Safety Sustainability

Remarks by John Howard, M.D., NIOSH Director, at ASSE Professional Development Conference and Exposition on June 10, 2014

Just over a year ago, on April 24, 2013, Rana Plaza, an eight-story commercial building in Greater Dhaka, the capital of Bangladesh, collapsed. The death toll has reached more than 1,000.  Thousands more were rescued from the collapsed building.  The vast majority of workers killed or injured were garment workers[i].

The Rana Plaza contained five garment manufacturing factories, a bank, apartments, and several other shops. The day before the collapse, shops and the bank on the lower floors immediately closed after cracks were discovered in the building. However, garment workers were ordered to return the following day or risk loss of pay or termination. The building collapsed that next morning.

Rana Plaza workers are part of the global workforce—producing various products for export to countries like the United States—for people like you and me to buy in our local stores.

In the aftermath of the disaster, expressions of concern, sorrow and condemnation were heard from many world leaders, including Pope Francis.  Some multi-national merchandisers from several countries are contributing support to care for and compensate victims’ families; worker advocates are trying to ensure better protections for Bangladeshi garment workers; and safety and health professionals from Bangladesh and from around the world are contributing their assistance and expertise to ensure fire and building safety is a priority for all workers in Bangladesh.

On May 7^th, the National Institute for Occupational Safety and Health was pleased to host a meeting in Washington to explore projects to strengthen workplace health and safety in Bangladesh. At the meeting were representatives of the Embassy of Bangladesh, the U.S. Department of Labor, the Alliance for Bangladesh Worker Safety, the Bangladesh Accord on Fire and Building Safety, the American Industrial Hygiene Association, the International Occupational Hygiene Association, the American Society of Safety Engineers, and others.

NIOSH is pleased to join in the effort to raise the level of safety provided to garment workers in Bangladesh, and is committed to do all it can do to assist global efforts to address the many issues presented by the Rana Plaza disaster[ii].

Even so, we need to ask ourselves—can we do more? Can we improve garment industry workforce safety in more than just one country? Is there something we can do to address these same safety and health issues across the global workforce?  In other words, how can we achieve global safety sustainability?

We have made much progress in the U.S. since the Triangle Shirtwaist Factory Fire on March 25, 1911. And much of the credit goes to a small group of 62 people—dedicated to protecting people, property and the environment—who joined together in October of 1911, motivated by the mission of creating safer workplaces for all American workers. These 62 people, originally known as the United Society of Casualty Inspectors, are today known as the American Society of Safety Engineers—a safety practitioner societycomposed of thousands of dedicated safety and health professionals[iii].

In 2014, what steps can we take to ensure that the safety profile ASSE members have worked so hard to achieve here in the U.S since 1911, becomes sustainable across the global workforce? How can safety become the type of system that maintains its own viability in every workplace, across global supply chains that bind all of us together—manufacturers, customers, suppliers, safety practitioners, and workers?

The emerging field of sustainability management provides us with new opportunities to assure global safety.

Today, I wanted to raise an idea with you. That idea is based on the value and need for greater transparency in how multi-national business enterprises report how well they are performing.

Traditionally, profit-making and non-profit-making businesses alike report how well they are performing by means of financial reports.  Audited financial reports tell investors how much profit the enterprise made, how much inventory they have on hand, what liabilities they have, how much dividend they plan to pay, and similar types of financial information.  It is a type of accountancy with which we are all familiar, but it does not represent the best kind of accountancy we can ask our businesses to provide to us.

Over the years, we have developed an increasing consciousness about the broader role of business enterprise in society.  Appearing first as calls for corporate responsibility reporting, and most recently, as sustainability reporting, demands for businesses to report how well they perform on the environment, on diversity, on human rights, on carbon emissions, on gender pay parity, and other social issues, has increased.

Over the past 20 years, sustainability reporting has become more prevalent for American and European multi-national enterprises.  According to CDP, an international, not-for-profit organization that collects environmental data on behalf of investors, more than half the companies listed on the world’s 31 largest stock exchanges publish some environmental, social or governance data, or ESG data, in a sustainability report[iv].

In its 2014 survey of 613 of America’s largest publically-traded companies, Ceres, a non-profit organization in Boston advocating for sustainability leadership, and Sustainalytics, a leader in sustainability research and analysis, report that businesses are increasingly integrating sustainability criteria into their performance reporting to guide investors decisions[v].

Moreover, we see most recently, that the momentum is building to achieve the goal of integrated reporting—combining both financial and non-financial information about enterprise performance into One Report—in order to facilitate full transparency and socially responsible reporting[vi].

Integrated sustainability reporting among large multi-nationals, cascading down through their global supply chain source—both known and unknown—could be a vehicle that may raise the level of safety for Rana Plaza workers throughout the world.

Given current business arrangements in garment manufacturing, identifying indirect supply sources may difficult. As the Center for Business and Human Rights at the NYU Stern School of Business emphasized in their April 2014 Report on the global garment business, indirect sourcing—the “routine practice of subcontracting, often through purchasing agents, and in a manner not transparent to buyers, in order to increase margins and boost production capacity while keeping costs low,” increases risks for businesses and workers[vii].

One important item that is often left out of sustainability reports is a robust and detailed reporting of how well the enterprise protects the safety and health of its workers and the workers throughout its supply chain.

As the Center for Safety and Health Sustainability, hosted by the American Society of Safety Engineers, with participation from the American Industrial Hygiene Association, the National Institute for Occupational Safety and Health, and others, makes clear in their vision statement, all organizations must consider the safety, health and well-being of workers as a part of sustainable business practice. But, I am sure you will not be surprised to learn that more needs to done to achieve the Center’s vision.

For example, sustainable development conferences do not usually include workforce safety and health as a focus. Sustainability centers and institutes worldwide lack an emphasis on safety and health. Even for a multi-national who wants to integrate safety into their sustainability reports, there is no widely accepted definition of safety and health sustainability, there is no standardized way to report workforce safety and health sustainability, and workforce safety and health is not included in the sustainability indices that make comparisons across firms.  For instance, safety and health sustainability is not included in the Global Reporting Initiative, the Dow Jones Sustainability Indices, or in the indices of other investment rating organizations.

The continued absence of workforce safety and health as a critical performance metric in the sustainability indices of global investment rating companies means that the voice of safety is not being heard as loudly as it should be in the new globalized economic order of extended supply chains. Given how muted the safety voice is in sustainability reporting, advances in global workforce safety and worker well-being will be limited.  If we don’t change that, who will?

It is not an easy task that the Center for Safety and Health Sustainability has taken on, but I applaud the American Society of Safety Engineers for recognizing our collective obligation to the global workers upon whose labor, and the products arising from their labors, we depend.

The 2013 United Nations Global Compact Report notes that while signatories to the Compact are making progress in setting expectations for supply chain sustainability, many are failing to implement tangible measures to drive adherence with the firm’s own supply chain safety requirements. But that may not necessarily be for a lack of commitment—the sheer size and geopolitical complexity of global supply chains makes supply chain safety management a daunting task[viii].

In conclusion, as in 1911, when the death of 146 garment workers in New York City galvanized 100 years of action on safety and health for the benefit of American workers by the ASSE, my hope is that, like the Peace Corps of the last century, the efforts arising from the 2013 Rana Plaza disaster may spur development of a “Safety Sustainability Corps,” promoted by safety and health practice associations and dedicated to sharing their members’ professional expertise for the benefit of Rana Plaza workers everywhere.

John Howard, M.D.

Director, National Institute for Occupational Safety and Health

References

[i] U.S. DOL. Press Release 4/23/2014 “Joint statement on one-year anniversary of deadly factory collapse in Dhaka, Bangladesh”. http://www.dol.gov/opa/media/press/opa/OPA20140678.htm

[ii] International Labour Organization. “The ILO’s response to the Rana Plaza tragedy.” http://www.ilo.org/global/about-the-ilo/activities/all/safer-garment-industry-in-bangladesh/WCMS_240343/lang–en/index.htm

[iii] The American Society of Safety Engineers. “What is the American Society of Safety Engineers?” http://www.asse.org/about/history.php

[iv] Carbon Disclosure Project (CDP). “Climate Resilient Stock Exchanges –Beyond the Disclosure Tipping Point”. https://www.cdp.net/CDPResults/CDP-2011-climate-resilient-stock-exchanges-white-paper.pdf.

[v] Sustainalytics. “Gaining Ground – A Ceres and Sustainalytics Collaboration”. http://www.sustainalytics.com/gainingground

[vi] Harvard Business School. “One Report: Better Strategy through Integrated Reporting”. http://hbswk.hbs.edu/item/6392.html

[vii] Labowitz,S. Baumann-Pauly, D.  NYU/STERN Center for Business and Human Rights. “Business as Usual is Not an Option: Supply Chains and Sourcing after Rana Plaza.” http://www.stern.nyu.edu/cons/groups/content/documents/webasset/con_047408.pdf

[viii] United Nations Global Compact. “Global Corporate Sustainability Report 2013.” http://www.unglobalcompact.org/AboutTheGC/global_corporate_sustainability_report.html