Today, global trade and production employs millions of workers who routinely face extreme overtime, work environments which are hazardous to health, and wages which barely cover living and food expenses. Gross forms of child labour and forced labour also occur, and some businesses engage in activities which cause severe environmental damage. The causes of poor working and environmental conditions are linked to poverty issues and weak enforcement of national legislation.
National authorities have the main responsibility for ensuring compliance with human rights, workers’ rights and environmental standards. If a state lacks the ability or will to do so, it is wrong for businesses to exploit the situation at the expense of workers and the environment at the production site. Companies have a responsibility to comply with applicable laws, and to meet the expectations of society at large as regards preventing and helping to remedy breaches of fundamental human rights in their businesses, including in the supply chain.
Risk assessment and being able to deal with negative results requires documentation and follow-up systems. Reliable documentation and transparency give companies a stronger hand, enabling them to demonstrate what they have actually done, instead of being exposed for not doing what is apropriate.
Ethical trade is the work companies do to help ensure that the goods they purchase are manufactured in accordance with internationally recognised standards relating to working conditions and environmental considerations. In practice, this often involves promoting compliance with local laws in producer countries.