Professional Documents
Culture Documents
The company’s two main brands are Switcher and Whale. Switcher has become
the better-known brand and now represents a full line of basic clothes: T-shirts,
sweat-shirts, tracksuits, shirts, polos, pants, jackets and accessories for adults
and children. The Switcher brand is a concept in itself: simple and fun, bright
colours, everyday casual wear for the whole family, staple clothes that everyone
should have in his/her wardrobe, with a clear medium range positioning. A 2000
survey by MIS-Trend in Switzerland showed awareness of Switcher reaching 80
percent and the image generally being that of a friendly brand with a good
price/quality rapport. In 1999, more than 5 million Switcher and Whale items were
sold in Switzerland and the rest of Europe, mainly Germany.
Switcher / Whale clothes are distributed through three channels:
• Independent retailers and Switcher boutiques, a total of 450 outlets in
Switzerland;
• 500 resellers specializing in serigraphy (screen printing and embroidery),
representing 50 percent of the Mabrouc’s sales revenue in 2000;
• Direct sale to consumers by way of the Switcher catalogue (since 1989)
and through the internet by way of Switcher-World SA (since 2001).
Although this last channel still represents few sales, the Switcher Friends
Internet club is steadily increasing its membership.
Company Philosophy
The Mabrouc/Switcher philosophy is one of sustainable development, preserving
the environment, acting in a socially responsible manner and making the work
environment as enjoyable as possible, under economic constraints. Owner Robin
Cornelius strongly believes that « although economic pragmatism is a must – we
are in business to make money - it should not prevent a company from being an
active contributor to social development and environmental protection.
International Standards
In the 1990’s, Switcher aimed at ensuring product quality at all
production/distribution stages and at complying with international environmental
and social standards : the company gained ISO 9001 certification in 1997 and
Switcher and Whale products are Oeko-Tex 100 certified (absence of harmful
chemicals in production process). More recently, the company engaged in ISO
14001 (environmental protection) and SA 8000 (social accountability)
certification. Switcher requires from all its business partners that they engage in
the same process.
In 2000, along with two other Swiss companies (Migros and Charles Veillon),
Switcher agreed to be part of a pilot project for the independent monitoring of its
own code of conduct: “Switcher has nothing to hide,” says Daniel Rufenacht,
Head of Environment and Social Relations since 1999. “We have set high
environment and social standards for ourselves and work hard to implement
them; we remain open to any suggestion that could help us improve.”
GSwitcher’s policy is to apply the same standards everywhere, in Asia as well as
in Europe. It recognizes, however, that cultural differences may require
adaptations, for example, in the management of wages.
The company’s Social Accountability Systems Policy is well known and widely
spread: the policy statement is distributed to workers in their native language
(Tamil), to active NGOs and to local and regional political authorities. Several
recent press articles have contributed to its diffusion to the public. Social
management factors are reviewed below, with some of the operational
specifications thought to have a direct impact on the company’s competitive
standing.
Work Environment
A visit to the Prem Group factories shows the importance the Switcher/Prem
Group partnership gives to work environment factors : workplaces are well
spaced, light is abundant, high ceilings control for heat from neon lighting ; good
ventilation in all sections is provided by regularly spaced fans (regular
maintenance ensures proper ventilation) ; different noise-generating activities
(spinning, dyeing) are isolated from the more labor-intensive downstream
activities; air quality is optimized by blocking out fibers (churning and spinning)
and odors (dyeing) by isolating the related activities or by installing exhaust fans
to suck micro dust; outdoor embellishment (plants and flowers around the factory
buildings) is also part of the environment improvement program.
Identifying a particular need for training usually comes from unit managers who
arrange with training officers for specific training sessions to take place. For
example, competent people are sought from machinery manufacturers and
suppliers to help Prem Group workers acquire the appropriate skills in machinery
handling and maintenance. The training process contributes to motivating
workers to develop their abilities, helps in identifying higher-potential personnel
for future promotion and is considered to be a major factor of general
performance improvement.
Working hours are clearly defined and communicated on a notice board in the
canteen. Regular working hours do not exceed 48 hours for a six-day week,
including rest periods. Overtime, on a voluntary basis, does not exceed 12 hours
in a week, in accordance with Indian law.
In addition, grievance and suggestion boxes are provided in all working areas.
“Unfortunately,” says Rufenacht, “these boxes are often empty. Indian workers
don’t express complaints easily, nor do they easily admit having problems. It is
often better to talk to a worker individually, spend some time asking questions to
get to the root of eventual difficulties.”
Better working conditions, human development policy and improved work
environment, and a general Switcher/Prem philosophy to reinject benefits in
social programs and work-related improvement measures, are believed to have
had a direct impact on absenteeism and workforce turnover rate:
Labor Relations
All workers are unionized. The company has two trade unions, the Central Indian
Trade Union (CITU) and the Marumalarchi Labor Federation (MLF). Management
– labor relationships have developed on a cooperative mode, as reflected in the
composition of the company’s Corrective Action Committee, which brings
management and union representatives together to solve problems.
Management and Union leaders also meet on other occasions. “When Robin
(Cornelius) or I meet with Prem management,” says Rufenacht, “Union
representatives often come by and we discuss issues together. This is quite an
open management system; it helps build confidence.”
Non-Discrimination
Prem Group follows a non-discrimination policy: The Company hires, trains,
compensates and promotes employees on the basis of performance and
competence irrespective of race, caste, natural origin, religion, disability, gender
or political affiliation. With respect to gender, the company employs 43 percent
women and 57 percent men, with equal pay for equal work, in accordance with
the Equal Remuneration Act, 1976.
Child Labor
ILO standards specify children under 15 (13, under special circumstances)
should not be hired for work. Prem Group has set the minimum age for
recruitment at 18, for all tasks. To implement such standards, systematic
checking of young workers’ age is necessary. It is done by asking for birth
certificates, local school records, passports, and by conducting medical and past
events memorization checks. Upon hiring, identity cards are issued and checked
afterwards by security personnel. Contractors /suppliers are requested to
implement the same principles and to provide a written commitment to that effect.
Forced Labor
In compliance with the Indian Bonded Labor System Act of 1976, Prem Group
does not engage in practices which lead to forced labor: it does not retain
personal identification documents, qualification certificates, money deposits and
does not support long-term loans, which could prevent workers from leaving the
company. Workers are not forced to do overtime, as specified in the labor union
agreement. “It is important that workers understand their rights,” says Prakash,
“and this can be achieved through good communication: disclosing terms and
conditions of work prior to recruitment, making sure that all contracts are fully
communicated and fully understood, conducting education programs to make
workers fully aware of their rights and obligations.”
Management Review Meetings
Management review meetings take place twice a year to evaluate the
effectiveness of the company’s Social Accountability Systems. The meetings are
chaired by the Managing Director S. Duraiswamy, and bring together the General
Manager Prakash, as Social Accountability Representative (SAR), and all
managers. Management reviews are of:
• Adequacy, suitability and effectiveness of the company’s SA policy;
• Effectiveness of the systems and procedures;
• Training and awareness programs;
• Supplier conformance;
• Concerns expressed by workers, customers and other stakeholders;
• Internal/external audit reports.
Internal Audit
As mentioned earlier, a Corrective Action Committee has been established to
suggest corrective and preventive actions. Members include four Prem Group
managers and workforce representatives elected by the workers. As SAR,
Prakash has authority to implement the suggested actions.
Supplier Audit
As for suppliers, they are required, once a year, to complete a questionnaire
about their commitment to SA 8000 standards, leading to eventual corrective
actions when needed. Visits to suppliers’ premises allow for checking the
authenticity of the data provided in the questionnaire. The company maintains
records of suppliers’ and sub-contractors’ degree of compliance with SA
standards over the years, providing some sense of progress being made and
helping to point out most appropriate remedial action. Ability to reach and
maintain SA-8000 standards is an important criterion in selecting and retaining a
supplier. This practice is well in line with Switcher’s own auditing procedure
resulting in a 4-level grading scheme of its business partners.
Image Building
The Switcher/Prem partnership has become a benchmark in the Indian garment
industry: “We have set an example which is being followed,” says Prakash, “the
fact of complying strictly with statutory and regulatory requirements and of
reinvesting a share of profits in social programs contribute to Prem Group’s
exceptional image.” Among recent visitors to Tirupur, Neil Kearney, General
Secretary of Belgium-based International Textile, Garment and Leather Workers’
Federation, praised the company’s accomplishments with respect to wages
(above the minimum wage for all workers) and working hours, health and safety.
• Seven schools are running (12 are planned by end 2002), fully
funded by the trust, free of charge, for workers’ children and those from
poorer families of Tirupur and nearby villages. Over 1200 children are
now registered;
• In addition to employees’ children, who are automatically accepted,
other children are selected among the poorer families of Tirupur and
nearby villages. A criterion of selection is the family’s motivation to see
their children through school. Representatives of Prem Group meet with
the families to determine their motivation. Through schooling, the
company sees that children who do not work due to their age are not left
on the streets;
• Four dispensaries were opened in the factories and schools for free
medical service and hygiene advice. Safety awareness and first-aid
training is provided on a regular basis in the factory. An AIDS awareness
and prevention campaign was launched in 2001, including the
distribution of free preservatives on the workplace and information
sessions regarding their use;
• Family planning issues are also regularly addressed;
• 12,000 liters of drinking water are distributed daily to remote places
which have no access to clean water;
• Living quarters and recreation areas are provided to workers at no
cost, with safe separate quarters for single women;
• A daycare center was opened to help working mothers.
Some observers have compared such initiatives with 19th-century European
paternalism. Criticisms are few, however, and do not seem to emanate from
Indian sources.
After more than ten years, Cornelius remains excited about the partnership: “It
extends far beyond a typical business deal,” he says, “we share the same values
and we finance the [social and environmental] projects together.”
Questions
What were the main benefits of SA8000 (hint: check the paragraphs in bold face?
What predictions would you make about the future of the company?
Yeşim supplies world-famous brands and is also one of the few accredited
members in Turkey of Du Pont Clothing and Textiles Sciences, which develops
new approaches to the world of fashion and emphasizes outstanding quality and
customer service.
STATUS PRIOR TO CERTIFICATION
Existing Strengths
OUTCOMES
Compliance Was Speedy
There were no delays. The findings of certification audits and follow-up audits
were monitored by Yesim’s own management system and the expected benefits
were achieved.
Measurable Achievement:
Factory proposed for certification at first audit (no major
nonconformances).
Company Awareness of Workplace Issues Was Raised
Awareness of the program was raised at the managerial level and at the worker
level, with vocational training and an effective compliance and environmental
health and safety committee, as well as ample NGO engagement.
Measurable Achievement (Overtime Limit):
2006: Just four out of 2500 employees exceeded yearly limit of 270 hours.
2007 (end of September): Only one employee exceeded yearly limit.
Grievance System Was Improved
Greater coordination with trade union representatives through periodic meetings.
Concerns raised during trainings or site audits were addressed.
Measurable Achievement:
Communication and training were initiated for a new grievance system.
Feedback that its details were effectively conveyed and it is functioning.
New Programs Were Created for Environmental Health and Safety
Concerning environmental health and safety, Yesim determined that as part of
their social compliance program, there should be ongoing training and
monitoring, internal audits, as well as a corrective action request system. The
company is now undertaking:
- AKUT Research and Rescue – emergency preparedness project.
- Ergonomic studies.
- Revised personal protective equipment (PPE) selection system.
- Detailed risk analysis.
Measurable achievement:
1. 37% decrease in total lost time due to incidents.
2. Lost days fell from 652 days to 414 days (238 days gained).
QUESTIONS