ investigation into the working and living conditions of workers in tea plantations in Assam, North-East India. The article described conditions as “dangerous and degrading”, with workers having to endure dilapidated living quarters on the estate with no functioning toilets, daily wages about 35% below the minimum wage and a lack of protective wear in the field when handling toxic pesticides. Additionally, the Director of a hospital nearby stated that “nine out of ten patients” were malnourished, with many suffering from life-threatening and poverty-related diseases such as diarrhoea, TB and meningitis. To emphasise the importance of this scandal, the estates investigated were owned by some of the largest tea producers in the world, supplying household names such as PG Tips, Yorkshire Tea and Twinings. India is the second largest tea-producer in the world, with the state of Assam producing nearly 50% of its total output. Hence this issue cannot be ignored as an isolated or unimportant case by the Indian authorities or the big brands affected. What makes this case even more galling is that the plantations investigated were all certified by The Rainforest-Alliance, a global NGO that certifies businesses who meet their rigorous criteria on conserving biodiversity, ethical treatment of workers and sustainable business practices. Certification NGOs and self-regulation have grown rapidly as a response to supply chain scandals that have erupted periodically over the last twenty years or so. Nike and “sweatshops”, the Rana Plaza collapse, Primark and child labour, and the UK horsemeat scandal are some of the cases where industry participants have eventually come together with large NGOs to sign accords and promise change through rigorous self-regulation. Unfortunately, most informed observers of the “supply chain CSR” movement would agree that not much has really changed, as highlighted by the BBC investigation. One of the reasons behind the lack of meaningful progress is probably evident in part of the response provided by The Rainforest-Alliance to the BBC report: Rainforest Alliance Certified™ farms are certified to the Sustainable Agriculture Network (SAN) standard. The SAN is an independent organization consisting of a range of conservation groups including the Rainforest Alliance (www.san.ag). The standards developed by the SAN comply with the Code of Good Practice for Setting Social and Environmental Standards of the International Social and Environmental Accreditation and Labelling (ISEAL) Alliance. In India the accredited certification bodies authorized by the SAN to carry out audits include RA-Cert, IMO-India and Indocert. These bodies are accredited by the IOAS, the International Organic Accreditation Service. For the past six years, the Rainforest Alliance has provided training and guidance to the tea sector in Assam on improvements to social and environmental impacts of production, mainly focussed on the rigorous requirements of the SAN standard. You would be forgiven for being confused about where ultimate responsibility lay for certifying the farms. The Rainforest-Alliance certifies farms (and consequently the brands buying from those farms) based on audits it does not conduct itself and on standards it has not developed itself. The proliferation of standards, private auditing firms and certificates has resulted in a lack of transparency and accountability, and accusations that NGO logos on products are motivated by price-premiums for ethical products rather than improving worker’s lives. A complex web of private and third-sector initiatives has resulted in distancing the multinationals even further from the issues at hand, and hence no organization is any closer to having real visibility and accountability of what is happening on the ground today, despite the noble efforts of many NGOs to highlight and solve many serious issues. The question for big brands affected by scandals such as this one is that in the absence of capable government regulation and effective self-regulation, what is the best way of preventing this kind of scandal from happening? This question is addressed in a thought-piece done by Tomorrow’s Company titled “The Future of Supply Chains”, that can be found here. Two of the recommendations in a comprehensive and integrated list detail ways in which the multinationals can increase control and visibility of their global supply chains and can reform auditing mechanisms from box-checking towards more collaborative and qualitative methods. “The bitter story behind the UK's national drink”, http://www.bbc.co.uk/news/world-asia-india-34173532 http://www.teacoffeespiceofindia.com/tea/tea-statistics “The Rainforest Alliance Responds to Allegations Made by the BBC Regarding Tea Estates in Assam, India” http://www.rainforest-alliance.org/statment/tea-estates-assam-india