OECD Guidelines for MNEsOECD Guidelines for MNEs Adopted in 1976, and reviewed in 2000 Guidelines, major features:

– comprehensive set of rules, multilaterally endorsed, binding for adhering governments which are requested to promote their application by MNEs operating in their countries and by MNEs based in their countries operating worldwide

– voluntary to enterprises, not legally but morally binding;

Major components: NCP, CIME (Committee on International Investment and Multinational Enterprises) , and TUAC

OECD Guidelines : contentOECD Guidelines : content The Guidelines consist of ten chapters covering most

aspects of company behaviour: 1. Concepts and Principles, 2. General Policies, 3. Disclosure, 4. Employment and Industrial Relations (FoA, CB),5. Environment (OSH), 6. Combating Bribery, 7. Consumer Interests, 8. Science and Technology, 9. Competition and (10) Taxation.

Trade Union Advisory Committee to the OECD - TUAC

- international trade union organisation which has consultative status with the OECD;

TUAC represents views of organised labour in industrialised countries;

56 national trade union centres in 30 OECD countries, covers 66 million workers.

OECD Guidelines : applicationOECD Guidelines : application

The Guidelines apply to MNEs operating in or from:

1. the 30 OECD member countries, plus currently nine non-OECD members: Argentina, Brazil, Chile, Estonia, Israel, Latvia, Lithuania, Romania and Slovenia.

2. Guidelines also apply to these companies’ operations worldwide.

Role of TUCheck OECD Annual Report on GuidelinesWhen a company breaches the Guidelines,

TU can raise this case with the NCPConsult TUAC; it works closely with

ICFTU, WCL, ETUC and GUFs. (http://www.tuac.org)

Code of ConductCode of Conduct

Is a written policy or statement of principles adopted voluntarily by a company to express its commitment toward a particular conduct

NOT NEGOTIATED BUT UNILATERAL DECLARATION

Code of conduct for business– consumer rights, product safety or environmental protection– ethical behaviour codes for employees– International instruments to monitor the social responsibility of

business– ILO MNE Declaration– OECD Guidelines for MNEs– attempt by UN to set a global code

New Code of ConductNew Code of Conduct

Four Major CharacteristicsPurely private, voluntary initiative (PVI)Response to the situation of poor labour

standards created by the failure of national governments;

international applicationCross-cutting application to suppliers and

subcontractors

Definition of New Code of ConductDefinition of New Code of Conduct

“Commitments voluntarily made by companies, associations or other entities which put forth standards and principles for the conduct of business activities in the marketplace”

(“Workers’ tool or PR ploy?” – by Dr. I. Wick)

Number of New CodesNumber of New Codes

246 codes (June 2000 by OECD study)- 118 by individual companies, 92 by industry and

trade associations, 32 by partnerships between stakeholders and 4 by inter-governmental organizations

- Only 163 mention monitoring- Only 30% mention freedom of association, and

only10.1% refer to ILO codes

Why New Codes are important for Why New Codes are important for Trade Unions?Trade Unions?

New Codes are on “labour practice”

Most companies adopt COC without involving trade unions So, they can be used as an excuse

for having no union

So, they can be used as an excuse for having no union

Great potential and also danger

Truly applied, codes may establish ILSs as binding international framework for responsible corporate behaviour So, union’s involvement is vitalSo, union’s involvement is vital

CSR and TUCSR could be a positive process for TU if:

- Strengthen FoA and the creation of unions- Strengthen C.B- Support organising- Not only comply with the law but it goes beyond

national legislation (socially and ethically responsible to stakeholders/local communities)

- Alliances of TU and civil society

Negotiated agreements and global labour relations

INTERNATIONAL FRAMEWORK AGREEMENTSINTERNATIONAL FRAMEWORK AGREEMENTS Instruments negotiated between a MNE and a Instruments negotiated between a MNE and a

Global Union Federation Global Union Federation (GUF) concerning (GUF) concerning international operations of the company;international operations of the company;

MNEs commit themselves to applying the same MNEs commit themselves to applying the same labour standards to their employees in all the labour standards to their employees in all the different countries where they operatedifferent countries where they operate

Framework AgreementsFramework AgreementsImplement Core Labour Standards;

Apply “Decent working conditions”;

Apply environmental standards;

Promote good labour practices

Major Framework AgreementsMajor Framework AgreementsIUF

- Danone (1988), Accor hotel group (1995), Nestle (1996), Del Monte (2000) and Chiquita (2001)

IFBWW- Ikea (1998), Faber-Castell (2000), Hochtief (2000)

ICEM- Statoil (1998), Freudenberg (2000)

UNI- Telefonica (2000), OTE (2001), Carrefour (2001)

Codes of conduct and FACodes of conduct and FA

Codes of Conduct International Framework Agreements

Unilateral actions Negotiations between workers and management

Not all Core Labour Standards are necessarily acknowledged

All Core Labour Standards are explicitly acknowledged

Rarely address suppliers Usually include suppliers

Monitoring, when envisaged, is under the management’s control

Unions are called to participate in the implementation process

Feeble basis for dialogue Strong basis for dialogue between unions and management

Important Aspects for FAImportant Aspects for FA

Capacity of GUFs to engage in F.A. with a large number of MNEs

Monitoring F.A.Capacity of MNEs to control subcontractors or

supply-chainsExtension of EWC versus GWC and strategic

alliances between European Trade Unions and GUFs.

Agreements between MNEs and GUFs for the implementation of monitoring of FA

Regional Economic Agreement

National Labour Relation / Tripartite

Committees

ILO Tripartite Declaration on

MNCs

International InstrumentsInternational InstrumentsInternational

National

Private Public

ILO Declaration on F.P.R.W.

Framework Agreements

Code of Conducts

Social Labelling

Labour Legislation

CFAILCs

UN Global Compact

OECD Guidelines for MNCs

Policy and Strategy for T.U.Policy and Strategy for T.U.

Set up institutional mechanisms and capacities to fully utilize all the available international instruments– Regular reporting– Complaints procedures in case of violation (case: CROATIA,

asbestos)– Multilateral approaches to problem-solving

Importance of International, Regional, and Sub-regional trade union networks/IT and communication systems

Networking / SoliComm portal http://www.solicomm.net/

PROGRAMME FOR WORKERS’ ACTIVITIES OF THE ILO TURIN

CENTRE(ACTRAV)

WWW.ITCILO.IT/ACTRAVWWW.ITCILO.IT/ACTRAV

ACTRAV-Turin