A study on the influence of CSR reports on Corporate Human
Rights abuses through a lens of symbolic and substantive action
Due date: 01/07/2016 Final Thesis Version Author: Bozena Gerits (6047475)
MSc in Business Administration - International Management Supervisor: Dr. M. Westermann-Behaylo
Statement of originality
This document is written by Bozena Gerits, who declares to take full responsibility for the contents of this document. I declare that the text and the work presented in this document is original and that no sources other than those mentioned in the text and its references have been
used in creating it. The Faculty of Economics and Business is responsible solely for the supervision of completion of the work, not for the contents.
ABSTRACT
This research investigates the relationship between CSR reporting and corporate abuse allegations (CAAs). It has been established that there is a misalignment between CSR commitment and the implementation of it, which has led to grave human rights violations in the Textiles and Apparel (T&A) industry. This research examines the link between the quality of MNCs CSR reports and how this influences the amount of CAAs against them. Moreover, by looking through a lens of symbolic and substantive management, an explanation was found. This paper takes a qualitative multiple-case study approach and analyzed the CSR reports of six corporations between the years 2001-2012. The findings suggest that the level of a CSR report does not influence the behavior of a MNC towards respecting human rights. It also indicates that symbolic management is a highly used method to satisfy stakeholders. Interestingly, the results also suggest that late joiners to the CSR reporting trend, are effectively doing more to minimize the misalignment between their commitment and the implementation, than early joiners.
TABLE OF CONTENTS
INTRODUCTION 4
LITERATURE REVIEW 6
1. Human Rights 6
1.1 Business and Human Rights 6
1.2 Protect, Respect and Remedy 7
2. Corporate Social Responsibility 9
2.1 The beginning of CSR 9
2.2 CSR Reports & the GRI 10
2.3 Benefits of CSR 11
2.4 Motivators of CSR 12
2.5 Critics of CSR reports 12
3. Symbolic & Substantive action 13
3.1 Symbolic acts as part of Impression Management 14
3.2 Symbolic actions and the Institutional Theory 14
3.3 Symbolic acts and Institutional pressure 15
4. The Accord versus the Alliance 16
4.1 the difference 17
5. Textiles and Apparel Industry 20
RESEARCH DESIGN 22
1.Methodology 22
1.1 Epistemology & Ontology 22
1.2 Inductive & deductive 23
1.3 Multiple-case study 23
1.4 Reliability & Validity 24
3. Data Collection 26
4. Analytical strategy 27
5 Coding methodology 28
RESULTS 30
1. Level of Corporate Social Responsibility reporting 31
2. Within-case analysis. 32 3. Cross-case analysis 52 DISCUSSION 58 CONCLUSION 64 REFERENCES 65 APPENDIX 73
INTRODUCTION
The Rana Plaza building was an eight-story high complex in Bangladesh that housed multiple clothing factories. On April 24th 2013 it collapsed and 1.137 people lost their lives. Although this was one of the biggest disasters in the history of the garment industry (Institute for Global Labour and Human Rights 2014) it was not the first time that horrible sweatshop circumstances came to light. Multiple scandals with well-known brands have reached society before but the substantial magnitude of the Rana Plaza collapse seems to have been a wake-up call.
The impact that companies have on society has become a prominent issue. Through the rapid rise of globalization, the operations of Multinational Corporation’s (MNCs) have shifted across the world (Kobrin 2009). Chandler (2009) states that because of the spreading supply chain, MNCs started touching the lives of millions: “its operations affected the social and physical environment wherever it worked” (2009:29). As a reaction to this change, stakeholders have increased pressure on companies to behave ethically. And the demand for Corporate Social Responsibility (CSR) reporting and transparency has become stronger (Smith 2003). The fact that the number of published CSR reports has grown (KPMG 2013) shows that companies are responding to these new societal expectations.
However, researchers have pointed out that there is a gap between CSR commitment in theory and the implementation of it (Bowen et al. 2001, Carroll & Buchholtz 2003). Even more so, there are CSR critics that see it as a green washing method and do not believe that the companies will implement the stated actions at all (Laufer 2003). Corporate behavior that does not aim to positively impact social change can be seen as an act of symbolic management. Symbolic actions are merely aimed at satisfying the stakeholder by appearing to do what they have asked for. This can create good will and lower the risk of stakeholder conflicts (Scherer et al. 2006). The opposite of symbolic action is called substantive action. According to Hosner (1994) strategic decisions should always extend beyond economic considerations; they should be
seen as small steps in building a relationship with stakeholders. This type of action would enforce the actual implementation of CSR commitments.
A positive relationship between corporations, their CSR reporting and changes in the social environment they operate in, has not been established. Yet, because of today’s heightened scrutiny of CSR commitment it would be beneficial to know whether the reports actually influence their behavior. This research is twofold. First, it will aim to shed light on the relationship between a corporation’s level of CSR reporting and their involvement in human rights abuses. Second, this paper will build upon Logsdon and Wood’s (2005) idea that a firm will only behave accordingly and respect human rights throughout the entire value chain if corporate management encourages the firm to keep to their commitment. This implies that CSR reporting must be done in combination with substantive action. It will do so by addressing the following questions: 1. How does the level of specificity in a MNCs CSR report influence the amount of human rights abuse allegations? 2. How can substantive/symbolic management offer an explanation on the gap between theory and practice in regards to respecting human rights?
This research will make a scientific contribution to the current debate on the effectiveness of CSR reporting on social change. Through a multiple case-study and content analysis I will provide more clarity on whether the level of CSR reporting influences a MNCs amount of human right violations. This study will also come up with propositions regarding the symbolic and substantive acts used in CSR management. It will deepen the level of research done so far and the insights into the relationship between CSR reporting and corporate behavior towards respecting human rights can serve as a solid base to build upon in the future. Acknowledging this relationship will also contribute to practice. This research will show that certain types of CSR reporting should be seen as a red flag considering that in these circumstances it does not aim to be more than a symbolic gesture.
The remainder of the paper is structured as follows. The next section will be an extensive literature review on the key aspects of this research followed by the research design. Hereafter, the results of the individual case studies, as well as the overarching findings, will be discussed. This discussion will end with the acknowledgement of this research’s limitations, contributions and recommendations for future research. The final section consists of a conclusion.
LITERATURE REVIEW
1. Human Rights
For a long time, governments were the main institutes that tried to protect human rights. Through treaties and declarations state agents tried to safeguard those rights. After the World War II period there was a need to universally protect fundamental human rights even more. The Universal Declaration of Human Rights (UDHR) exemplifies this. The UDHR is a document that consists of 30 articles describing what these fundamental rights are. Among others it states that all human beings are born equal, that all people have a right to life, liberty and security and that no one can be enslaved. More importantly, if done wrong, everyone has a right to be heard in a court of law and is entitled to remedy (UN 1948). When the UN General Assembly signed this document on December 10th 1948 in Paris, it was declared “a common standard of achievement for all peoples and all nations” (UN 1948).
1.1 Business and Human Rights
Bernhagen & Mitchell (2010) say that research on the subject of human rights and multinational companies has only come up five to ten years ago and is therefore limited, but according to Wettstein (2010), there has been a large increase in interest into this relationship. Due to non-governmental organizations, such as Amnesty International, and internon-governmental organizations,
like the United Nations, the debate on business impact on human rights has developed over recent years (Preuss & Brown 2012).
According to the Office of the United Nations High Commissioner for Human Rights, the declaration has been widely accepted as “the fundamental norms of human rights that everyone should respect and protect” (UN 2015). However, this has not been the case. Since the rapid increase in economic globalization, corporations now have the ability to become bigger and more powerful institutions (Kobrin 2009). There are instances where they exceed the revenue-producing ability of small governments (Anderson & Cavanagh 2000). And even though this might have a positive effect on employment, income and sometimes even country wealth, there is a negative side to it as well. Because with this internationalization process comes the circumventing of human rights laws (Westaway 2012). Due to this growth and reach of corporate abilities, the idea that human rights protection lies solely in the hands of countries and their governments has changed (Westaway 2012).
In 2000, governing bodies tried to constrain the impact of corporations on society by signing the UN Global Compact. This document specifically refers to human rights, environment, labor, anti-corruption and holds general codes of conduct to prevent abusive corporate behavior (UN Global Compact 2000). With this document, governments shifted some of the responsibility to protect human rights onto the corporate world.
1.2 Protect, Respect and Remedy
In 2008, John Ruggie, a special representative of the United Nations Secretary-General, wrote a report on the issue of the relationship between MNCs and human rights. He states that: “Markets work optimally only if they are embedded within rules, customs, and institutions” (2008; 189). Ruggie believes that we arrived at a point where “The scope and power [of the markets] far exceed the reach of the institutional underpinnings that allow them to function smoothly and
According to Wouter and Chanet (2008) the cause for corporations to violate human rights lies within the unbalanced international legislation: Current legislation protects all their own rights but they do not determine which responsibilities are paired these rights. Ruggie (2008) finds that the cause for this business and human rights predicament “lies within a governance gap created by globalization” (2008; 189). To turn this proverbial tide, he created a three-legged framework called ‘Protect, Respect and Remedy’. Each of the framework’s aspects are imperative because it is: “The State’s duty to protect because it lies at the very core of the international human rights regime; the corporate responsibility to respect because it is the basic expectation society has of business; and access to remedy, because even the most concerted efforts cannot prevent all abuse” (2008; 191). In the section on corporate respect for human rights, the framework emphasizes required due diligence. For this due diligence process to have substantive meaning a company needs policies, impact assessments, integration and performance tracking. The effectiveness of these aspects are mutually dependent; an impact assessment without policy would be useless and a well thought-out policy without monitoring and auditing the implementation equally so. The key is to meet these four requirements in order to maintain long-term corporate respect for human rights throughout the value chain.
In 2011, a new document was published called “Guiding Principles on Business and Human Rights: Implementing the United Nations ‘Protect, Respect and Remedy’ Framework”. This contained more concrete recommendations on how to implement the previously published framework and how to enhance practices and standards to achieve tangible results. Multiple researchers have written about the ‘Guiding Principles on Business and human rights’ and claim that the effectiveness of human rights due diligence is dependent upon the moral commitment of that company. They do not believe due diligence will help if the company is not completely devoted to implementing their official ethical stance (Fasterling & Demuijnck 2012). Kim & Jun (2014) also mention that modern corporations are still not exercising their ethical and social
responsibilities to a sufficient degree. Other critics also claim that the narrow definition of corporate responsibilities in this framework is making it impossible for an MNC to maximize their abilities (Wettstein 2012).
It is clear that there are fundamental human rights in place that have been proclaimed to be universal. However, the combination of MNCs practices and respecting these rights has led to a clash. The acknowledgement of, and respect towards, human rights by MNCs will be key aspect of this research.
2. Corporate Social Responsibility
The concept of CSR relates to the above-mentioned impact that corporations have on society and their human rights. There are a lot of different definitions of CSR but many researchers say there is no agreed-upon definition yet (McWilliams & Siegel 2001; Montiel & Delgado-Ceballos 2014). However, in 1987, the World Commission on Environment and Development wrote the Brundtland report and concluded that the most important environmental issues were consequences of poverty, non-sustainable production and consumption. It called for socially responsible behavior and defined CSR as: “Actions of the firm that appear to advance some social good, beyond the immediate interests of the firm and its shareholders and beyond that which is required by law” (1987; 8). According to Harjoto & Jo (2011) CSR describes; “how firms manage the business processes to produce an overall positive impact on society and refers to serving people, communities, and the environment in ways that go above and beyond what is legally and financially required of a firm” (2011; 45). In this research, this will be the definition I will uphold.
2.1 The beginning of CSR
is well known for saying: “The business of business is business”. According to him, it was foolish to think that management should make decisions on any other topics than satisfying shareholders. It would even be “unfair” for them to spend shareholder money on anything other than clear profitable investments (Friedman 1970).
Nowadays, people are moving away from the idea of creating wealth as a primary responsibility (Makiela & Misztur 2012). The impact of business on society, social and environmental, has become clearer and the demand for companies to take responsibility has grown (Banerjee 2008). Today, MNCs are experiencing more external pressure from stakeholders. They are responding by adopting ethically responsible operations and communicating these adaptations to their shareholders (Cerin 2002). Corporations communicate these changes through a CSR report.
2.2 CSR Reports & the GRI
A CSR report allows companies to explain their knowledge about the risk-areas of their operations and what they will do to maintain high environmental and social standards. These reports allow MNCs to show they are applying a triple bottom line approach. This means they take both the environment and society into consideration when pursuing their economic goals.
Many MNCs that publish CSR reports use a standard reporting format. This is preferred in the CSR reporting industry because it means all reports can be compared with each other (Bagnoli & Watts 2014). This preferred standard reporting format originated with the Global Reporting Initiative (GRI). The GRI, originated in 1997, is an international and independent organization that tries to make MNCs understand their impact on critical sustainability issues. Clarkson et. al (2008) states the GRI’s mission is to “empower decision makers everywhere, […], to take action towards a more sustainable economy and world”. As a joint initiative of the Coalition for Environmentally Responsible Economies, a US NGO, and the United Nations
quality, rigor, and utility of sustainability reporting” (Global Reporting Initiative 2002). “The GRI Guidelines follow 11 principles (transparency, inclusiveness, auditability, completeness, relevance, sustainability context, accuracy, neutrality, comparability, clarity, and timeliness) to ensure that sustainability reports (1) present a reasonable and balanced account of economic, environmental, and social performance, (2) facilitate comparison over time and across organizations, and (3) credibly address issues of concerns to stakeholders.” (Clarkson et al. 2008; 309)
As they state themselves: “The GRI Sustainability Reporting Guidelines (the Guidelines) offer Reporting Principles, Standard Disclosures and an Implementation Manual for the preparation of sustainability reports by organizations, regardless of their size, sector or location” (www.globalreporting.org). This guideline of reporting is voluntary and corporations can choose whether or not to use them. However, according to a survey (KPMG 2015) the GRI guideline is the most popular to date: 60% of all CSR reporters, in 45 different countries, reference to it.
2.3 Benefits of CSR
There are many different thoughts on the benefits of CSR integration but the idea that it ‘pays to be good’ has been widely accepted (Battacharya & Sen 2004; Ambec & Lanoie 2008; Marcus & Fremeth 2009). Different types of benefits have been established and they are widespread: Cost saving, reducing risk, increasing revenue, building reputation, developing human capital and improving access to capital (Gupta & Sharma 2009). Porter & Kramer (2006) created a framework that helps identify social consequences of business operations and finds an effective way of dealing with this. They suggest looking at CSR as an opportunity instead of a damage control tool. According to them a CSR policy provides corporations with a competitive advantage and therefore; it pays to be good. Arkana & Theobald (2005) claim it is because a corporation differentiates itself by building a better reputation than their competitors. According to others it is
very profitable long-term (Barnett 2007). Research has also found that a positive CSR image has a positive effect on cognitive loyalty and word-of-mouth (Plewa et al. 2015).
2.4 Motivators of CSR
The idea that CSR has a positive effect on a corporation has been confirmed. However, one of the reasons CSR is such a widely discussed topic is because the motivation behind adopting a CSR policy is ambiguous. As Gupta & Sharma (2009) say: “It is no longer a legal necessity and a nice thing to do, CSR is emerging as a ‘hard’ commercial factor, linked directly to profits and brand value” (2009:398). As a company, there are two reasons for committing to CSR; there are those who truly believe in being a ‘good corporate citizen’ and want to contribute to society’s well-being, for them CSR policies and codes of conduct are normative (Bondy et al. 2004), and there are those that purely engage in CSR to make more profit or avoid government imposed regulation (Brereton 2002).
There are theories that top-management over invests in CSR activities to create a picture of perfect-citizenship (Barnea & Rubin 2010), that companies use CSR actions to emphasize their high product-quality (Fisman et al. 2005) and that CSR is used to limit the chance of management, investing- and non-investing stakeholder conflict (Scherer et al. 2006). Clearly, there are widely different views on whether a company’s CSR commitment has anything to do with wanting to contribute to, and better, society. This research will elaborate on these questionable motivations later. They are linked to the third subject of this literature review: Substantive and symbolic management.
2.5 Critics of CSR reports
As mentioned earlier, MNCs have responded to the general public’s request for social improvement by publishing CSR reports. But the growth in CSR reporting has not been well received by everyone. Bartlett, Ilhen & May (2012) believe there are only two reasons for CSR
reporting: 1. To show a strategy to their stakeholders 2. For self-promotion. Others believe that the reports will not make any difference given the near standardization of these CSR reports (Snider et al. 2003). Cerin (2002) states that the CSR reports and corporate behavior in reality are vastly different and that this is possibly due to a lack of regulation. Some also believe that CSR reports only function to improve corporate image or to move the responsibility towards others (Laufer 2003). Similarly, Stevens et al. (2005) wonders: “When ethics codes are substantive documents guiding the decisions of top management and when are they merely symbolic and not integrated into strategic choices at all?” (2005; 182).
With human rights violations ever occurring, CSR is an increasingly important aspect of business practice. Within this topic, the focus will be on the level of reporting and the commitment to it afterwards.
3. Symbolic & Substantive action
Symbolic management is when management decides to satisfy stakeholders without having to internally change anything substantial (Meyer & Rowan 1977). It is also described as: “Actions in which the actor displays or tries to draw other people’s attention to the meaning of an object or action that goes beyond the object’s or action’s intrinsic content or functional use” (Zott & Huy 2007; 70). Walker & Wan (2012) conceptualize symbolic management through the concept of greenwashing. Greenwashing is “symbolic information emanating from within an organization without substantive actions. Or, in other words, discrepancy between the talk and walk” (2012; 231). A good example is Maignan and Ralston (2002) providing evidence of the importance companies ascribe to presenting themselves as being socially responsible. This is symbolic management at play; they ascribe importance to presenting themselves as being socially responsible; not on being socially responsible.
Substantive management, on the other hand, means committing to meaningful acts. Substantive management exists of a corporation acting in accordance with what they are saying. When the words and actions are in line, a MNC is asserting substantive management. Donia & Sirsly (2016) explain it by stating that substantive CSR are initiatives driven by a need to address societal issues whereas symbolic CSR is aimed at providing “a self-flattering presentation, characteristic of the conceptualization of the self-serving organization” (2016; 234).
3.1 Symbolic acts as part of Impression Management
According to Arndt & Bigelow (2000) symbolic management is a sub-part within the idea of impression management. Impression management refers to any behavior that tries to control the impressions which are formed, by controlling the information that is given. Referring to Schlenker (1980), Arndt and Bigelow (2000) explain this by saying: “Through managing the impressions others will form, an actor can influence the nature of interactions. For example, a self-presentation of efficacy can be a positive influence on task accomplishment” (2000; 496).
3.2 Symbolic actions and the Institutional Theory
Symbolic actions can be seen as logical when placed next to the institutional theory. This theory suggests that firms obtain legitimacy when they assimilate to the dominant practice in their organizational field (DiMaggio & Powell 1983). According to Walker and Wan (2012) gaining legitimacy is important because it can lead to “greater access to resources, stronger exchange relationships with business partners, and better job applicants— subsequently leading to a stronger work force” (2012; 229).
Organizations are rewarded for structural isomorphism (Scott 1987) and symbolic management is therefore a perfect way to still obtain this legitimacy without having to comply with the suggested new stipulations (Delmas & Montes-Sancho 2010). Aldrich & Fiol (1994) confirm that symbolic management can facilitate legitimacy. More importantly, it has been
proven to be an effective way of management. During a two-year inductive field study Zott & Huy (2007) proved that entrepreneurs were more successful in obtaining the necessary resources when they carried out symbolic acts. Researchers Westphal and Zajac (1998) equally confirmed the positive impact symbolic actions can have on stakeholders after investigating “whether the stock market reacts favorably to specific governance mechanisms that convey the alignment of CEO and shareholder interests, such as the adoption of long-term incentive plans even if such plans are not actually implemented” (1998; 127).
3.3 Symbolic acts and Institutional pressure
When there are complaints, this can be both internal as well as external, an MNC can decide to try and solve the problem by making a gesture. However, when it is a symbolic action it will be an empty gesture. According to Delmas and Montes-Sancho (2010) institutionalists believe that symbolic adoption or the “decoupling of formal organizational structures from actual practices in the organization” will occur when there are institutional pressures and when a practice is adopted for legitimacy instead of efficiency (2010; 577). DiMaggio and Powell (1983) state that such pressure can arise from various constituents within an organizational field, such as other companies that produce similar products.
Around the same time, Tolbert and Zucker (1983) use the civil service reform as an example to show that first movers adopt management practices because of real need for technical efficiency where later supporters only follow because other organizations do. Westphal et al. (1997) confirm this with a research on Total Quality Management practices where those close to a movements initiation look for efficiency gain while followers are looking for legitimacy.
Interestingly, researchers Delmas & Montes-Sancho (2010) also concluded that late joiners had undertaken significantly less investment in improvements than early joiners. Because the pressure on each joiner is different, they believe that late-joiners to a dominant practice are
These two types of action, symbolic and substantive, are essential to understanding the influence of CSR reports on corporate behavior. Therefore, to put theory to practice, this study will continue by looking at two agreements made in the aftermath of the earlier mentioned collapsed textile factory. Through research on the substance of each agreement it has become clear that many institutions and NGO’s are of the opinion that the Alliance is unsubstantiated and ‘empty’ where the Accord is an actual undertaking. This paper will therefore use these two agreements to exemplify the use of ‘symbolic acts’ versus ‘substantive acts’.
4. The Accord versus the Alliance
On May 15th 2013, within one month of the Rana Plaza incident, multiple stakeholders wrote an agreement called the ‘Accord on Fire and Building Safety in Bangladesh’, or in short ‘the Accord’. All parties signing this document voluntarily committed to a “safe and sustainable Bangladeshi Ready Made Garment (RMG) industry in which no worker needs to fear fires, building collapsing, or other accidents that could be prevented with reasonable health and safety measures” (the Accord 2013). The six key components of this Accord are: “1. A five year legally binding agreement between brands and trade unions to ensure a safe working environment in the Bangladeshi RMG industry; 2. An independent inspection program supported by brands in which workers and trade unions are involved; 3. Public disclosure of all factories, inspection reports and corrective action plans (CAP); 4. A commitment by signatory brands to ensure sufficient funds are available for remediation and to maintain sourcing relationships; 5. Democratically elected health and safety committees in all factories to identify and act on health and safety risks; 6. Worker empowerment through an extensive training program, complaints mechanisms and right to refuse unsafe work” (bangladeshaccord.org 2015). Moreover, this five-year commitment clearly states that it encompasses all suppliers producing products in the signatory factories.
Around the same time, a second agreement was composed. It was the ‘Alliance for Bangladesh Workers Safety’, or ‘the Alliance’ for short. This agreement also said to be a “binding, five-year commitment to improve safety in Bangladeshi RMG factories” (bangladeshworkersafety.org 2015). To realize their vision of improvement they have five key components: 1. Standards and inspection; 2. Remediation; 3. Worker empowerment; 4. Training; and 5. Sustainability. They aim to conduct factory safety assessments that provides the owner with a technical understanding of fire hazards and structural concerns and afterwards, improve the structural integrity through a Corrective Action Plan (CAP). The Alliance also intends to create a safe environment for workers to voice safety concerns, provide extensive training on fire safety and build a sustainable industry.
4.1 the difference
Because majority of the 260 members that have aligned with the Accord are European companies the Accord is seen as ‘the European’ agreement. Conversely, the Alliance has 26 North American members and is seen as ‘the North American’ agreement. They both have the same ideals; the Accord and the Alliance both want to prevent fires and construction safety hazards. They are training the factory owners and the employees what the dangers are and how to respond to a dangerous situation. They both opened a hotline for factory workers to call about their concerns and both treaties pledged to conduct safety inspections and write CAPs. These are all good improvements to the garment industry in Bangladesh. However, there has been some debate about the implementation and motivation of both accords.
The ‘North-American’ Alliance emphasizes the idea of shared accountability. Therefore, they mainly try to cooperate with different institutions, like the Bangladesh government and NGOs, to figure out how to pay for the necessary improvements. They clearly state that in the end the responsibility lies with the factory owner. They put together an amount of $42 million to
responsibility for the improvement of the supplier factories. If a factory does not live up to standard and does not fix the assessed problems, the Alliance’ signees promise to terminate any business they had with these factories (The Alliance 2013).
However, labor rights organizations like Worker Rights Consortium, The Clean Clothes Campaign and the United Students Against Sweatshops, have voiced their opinion by saying that the companies that joined the North-American Alliance are unwilling to make an actual change. They state that the Alliance is the easy option because it is not legally binding and that the signees do not have to invest long-term. The Workers Rights Consortium stated there really is not any substance to the North-American Alliance (New York Times 2013).
Contrary to the Alliance, the ‘European’ Accord consists of more permanent rules. In the 18 months that followed the disaster the Accord inspected 1100 factories and found over 80.000 safety issues, ranging from small to significant. The company signatories are obligated to come up with the money for the improvements needed in their supplier factories. They do not give a specific amount but explain that each company pays an amount relative to the annual volume of each company’s garment production in Bangladesh. Another difference is that this Accord is actually legally binding and can be taken to a court of law if a company wants to opt-out before the end of the five-year contract. Furthermore, the Accord has taken on 1600 factories to inspect and improve, where the Alliance took on 700. Lastly, contrary to the Alliance, the Accord protects workers’ rights to refuse dangerous work, including entering a hazardous building (Accord 2013).
AGREEMENT
Accord on Fire and Building Safety in Bangladesh Alliance for Bangladesh Worker Safety Launched May 15th, 2013 July 10th, 2013 Goal
Preventing fires and building safety hazards in Bangladesh
Preventing fires and building safety hazards in Bangladesh
Time span 5 years 5 years
Provide Fire and safety training Hotline for factory workers
Safety inspectors Corrective Action Plans
Fire and safety training Hotline for factory workers
Safety inspectors Corrective Action Plans Disclose Their list of contracting
supplier factories
Their list of contracting supplier factories
#Members 260 26
Also known as European initiative N-American initiative
Legally binding Yes No
Term 5 year, commitment for full duration
5 years, allowed to terminate whenever Commitments Long-term sourcing
relationship with main supplier
N/A
Signatories must ensure
workers’ employment during necessary fire and building safety
remediation
N/A
Safety inspection Independent Chief Safety Inspector, who is free from the Accord.
Conducted by employees under their supervision
Safety inspector Appointed to a supplier factory
Chosen by the signatory company
The deputy general of UNI Global Union, Christy Hoffman, expressed her disappointment about the amount of US brands joining the Accord. According to an article in the Guardian, she said that “joining the Accord would cause a “very, very small increase” in the price of garments, “something like 2¢ per T-shirt”.” (McVeigh 2013). That same article states that the general secretary of the IndustriALL global union, Jyrki Raina, said: “This historic Accord will effect tangible change on the ground and help make the Bangladeshi garment industry safe and sustainable” (McVeigh 2013). Clearly aligned with that statement fifteen American Universities, including Columbia, Georgetown and NYU, have told their producers to join the Accord, whose program they see as better (Greenhouse & Harris 2014). Another NGO that spoke up is Oxfam, they expressed concern about the fact that the Alliance their process is not legally binding, safety inspection reports are not made publically available and that the factory workers are not included in their inspections. They “do not consider this to be a cross-industry, independent approach to factory audits which is needed to provide whole-of-industry oversight on these important factory inspections” (Oxfam 2014).
5. Textiles and Apparel Industry
According to Arnold & Hartman (2003) it was the availability of international financing that first allowed the Textiles & Apparel (T&A) industry to outsource their manufacturing to developing countries to meet the growing demand. Asia and South-America are the continents associated most with western T&A production. For example, in Bangladesh, the T&A industry is currently turning over twenty billion US dollars a year and, according to Bradsher (2013), it is the second largest garment exporter in the world.
Although it is argued that the increasing foreign direct investments in developing countries have had a positive impact on human rights conditions across several quality of life indicators (Kim & Trumbore 2010) there are still a lot of violation examples that point to the
non-improved areas. Kim & Jun (2014) put it clearly by saying: “These surprisingly low prices for garments [...] cannot be produced unless someone makes a sacrifice in the chain that includes production, distribution, and sales” (2014; 124). Between 2012 and 2015 alone, there have been 1.600 reported deaths in the garment industry (International Labor Rights Forum 2015). Following a few big accidents and scandals within this industry, the failures of social auditing have come to light and the debate about corporate-controlled auditing has never before been projected in the limelight as it is today (ILRF 2015).
Moreover, sustainably and ethically sourced clothing has become a popular topic. ‘Green’ clothing stores are up and coming, while gaining support. Research suggests that the market for ethical consumers is growing (Davies, Lee and Ahonkhai 2012). There is also a broad number of websites and blogs that are trying to guide the consumer towards responsibly sourced brands and away from the “big” mainstream stores (ecofashionworld.com, greenchoices.org, ecocult.com, ecouterre.com).
Laudal (2010) states that the T&A industry is well suited for a CSR study due to the fact that it is one of the most global industries in the world and has “closely coordinated production and distribution lines spread out in regions with great variations in government regulation, employment and environmental protection and wage levels” (2010: 64). Laudal also states that businesses that operate in environments where many requirements of international CSR standards are not fulfilled, have the highest potential for positive influence through CSR related actions. This study will elaborate on this statement. The enormity of this specific industry, the bad reputation for human rights violations within the productions centers/factories, the changes in consumer interest and the increasing shift to ethically sourced clothes are the reasons this paper will use the Textiles and Apparel industry as the context in which this research is conducted.
It is clear that human rights have been proclaimed universal and that there is a specific framework to respect and implement them within business practices. Yet, research has shown there is a misalignment between what is supposed to happen in theory and what has been happening in practice. This gap can also be found in multinational’s CSR reporting (theoretical) and the change in their behavior (practical). In today’s society where there is a great need for clarity and demand for ‘good corporate behavior’ this gap requires an explanation. Therefore, this research will (1) look into the relationship between large MNCs their CSR reporting in the T&A industry and the effect this has on human rights violations within their factories and (2) it will look into the reason behind the apparent failure of MNCs to see through on their publically disclosed commitment. The next section will explain how this the research will be conducted.
RESEARCH DESIGN
1.Methodology
This paper will conduct a qualitative multiple-case study. A quantitative research would not be suitable due to the nature of the subject; the textiles and apparel industry and the still developing database that will be consulted. There were other distinctive options to choose from within the beliefs of epistemology, ontology and methodology, and in the following section, each choice for this research design will be justified.
1.1 Epistemology & Ontology
Epistemology approaches the nature of the relationship between knowledge and the acquirement of this knowledge. Saunders et. al (2009) explain that there are two ways to acquire knowledge; there is a resource researcher and a feelings researcher. The former acquired his knowledge through hard data, where the latter acquirers his knowledge based on a perceived attitude. This paper will approach knowledge as if it is independent from the human perception.
This leads to the concept of ontology, which questions what the nature and form of reality is (Guba & Lincoln 1985). Within this concept there are two perspectives; objective and subjective. This research will take an objective point of view. Saunders et al. (2009) state that this means the influence of social actors are excluded from the research. I will therefore conduct this research assuming there is an independent existence of social and natural reality.
1.2 Inductive & deductive
Another distinctive choice that was made prior to starting this research, was to take an inductive approach. Saunders et al. (2009) give two options: Inductive and deductive. These options are seen as ‘bottom-up’ and ‘top-down’ approaches. Deductive research is designed to test a theory while the inductive approach is made to generate a theory emerging from data. The goal of an inductive approach is to explore the meaning of an occurrence and Bryman and Bell (2007) say that an inductive qualitative research approach provides a rich understanding and insight.
1.3 Multiple-case study
This research will furthermore be conducted through a case study analysis. A case study is “an in-depth exploration from multiple perspectives of the complexity and uniqueness of a particular project, policy, institution, program or system in a “real life” context” (Simon 2009) and according to Yin (1994) the use of a case study is appropriate in only three situations. One of these is when a research is looking to explain an occurrence through a ‘how’ or ‘why’ question. Since this paper will try to explain; (1) how CSR reporting influences the amount of corporate abuse allegations and (2) how substantive and symbolic management can explain a very specific occurrence, this way of conducting this research seems appropriate. A case study is also a strategy that focusses on understanding the dynamics within a single setting (Eisenhardt 1989). According to Merriam (1988) a case study offers a descriptive, interpretive and evaluative way to
The type of case study I will use is a multiple-case design. I will conduct individual analyses for multiple cases and then summarize these findings. Due to its replicating nature, doing a multiple-case study has the advantage of being considered more robust (Yin 1994).
According to Thomas (2011) every case study has an object and a subject. The object is something that has to be explained. The subject is something that can offer the explanation. This subject however, does not have any meaning unless the researcher can link it to a theory. The object of this research will be the gap between theoretical CSR commitment through a rapport and the practical influence that has on human right violations. The subject at hand is the type of management that is enforced; symbolic or substantive. This has not been done in earlier research and will therefore contribute to the existing literature.
1.4 Reliability & Validity
In order to ensure credibility through reliability and validity, certain measures must be taken. Validity emphasizes whether the data collection method accurately measures what it is intended to measure (Saunders et al. 2009). Reliability emphasizes whether the applied techniques to collect and analyze produce consistent findings (Saunders et al. 2009).
There is high reliability in a research when the research procedure is structural. By documenting the steps of the analyses and using a software program called Atlas to stick to the chosen protocol this research will create reliability. For validity there are two types to take into account; internal and external. According to Yin (1994) internal validity is not applicable when the nature of a case study is descriptive or exploratory. However, when it is an explanatory case study, such as the present, there must be internal validity. In order to tests causal relationships between concepts the research must be be based on grounded literature (Yin 1994). Lastly, external validity refers to the generalizability of a research. However, due to the nature of multiple-case studies, this is not the case. Because the setting is very specific its results cannot
2. Case Selection
In this research the unit of analysis are corporations. In order to address this paper’s research question properly I will look at corporations that: 1. Operate in the textiles and apparel industry, 2. Are categorized as the same size (very large), 3. All have supplier factories in developing countries, 4. Are all reporting on their corporate social responsibility 5. Have all been involved in human rights abuse allegations. These criteria have led to the selection of the following corporations: Philip van Heusden (Calvin Klein, Tommy Hilfiger and Heritage Brands), Inditex (Zara, Massimo Dutti, Pull&Bear, Bershka, Stradivarious, Oysho, Uterque), H&M Group (H&M, Cos, Monki, Weekday, Cheap Monday, Other Stories), Nike (Nike, Jordan, Hurley, Converse), Gap Inc (Gap, Banana Republic, Old Navy, Athleta, Intermix) and Target.
PVH HM GAP NIKE TARGET INDITEX
SECTOR Textiles Retail Retail Textiles Wholesale & Retail Textiles HQ 1976, USA 1947, Sweden 1969, USA 1969, USA 1902, USA 1985, Spain REVENU $8. Billion $20.4 billion $15.8 billion $30.6 billion $73.8 billion $22.8 billion NUMBER OF BRANDS 8 6 5 4 1 7 NUMBER OF EMPLOYEES 34.200 93.351 141.000 62.600 341.000 152.854 NUMBER OF SUPPLIERS 2.100 872 300 430 3.200* 1.592
Table 2. overview on corporation characteristics
* These are all targets suppliers, including their wholesale department. There is no public information available on the suppliers solely for their retail department.
3. Data Collection
In order to conduct this research, this paper will use multiple data collection methods. According to Yin (2003) using different types of data allows you to look at your subject from multiple perspectives. Consequently, I will obtain qualitative information on human rights abuses through the Corporations and Human Rights Database project (CHRD) and the Business & Human Right Resource Center (BHRRC), I will use archival data in the form of CSR reports, archival documents of the Accord and the Alliance, news articles and any extra background information on each corporation will be retrieved from the Orbis database website.
The BHRRC is a website that tracks the Human Rights policies of 6.000 companies in 180 countries. They are fighting for more corporate transparency and are therefore making information on this subject publically available. The CHRD is a project that systematizes and organizes all the information on Company Abuse Allocations (CAA’s) of the BHRRC website. The CHRD project creates a clear overview on all the abuse allegations and has coded them. They contain information on the company’s sector, the type of abuse (physical, health, environment, labor and development and poverty), date of the claim, who reported the claim, attempts of remedy, state involvement and company response. In return for coding, I will be granted access to this database. The CSR reports will be retrieved from the company’s website. According to the GRI guideline on CSR reports, these must be publically available. I will work with CSR reports from the years 2001, 2004, 2007, and 2010. Because this research only focuses on human rights abuses and more specifically on labor, health and abuse, this research will only use the CAAs concerning those topics. The Accord and the Alliance both have their own website where they have a PDF file which shows the exact rules and content of the agreement. They also have a list of signatories. The Orbis database website provides information on worldwide, listed and non-listed, companies. It contains corporate and financial information of over 120 million
companies. The articles used are a mixture of daily newspaper content and peer reviewed publications.
4. Analytical strategy
First, I have to establish each corporation’s level of CSR reporting. I will determine this reporting level on the basis of two factors; their compliance level to the GRI guidelines and through a content analysis. This compliance can be measured through the grades provided by the companies producing reports. The GRI database lists these grades on their website (http://database.globalreporting.org). The grade system is divided in three levels, A, B and C. Through the development of their guidelines the GRI made it possible for a corporation to self-determine what level their report is. Occasionally, this is verified by the global reporting initiative itself.
Second, the content of each CSR report is evaluated. In order to do that, I will conduct a qualitative content analysis. By analyzing textual data, the studied phenomenon is better understood and new knowledge can submerge (Hsieh & Shannon 2005). According to Hsieh and Shannon a content analysis is “used to interpret meaning from the content of text data and, hence, adhere to the naturalistic paradigm” (2005; 1277). They also state that there are three types of content analysis; conventional, directive and summative. I will conduct a conventional analysis, which is appropriate when the existing theory on the phenomenon is limited.
When the coding process is completed, the content analysis will be finished by distinguishing ‘hard’ and ‘soft’ disclosures. Clarkson et al. (2008) developed this measurement tool to research voluntary environmental disclosures. With ‘hard’ disclosures Clarkson et. al (2008) aim for “objective measures of performance” whereas ‘soft’ ones are “not easily verifiable”. Examples of hard disclosures are explicit governance structures, implementation of compliance strategies, adaptations, autonomous verifications, improvements thought of through
unique collaborations. Examples of soft disclosures are letters of the CEO, visions, ideals and strategy, mentioning the state of the entire industry, internal training, verification and awards. Because Clarkson et al. (2008) clearly state that they developed a content analysis index based on the GRI guidelines to assess “the extent of discretionary disclosures in environmental and social responsibility reports”, I argue that this is a valid measurement tool for this research too.
After extracting this specific information, I evaluated the GRI grades and percentage of ‘soft’ disclosure used per corporation and cumulatively divided them into either the low, medium or high category of CSR reporting.
5 Coding methodology
My primary data are CSR reports downloaded from the corporations’ websites. Before I could start analyzing these reports I first had to sort, eliminate and organize my data (Miles & Huberman 1984). During this process I used a software program named Atlas, which managed and structured the data I wanted to use. It organized all data and helped divide relevant quotes into multiple codes. I reduced the data by dissecting the material into meaningful compartments (Attride-Stirling 2001). To achieve the most viable results I used a deductive approach.
First, I scanned through the CSR reports to understand the content. I then based my compartments on relevant themes that I derived from the GRI guidelines. The GRI guidelines (GR4, www.globalreporting.org) are built upon three corner stones: The economic, environmental and social category. Because this research focusses on the labor and abuse aspects of human rights violations, I, consequently, only look at the social category of CSR reporting. Within this category there is a ‘Labor Practices and Decent Work’ compartment as well as a ‘Human Rights’ compartment. Based on in-depth information from the GRI guidelines I assigned the following codes to the former: Occupational health and safety, diversity and equal opportunity and training and education. The latter contains: non-discrimination, child labor,
forced or compulsory labor and labor & human rights grievance mechanisms. In total I worked with seven codes that were all based on previous literature on the matter, the GRI guidelines, an understanding of the CSR reports and the reach of my research question. As mentioned before, I applied Clarkson et al. (2008) for their research logic and divided the codes into two areas: Soft versus hard. A table with more elaborate examples can be found in appendix 1.
CODE SOFT HARD
Occupational health and safety
“Looking after the health and safety of employees is our priority.” (INDITEX, 2004)
In 2004, we reduced our worker injury rate by 9 percent relative to 2003, with 4.43 injuries per 200,000 hours worked (GAP, 2004)
Diversity and equality
“We value the uniqueness of each individual and believe that a diverse workforce is essential to the
competitive demands of the global marketplace”
(PVH, 2010)
“The data shows that female associates represent 66% of our total workforce and that approximately 66% of our managers are women”
(PVH, 2010)
Training and Education
We also recognize the need for ongoing training for managers and employees to ensure all employees adhere to our Code of Business Conduct. To that end, this year, we introduced a required training program called the “Principles of Integrity” to help our employees understand how our Code applies to their work. (GAP, 2004)
Raising awareness of worker rights among those who work in our supply chain is a vital part of our strategy to contribute to long lasting improvements in conditions. We continued our
training programme, using short films to educate workers in Bangladesh and, since the start of 2008, we have reached more than 300,000 workers. We will expand this successful programme to India. (H&M, 2010)
Non-discrimination
“Respecting the dignity and rights of all persons, regardless of race, color, or creed, and conducting ourselves with decency and common courtesy in all aspects of our business.” (PVH, 2010)
“To aid in the hiring of minority candidates, we maintain relationships with organizations that promote the placement of ethnically diverse interns. These partners include the Black Retail Action Group (BRAG), INROADS and Prep for Prep (for inner city high school students)” (PVH, 2010)
Table 3. Codes, source and example.
RESULTS
This section will describe all findings of the qualitative data analysis. This will be divided into three segments. First I will describe the level of reporting. As stated, based on their GRI compliance and soft disclosures, I have cumulatively placed them in a range of low, medium or high quality reports. Second, per case study, I will analyze the findings and place them next to the available information on this specific company’s Corporate Abuse Allocations (CAAs). I will also elaborate on their membership with either the ‘Alliance for Bangladesh Worker Safety’ or
Child Labor
“The external manufacturers,
suppliers and their subcontractors will not hire minors. Inditex defines a minor as a person who is younger than 16 years of age. If the local legislation sets a higher limit, that limit will be respected”
(INDITEX, 2007)
“Gap took full responsibility — and immediate action in support of its Vendor Code, Agreement and policies. It
canceled the product order and barred the embroidery subcontractor from any future GAP involvement. The finished garments would, of course, never be sold. A summit meeting of all Indian suppliers reinforced Gap’s zero-tolerance policy on child labor, and the consequences of non-compliance” (GAP, 2004)
Forced or Compulsary labor
Our immediate focus is on the four fundamental labor principles that protect workers’ rights, which are defined in the ILO Declaration on Fundamental Principles and Rights at Work (often referred to as the “ILO Core Conventions”). These
fundamental labor principles include the prohibition of child labor, the prohibition of forced labor in all its forms, freedom of association and the right to collective bargaining, and protection from discrimination (GAP, 2010)
“In 2010, we engaged with NGOs, unions and labor advocacy groups in the U.S., Europe, China, Thailand, India, Bangladesh, Cambodia, Vietnam, Egypt and in Central America to address critical issues such as factory closures, freedom of association, forced labor and wages.” (PVH, 2010)
Human Rights grievance mechanisms
“At PVH, we place a priority on the establishment of grievance
mechanisms in our supply chain and have consistently worked with factories to build effective procedures.”
“We operate a global toll-free Alertline for employees to confidentially report any suspected violations of the law or our code of ethics. Any reported
concerns around accounting, auditing or internal control are communicated to the audit committee of the board” (NIKE 2004)
‘The Bangladesh Accord for Fire and Building Safety’: I will refer to them as the Accord and the Alliance. Third, I will do an overall cross-case analysis. This will show similarities and differences between the cases which will provide new insights and perspectives. The six cases will be compared across their level of CSR reporting and are put side by side to the evidence on their behavior concerning CAAs to identify patterns.
1. Level of Corporate Social Responsibility reporting
The next two tables each show CSR report’s level of compliance to the GRI standard guidelines and the amount of soft disclosures per report. N/A means there was no CSR report published that year and ‘no’ means it was not graded according to the GRI guidelines. S.D. refers to the fact that these grades are self-declared and not verified by the GRI itself. The results are as follows:
Table 4. Level of GRI compliance.
Level of soft Content in %
PVH TARGET GAP NIKE H&M INDITEX
2001 N/A N/A N/A 62.5% N/A N/A
2004 N/A N/A 46.2% 63.6% 70% 12.5%
2007 N/A 62.5% 35.7% 40% 62.5% 30%
2010 70.6% N/A 47.4% 60% 44.4% 25%
Average 70.6% 62.5% 43.1% 56.5% 58.9% 22.5%
YEAR PVH TARGET GAP NIKE H&M INDITEX
Level of GRI
Compliance 2001 N/A N/A N/A no N/A N/A
2004 N/A N/A no no no A (S.D.)
2007 N/A A (S.D.) no B (S.D.) C (S.D.) B+
The GRI compliance table reveals two things. First, it shows that many of the selected corporations have not been fervent CSR report publishers. PVH, for example, started many years after Nike had started sharing their social undertakings. Second, it shows that not all corporations have adopted the GRI guideline standards. GAP has not once tried to comply to their format. Because this makes it harder to compare all corporations, I also use the nature of the disclosures as a quality level indicator. Soft disclosures are easier to make, since they are not connected to numbers or figures, therefore, a higher amount of soft disclosures lowers the quality of the report. Considering the data I divided the corporations as follows; PVH, Target and H&M are low level CSR reporters. Nike and GAP are medium level reporters and the only high level reporter is Inditex.
LOW MEDIUM HIGH
PVH Nike Inditex
Target GAP
H&M
Table 6. All six corporations assigned to a low, medium or high level of CSR reporting.
2. Within-case analysis.
PHILIP VAN HEUSDEN. PVH is an American corporation that was created in 1976 and nowadays controls eight brands. Of all six corporations used for this research, PVH is the smallest one with the lowest revenue of 8 billion. With an amount of 34.200 they also have the least employees. Within this research PVH is the last corporation to join the movement of CSR reporting. They only published their first report in 2009. Their reports were short and contained many pictures and statistics covering multiple pages. They only upheld the GRI guidelines in 2013 and accredited themselves a C. The lowest compliance grade provided by the GRI. Concerning soft disclosures, the PVH report contains a high percentage of 70.6%.
Tabel 7. Corporate Abuse Allegations against PVH, 2001-2012
Interestingly, despite publishing the least amount of reports and having the highest amount of soft disclosures, PVH also has the least amount of corporate abuse allegations against them. Concerning labor and abuse human rights violations there are 5 in the BHRRC database. In 2004 two workers from a PVH supplying factory in Bangladesh came forth and exposed abusive work circumstances. In 2006 there was also a demonstration against abusive circumstances in a factory in Jordan. After that, no abuse allegations have been made until 2012. However, 2012 holds three separate allegations against the corporation. Two out of three were one time critical incidents; the Bangladesh factory fire killing twenty-five people in March and the killing of a Bangladeshi labor activist in April. As a response to these allegations PVH announced a labor union agreement on September 28th. The third allegation was made on the 1st of July that year and concerned a Sumangali scheme (bonded labor) in the South of India. The India committee of the Netherlands reported on this discovery (Overeem & Peepercamp 2012) and it is the only incident to which there has not been a response.
From their CSR report it becomes clear they are very focused on their North-American facilities, offices and storage spaces. The report dedicates a chapter on ‘workplace growth’ and ‘health and safety’, both solely aimed at their locations within the USA. “The Risk Management department helps to design and execute these programs and provides guidance and resources for services such as inspections, ergonomic analysis, and training on proper lifting techniques. In 2009, we implemented Liberty Mutual’s Residual Risk eduction (R3) program at our Reading, PA distribution center. R3 is a risk assessment technique used to qualify and quantify hazards,
PVH ‘01 ‘02 ‘03 ‘04 ‘05 ‘06 ‘07 ‘08 ‘09 ‘10 ‘11 ‘12
demonstrate risk reduction and provide an upstream measure of safety program effectiveness. It is a facilitated process using a cross-functional onsite team, including Human Resources, Engineering and Facilities/Operations Management. After the implementation of the program, we saw significant decreases in workplace accidents and an increase in associate morale throughout 2010. The R3 program was introduced at all of our warehouse facilities in 2010, including our new facility in McDonough, GA. We will implement the program at our facility in Los Angeles in 2011.” (2010;12) This is a very specific approach to maintaining high health and safety standards within their American distribution centers. However, when it comes to their overseas facilities, they assert a different approach. They acknowledge their existence: “The majority of non-compliance cases in the 2010 audits were in the realm of health and safety, wages and benefits, and hours of work.” (2010; 23)
But other than showing exact figures on the amount of reported violations and what has been resolved (see table 8), they make no statements on how they will overcome the root of this structural problem. They continue saying: “While we endeavor to support and strengthen internal sustainability systems at the factory level, we continue to monitor for social and environmental non-compliance against our code of conduct and labor standards” (2010; 24). Other statements such as “We seek to engage in ethical sourcing that ensures respect for human rights, protection of the environment and the existence of fair labor conditions” (2010; 5) do not imply any undertaken action either.
Tabel 8. Source: PVH CSR report 2010, page 23.
PVH has also filled this report with soft statements on their respect for diversity and equality. Examples are: “This consideration includes the diversity of business and financial talents, skills, abilities and experiences, as well as the race, ethnicity and gender of qualified candidates. We are proud of the diversity of backgrounds that characterize our current Board and believe that the diversity that exists on the Board provides significant benefits to us” (2010; 8). They elaborate by saying: “We value the uniqueness of each individual and believe that a diverse workforce is essential to the competitive demands of the global marketplace. We are committed to recruiting, training and providing career advancement opportunities to all associates without regard to
race, gender, religion, age, national origin, citizenship status, disability, qualified veteran status, marital status or sexual orientation. This policy applies to PVH’s entire global workforce” (2010; 10) However, besides PVH hiring minority interns: “To aid in the hiring of minority candidates, we maintain relationships with organizations that promote the placement of ethnically diverse interns. These partners include the Black Retail Action Group (BRAG), INROADS and Prep for Prep (for inner city high school students.” (2010; 13), they do not go into any further depth how they ensure diversity and equality within their hiring process.
We can conclude that PVH does not have a strong CSR report when it comes to hard disclosures. The information they give is easy to replicate, rephrase and reuse. Based on this, it is interesrting to see they have the least CAAs against them. However, considering they still have CAAs in 2012, it seems as if the CSR reporting has not affected the corporation’s behavior towards respecting human rights. There were no more allegations before they started reporting their CSR actions than after and the language and content of the report does not indicate any firm action.
Membership: As one of the first, PVH joined the Accord very quickly after the Bangladesh accident occurred. They also serve on the Steering Committee and state in their CSR report that because of this, they “have witnessed first-hand what can be achieved when [our] industry peers and other stakeholders work collectively” (CSR Report 2013; 9).
TARGET. Target is a large American corporation that was founded in 1902. The corporation has multiple operations within this brand; besides T&A they also sell footwear, jewelry and food. They employ 341.000 people and had a revenue of more than seventy billion US dollars in 2015. This corporation too, is a late joiner in the trend of CSR reporting. Where many others have started around the turn of the century, Target only published their first report in 2007. Within this
