GIZ promotes regulatory policy dialogue on sustainable supply chains

20th February 2019 | Forum for the Future | Berlin, Germany

As part of the 5th Forum for the Future in the BMZ’s “Making Globalisation Fair” series on February 20, 2019, Federal Development Minister Dr Gerd Müller, Federal Labour Minister Hubertus Heil and Federal Government Commissioner for Human Rights Dr Bärbel Kofler met with representatives from business and civil society to discuss possible voluntary and binding steps that could help protect human, environmental and labour rights in global supply chains.

Minister Heil described the dire conditions common to much of the globalised working world: "Occupational health and safety and social and environmental standards are foreign concepts in many areas. Human rights are trampled underfoot and fair wages and the rights of trade unions and to co-determination are denied." Development Minister Müller pointed out the advantages of regulating the private sector’s responsibility for due diligence: "Companies have to take a close look at how they manufacture their products. There are many pioneers in this area involved in voluntary initiatives. A law would bring all large companies on board, safeguarding the pioneers and ensuring legal clarity." The ministers announced a joint action alliance to combat child labour, human trafficking and forced labour. They also pledged to make fair supply chains a priority during next year’s German EU Council Presidency.

On the following day, BMZ Director-General Gunther Beger opened the conference on sustainable supply chains. He stressed the importance of a “smart mix” of voluntary and binding national and international instruments to improve living conditions in partner countries and make global supply chains more sustainable. In her keynote speech, Caroline Rees, president of the human rights organisation Shift, emphasised that governments must take action in five equally important areas. She called for coherent guidelines with clear requirements for all companies to meet their due diligence obligations, the provision of guidance and support, the integration of sustainability requirements into all government economic activities, legislative and regulatory initiatives, and ensuring effective access to redress.

In three parallel workshops, German and international experts explored conditions in the textile sector and in cocoa and conflict minerals, and looked into what lessons could be drawn from the French "loi de vigilance" (duty of vigilance law) for implementing corporate due diligence.

The 60 participants at the textile workshop agreed that initiatives like Germany’s Textile Partnership, the Fair Wear Foundation, the Bangladesh Accord on Fire and Building Safety, and the Action Collaboration Transformation (ACT) offered ambitious, voluntary and collective approaches to anchoring due diligence in the textile sector. A presentation detailed the fairly uncoordinated mix of state and private and voluntary and binding initiatives that have all coexisted to date. A lack of legal incentives for rolling out initiatives more widely was identified as the biggest hurdle to achieving the desired smart mix. Without greater support from the private sector, participants agreed that those who initiated such measures would find themselves at a competitive disadvantage. A small group of companies pointed out that legal regulations were not a panacea, and a cultural shift was needed as well. Debate on the importance of consumer-oriented regulation and the role of consumers was inconclusive, and participants expressed hope that the German EU Council Presidency would introduce coordinated steps to pass due diligence regulations at the European level.

Photo above: The topic sponsors of the workshops. From left to right: Prof. Elke Schüßler, Professor of Business Administration and Head of the Institute for Organisation and Global Management Education, Johannes Kepler University Linz, Friedel Hütz-Adams, Senior Researcher, SÜDWIND e.V., Michael Windfuhr, Deputy Director, German Institute for Human Rights, Dr Melinda Crane (moderator). Photo: GIZ/Thomas Ecke

The second workshop explored best practices and generalizable approaches for achieving a smart six in the cocoa and conflict minerals value chains. A panel of experts from the OECD, the Federal Institute for Geosciences and Natural Resources (BGR), the NGOs Südwind and Fern, and BMW and the Mars Wrigley Confectionery enjoyed an animated discussion with around 90 participants that confirmed the value of cross-sector dialogue. While the group agreed it was hard to identify any cross-industry blueprints, there was also great consensus among the various sectors on fundamental success factors and key takeaways from experience. Cocoa sector representatives joined with Mars to unanimously support due diligence guidelines similar to those set out in the EU’s conflict minerals regulations. Participants emphasized that relying on voluntary measures like certification was not enough, and more attention needed to be paid to the role of governments in production countries. Targeted accompanying measures, including bilateral development cooperation, were also called for. The panel focused on the importance of European solutions to prevent a crazy quilt of regulations and create a level playing field.

Photo above: Panel of the workshop on cocoa and conflict minerals. From left to right: Natasha Walker (moderator), Niels Angel, Head of Strategic Purchase and Sustainability in the Supply Chain, BMW Group, Tyler Gillard, Head of Sector Projects and Legal Adviser, Responsible Business Conduct Unit, Organisation for Economic Co-operation and Development (OECD), Dr Gudrun Franken, Head of Mining and Sustainability Unit, Federal Institute for Geosciences and Natural Resources (BGR), Alex Assanvo, Director Corporate Affairs, Mars Wrigley Confectionery, Julia Christian, Forests and Cocoa Advisor, Fern. Photo: GIZ/Thomas Ecke

In the third workshop, French representatives from politics, civil society and the private sector stressed the historical significance of the 2017 "loi de vigilance", adding that only the law’s ambitious rollout at national level had make it possible to consider EU-level proposals. France was leading the way, participants emphasised, and now Germany should double-down on its commitment as well. During the subsequent German podium discussion, panellists expressed differences of opinion on the French law’s potential regarding scope and options for sanctions. All agreed, however, that it could serve as a basis for discussion in German policy circles. Participants noted that the German government’s concept for a due diligence act, principally welcomed by private sector representatives, was designed to address any loopholes in the French legislation with clearer guidelines and should be subject to discussion at European level.

Photo above: Panel of the workshop on the "Loi de Vigilance". From left to right: Michael Windfuhr, Deputy Director, German Institute for Human Rights, Andreas Streubig, Director Global Sustainability, HUGO BOSS AG, Stephan Bartmann, Managing Director, Spa Vivent Vertriebs GmbH, Johanna Kusch, Senior Advisor Corporate Accountability, Germanwatch, Prof. Remo Klinger, Lawyer and Partner, Geulen & Klinger Lawyers. Photo: GIZ/Thomas Ecke

A total of 300 German and international experts took part in the events in Berlin, providing an important impetus for future dialogue on regulating global supply chains in Germany and at a European and international level. The Future Forum and the specialist conference were organised in accordance with sustainable event management criteria. These include well-balanced panels, information on accessibility, no printouts, organizational team meetings via video and telephone conference instead of face-to-face, reusing existing equipment and information for participants on environmentally friendly travel options. Catering featured vegetarian/vegan options of overwhelmingly regional products and provided guests with compostable leftover containers to take home any uneaten food.

The Sustainability Standards and Public-Private Responsibility sector programme as well as Sustainability in Textile Supply Chains and the GIZ Development Policy Forum supported the BMZ in preparing and organising the event.

Photo on the top: From left to right: Michael Windfuhr, German Institute for Human Rights, Andreas Streubig, HUGO BOSS AG, Stephan Bartmann, Spa Vivent Vertriebs GmbH, Johanna Kusch, Germanwatch, Prof. Dr. Remo Klinger, Geulen & Klinger Lawyers. Foto: GIZ/Thomas Ecke

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