Asia Centre

The Chinese authorities have recently sought to promote sustainable development in their country. This has already been seen at environmental level. This article emphasises the Social Responsibility of Enterprises (SRE)

Social Accountability 8000 (SA 8000) is a standard established by the American organisation Social Accountability International (SAI). It has been adopted by a range of American and European companies and NGOs, and is comparable to standards such as ISO 9000 and ISO 14000[1].

It aims to develop SRE by improving the working conditions and rights of workers. For example, it forbids companies to use child labour, to impose constraints on their employees, to confiscate identity papers or money from workers, to prevent the formation of worker's associations, not to respect the religious beliefs and customs of their employees, to make them work more than 48 hours per week, to allow them less than one day off per week, etc.

Chinese experts have listed 20 major problems linked to conditions in Chinese companies. These are the main ones: the illegal employment of minors; the confiscation of part of the salary or of the identity papers of employees; illegal confinement and violation of the rights of workers; adding hours to normal working times; wages below the guaranteed minimum  wage and illegal costs imposed on workers; delays in paying wages (particularly to the mingong[2]) ; barebones social insurance and the lack of payments provided for by law; poor housing conditions (in terms of hygiene, security, etc.); the violation of safety standards (lack of fire extinguishers, lack of training for employees on procedures in case of fire, etc.); the use of chemical products or poisons which do not conform to safety standards; the lack of safety equipment for each employee; the lack of unions or employee organisations; discrimination based on gender, social or geographical origin, qualifications and age; the lack of maternity leave, and finally harassment. In comparison, the Observatory of the Social Repsonsibility of Enterprises notes the following problems: unhygienic conditions; gaps in social insurance; lack of work contracts; the violation of minimum  wage standards and unpaid wages; forced labour; the exploitation of the mingong; shortcomings in the right to strike; child labour; the lack of union freedom.

This problem of deplorable working conditions concerns both Chinese and foreign companies (see box). China is now the world leader in terms of work-related hazards, illness and death. According to official statistics (whose reliability is naturally doubtful), 1.6 million companies have dangerous workplaces and 200 million Chinese employees are exposed to various risks in the workplace. A report published in 2003 counted 10,647 work-related illnesses.

The article gives the example of a textile company in the province of Hebei, Ningfang, which has applied SA 8000. Before, working conditions were deplorable: employees were housed in rooms of about 4 square metres, apprentices had to climb up on the lights to dust them off, and above all — according to the magazine — the most unbelievable thing was that the women's toilets could be accessed only by passing through the men's.  "We didn't have the right to negotiate, or the right to eat; we had to beg for our pay, check the tax deductions, and there was only one toilet !" complained one employee. Since the enterprise has applied SA 8000, new toilets have been built; there are now five. Major efforts have been made in the hygiene and security of workers. Over a million yuans have been invested in replacing the old company restaurant with three new canteens. An additional floor has been added to the building where the workers are housed, with an emergency exit and first aid kits in the rooms. Around 100,000 yuans have been invested in these dormitories.

Wang Kequn recognises that the SA 8000 standard is likely to be difficult to apply, particularly in labour-intensive industries such as electronics, textiles and clothing, leather, toys, and the craft industries. In these sectors accidents are frequent, employees use toxic products and workers' rights are often violated.

It is to be noted however that a Chinese SRE standard already exists: China Social Compliance 9000 (CSC 9000), a management standard which applies to the textile and clothing sectors. Strangely enough, it is not mentioned in this article.

Widespread application of this standard is therefore likely to be difficult. Wang lists some proposals to make it easier: 1) the population must be made aware and understand that improving working conditions is a challenge; 2) the labour law (劳动法, passed in 1994 but very inconsistently applied) needs to be more rigorously enforced; 3) asking the government to take measures to make companies discipline themselves; 4) adjusting the country's production facilities in order to facilitate the application of these standards by export companies, and, finally, 5) setting up effective methods of inspection.

However the main motivation which seems to encourage companies to adopt these standards is not a moral one. Companies which apply SA 8000 hope to facilitate their exports to the United States and Europe. The retention measures applied to Chinese products by Western customs remain a major preoccupation to the country's companies (the total value of Chinese products stopped by the customs is said to have reached 1.79 billion dollars in 2005). The article estimates that the EU reduces by 5% the customs charges on the products of companies which have applied SA 8000.

More generally, this promotion of the SA 8000 should be set in the context of the improvement in working conditions, in the framework of the construction of an "averagely affluent society" (小康社会). It is a complement to plans to improve living conditions in the countryside and programmes to raise wages. SRE could thus become an important element of the populist tendency in the discourse of the Hu Jintao-Wen Jiabao partnership, alongside environmental protection[3].

The question is how successful these standards will be with companies, especially at local level. While sustainable development has become an official objective at central level, it is still far from being so in many localities.

Foreign companies caught out