Why Social Entrepreneurship is Just Good Business

Meghan French Dunbar March 5, 2016


Location: New York, NY

Founded: 1997

Team Members: 30

Structure: Nonprofit

Impact: 2 million people work in SA8000-certified workplaces around the world

An early adopter in the sustainable business community, Alice Tepper Marlin has been at the forefront of social entrepreneurship and labor rights for decades. In 1997, Tepper Marlin founded Social Accountability International (SAI), which advances the human rights of workers worldwide. SAI’s work focuses specifically on labor rights and, in particular, the rights of migrants, women, minorities, and children.

Pioneering a multi-stakeholder approach, SAI created SA8000, the widely respected metric for decent work standards; TenSquared, a management tool that builds the capacity of workers and managers to work together to identify and solve problems in the workplace; and Social Fingerprint, which is used to measure and improve working conditions.

We spoke with Tepper Marlin about everything from her work at SAI to the evolution of labor rights.

What inspired you to start this organization?

Alice Tepper Marlin: I was driven to find ways to break the cycle of poverty through jobs and investment. I founded the Council on Economic Priorities (CEP) in 1968 to evaluate and report on the social and environmental performance of US corporations. An early social entrepreneur, I applied the methods I had learned as a Wall Street securities analyst to evaluating and rating a company’s social and environmental performance.

Investors, managers, and policymakers relied on CEP’s in-depth research and policy recommendations. We reached our widest audience with the publication of “Shopping for a Better World,” a quick and easy guide that sold over a million copies, eliciting significant improvements by consumer products companies and empowering consumers by turning their shopping carts into vehicles for social change.

Then, as globalization took hold, our highly developed research methods had done their job. Government agencies were collecting data on corporate water and air pollution, diversity, and other key social issues. Our example and open sharing of information had resulted in similar guides and research organizations in a dozen other countries, including the UK, France, Germany, Belgium, and Japan. The Global Reporting Initiative had begun to broaden and further internationalize corporate sustainability reporting, linking up with the UN. Production shifted out of the US to countries where workers, communities, and the environment were more at risk, yet reliable information was much less available. We had to reinvent ourselves. SAI was how we did it.

“The expectations and dreams of the competent and dedicated next generation… they reflect a paradigm shift in society, a new set of expectations of business from consumers, managers, and workers alike — expectations for the sustainable provision of decent work, care for communities, and respect for the environment as a key determinant of value in a business.”

What is an example of the type of changes that you typically see when working with companies?

ATM: In our TenSquared program, for example, substantial occupational health and safety improvements have been attained by teams of workers and managers. These improvements are thoroughly measured using both objective data and mobile phone surveys of worker opinions. Results include significant reductions in limb trauma accidents and high-level fire risks (70 percent each), as well as a 98 percent increase in commitments to health and safety by managers.

What trends have you seen emerge with regard to labor practices since you started doing this work?

ATM: The major trends that I have identified include:

• First, a proliferation of quite varied and often weak company and industry sector codes, then convergence among them, then increasing rigorousness as SA8000 and the Ethical Trading Initiative’s base code set the model and the central role of International Labor Organization (ILO) conventions became widely recognized

• Progressively more outsourcing abroad

• A growing gap between top management and average worker compensation

• Vastly more consumer, government, and investor concern about the work conditions of the people who make the goods and services we enjoy, and the environmental impact of their production

• Widespread recognition that brand and retailer responsibility now extends to their supply chains where the goods and services in their stores and bearing their brand name are produced. This is a paradigm shift of immense significance

• Nascent awareness that this responsibility extends beyond first-tier suppliers all the way down the chain, to contractors, and even to franchisees

• A turn by unions away from investing in multi-stakeholder approaches to more reliance on anti-corporate campaigning

How do you describe the SA8000 and its primary pillars?

ATM: SA8000 is a standard for decent work that can be used in any workplace, across countries and industrial sectors. It is derived from labor law, ILO conventions, the UN Declaration of Human Rights, and a management system modeled on the International Organization for Standardization systems widely relied upon in the business world. Two million people are employed at SA8000-certified factories, offices, and farms in more than 60 industrial sectors.

The primary pillars of SA8000 are:

1 of No gender discrimination , race, religion on the , basis caste, national origin, union membership, or age

2 No child labor, and remediation for any child found to be working, by enabling them to attend school

3 Provision of a safe and healthy workplace, with occupational safety and health training for all personnel, potable water, and decent conditions in dorms

4 No forced labor, no required deposits, no use of or support for human trafficking

5 Freedom of association and the right to collective bargaining

6 A limit of 48 hours in a normal work week and 60 hours of total work per week, including overtime, which must be voluntary and paid at a premium — at least one day off every seven days

7 No corporal punishment, or mental or physical abuse

8 requirements Wages that meet and legal respect the right to a living wage (including benefits), and compensation that is clearly communicated to workers

9 provides A management policies system , procedures that , delegation of authority, and training, and has an adequate budget to assure the effective implementation of SA8000 provisions

What are the most common challenges that companies face when using the SA8000 standards?

ATM: Common challenges vary by country and industry sector. For example, safety is a particular roadblock in sectors where the incidence of accidents is highest, such as construction and mining, especially in countries where these sectors are not effectively regulated.

Challenges also vary by country. For instance, caste discrimination is peculiar to certain countries, such as India; child labor is endemic in the poorest countries; and discrimination against women is particularly challenging in countries where sharia is the law.

More broadly, the most common challenge confronting facilities worldwide that seek to implement SA8000 are hours of work, the right to collective bargaining, and respect for a living wage.

What do you see as the biggest issue right now with regard to labor rights?

ATM: Poverty, rapidly shifting economic conditions, absence of the rule of law in many countries, and tough competition for the consumer dollar are always the dominant challenges. Currently, the rapid drop in commodity prices is exerting extreme pressures on companies and workers in commodity-dependent sectors and geographic regions.

What gives you hope for the future?

ATM: The expectations and dreams of the competent and dedicated next generation of people working at SAI and taking the classes that I teach at NYU’s Stern School of Business. They reflect a paradigm shift in society, a new set of expectations of business from consumers, managers, and workers alike — expectations for the sustainable provision of decent work, care for communities, and respect for the environment as a key determinant of value in a business.


Decent work standards can benefit businesses by:

• Enhancing the value of a brand

• Increasing employee retention and eliciting greater loyalty

• Boosting productivity

• Raising product quality and reducing reject rates

• Attracting brand and retail buyers

• Protecting the value of a brand by reducing the risk of an exposé or an activist campaign

4 Changes Tepper Marlin Anticipates For Labor Practices

1. Nascent interest in and then implementation of a living wage by leading-edge socially responsible companies

2. A shift away from auditing as the main tool toward building capacity in the workplace

3. A slow return by unions to multi-stakeholder approaches

4. Increasing use of new technologies, such as mobile phones for surveys of workers and identification of worker complaints

Stakeholder Capitalism
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