Primary production and manufacturing

The products that we source are produced by more than 9000 first tier suppliers in 120 countries across the globe. Manufacturing is often specialized, i.e. the components for a jacket may be sourced from various countries. The cotton may be grown and spun into cotton cloth in India, then exported to China, where the supplier will dye the material and source thread, zippers and buttons from different suppliers. Finally the jacket is assembled at the factory of the supplier, that we know. We may be sourcing the jacket directly from this supplier, but it is also possible that an agent is buying the jackets we need.

Similarly a food product may contain spices from Zanzibar, palm oil from Malaysia, cocoa from Ghana and flour from Denmark, although it is just a chocolate cake produced by a Danish supplier. As soon as we go beyond tier one or tier two suppliers the value chain becomes very complex and our ability to positively impact human rights very limited.

Looking at our value chain in this way one can argue that our responsibility stretches beyond tier one suppliers and all the way to the primary production of a cotton farmer in India or the cocoa farm in Ghana. We do believe this is our responsibility. However, we also believe we share this responsibility with all the companies in our value chain as well as all the companies who also have a value chain that reaches all the way to a farm in India or Ghana.

As individual companies it is difficult to know every link in the chain, but in collaboration we create better risk management systems in our own businesses and in the companies we source from. This is why we are part of organisations like Business Social Compliance Initiative, Danish Ethical Trading Initiative and The Bangladesh Accord on Fire and Building Safety. It is slow progress, but it is progress.

Most of the human rights issues related to manufacturing in high risk countries are labour related, i.e. child labour, forced labour, excessive overtime, lack of right to organise in unions, no access to collective agreements, health and safety issues, discrimination aso. However, there could also be potential abuse issues from security forces on factories, and pollution from factories can impact health of the residents in the vicinity of a factory.

We often associate human rights issues with production taking place in faraway countries, but even in Denmark there is potential for human rights issues when foreign nationals are recruited for low paying jobs on farms or building sites, i.e. if the worker has to repay the cost of travel to Denmark or if the employer withholds a passport during employment. Both actions can force the worker to stay even if he or she wants to seek new employment, and that is a breach of basic human rights.

We require that all our suppliers regardless of their nationality must accept our code of conduct, which covers human rights and labour rights in accordance with international law. We know that our code of conduct does not always prevent breach of human rights, but it does mean that there is no excuse. Our suppliers know that we will not accept code of conduct violations.

In regards to the workers right to organise and bargain collectively there are specific issues in countries that do not accept these rights. This is the case in China, Bangladesh and other countries where the political establishment does not accept free and independent unions as defined by international law.

Clearly this is a dilemma as the national law or the local political environment prevents the producer from complying with our code. We still source from these countries, because we believe the workers are better off having good jobs, that provide food on the table and education for their children. However, we have a responsibility to ensure that the jobs are indeed good safe jobs and we must keep pushing for the fundamental rights as well.  

Particularly in southern Europe the migrant worker situation leads to high risk of breaching human rights in the agricultural production. Especially workers that are illegal immigrants are vulnerable to exploitation by criminals.

To prevent human rights issues in relation to production of fruit, vegetable and berries that are grown in these areas we have historically tried to build long term relationships with suppliers. Trust built over time is often a better way to prevent issues than many certification and audit schemes. However, we have this year initiated a process to require more from those who produce our own labels. These producers will be included in our monitoring process in order to help them tackle any issues they might face.