Why does business still undervalue women?

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By Rachel Noble and John Morrison

(kindly reproduced from www.ihrb.org)

A new report by ActionAid UK, Close the Gap!, finds that women’s wages and labour market participation relative to men’s cost women in developing countries an astounding US$9 trillion every year. This despite unprecedented economic opportunities opening up for many women as a result of expanding global supply chains, equal rights for women in many countries’ constitutions, and widespread ratification of international labour standards including equal pay for work of equal value.

It would be unfair to blame business alone for this state of affairs: discrimination reflects the norms prevalent in wider society. The scale and persistence of women’s economic inequality starkly illustrate the power of prevailing social norms, which discriminate against women. Such norms place inherently lesser value on the work women undertake, denigrate and deny women’s role in decision-making, and curtail women’s opportunities to fulfil their potential and realise their rights throughout their lives.

Discrimination against women occurs at every level of society, from institutions at local to global level, and within the social, cultural, political and economic spheres. It has led to an economic order that systematically exploits women, and one that is further confounded by flawed economic policies and corporate practices that depend upon the subsidy of women’s cheap labour to boost profits, economies and GDP. This labour includes the hugely disproportionate amount of care work women are expected to undertake – caring for children, the sick and the elderly, preparing food and fetching water – so vital to our social fabric and for healthy workforces. Such care work is all the more demanding in contexts of poverty, while further curtailing women’s opportunities to secure regular, decent work.

As a result, women constitute some 60% of the world’s poor. They are vastly over-represented in the lowest paid, precarious jobs, enduring degrading working and living conditions, with little access to social protection or to justice where rights violations occur. Such a system is both unjust and socially and economically unsustainable, not least because businesses are missing a huge pool of potential talent by under-employing and underinvesting in half of their workers. The ILO estimates that an additional $1.6 trillion could be generated in global output by reducing the employment gap between women and men, which could help eradicate poverty and drive prosperity for all.

Businesses, whether small companies or multinationals with supply chains spanning continents – do not operate in a vacuum. They are situated within societies and, as such, tend to reflect and reinforce prevailing social norms, which combine with harmful economic policies and further drive women to the bottom of the pile.

So what should business do? Following national laws is the first step and most countries (but by certainly not all – around 90% still have at least one law restricting women economically,) outlaw overt discriminatory practices relating to recruitment and pay. However, discrimination is much more subtle and pervades every society at every level. Women are vastly underrepresented in the Board Room in every country, despite evidence that the financial returns for companies with three or more women on their boards are better than those lacking women at the top. And women were again a small minority on panels at the World Economic Forum in Davos last week.

Changing such patterns of behaviour requires much greater awareness and action by both men and women – as the “No thanks to all male panels” campaigns in Norway, Sweden and Australia have been demonstrating. Businesses can also introduce policies to help redress the balance, such as offering flexible work and shared parental leave to allow women and men to balance caring responsibilities, and pay their taxes to pay for public services, so vital to reducing the burden of care. They can seek to ensure women working in their supply chains have secure contracts, earn a living wage, are entitled to maternity leave and sick pay, and – vitally – have the right to engage in collective bargaining to help safeguard their rights.

Another issue which is perhaps less common in the boardroom but much more prevalent in supply chains is that of sexual violence. Human Rights Watch has estimated that many thousands of women have been abused in the US agricultural sector – many of them migrant workers and many of the cases unreported. Sexual violence is endemic in agriculture in many parts of the world, as cases in India and East Africa suggest. Indeed, violence against women in the world of work, including sexual violence, is so widespread across so many sectors that the ILO and trade unions are pushing for a new ILO Convention on Gender Based Violence.

The approach taken by business needs to be one of due diligence: preventing and mitigating abuse and discrimination as much as possible but also providing adequate remedies when harm has occurred, and cooperating fully with legal cases which attempt to give victims redress for harm done.

But there is one game-changer that should not be overlooked. Businesses still tend to wait until they find evidence of discrimination or abuse before acting. This often means abuse goes undiscovered and underreported. Widespread discrimination against women in a society is likely also to be found in the workplace. If it is known that women workers are particularly vulnerable to exploitation – be it in agriculture, domestic work or the apparel sector – then businesses should not wait for evidence before taking action. Cases suggest that in countries where abuse is most endemic, women are least likely to report abuse to the company, often fearing repercussions if they do or lacking faith that the business can actually do much about it. So corporate human rights due diligence in relation to a known risk such as gender-based discrimination means being proactive and using all available leverage to increase transparency and accountability of risk-factors. Businesses that do not act will one day find themselves in court, but long before that their social license should be challenged by women and men everywhere.

Business is clearly an important actor, but it is not the only one. Some of the worst discrimination is in the informal sector or the home. Transforming the status quo requires communities, civil society and government to act to change societal norms, to rethink economic policies, strengthen legislation, ensure its effective implementation to create a level playing field for all, and ensure proper accountability mechanisms. Women can be a powerful force for change as has been shown countless times. They just need business to get on board.

Rachel Noble is the Women’s Rights Policy Adviser & Research Officer, ActionAid UK

John Morrison is Executive Director of the Institute for Human Rights and Business

 

What part of “no” don’t you understand?

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The following is a short reading from my book The Social License I recently recorded for “Author’s Corner” on National Public Radio in the USA. It relates to Chapter Six of the book and the issue of community consent.

(Start)

When we talk about an enterprise as having a “social license” what do we mean? I mean it has legitimacy through accountability to the people and not just powerful interests. But cultures surely differ in how they understand this.

As one indigenous leader in Guatemala explained to me: “Companies want to consult with us about their operations. They often want to know how long it will take our community to respond. We tell them that sometimes it will take one night, sometimes it might be a week, or even years. It depends on the question they ask.”

There was once a mining company desperate to open a mine deep within the Australian outback. The challenge for the company was the fact that the mine would sit upon the land of indigenous peoples. Under Australian law, the company needed to gain the consent of the local community before any mining could start. Every month, the company’s anthropologist went to talk to the village elders. One old lady sat there in silence during every visit with her eyes closed, letting the men of the village voice their fears and concerns.

The anthropologist was concerned by the silence of the woman. After two years of visits, the community was still withholding its consent. After one awkwardly long silence, the anthropologist was surprised to see that the woman had opened her eyes. The woman fixed the anthropologist in a long stare and said in her broad Aussie accent: “What part of ‘no’ don’t you understand?”

I’m author John Morrison

(End)

The fear confronting Europe in 2015

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“Martyrs for Liberty”

The terrorist attacks in Paris today are a watershed moment. This is not the largest terrorist attack of recent times – Paris has been spared until now the major incidents faced by New York, London, Madrid, Mumbai, Bali or Nairobi for example – but today’s attack will be remembered for the clear message it delivers in relation to international values because it is such an obvious one. I am not one to usually talk about things such as “French values”, given that human rights are now universal and internationally recognized, but there is something specific in historic terms about freedom of expression and democracy in a city such as Paris. It is debated as to whether Voltaire ever actually said “I disapprove of what you say, but I will defend to the death your right to say it” in 1758 (it might be a summation by Tallentyre much later) but it was clearly Voltaire’s sentiment.

Since 1948 freedom of expression has been an internationally recognised human right and is an essential aspect of life for activists, entrepreneurs, artists, journalists, writers, comedians and politicians across every continent. The fact that this freedom is not an absolute and is denied to the populations of too many countries does not diminish its universality or its essential role in the modern world.

I am not a freedom of expression fundamentalist. I have often argued with colleagues often about why papers in Copenhagen or Paris should go out of their way to be offensive, particularly to minorities who already face considerable racism and marginalisation across Europe. The cartoons did not just offend extremists but many moderate Muslims, in the way Christians, Hindus and Jews have been offended by other publications, works of art, music for decades. For example, the offence of “blasphemy” was only removed from English law in 2008 and this had only protected Christian sentiment.

I would not ban Wagner’s powerful music even though he was clearly anti-semitic, nor any of the movies depicting the death of Jesus Christ or even stop the bookshop at Amman airport from selling copies of Mein Kampf in Arabic and English which I believe it still does (a book still banned in some European countries). So whilst I have never read any copy of Charlie Hebdo and did not agree with the sentiments of some of their cartoons, there is a fundamental value at stake which is much more important.

Democracies cannot function without freedom of expression, freedom and liberty. More than this, as Aung San Suu Kyi wrote under house arrest in 1991, it is also fear that corrupts and fear of terrorism will have a chilling effect on freedom of expression even without specific threats. This of course is the basis of such terrorism. The murdered journalists and editor were very aware of this and undoubtedly pushed the envelope for this very reason – offending many religions and establishment figures over the years in order to push back the boundaries of fear that chill freedom of expression itself. The most invisible type of censorship is self-censorship and newspaper editors must remain brave. Many of us tweeted #jesuischarlie today even if many of us will never read Charlie Hebdo regardless of how good our French might be (or not).

And then there is the other even greater threat to European values, from the bowels of the continent itself and its extreme right. Racists also kill people, from the thousands of racially motivated attacks every year to the specialists such as Anders Breivik who killed 77 fellow Norwegians in 2011 for being young social democrats. But beyond this, like the beating drums of Mordor, looms the ugly face of xenophobia and intolerance which has recently taken the form of the “Pegida” marches in Dresden and other parts of Germany. Pegida or Patriotische Europäer gegen die Islamisierung des Abendlandes (in English: “Patriotic Europeans Against the Islamization of the West”) would claim to be the counterpoint to Islamic extremism, but actually it has much in common. It is clear that both hate liberalism, both hate journalists and both wish to divide European society based on ideology. The danger now is that the Pegida marches will grow and we will see similar in France led by Marine Le Pen who must fancy her chances to run for the next French Presidency. A fascist in the Elysee Palace, the first since 1945, would warm the hearts of all those wishing harm to the democracies of Europe and our essential values. Those in the UK and other countries debating whether we still need a European Convention on Human Rights or would like to further restrict the sanctuary offered to refugees from the Middle East should reflect carefully as to which side of history they might stand.

I end by re-quoting the Paris-based Imam (via US Secretary of State John Kerry) who today honoured the murdered journalists as “martyrs for liberty”.

A Trade Union leader’s personal perspective

Jim Baker’s thoughts on “The Social License” by John Morrison (Palgrave MacMillan, 2014)

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(Jim Baker was Co-ordinator of the Council of Global Unions (CGU) until 1 July 2014. The CGU was formed in January of 2007 and is composed of Global Union Federations, which group trade unions by sector and occupation as well as the International Trade Union Confederation (ITUC) and the Trade Union Advisory Committee to the OECD (TUAC), which bring together national trade union centres. Prior to that, Baker was the Director of the Bureau for Workers’ Activities (ACTRAV) at the International Labour Organisation (ILO). Before joining the ILO, he held the post of Director of the Department of Multinational Enterprises at the International Confederation of Free Trade Unions (ICFTU) in Brussels. These comments represent his personal thoughts)

The book accomplished what I understood to be its mission. It provoked thought and helped to further the discussion. What follows are some fairly unorganised thoughts that it provoked, by no means exhaustive: some of which might be useful.

Traditional CSR, public relations, and due diligence

The book showed restraint in its reflections on CSR, but I think that the essential points were made about its weaknesses and about the nature and self-propelling characteristics of the CSR industry. I had two complementary thoughts.

First, some of the comments reminded me of how CSR language has tripped us up. As George Orwell wrote,“…if thought corrupts language, language can also corrupt thought”. I suspect that we have all been afflicted by this language effect. We have become artificially conditioned to react in a way devoid of common sense. It is as if we have become one of Pavlov’s dogs that confuse noise with real food.

That brings me to a larger point that came to mind in several sections of the book; the degree to which we have all been affected by public relations and “hype”. Growing up in the Northwest, dependent on the lumber and wood products industry at the time, I recall that major companies were being attacked for logging without restoring the forests (inadequate planting of new trees to replace the barren ground that they had created). One of the major companies responded, not by planting more trees, but by calling themselves, “the tree growing people”. Part of the struggle for us all will be to separate the real from the imaginary.

The most serious danger of misinformation and disinformation is, undoubtedly, for democracy. The level of political debate is lower than at any other time in my memory. The people may still make decisions, but based on what information? And, where is that information coming from? In the US, with the end of key restrictions on political and issues funding, the “marketplace of ideas” is becoming more distorted as it is being increasingly “bought”.

But, to get back to smaller problems, the business and human rights framework is the best way out of the incestuous CSR world. However, the element that is probably, in practical terms, the most important is due diligence. It gets beyond companies saying and “proving” how good they are and others saying how bad they are to something that, rather than a good and evil measure, can be judged on how robust a process is; in that sense, it compares to democracy. After all, democracy is, above all else, the question of the value and validity and legitimacy of a process.

One of the useful and salvageable words in CSR is “responsibility”. I think that, to some extent, the use of the word “obligations” in the business and human rights discussions has worked. It is the same sense that rehabilitation of the word “responsibility” might be useful.

Legitimacy

A key argument of the book is legitimacy. It is related to the social license along with other concepts and it covers business, government and civil society organisations. I understand the importance of the argument and that without it, it does not hold together as well as it would otherwise. However, my idea of legitimacy is more restricted; probably reflecting the fact that I have spent my life dealing with it in a trade union context. And, defining legitimacy was central to the fight against totalitarianism, but also against company unions and other outside influences and control.

Legitimate trade unions are what were called “free trade unions”. Although the term has gone out of style, the concept remains important. Trade unions should be controlled by their members, not by the boss or by government or by a party, or by a church or by various stripes of mobsters. There have been two issues; the lack of outside control and democratic procedures to ensure that there is internal control by members. As in other democracies, the real democratic life in trade unions does not depend exclusively on having democratic constitutions and rules and dedicated democrats as leaders.

I think that it is important (in reference to a passage in the book) to maintain the importance of the distinction between Amnesty International and Human Rights Watch. Both make a significant contribution to the human rights debate, but having democracies inside democracies are also quite important. That is, of course, also true of trade unions that are, if they are free trade unions, both democratic and representative as well as being part of both the private sector and civil society. Trade unions and other democratic organisations also serve as schools for democracy. Also, democratic organisations depend for their legitimacy on internal factors; the expression of views of members or citizens rather than “stakeholders” or others.

That, in no way, minimizes the impact of expertise, dedication and good work any more than it is a form of attack on the great men and women that you quoted in your book. Non-governmental individuals (NGIs) are important, but are different than representative organisations. And, “membership-based” organisations are neither automatically representative nor democratic.

Constraints on business

Although we all have high hopes for the impact that the United Nations Guiding Principles (UNGPs) on Business and Human Rights will have on the future of capitalism, it is important to be realistic. Although there are forces and pressures building for companies to be more sensitive to human rights, such considerations are not driving business, even those making the most sincere efforts. And, there are other powerful forces in the world economy that business cannot ignore.

One of the realities of the financialisation of the economy culminating in the financial crisis is that the actors in financial markets often had more power than the people who were running businesses in the productive economy. Businesses were making bad decisions, in purely business terms (even though they often had human rights impacts as well) because they had to place priority on paying high dividends over investing in the future of their enterprises. If not, they risked hostile takeovers, asset stripping, etc. As has become clear with the BEPS work of the OECD, businesses were also often making bad business decisions related to shifting profits and transfer pricing; again, unrelated to production or services.

I have had a number of discussions with trade union leaders who saw eye to eye with their managers that action that undermined the long-term viability of companies and that resulted in bad investment priorities (and often in layoffs even if units were profitable) was destructive, but that they were in a context where there was no choice. With the GPs, we tend to look at MNEs as if they are powerful forces that can extend their respect for human rights to others. That is, to some extent, true, but it does not mean that they always have complete control or absolute power.

Of course, the market context is different for different sectors and companies inside of sectors. It is important and necessary to try to improve the health and safety and the rights situation in Bangladesh. However, that does not change the fact that in labour-intensive industries like garments, there is enormous competitive pressure for low wages and poor conditions. In other words, to look at Bangladesh without looking at the way that the global market in clothing works is only a tiny piece of the picture. Although it might sound protectionist to some, we did not have these massive problems in the 1970’s when much of the clothing market was being supplied by companies producing in the UK, the US and other developed countries. Workers had fought for their rights for generations and had made huge progress before they lost jobs as employment shifted to workers without rights. In the US, famously on the docks (although it existed elsewhere), there were “shapeups” where workers gathered each morning and were picked by the bosses to work that day. We are now in a sort of global shape-up where the labour of a human being has, once again, become a commodity and the basis of competitive advantage in some markets.

However, there is one specific area where the UNGPs have enormous potential concerning institutional investors. In the trade union movement, we have always had to explain to pension trustees that they cannot use their positions to “do good” or even to carry out their missions as trade unionists. Their job, often restricted by law and regulation, is to get a good return on investments to benefit retirees. If they could help in some situations, it was through the “business case”, in other words, arguing that bad industrial relations or environmental practices could jeapardise the profits and futures of companies and, for that reason, should be avoided. Decisions of the Dutch and Norwegian National Contact Points on due diligence responsibilities of institutional investors even with minority investments are an important change. If such considerations could have equal weight with fiduciary considerations, and if laws could be modified in keeping with that idea, it could, indeed, have great impact.of

Public Private Partnerships

PPPs are in fashion, in part, because governments and international organisations are looking for new sources of revenue. However, I think that there are not enough discussions about their usefulness, about any effects on democratic governance or public priorities or even their efficiency. I have always supported using private money for public purposes, but in the form of government bonds. Investors get a safe, guaranteed return and governments get needed resources, but public control remains intact. That is not the same as turning over services to private parties.

“Stakeholders”

The book helpfully tries to limit the use of the word “stakeholder”, but I have come to the conclusion that we need a stakeholder like in the Dracula films that can put a stake through its heart. It has gotten so out of control that governments are often considered stakeholders in companies, citizens are considered stakeholders in their governments (that might be true in China, but citizens are “shareholders” in democratic governments). It is an over-used and abused, and misleading word.

Some other more specific points

Page 34. The book mentions that CSR directors are restrained on employee issues because that is the province of HR directors. This cuts both ways. CSR directors often see employees, even the companies own employees as “stakeholders”. HR directors, by contrast, most often see employees as internal. An HR director who is instructed to respect human rights is, in fact, at the nexus of one of the few places where democracy actually has an impact on the company. He or she is dealing with trade unions on a daily basis. A good HR director often has the mentality of working and negotiating with people. A bad one, like a lot of CSR directors, sees his/her job as “taking care” of people.

Page 59. I found the Wikileaks example very interesting and completely concur that there is an issue of adverse impacts. An extreme example from some years ago was publishing names of CIA agents; thus putting their lives in danger. However, your paragraphs prompted another thought. Wikileaks also shows how weak and fragile professional, ethical journalism has become. The same information, handled by skilled journalists would have been much more useful than the flood of information with no study or analysis. Would newspapers be capable of breaking the Watergate story today even if they had all the information? And, what will Google do down the road when there is no reliable content?

Pages 70-71. I think that the book is right not to be “absolutist” when it comes to trust. It is very difficult to really understand what it means. In terms of SRI, a very large proportion of money that was SRI invested went into banks – pre-financial crisis. Was that trust mis-placed? But, that probably reflected public sentiment. If you can’t trust the banks, who can you trust?

And, there is the issue of trust by whom. Some decades ago, the US Department of Labour did an extensive poll on attitudes towards trade unions. As expected, it showed fairly negative views by the general public. And, when union members were asked about trade unions, in general, there was little difference from the public reaction. But, when they were asked what they thought of their own trade unions, they were very positive. For me, the second figure is the most important. However, the reaction of union members to trade unions in general also shows that union members are influenced by what they hear in the media in spite of their personal experience. I cite this example as something that shows how complicated trust can be.

Page 84. I thought that the points about tacit consent and about manipulation were very important. If we are to protect democracy, we have to work at it, but these issues are rarely on the agenda. Some years back, a friend of mine from the UAW was complaining about the fact that the Republican right was able to reach some of our members. He said, “It is like convincing the chickens to vote for Colonel Sanders”.

Page 91. I thought that the quotation from Salil Tripathi about not being able to measure a human rights abuse was excellent. The foolishness of claiming respect for freedom of association in China based on interviews is along these lines. This is another reason why due diligence rather than claiming virtue makes sense.

Pages 99-101. The discussion of businesses working in cooperation with NGOs and supply chains prompts me to point out that it is also appropriate for global companies to speak with Global Union Federations about their employees. As opposed to trying to improve conditions and rights in suppliers, some companies, through this process of examination of the situation in their facilities and suppliers some companies are actually making many workers direct employees and, in that way, ensuring that their rights are respected.

Pages 101-102. Although I do not disagree with you on outrageous CEO pay, I tend, however, to look at it as part of a broader issue of inequality. Pay determination is always subjective. To me, paying a CEO millions in salary and other benefits for his work is not inherently more evil than enabling somebody to make millions without working by clipping coupons.

Pages 105-106. The section about understanding power was really good. It is, in fact, an argument that is largely missing in CSR. And, there is no place where the imbalance of power has a bigger effect on rights or their absence than at the workplace. In fact, the worst impact on rights in triangular employment relationships is that a relationship between a worker and an employer that, in labour law, is recognised as being inherently unequal is replaced by commercial law relationships where parties are assumed to be equal. Fear is also highly relevant to power. As bad as it may be to be powerful; it is worse to be powerless.