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From commodity to asset: how conversations about workers are changing in China

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The conversation among Chinese businesses on how they view their workers is slowly shifting from commodity to asset, says Carmel Giblin, CEO of Sedex.

In June 2014 we held our fifth annual Sedex conference in Shanghai. With tickets sold-out weeks before the event it was our biggest China conference yet, filling the room with over 200 delegates from businesses across China and further afield. But what struck me about the conference wasn’t the size of it, but the way conversations about workers are changing.

When I first visited China – only four years ago – businesses were talking about their workers as a commodity. Workers were in plentiful supply and some factories did not blink at a 100% annual staff turnover rate. Now, this mind-set is changing, and quickly. Almost every speaker at the conference talked about worker engagement: about how businesses can help their workers deal with issues that are faced throughout China. Significantly, these aren’t just health and safety issues; they go beyond compliance to look at employees’ emotional wellbeing. Workers are now being regarded as an asset, and companies are recognising that a happy, engaged workforce can have a huge impact on the quality of products and how efficiently orders can be fulfilled.

While there are many complex issues impacting workers in China, I want dive into a couple here to show how seemingly huge problems can be solved – or at least alleviated – relatively easily.

One of the key issues facing China is migrant workers. While many factories are sited in deltas along the coast, much of the population lives inland and travels far for work. In total, nearly 160 million rural Chinese migrated to find work by the end of 2011, making it the largest migration in history, according to the Economist.

While this migration has slowed or even reversed in recent years the number of migrant workers still stands at 20% of the workforce, 80% of whom are parents who must leave their children behind when they move for work. They may only see their children once a year at Spring Break (Chinese New Year), largely building their relationship through phone calls. This long-term division of families can be traumatic and have far-reaching effects. At the conference Sedex member New Look referenced a study of its Chinese workers which found that 80% of parents who had left their children behind felt inadequate as parents and 59% said that the situation lessened their commitment to work, making them distracted and affecting their performance.

The simple solution to this problem is to site factories inland so workers don’t have to migrate, but while this is already an established trend it will take years for enough factories to be built inland. In the meantime, one organisation working to improve the situation for migrant workers is INNO, a hotline which gives workers support and guidance over the phone. INNO set up the Left Behind Children Hotline project to help migrant workers build better relationships with their children, particularly over the phone. The project works with the migrant workers, their children and the local community to share knowledge and help build communication skills, bringing families closer together despite physical distance.

Another challenging issue that companies are addressing is giving workers a voice. Unions set up in the past were often criticised as being little more than government-controlled vehicles, which did not truly aid worker representation. Now, particularly among the younger demographic, social media (QQ, Weibo and WeChat, among others) is enabling workers to collectively organise themselves and speak out for their rights. Research by Professor Kan Wang from the China Institute of Industrial Relations reveals that the number of workers involved in collective disputes surged from 12% in 2005, to 94% in 2013.

One way companies are helping their workers to have a voice – and crucially, listening to that voice – is by supporting them to set up worker committees. Clearly this is an improvement, but it has to be carefully managed to maintain that committee’s independence and ensure that it is providing true representation.

While these are only two examples of the issues and possible solutions, it’s clear that the tone of conversation in China is changing rapidly. The number of 15- to 29-year-olds in the country peaked in 2011, according to UN estimates and the working-age population as a whole has been in decline for the last two years. This means that workers are no longer regarded as a commodity, but as human beings with both physical and emotional needs. This welcome progress has opened up new avenues for innovative solutions, but there is still much that can be done.

Sedex is committed to highlighting these issues, using our rich bank of data to identify the root causes and supporting our members in their efforts to improve working conditions in China. We recognise that although some of the issues facing workers in China are driven by Chinese law or other macro factors, others can be relatively simple, quick and cheap to fix. Working out how, and where, to make these adjustments to deliver changes at scale can be challenging.  This is where collaboration at the brand – and supplier level – can play a vital role in maximising impact.

Carmel Giblin is the CEO of Sedex, a membership organisation which supports responsible supply chains.

Photo: Edwin Lee via Flickr

Further reading:

Sedex launches film series in a bid to improve responsible sourcing

Sedex teams up with World Bank to launch supply chain monitoring platform

China: supply chain progress made, but major problems still exist

Engage with China to build global political trust, says top climate diplomat

We are a long way from achieving stability in supply chains

Economy

How Going Green Can Save A Company Money

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going green can save company money
Shutterstock Licensed Photot - By GOLFX

What is going green?

Going green means to live life in a way that is environmentally friendly for an entire population. It is the conservation of energy, water, and air. Going green means using products and resources that will not contaminate or pollute the air. It means being educated and well informed about the surroundings, and how to best protect them. It means recycling products that may not be biodegradable. Companies, as well as people, that adhere to going green can help to ensure a safer life for humanity.

The first step in going green

There are actually no step by step instructions for going green. The only requirement needed is making the decision to become environmentally conscious. It takes a caring attitude, and a willingness to make the change. It has been found that companies have improved their profit margins by going green. They have saved money on many of the frivolous things they they thought were a necessity. Besides saving money, companies are operating more efficiently than before going green. Companies have become aware of their ecological responsibility by pursuing the knowledge needed to make decisions that would change lifestyles and help sustain the earth’s natural resources for present and future generations.

Making needed changes within the company

After making the decision to go green, there are several things that can be changed in the workplace. A good place to start would be conserving energy used by electrical appliances. First, turning off the computer will save over the long run. Just letting it sleep still uses energy overnight. Turn off all other appliances like coffee maker, or anything that plugs in. Pull the socket from the outlet to stop unnecessary energy loss. Appliances continue to use electricity although they are switched off, and not unplugged. Get in the habit of turning off the lights whenever you leave a room. Change to fluorescent light bulbs, and lighting throughout the building. Have any leaks sealed on the premises to avoid the escape of heat or air.

Reducing the common paper waste

paper waste

Shutterstock Licensed Photo – By Yury Zap

Modern technologies and state of the art equipment, and tools have almost eliminated the use of paper in the office. Instead of sending out newsletters, brochures, written memos and reminders, you can now do all of these and more by technology while saving on the use of paper. Send out digital documents and emails to communicate with staff and other employees. By using this virtual bookkeeping technique, you will save a bundle on paper. When it is necessary to use paper for printing purposes or other services, choose the already recycled paper. It is smartly labeled and easy to find in any office supply store. It is called the Post Consumer Waste paper, or PCW paper. This will show that your company is dedicated to the preservation of natural resources. By using PCW paper, everyone helps to save the trees which provides and emits many important nutrients into the atmosphere.

Make money by spreading the word

Companies realize that consumers like to buy, or invest in whatever the latest trend may be. They also cater to companies that are doing great things for the quality of life of all people. People want to know that the companies that they cater to are doing their part for the environment and ecology. By going green, you can tell consumers of your experiences with helping them and communities be eco-friendly. This is a sound public relations technique to bring revenue to your brand. Boost the impact that your company makes on the environment. Go green, save and make money while essentially preserving what is normally taken for granted. The benefits of having a green company are enormous for consumers as well as the companies that engage in the process.

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Energy

5 Easy Things You Can Do to Make Your Home More Sustainable

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sustainable homes
Shutterstock Licensed Photot - By Diyana Dimitrova

Increasing your home’s energy efficiency is one of the smartest moves you can make as a homeowner. It will lower your bills, increase the resale value of your property, and help minimize our planet’s fast-approaching climate crisis. While major home retrofits can seem daunting, there are plenty of quick and cost-effective ways to start reducing your carbon footprint today. Here are five easy projects to make your home more sustainable.

1. Weather stripping

If you’re looking to make your home more energy efficient, an energy audit is a highly recommended first step. This will reveal where your home is lacking in regards to sustainability suggests the best plan of attack.

Some form of weather stripping is nearly always advised because it is so easy and inexpensive yet can yield such transformative results. The audit will provide information about air leaks which you can couple with your own knowledge of your home’s ventilation needs to develop a strategic plan.

Make sure you choose the appropriate type of weather stripping for each location in your home. Areas that receive a lot of wear and tear, like popular doorways, are best served by slightly more expensive vinyl or metal options. Immobile cracks or infrequently opened windows can be treated with inexpensive foams or caulking. Depending on the age and quality of your home, the resulting energy savings can be as much as 20 percent.

2. Programmable thermostats

Programmable thermostats

Shutterstock Licensed Photo – By Olivier Le Moal

Programmable thermostats have tremendous potential to save money and minimize unnecessary energy usage. About 45 percent of a home’s energy is earmarked for heating and cooling needs with a large fraction of that wasted on unoccupied spaces. Programmable thermostats can automatically lower the heat overnight or shut off the air conditioning when you go to work.

Every degree Fahrenheit you lower the thermostat equates to 1 percent less energy use, which amounts to considerable savings over the course of a year. When used correctly, programmable thermostats reduce heating and cooling bills by 10 to 30 percent. Of course, the same result can be achieved by manually adjusting your thermostats to coincide with your activities, just make sure you remember to do it!

3. Low-flow water hardware

With the current focus on carbon emissions and climate change, we typically equate environmental stability to lower energy use, but fresh water shortage is an equal threat. Installing low-flow hardware for toilets and showers, particularly in drought prone areas, is an inexpensive and easy way to cut water consumption by 50 percent and save as much as $145 per year.

Older toilets use up to 6 gallons of water per flush, the equivalent of an astounding 20.1 gallons per person each day. This makes them the biggest consumer of indoor water. New low-flow toilets are standardized at 1.6 gallons per flush and can save more than 20,000 gallons a year in a 4-member household.

Similarly, low-flow shower heads can decrease water consumption by 40 percent or more while also lowering water heating bills and reducing CO2 emissions. Unlike early versions, new low-flow models are equipped with excellent pressure technology so your shower will be no less satisfying.

4. Energy efficient light bulbs

An average household dedicates about 5 percent of its energy use to lighting, but this value is dropping thanks to new lighting technology. Incandescent bulbs are quickly becoming a thing of the past. These inefficient light sources give off 90 percent of their energy as heat which is not only impractical from a lighting standpoint, but also raises energy bills even further during hot weather.

New LED and compact fluorescent options are far more efficient and longer lasting. Though the upfront costs are higher, the long term environmental and financial benefits are well worth it. Energy efficient light bulbs use as much as 80 percent less energy than traditional incandescent and last 3 to 25 times longer producing savings of about $6 per year per bulb.

5. Installing solar panels

Adding solar panels may not be the easiest, or least expensive, sustainability upgrade for your home, but it will certainly have the greatest impact on both your energy bills and your environmental footprint. Installing solar panels can run about $15,000 – $20,000 upfront, though a number of government incentives are bringing these numbers down. Alternatively, panels can also be leased for a much lower initial investment.

Once operational, a solar system saves about $600 per year over the course of its 25 to 30-year lifespan, and this figure will grow as energy prices rise. Solar installations require little to no maintenance and increase the value of your home.

From an environmental standpoint, the average five-kilowatt residential system can reduce household CO2 emissions by 15,000 pounds every year. Using your solar system to power an electric vehicle is the ultimate sustainable solution serving to reduce total CO2 emissions by as much as 70%!

These days, being environmentally responsible is the hallmark of a good global citizen and it need not require major sacrifices in regards to your lifestyle or your wallet. In fact, increasing your home’s sustainability is apt to make your residence more livable and save you money in the long run. The five projects listed here are just a few of the easy ways to reduce both your environmental footprint and your energy bills. So, give one or more of them a try; with a small budget and a little know-how, there is no reason you can’t start today.

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