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Deepwater Horizon (2016) – Official Teaser Trailer - Mark Wahlberg

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What is business for?
What contribution should business make to society?
Society needs Business
1) emplolyment, wages
2) investment and innovation
3) profits and taxes

Business needs society:
1) demand
2) public assets, infrastructure
3) legal protection

CSR 2 vies to contrast
1) Free market view -  create wealth for shareholders
2) CSR view-business should be concerned with social issues

Watch video :
What is the case for shareholder view 1?
What is the case for CSR ?

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BUSS4 Section B: Corporate Social Responsibility (CSR)

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In this topic briefing Jim Riley introduces the concept of CSR - corporate social responsibility. The relationship and interdependence between business and society is explored as well as the case for and against businesses adopting CSR. Please SUBSCRIBE to our YouTube channel for more free business revision videos

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Corporate Social Responsibility - Elkington's Triple Bottom Line

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Elkington's Triple Bottom Line model encourages businesses to take a broader approach to business performance. It suggests that there are three key areas of performance: profit, planet and people.

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Bhopal Gas Tragedy | World's Worst Industrial Disaster

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Uploaded by AmazingFunFact on 2013-12-06.

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Steve Howard: Let's go all-in on selling sustainability

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Two giant pharmaceutical companies should lower the price of a new vaccine against pneumococcal disease that is needed by children in developing countries, but is unaffordable for some of their governments, say the volunteer doctors of Médecins sans Frontières (MSF).

In a new report on vaccine pricing, MSF says British company GlaxoSmithKline (GSK) and US giant Pfizer should slash the price of the vaccines to $5 (£3.20) per child in developing countries. At the moment, the two big pharma companies are the sole manufacturers of the pneumococcal vaccine.

The secretive nature of the industry means that prices are not disclosed in all countries, but, where they are known, there is huge variation. Hospitals in Morocco pay nearly $64 and in Tunisia $67, whereas the manufacturer's price in France is less - at about $58.

We think it's time for GSK and Pfizer to do their part to make vaccines more affordable

"We have an irrational situation where some developing countries like Morocco and Tunisia are paying more for the pneumococcal vaccine than France does," said Kate Elder, vaccines policy adviser for MSF's Access Campaign. "Because of the astronomical cost of new vaccines, many governments are facing tough choices about which deadly diseases they can afford to protect their children against."

MSF says the pneumococcal vaccine is a big contributor to the soaring cost of vaccinating a child in the poorest countries - it accounts for 45% of the total. GSK and Pfizer have collectively reported more than $19bn in global sales of the vaccine since it launched.

The full vaccination schedule which every child should receive includes 12 vaccines. Since 2001, the cost of the full package has risen dramatically, says the report, The Right Shot: bringing down barriers to affordable and adapted vaccines.

"The price to fully vaccinate a child is 68 times more expensive than it was just over a decade ago, mainly because a handful of big pharmaceutical companies are overcharging donors and developing countries for vaccines that already earn them billions of dollars in wealthy countries," said Rohit Malpani, director of policy and analysis for the MSF campaign.

"Donors will be asked to put an additional $7.5bn on the table to pay for vaccines in poor countries for the next five years, with over one-third of that going to pay for one vaccine alone, the high-priced pneumococcal vaccine; just think of how much further taxpayer money could go to vaccinate more children if vaccines were cheaper. We think it's time for GSK and Pfizer to do their part to make vaccines more affordable for countries in the long term, because the discounts the companies are offering today are just not good enough."

The report is published before next week's meeting in Berlin, where donor governments will be asked to top up the coffers of Gavi - the vaccine alliance. Gavi subsidises the price for the poorest countries, but middle-income countries are increasingly struggling to pay, says MSF.

More than a quarter of countries now eligible for Gavi support will lose it next year, as they "graduate" because of their increasing per capita income. Angola, for instance, will lose support in a year, which will push up its vaccines bill by 1,500%.

MSF has difficulty affording the costs of vaccinating children in the emergency situations where it works. "MSF faces increasing challenges in offering full immunisation to children in our projects. The rising price of the basic vaccines package means that we can't afford to protect kids living in crisis, and nor can many countries who want to protect their children," said Dr Greg Elder, MSF deputy director of operations, in the report.

In a statement, GSK said its pneumococcal vaccine is "one of the most complex we've ever manufactured, essentially combining 10 vaccines in one".

It added: "For Gavi-eligible countries, we are providing this vaccine at a deeply discounted price. At this level, we are able to just cover our costs. To discount it further would threaten our ability to supply it to these countries in the long-term. Nevertheless, we continue to look at ways to reduce production costs and any savings we make we would pass on to Gavi."

Pfizer said 60% of the world's poor children are covered by the Gavi programme at a price that is "far below" the cost to manufacture the vaccine.

In a statement, Pfizer aded that it had committed to providing Prevenar 13 until 2025 at a reduced price to countries who no longer qualify for Gavi support. "This gives countries the best chance of maintaining their pneumococcal vaccination programmes and sustaining the significant public health gains these programmes provide, even after Gavi support ends."
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Pharmaceutical companies told to slash price of pneumococcal disease vaccine

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Two giant pharmaceutical companies should lower the price of a new vaccine against pneumococcal disease that is needed by children in developing countries, but is unaffordable for some of their governments, say the volunteer doctors of Médecins sans Frontières (MSF).

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China has fined UK pharmaceuticals firm GlaxoSmithKline $490m (£297m) after a court found it guilty of bribery.

The record penalty follows allegations the drug giant paid out bribes to doctors and hospitals in order to have their products promoted.

The court gave GSK's former head of Chinese operations, Mark Reilly, a suspended three-year prison sentence and he is set to be deported.

Other GSK executives have also been given suspended jail sentences.

The guilty verdict was delivered after a one-day trial at a court in Changsha, according to the Xinhua news agency.

Chinese authorities first announced they were investigating GSK in July last year, in what has become the biggest corruption scandal to hit a foreign firm in years. The company was accused of having made an estimated $150m in illegal profits

GSK said it had "published a statement of apology to the Chinese government and its people".

"Reaching a conclusion in the investigation of our Chinese business is important, but this has been a deeply disappointing matter for GSK," said chief executive Sir Andrew Witty in a statement.

"We have and will continue to learn from this. GSK has been in China for close to a hundred years and we remain fully committed to the country and its people," he said.

"We will also continue to invest directly in the country to support the government's health care reform agenda and long-term plans for economic growth."

Mick Cooper, analyst at Edison Investment Research in London, said: "GlaxoSmithKline will hope that this will draw a line under events in China, but it will take time for its Chinese commercial operations to recover."

Analysis: Carrie Gracie, BBC China editor

This is a humiliating outcome for one of Britain's biggest companies: pleading guilty to systematic bribery, facing the biggest fine in Chinese history and making an abject apology to the Chinese government and people.

But after a case lasting more than a year, there was no easy way out for GSK, and at least now, it can start to rebuild its battered brand in China.

Today GSK said it had learned its lessons, and one of those is clearly that foreign companies need to keep a close eye on China's fast changing political and regulatory weather if they are to prosper, or even survive, in this promising but perilous market.

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China has fined UK pharmaceuticals firm GlaxoSmithKline $490m (£297m) after a court found it guilty of bribery. The record penalty follows allegations the drug giant paid out bribes to doctors and hospitals in order to have their products promoted.

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Coca-Cola has been accused of using legal manoeuvres to delay an official investigation into a misleading advertising campaign in Mexico by accusing the government agency of acting unconstitutionally.

Campaigners say that a multimedia publicity campaign launched at the beginning of 2015 misled consumers by suggesting that Sidral Mundet - an apple-flavoured drink which contains 60 grams of sugar in each 600ml bottle - was made from apples.

Adverts bearing the slogans "with apple juice" and "with pasteurized juice" accompanied by images of juicy apple slices were plastered across billboards, bus stops and delivery vans.

More than 70 videos suggesting the drink is made from fresh apples were also posted on YouTube. In one video, a whole red apple emerges from a flower pot after Sidral is poured in. In another, the drink is made by mixing an apple in a cocktail shaker.

Sidral was launched in Mexico in 1902, and bought by Coca-Cola in 2002. It contains 1% of "juice from concentrate" - which is classified an added sugar by the Food and Drug Administration (FDA).

In February, the campaign group Consumer Power reported the company to federal authorities, accusing Coca-Cola of intentionally misleading consumers about the content and benefits of Sidral. The group also claimed that the use of the term "pasteurized" is also disingenuous as it normally applies to fruit juices, not sodas.

The federal prosecutor's office for consumer rights (Profeco) asked Coca-Cola to clarify how much apple juice and apple flavour the drink contains, and explain its use of the word pasteurized.

In response, the company launched a legal challenge in March claiming that its constitutional right to a fair trial had been violated, and arguing that the country's federal consumer rights law is unconstitutional.

Coca-Cola also claimed that the complaint was directed at the wrong party, as its publicity and labeling is run by a subsidiary, Propimex.

The soft drinks giant convinced the judge to suspend the complaint against Sidral until its petition was resolved.

"Coca-Cola's primary objective was to delay the process so that it could continue with its campaign," said Javier Zuñiga, lawyer with Consumer Power.

"The case is an abuse of the constitutional claim system as the company was simply asked to clarify basic details. It bought Coke time, and consumers are left with the idea that Sidral is a healthier option when it should be seen as exactly the same as every other sugary fizzy drink," Zuñiga told the Guardian.

Mexico now has the highest child and adult obesity rates in the world and 14% of adults are diabetic.

It also has the highest per capita soda consumption rate in the world. Each year, Mexico's 119 million people drink on average 163 litres of sugary fizzy drinks each, or nearly half a litre every day. Coca-Cola controls almost three quarters of the market.

A ground-breaking sugar tax on sugary drinks was introduced in January 2014 amid growing concerns about the obesity and diabetes epidemics. The 10% tax - which was implemented after a battle with the drinks industry - cut sales by 6% in the first year.

But the rules governing advertising and labelling in Mexico are relatively weak and the complaints procedure can be long and cumbersome. Even when companies are sanctioned, the fines are so small they do not serve as a deterrent, according to Alejandro Cavillo, director of Consumer Power.

Coca-Cola's claim against the consumer rights law was thrown out in July, but the company promptly lodged an appeal.

The appeal court - which will assess the soundness of the July decision dismissing the unconstitutionality claim - usually takes five or six months to issue a ruling.

However, in October the case was sent for completion to an equivalent court in the state of Zacatecas. This means the final ruling - which could set a precedent - is unlikely until to come until mid-2016, until which Profeco's hands are tied.

Activists claim Coca-Cola's delay tactic is harming consumers who are increasingly bombarded with misleadingly information amid a global strategy by soft drinks companies try to portray certain products as healthier choices.

Meanwhile the Sidral "with apple juice" campaign ended at the beginning of August. The new campaign promotes it as a traditional, domestically-produced soda and does not make the same claims.

A Coca-Cola spokesman said: "To reinforce our commitment of encouraging informed purchase decisions, there was a modification of the logo and labelling. The percentage of juice contained in the product will be visible in the front part of the product, information that has always been present in the label.

"In this case we executed our right of defense as provided by law ... it was not a delaying tactic."

This is not the only Coke advert to draw complaint in Mexico. Earlier this month, the company issued an apology over a Christmas advert deemed offensive to the country's indigenous population. The advert was withdrawn.
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Coca-Cola ads suggesting soda is made from apples lead to legal battles

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Coca-Cola has been accused of using legal manoeuvres to delay an official investigation into a misleading advertising campaign in Mexico by accusing the government agency of acting unconstitutionally. Campaigners say that a multimedia publicity campaign launched at the beginning of 2015 misled consumers by suggesting that Sidral Mundet - an apple-flavoured drink which contains 60 grams of sugar in each 600ml bottle - was made from apples.

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A court in Australia has ordered drug giant Reckitt Benckiser to stop selling some of its popular Nurofen painkiller brands after finding tablets marketed for specific complaints such as back pain or migraines contained exactly the same active ingredient.

The Australian federal court ruled that the British-based multinational had made misleading claims when selling its Nurofen Back Pain, Nurofen Period Pain, Nurofen Migraine Pain and Nurofen Tension Headache products.

While these were marketed as formulated to treat a specific type of pain, and cost about double the price of standard Nurofen, tablets from the so-called Nurofen Specific Pain range were all found to contain the same active ingredient, 342mg of ibuprofen lysine, equivalent to 200mg of ibuprofen.

The court ordered that the products should be removed from shops within three months. A subsequent court hearing will decide on a possible fine for the company.

The ruling followed legal action launched this year by the Australian Competition and Consumer Commission (ACCC), which argued that even though the tablets all contained the same generic ingredient they were priced "significantly above that of other comparable analgesic products".

The ACCC's chairman, Rod Sims, said on Monday that the watchdog had been concerned people might have bought the products "in the belief that they specifically treated a certain type of pain, based on the representations on the packaging, when this was not the case".

Sims said price sampling by the ACCC before the start of the court case found the Nurofen Specific Pain products were being sold at almost double that of Nurofen's standard ibuprofen.

He said: "Truth in advertising and consumer issues in the health and medical sectors are priority areas for the ACCC, to ensure that consumers are given accurate information when making their purchasing decisions.

"Any representations which are difficult for a consumer to test will face greater scrutiny from the ACCC."

The Nurofen brand is also used in the UK and New Zealand. While many of the same pain-specific Nurofen products are sold in Britain, and also all contain 342mg of ibuprofen lysine, the British government's Medicines and Healthcare Products Regulatory Agency (MHRA) said it currently had no concerns about the issue.

An MHRA spokeswoman said: "For over-the-counter medicines, informative names are permitted to help patients select an appropriate product without input from a healthcare professional."

The MHRA has no remit on medicine pricing, and tends to intervene only when a product's name or description makes a medically misleading claim.

The Consumers' Association in the UK said it had no comment to make as it had not looked at the issue.

Aomesh Bhatt, head of regulatory and medical affairs for Reckitt Benckiser in Europe, said the company did not set out to mislead consumers and was cooperating with the ACCC and the federal court. It was, he said, an "Australia-only issue" with no implications for UK sales.

Speaking on BBC Radio 4's World at One, Bhatt explained the company's reasoning for branding the same ingredient under multiple names: "Consumers want the navigation in a grocery environment, where there's no healthcare professional to assist in the decision-making. We know that 90% of consumers look for a specific type of product for their individual pain."

The company has been ordered to publish website and newspaper articles to clarify its status, implement a consumer protection compliance programme and pay the ACCC's costs.

The company's Australian website has already been changed. A section describing the four types of pill connected to the case describes them as "for general pain" and says: "Any of the four products shown on this page have the same ingredient and can be taken to provide effective temporary relief of pain and/or inflammation associated with either migraine, tension headache, back pain or period pain."
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australian competition and consumer commission (accc)

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Nurofen's maker misled consumers over painkillers' contents, court rules

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A court in Australia has ordered drug giant Reckitt Benckiser to stop selling some of its popular Nurofen painkiller brands after finding tablets marketed for specific complaints such as back pain or migraines contained exactly the same active ingredient.

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Primark workers in collapsed Dhaka building

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Two thousand people were in the building on the outskirts of the capital Dhaka when its upper floors simply crashed into the floors below. Some worked for the British high street retailer Primark.

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Fashion chain sacks three suppliers following an investigation for the BBC's Panorama and The Observer

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The suppliers sub-contracted smaller firms, which were using child labour to carry out embroidery and sequin work.

The BBC's Panorama programme, which carried out a six-month investigation, alerted Primark to the problems.

Consumers are increasingly demanding that companies produce goods in an ethical manner, turning the spotlight on worker wages and working conditions.
'Lapse in standards'
"The information provided by the BBC enabled us to identify that illegal sub-contracting had been taking place and to take action accordingly," Primark explained.

According to Primark, the garments affected accounted for 0.04% of the retailers' worldwide sourcing.

It added that "the sub-contracting involved home working and in some instances children were also found to be working at home".

"We take this lapse in standards very seriously indeed," said Primark, which is owned by Associated British Foods.

"Under no circumstances would Primark ever knowingly permit such activities, whether directly through its suppliers or through third party sub-contractors."
Code of conduct
Under the terms of its code of practice for suppliers, Primark prohibits the use of child labour in its manufacturing chain.

Primark says it will terminate relations with suppliers guilty of certain "transgressions" and those unwilling to make the "necessary changes" to their employment practices when breaches of its code are uncovered.

Primark has proved one of the UK High Street's unquestioned success stories in recent years, its mixture of low prices and accessible fashion proving a hit with varying age groups.

It currently has more than 170 stores and made a £200m profit last year on total sales of more than £1.6bn.

Leading European and US retailers have come under growing pressure to ensure that workers in their supply chain - particularly in labour-intensive markets such as India and China - are not exploited.

Companies such as Nike have responded to consumer concerns about ethical standards in the retail industry by making public details of all their suppliers.

But charities and fairtrade groups have criticised other retailers for failing to follow suit and argued that many popular products continue to be sold in developed countries at a fraction of their true cost of production.
A Panorama special on Primark will be broadcast on BBC1 at 9pm on 23 June.
Update June 2011: The BBC Trust has upheld a complaint from Primark about the Panorama programme.

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The suppliers sub-contracted smaller firms, which were using child labour to carry out embroidery and sequin work. The BBC's Panorama programme, which carried out a six-month investigation, alerted Primark to the problems. Consumers are increasingly demanding that companies produce goods in an ethical manner, turning the spotlight on worker wages and working conditions.

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International oil companies such as Shell and BP must completely change their business model or face a "nasty, brutish and short" end within 10 years, one of Britain's most influential energy experts has warned.

Paul Stephens, a fellow at Chatham House thinktank, said in a research paper the oil "majors" were no longer fit for purpose - hit by low crude prices, tightening climate change regulations and their own wrongheaded strategies.

In the report, Stephens argues the only way forward for the companies lies in diversifying into green energy, drastically reducing their operations or consolidating through mega-mergers.

"The prognosis for the IOCs [international oil companies] was already grim before governments became serious about climate change and the oil price collapsed ... their old business model is dying," said Stephens, a visiting professor at University College London.

"In this new world, the only realistic option ... lies in restructuring and realising (selling) many of their current assets to provide cash for their shareholders."

The death of these key fossil fuel providers would be an astonishing reversal in fortunes for powerful companies that have previously been accused of being climate change deniers and tools - if not makers - of foreign policy.

The companies, increasingly facing calls from many of their shareholders to take more account of the environment, have also been stalwarts of the London stock market and important providers of dividends for British pension funds.

Stephens believes the companies have spent too much time trying to maximise shareholder value by finding and proving more reserves while outsourcing key operations.

The collapse in crude to $45 per barrel has exacerbated problems for the industry, but the Chatham House expert says a major price recovery cannot be guaranteed. He says companies have 10 years to change strategy or die.

"This means inevitably, however, that they must shrink into the remaining areas, functionally and geographically, where they can earn an acceptable return.

"This requires a major change in the corporate culture of the IOCs. It remains to be seen whether their senior management can manage such a fundamental shift. If they can, then the IOCs will be able to slip into a gentle decline but ultimately survive, albeit on a much smaller scale. If they do not change their business model, what remains of their existence will be nasty, brutish and short."

The call for a shakeup comes less than 24 hours after another thinktank, the Carbon Tracker Initiative, also called on oil companies to slim down and base their business models around global warming targets.

The big oil companies, including US firms such as Exxon Mobil and Chevron, have been warned that they are presiding over "stranded assets" of carbon that can never be burned if the world is determined to keep average temperatures from rising no more than 2C (3.6F) above pre-industrial levels.

But the future of international climate change strategies, and therefore carbon emissions, will depend to a great extent on whether countries implement the necessary policies agreed at the UN talks in Paris last December.

A range of issues could influence this, not least whether America elects a president this year who is as committed to the low-carbon agenda as Barack Obama. Donald Trump, the Republican nominee, may not be.

Stephens said he had assumed the Paris agreement - known as COP21 - would be implemented, allowing the world to move slowly but surely into a new lower-carbon phase.

There are isolated signs of companies taking action to change their business model, with Shell merging with its rival BG and pulling back from high-cost and environmentally challenging drilling in the Alaskan Arctic.

The Chatham House expert notes that the influence of the international oil companies has waned since the 25 years following the second world war, when they controlled virtually all crude production outside of the US and communist states.

They also owned "70% of all refining capacity, every important pipeline and about two-thirds of the privately owned tanker fleet. In this period, international crude oil trade moved entirely within their integrated operations or through long-term contracts between them."

This article was amended on 9 May 2016. Because of an editing error, an earlier version converted a rise of 2C to 35.6F; that is the fahrenheit equivalent of the actual temperature of 2C.

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Oil firms have 10 years to change strategy or face 'short, brutish end'

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International oil companies such as Shell and BP must completely change their business model or face a "nasty, brutish and short" end within 10 years, one of Britain's most influential energy experts has warned.

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A NUMBER of major companies - from PepsiCo to Walmart to U.P.S. - have recognized that corporations have a responsibility to address the causes of climate change before it is too late.

We do not have to wait for an international treaty or new regulations to act. At Siemens, the global industrial manufacturing company I lead that makes everything from wind and gas turbines and automation systems to high-speed trains and M.R.I. machines, we understand that taking action is not just prudent - it's profitable.

That's why, today, we are committing to cut our global carbon footprint in half by 2020 and to make our global operations carbon neutral by 2030. We will accomplish this by eliminating a vast majority of our carbon emissions, while also supporting projects that reduce greenhouse gas emissions outside of Siemens, known as carbon offsets. Our net CO2 emissions will be zero.

Worldwide, Siemens employs more than 340,000 people, does business in more than 200 countries, and operates nearly 300 major production sites. Last year, we were responsible for 2.2 million metric tons of carbon emissions. That means our global carbon footprint is about three-quarters that of Washington, D.C., where our United States headquarters is located.

So how does a company cut its carbon footprint in half in just five years?

We're targeting facilities, vehicles and fuel.

Over the next three years, we plan to invest more than $110 million to improve energy efficiency at offices and factories, including sites in the United States, Germany, China, Brazil and Britain. These investments are based on existing strategies and promising results.

At our gas turbine plant in Berlin, we installed automated heating and ventilation systems and moved to more energy-efficient lighting. At our plant in Sacramento, where we build light-rail vehicles and Amtrak locomotives, we installed solar panels that generate about 80 percent of the plant's energy needs.

While time consuming and labor intensive, requiring us to go system by system and location by location, the effort is paying off. Between 2010 and 2014, we increased our facilities' carbon efficiency by approximately 20 percent. We also will require Leadership in Energy and Environmental Design certification for all our new buildings, including our new global headquarters in Munich.

In addition, we will focus on our company fleet of about 45,000 vehicles, which produce roughly 300,000 metric tons of carbon emissions per year. In Germany and elsewhere, we have already lowered emissions by purchasing more fuel-efficient cars for our employees and service teams. Now we'll do this on a global scale.

We will increase our use of distributed energy systems at our own sites - by combining solar panels, wind and highly efficient gas turbines with intelligent energy management, smart grids and energy storage solutions.

Finally, we will buy clean power. To make up for the emissions that cannot be avoided in the near term, we will purchase electricity from renewable sources like wind parks and "carbon credits" from credible organizations working to reduce carbon around the world, ranging from reforestation efforts to updating power plants.

Through these steps, we hope to demonstrate to other companies that cutting your carbon footprint is not only possible, but profitable. With today's software and technology, it's easier than ever before to increase efficiency.

And while this plan requires a substantial investment, it will pay off quickly. In fact, we expect our $110 million investment to pay for itself in just five years and generate $20 million in annual savings thereafter.

In other words, cutting your carbon footprint is not only good corporate citizenship - it's also good business.

I do not want to make this effort sound simple. This requires major support at all levels of the company, particularly at the board level. It requires that we take a longer-term view when it comes to investment decisions. It means accepting a longer payback period for energy-efficiency measures.

But no effort can be spared, and all of us must do something. While we remain hopeful that global policy makers will come to an agreement at the United Nations Climate Change Conference in Paris later this year, we also know that the business community does not have to wait to act.

So, as we await Pope Francis' expected call for decisive action on climate at the United Nations, the opportunity is clear: We have the technologies, we have the business incentive, and we have the responsibility. Now all we need is the commitment.

Joe Kaeser is the chief executive of Siemens, a global manufacturing company.

A version of this article appears in print on , on Page A27 of the New York edition with the headline: Industry Must Lead on Climate Change. Order Reprints | Today's Paper | Subscribe

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Opinion | Industry Can Lead on Climate Change

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A NUMBER of major companies - from PepsiCo to Walmart to U.P.S. - have recognized that corporations have a responsibility to address the causes of climate change before it is too late. We do not have to wait for an international treaty or new regulations to act.

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After a five-year effort, Unilever tells me that it has achieved zero waste in all of its 240 factories in 67 countries worldwide. It says that it generates efficiency savings of €200m a year by eliminating disposal costs. Smaller businesses like restaurants have aimed for zero wastage, but Unilever - which makes PG Tips and Ben & Jerry's ice cream - says it's the first global company to do so.

It's a fairly remarkable claim and achievement since undoubtedly landfill waste has a huge environmental cost. The UK government estimates that households in England alone generate 177 million tonnes of waste each year.

So, if it's good for business and the environment, then why hadn't Unilever and other businesses done this before?

I put that question to Pier Luigi Sigismondi who heads Unilever's supply chain. He said that the ethos around sustainability has shifted sufficiently to get one of the world's biggest companies to launch this initiative. Remember that Unilever has had problems with environmental groups; for instance, as the biggest buyer of palm oil. Environmental groups have been concerned with the rate of deforestation in places such as Indonesia due to palm oil extraction. So, the stakeholder pressures appear to be there.

When I asked if up-front capital costs are what puts businesses off, because most are geared for shorter-term returns, Mr Sigismondi pointed out that this was also changing as the biggest companies increasingly recognise the need to address sustainability.

It's an issue that came up when we discussed Fridgeonomics on Talking Business this week.

As part of A Richer World season, we peered into people's fridges to see how consumption patterns are changing with incomes. Refrigerators also contribute to global warming and the rate of refrigeration use is growing rapidly in the emerging world. So, we discussed technologies that use solar power, and other innovations that try to reduce the environmental impact and also allow more of the developing world to have refrigerators even in places with patchy electricity.

Indeed, even with electrification challenges, owning a fridge is a mark of becoming middle class. The top three wish list items for a household emerging from poverty are a TV, a mobile phone and a fridge.

When China reached middle income status a decade ago, about a quarter of the population had fridges. Now, it's about 90%, just shy of the 99% rate found in developed countries. In India, which still hasn't reached $3,000 per capita income, fridge ownership is about 27% and growing as the middle class expands.

Of course, rising incomes generate a growing demand for food, and a richer variety including meat. Global food production will need to increase by at least 60% to meet this demand by 2050 when the global population is expected to grow by two billion to nine billion. That poses sustainability challenges too.

Peering inside fridges around the world, it turns out that basic items, such as milk, comprised about 10 items. According to research by AllianceBernstein, for middle class households, there were more indulgent items such as ice cream. For the affluent, their fridges were stocked with healthier foods such as low-fat yogurt.

So, as more of the world becomes richer, the challenges around sustainability will also increase.

If, as it claims, Unilever has managed to make a business work with zero non-hazardous wastage, then that would a big step forward on an issue that will only gain in importance as the world gets richer.

Watch Talking Business, with Linda Yueh, here.

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After a five-year effort, Unilever tells me that it has achieved zero waste in all of its 240 factories in 67 countries worldwide. It says that it generates efficiency savings of €200m a year by eliminating disposal costs.

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A CHARITY worker has paid tribute to the "inspiring" campaigners she met on a recent visit to Zambia.

Fiona Daborn is a member of Weymouth Baptist Church and a regional co-ordinator for the charity Christian Aid.

She spent 10 days in the Copperbelt Province in Zambia, hearing from communities affected by the pollution allegedly brought about by copper mines.

She also visited Mufulira, close to the border with the Democratic Republic of Congo, where the Swiss-controlled Mopani Copper Mine allegedly emits sulphur dioxide into the air as a waste product.

Fiona said that Christian Aid and partner organisations have helped the local Kankoyo community to "effectively lobby the government and the mine" for better and safer practices.

She added: "There was a real sense of David and Goliath in Zambia, with the poorest communities pitched into conflict with tremendously powerful multinational companies with sometimes devastating consequences.

"But partner organisations are helping to turn the tide and giving communities the knowledge, confidence and skills to speak out for their rights. Their future impact will be much wider than the communities immediately next to mines, as our voices join together to insist that the mining companies are taxed fairly and transparently."

During Christian Aid Week in May, residents of Weymouth and Portland raised £8,359 to help tackle poverty around the world.

Weymouth Bay Methodist Church was able to raise £192 on its own with a 'Big Brekkie' event.

Fiona added: "Our partner organisations are helping to bring about change so that Zambia can collect the corporate tax it is owed and provide effective social support for its citizens in the future without the need for aid.

"It was an inspiring visit and underlined to me how we are all joined together by a powerful common desire to champion justice and dignity and equality. More than that I came back knowing that we are moving towards that goal."

Christian Aid is a member of the ACT Alliance, which comprises more than 130 churches and religious organisations working to provide humanitarian assistance all over the world. The charity works in approximately 50 countries around the world at any one time to tackle the root causes of poverty.

For information follow @CAidWest on Twitter.

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Fiona fighting 'David and Goliath' battle for justice over mines polluting communities

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A CHARITY worker has paid tribute to the "inspiring" campaigners she met on a recent visit to Zambia. Fiona Daborn is a member of Weymouth Baptist Church and a regional co-ordinator for the charity Christian Aid. She spent 10 days in the Copperbelt Province in Zambia, hearing from communities affected by the pollution allegedly brought about by copper mines.

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What is Volkswagen accused of?

It's been dubbed the "diesel dupe". In September, the Environmental Protection Agency (EPA) found that many VW cars being sold in America had a "defeat device" - or software - in diesel engines that could detect when they were being tested, changing the performance accordingly to improve results. The German car giant has since admitted cheating emissions tests in the US.

VW has had a major push to sell diesel cars in the US, backed by a huge marketing campaign trumpeting its cars' low emissions. The EPA's findings cover 482,000 cars in the US only, including the VW-manufactured Audi A3, and the VW models Jetta, Beetle, Golf and Passat. But VW has admitted that about 11 million cars worldwide, including eight million in Europe, are fitted with the so-called "defeat device".

The company has also been accused by the EPA of modifying software on the 3 litre diesel engines fitted to some Porsche and Audi as well as VW models. VW has denied the claims, which affect at least 10,000 vehicles.

In November, VW said it had found "irregularities" in tests to measure carbon dioxide emissions levels that could affect about 800,000 cars in Europe - including petrol vehicles. However, in December it said that following investigations, it had established that this only affected about 36,000 of the cars it produces each year.

Full details of how it worked are sketchy, although the EPA has said that the engines had computer software that could sense test scenarios by monitoring speed, engine operation, air pressure and even the position of the steering wheel.

When the cars were operating under controlled laboratory conditions - which typically involve putting them on a stationary test rig - the device appears to have put the vehicle into a sort of safety mode in which the engine ran below normal power and performance. Once on the road, the engines switched out of this test mode.

The result? The engines emitted nitrogen oxide pollutants up to 40 times above what is allowed in the US.

What has been VW's response?

"We've totally screwed up," said VW America boss Michael Horn, while the group's chief executive at the time, Martin Winterkorn, said his company had "broken the trust of our customers and the public". Mr Winterkorn resigned as a direct result of the scandal and was replaced by Matthias Mueller, the former boss of Porsche.

"My most urgent task is to win back trust for the Volkswagen Group - by leaving no stone unturned," Mr Mueller said on taking up his new post.

VW has also launched an internal inquiry.

With VW recalling millions of cars worldwide from early next year, it has set aside €6.7bn (£4.8bn) to cover costs. That resulted in the company posting its first quarterly loss for 15 years of €2.5bn in late October.

But that's unlikely to be the end of the financial impact. The EPA has the power to fine a company up to $37,500 for each vehicle that breaches standards - a maximum fine of about $18bn.

The costs of possible legal action by car owners and shareholders "cannot be estimated at the current time", VW added.

How widespread are VW's problems?

What started in the US has spread to a growing number of countries. The UK, Italy, France, South Korea, Canada and, of course, Germany, have opened investigations. Throughout the world, politicians, regulators and environmental groups are questioning the legitimacy of VW's emissions testing.

VW will recall 8.5 million cars in Europe, including 2.4 million in Germany and 1.2 million in the UK, and 500,000 in the US as a result of the emissions scandal.

No wonder the carmaker's shares have fallen by about a third since the scandal broke.

It's still unclear who knew what and when, although VW must have had a chain of management command that approved fitting cheating devices to its engines, so further departures are likely.

Christian Klingler, a management board member and head of sales and marketing is leaving the company, although VW said this was part of long-term planned structural changes and was not related to recent events.

In 2014, in the US, regulators raised concerns about VW emissions levels, but these were dismissed by the company as "technical issues" and "unexpected" real-world conditions. If executives and managers wilfully misled officials (or their own VW superiors) it's difficult to see them surviving.

Are other carmakers implicated?

That's for the various regulatory and government inquiries to determine. California's Air Resources Board is now looking into other manufacturers' testing results. Ford, BMW and Renault-Nissan have said they did not use "defeat devices", while other firms have either not commented or simply stated that they comply with the law.

The UK trade body for the car industry, the SMMT, said: "The EU operates a fundamentally different system to the US - with all European tests performed in strict conditions as required by EU law and witnessed by a government-appointed independent approval agency."

But it added: "The industry acknowledges that the current test method is outdated and is seeking agreement from the European Commission for a new emissions test that embraces new testing technologies and is more representative of on-road conditions."

Environmental campaigners have long argued that emissions rules are being flouted. "Diesel cars in Europe operate with worse technology on average than the US," said Jos Dings, from the pressure group Transport & Environment. "Our latest report demonstrated that almost 90% of diesel vehicles didn't meet emission limits when they drive on the road. We are talking millions of vehicles."

Car analysts at the financial research firm Bernstein agree that European standards are not as strict as those in the US. However, the analysts said in a report that there was, therefore, "less need to cheat". So, if other European carmakers' results are suspect, Bernstein says the "consequences are likely to be a change in the test cycle rather than legal action and fines".

Certainly is. Over the past decade and more, carmakers have poured a fortune into the production of diesel vehicles - with the support of many governments - believing that they are better for the environment. Latest scientific evidence suggests that's not the case, and there are even moves to limit diesel cars in some cities.

Diesel sales were already slowing, so the VW scandal came at a bad time. "The revelations are likely to lead to a sharp fall in demand for diesel engine cars," said Richard Gane, automotive expert at consultants Vendigital.

"In the US, the diesel car market currently represents around 1% of all new car sales and this is unlikely to increase in the short to medium term.

"However, in Europe the impact could be much more significant, leading to a large tranche of the market switching to petrol engine cars virtually overnight."

More on this story

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What is Volkswagen accused of? It's been dubbed the "diesel dupe". In September, the Environmental Protection Agency (EPA) found that many VW cars being sold in America had a "defeat device" - or software - in diesel engines that could detect when they were being tested, changing the performance accordingly to improve results.

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BBC special reports: - Get the latest background, news, features, reaction, Q & A, analysis and in-depth coverage, including interactive reports and infographics from BBC News correspondents and experts.

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Campaigners claim millions of shoppers are being led to believe the expensive shoes they buy in high-street stores are made in Germany and Italy - when many are actually made by workers on poverty wages in eastern European sweatshops.

The scandal is exposed in a damning investigation into the European shoe industry, which details illegal wages and shocking working conditions in factories turning out footwear for the UK market.

The investigation claims some big brands appear to be using a legal loophole, stamping their products with "Made in Italy" or "Made in Germany" to suggest they are high quality, when they have actually been made by poverty-stricken eastern European workers. The investigation found that footwear workers in Albania were earning as little as 49p an hour including overtime - which is an illegal rate even in such a poor country.

Workers in Macedonia, where the hourly wage was as low as 64p, described being taken to hospital in wheelbarrows after fainting in freezing factories where they had to work with strong chemicals. "If the employer needs to complete, let's say, an order of 9,000 pairs of shoes, he will put 90 pairs on the belt and even if you want to die, you have to finish it," a worker told researchers compiling the report, entitled Labour on a Shoestring.

It alleges that one Macedonian factory, which produced Geox shoes, was paying illegally low wages of €131 (£113) a month, with overtime. The legal minimum is €145 before overtime.

Geox shoes are available in the UK through John Lewis and House of Fraser, among other retailers. Geox did not respond to requests for comment.

Manufacturers are able to take advantage of an obscure European loophole known as the outward processing trade (OPT) scheme. Under the rules, companies cut parts for the shoes in one country before exporting them to a low-wage economy where they are assembled and sewn. They are then imported back to the original country, duty free. The finished shoes can then be labelled as being made in the original country.

The report, compiled by researchers from several European rights groups, is based on interviews with 179 workers in 12 factories. It condemns OPT as "a dead-end scheme for workers, national economies and businesses" and describes it as "an economic and social road to ruin".

Researchers found that the factories produced shoes for brands including Zara, Lowa, Deichmann, Ara, Geox, Bata and Leder & Schuh AG and subsidiaries of CCC Shoes & Bags in Poland and Rieker and Gabor in Slovakia.

Bata did not address the allegations directly but welcomed the report, which it said had provided "interesting insights in the generally under-reported working conditions in eastern Europe". The company said it expected its suppliers to comply with local laws.

The report looked at production in six low-wage European countries: Albania, Bosnia-Herzegovina, Macedonia, Poland, Romania and Slovakia. One in three of the Albanian workers questioned were paid less than the legal minimum wage of £121 a month, even with overtime and bonuses. The report indicated that women were generally worse off. Albanian workers reported having to work on up to 60 pairs of shoes a day.

Female workers in Romania said their husbands had to find low-paid seasonal work in the west to be able to afford wood to burn for heating during the winter. One man said: "Both my wife and I work in this factory. We are glad we could find work, but cannot imagine raising children on two factory wages. Our parents and relatives cannot support us, so we depend on this miserable wage. We wanted to move from the village to the city for a better life, but cannot afford to pay city rent from our salaries."

Another worker, Krisztina, said her family had to keep livestock to feed themselves. "We have a garden and some animals. If I had to buy meat, like chicken breast from the shop, I would not be able to afford it. So, we must also take care of our animals every day because they are some of the only food we can afford."

About 24 billion pairs of shoes are produced worldwide every year, including about 729 million made in Europe. But prices for European shoes are higher: an average Italian pair exports for £39, while an average Chinese pair exports for £3.

In a Macedonian factory supplying the Geox, Deichmann and Bata brands, workers said they were expected to use strong chemicals and complained of rheumatism, back pain, allergies and respiratory problems. They said their skin was often exposed to harmful chemicals because wearing gloves meant lower productivity and even lower wages.

Deichmann said it was not aware of issues with the factory, but was conducting its own investigation and would take any action necessary.

According to the report many workers complained of sweltering conditions in summer and freezing factories in winter. "My hands are freezing, I'm shivering all over and the door to the hall is open all the time," one worker said. "If I get sick at work and if I have a car, somebody will take me to the hospital. But if I don't have a car, then I will be taken in a wheelbarrow," said another.

"In the summer, the heat is unbearable so we have had the ambulance here six times this year because co-workers had heat stroke," said one Slovak worker.

If I get sick at work and I don't have a car, somebody will take me to hospital in a wheelbarrow

East European worker

Dorel Mituletum, deputy mayor of Calafat in Romania, was also interviewed for the report and said of the factory workers: "The poor things drop like flies."

One Romanian worker said that when three women were overcome by the heat at their factory her Italian supervisor joked that "he would have to improvise a cemetery in the back yard if the women continued to faint".

Anna McMullen, from Labour Behind the Label, a UK-based workers' rights group involved in the report, said consumers needed to be told the truth about where their shoes come from. "The clever ruse of shipping shoe parts out to low-wage countries to the east of Europe for assembly and glueing, before returning shoes for labelling as 'made in Europe', is duping consumers into thinking their products are made with dignity," she said.

"In fact, we now know that workers in Albania and Macedonia are being paid wages so low that they cannot feed their families - so much so that the gap between the minimum and living wage is greater than in China. These out-sourcing methods used by some brands are turning mass profits on the back of worker poverty."

McMullen said consumers tended to associate sweatshops with Asia, but the reality was that they existed much closer to home. "The need for fast fashion is bringing shoe production closer to home, and with it comes wage competition with Asia that mirrors, if not tops, the exploitation that we see elsewhere in global supply chains.

"Workers are earning less than a quarter of the wage that they need to live with dignity, despite toiling massively long hours to deliver stressful piece-rate targets. 'Made in Europe' no longer means 'made with dignity'."

The groups behind the report want manufacturers to be more transparent about where they make shoes that are on sale on UK high streets - and about wages and working conditions.

McMullen added: "Today, we are calling out brands that hide exploitation behind labels that con consumers. Brands have a duty to make sure human rights are delivered for people who make their shoes. Being honest about where that is, is one of the first steps."

Separately, one company not named in the report, Adidas, was invited by the researchers to comment on its findings and backed the campaigners' calls for improved working conditions. "We do agree ... that working conditions in eastern Europe are generally under-reported and increased worker rights protection is called for. More should be done to improve wages and we know, first-hand, that engagement between local suppliers, unions, governments, and buyers can pay dividends and improve the overall lives of workers," it said.

Zara's parent company, Inditex, confirmed that it produced a small number of shoes in Romania and Albania. It said it operated a strict code of conduct to comply with the most stringent labour and human rights standards. It added: "In line with a key recommendation of the report, Inditex is working hard, worldwide, to drive living wages throughout its supply chain."

Lowa stressed that it too set the highest ethical standards. In a statement, it said: "Lowa strongly condemns the deplorable conditions shown in these reports. The decision to manufacture 100% 'made in Europe' incorporates our assurance of fair and humane manufacturing conditions. We will be intensifying our oversights in this area in order to be absolutely certain that facilities producing for Lowa abide by such conditions."

The other brands did not respond to the allegations in the report or to the Observer 's request for comment.

Topics

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The expensive 'Italian' shoes made for a pittance in east European sweatshops

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Campaigners claim millions of shoppers are being led to believe the expensive shoes they buy in high-street stores are made in Germany and Italy - when many are actually made by workers on poverty wages in eastern European sweatshops.

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Beyonce's new sportswear label Ivy Park has denied claims its clothes are produced by sweatshop labourers who reportedly earn 44p an hour and £4.30 a day in Sri Lanka.

The Sun on Sunday reported the clothing range, which is sold by Topshop, was made by workers at MAS Holdings factory in Sri Lanka.

The tabloid claimed one of the labourers earned 18,500 rupees (£82.26) a month - just over half the Sri Lankan average wage of £164. This particular worker said she worked as a sewing machine operator for nine and three-quarter hours a day, five days a week and worked overtime.

MAS factory is not breaking the law because it pays over the legal minimum wage of 13,500 rupees a month.

Ivy Park told The Independent the original story was "unfounded".

"Ivy Park has a rigorous ethical trading programme," a spokesperson said in a statement. "We are proud of our sustained efforts in terms of factory inspections and audits, and our teams worldwide work very closely with our suppliers and their factories to ensure compliance. We expect our suppliers to meet our code of conduct and we support them in achieving these requirements".

Anti-Slavery International say the working conditions described in the original article are typical of the wider garment sector across South East Asia.

"The particular chain in question has a reputation for paying above minimum wage and for empowering women in the supply chain which is presumably why Ivy Park chose the company," explained Aidan McQuad, the Director of the anti-slavery charity.

"Those interviewed in the piece may come from a subcontracted part of business or be the result of some internal corruption and this is something which is worthy of further scrutiny," he added.

"The sort of thing Beyonce is doing has the potential to provide decent work for a lot of people but often there is a significant gap between the potential and the actuality".

Mr McQuad said it was vital the workers in this particular factory were provided with the living wage, access to an independent complaints body and freedom to join a worker's union.

"Making sure the living wage is being paid so you're taking people out of abject poverty is something the business could do," he said. "A living wage would allow you not be malnourished and make sure your kids go to school without getting into debt while a poverty wage is a wage which is not contributing to your exit from poverty".

During an appearance at London's Topshop store, Beyonce said her goal with Ivy Park was to "support and inspire women who understand that beauty is more than your physical appearance".

Topshop declined to comment and MAS Holdings factory did not immediately respond to a request for comment.

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Beyonce's sportswear line responds to claims it pays 'sweatshop workers £4.30 a day'

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Beyonce's new sportswear label Ivy Park has denied claims its clothes are produced by sweatshop labourers who reportedly earn 44p an hour and £4.30 a day in Sri Lanka. The Sun on Sunday reported the clothing range, which is sold by Topshop, was made by workers at MAS Holdings factory in Sri Lanka.

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Poor treatment of workers in Chinese factories which make Apple products has been discovered by an undercover BBC Panorama investigation.

Filming on an iPhone 6 production line showed Apple's promises to protect workers were routinely broken.

It found standards on workers' hours, ID cards, dormitories, work meetings and juvenile workers were being breached at the Pegatron factories.

Apple said it strongly disagreed with the programme's conclusions.

Exhausted workers were filmed falling asleep on their 12-hour shifts at the Pegatron factories on the outskirts of Shanghai.

One undercover reporter, working in a factory making parts for Apple computers, had to work 18 days in a row despite repeated requests for a day off.

Another reporter, whose longest shift was 16 hours, said: "Every time I got back to the dormitories, I wouldn't want to move.

"Even if I was hungry I wouldn't want to get up to eat. I just wanted to lie down and rest. I was unable to sleep at night because of the stress."

'Continuous improvement'

Apple declined to be interviewed for the programme, but said in a statement: "We are aware of no other company doing as much as Apple to ensure fair and safe working conditions.

"We work with suppliers to address shortfalls, and we see continuous and significant improvement, but we know our work is never done."

Apple said it was a very common practice for workers to nap during breaks, but it would investigate any evidence they were falling asleep while working.

It said it monitored the working hours of more than a million workers and that staff at Pegatron were averaging 55 hours a week.

Find out more

Watch Panorama: Apple's Broken Promises on BBC One on 18 December at 21:00 GMT or later on the BBC iPlayer.
BBC iPlayer
The poor conditions in Chinese factories were highlighted in 2010 when 14 workers killed themselves at Apple's biggest supplier, Foxconn.

Following the suicides, Apple published a set of standards spelling out how factory workers should be treated. It also moved some of its production work to Pegatron's factories on the outskirts of Shanghai.

But Panorama's undercover reporters found that these standards were routinely breached on the factory floor.

Overtime is supposed to be voluntary, but none of the reporters were offered any choice. In addition to the excessive hours, one reporter had to attend unpaid meetings before and after work. Another reporter was housed in a dormitory where 12 workers shared a cramped room.

Apple says the dormitory overcrowding has now been resolved and that it requires suppliers to retroactively pay workers if it finds they haven't been paid for work meetings.

Pegatron said it was carefully investigating Panorama's claims and would take all necessary action if any deficiencies were found at their facilities.

"Worker safety and well-being are our top priorities. We set very high standards, conduct rigorous training for managers and workers, and have external auditors regularly visiting our facilities to find areas for improvement," a statement said.

Dangerous conditions

Panorama also travelled further down Apple's supply chain to the Indonesian island of Bangka.

Apple says it is dedicated to the ethical sourcing of minerals, but the programme found evidence that tin from illegal mines could be entering its supply chain.

It found children digging tin ore out by hand in extremely dangerous conditions - miners can be buried alive when the walls of sand or mud collapse.

Twelve-year-old Rianto was working with his dad at the bottom of a 70-foot cliff of sand. He said: "I worry about landslides. The earth slipping from up there to the bottom. It could happen."

Panorama tracked down a gang who collect tin from the area where Rianto was working. One of them said they sold tin to a smelter on Apple's list of suppliers.

Johan Murod, who runs one of the smelters on Apple's list, said 70% of the tin that is exported comes from the small-scale mines.

"At the smelter there's everything from both large and small scale mines. It's all mixed. There's no way to know what is legal and what is illegal."

Apple says it is a complex situation on Bangka with tens of thousands of miners selling tin through many middle men.

"The simplest course of action would be for Apple to unilaterally refuse any tin from Indonesian mines. That would be easy for us to do and would certainly shield us from criticism.

"But that would also be the lazy and cowardly path, since it would do nothing to improve the situation. We have chosen to stay engaged and attempt to drive changes on the ground."

Watch Panorama: Apple's Broken Promises on BBC One on 18 December at 21:00 GMT or watch later on BBC iPlayer.

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Poor treatment of workers in Chinese factories which make Apple products has been discovered by an undercover BBC Panorama investigation. Filming on an iPhone 6 production line showed Apple's promises to protect workers were routinely broken. It found standards on workers' hours, ID cards, dormitories, work meetings and juvenile workers were being breached at the Pegatron factories.

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The illegal and often abusive treatment of migrant workers is one of the most pressing reputational risks for global corporations, according to a report released on Monday.

Recent exposés concerning forced labour - from the Thai seafood industry to the Turkish garment sector - reveal how pervasive the problem of migrant abuse is.

It is rare for multinationals to employ illegal migrants directly, but claiming ignorance about abusive practices in their supply chains is no longer a defence, says the report. "There's a public assumption that companies are responsible for all the workers that contribute to the end product that they sell," says Alexandra Channer, principal human rights analyst at Verisk Maplecroft and co-author of the report.

"Most companies haven't mapped beyond their tier 1 [primary] suppliers, so they have this hidden deep part of their supply chain where they are vulnerable to serious human rights allegations that they might be totally unaware of."

The notion that the world's largest corporations are profiting from abusive labour practices is, regrettably, nothing new. A stinging report from the International Trade Union Confederation (ITUC) recently estimated that the world's 50 largest companies indirectly employ 116m "hidden" undocumented workers - equivalent to 94% of all the workers connected to their business.

How can companies improve?

Under international norms such as the UN Guiding Principles on Business and Human Rights, companies are expected to undertake due diligence on their supply chains, says ITUC general secretary Sharan Burrow. Yet few do. "The evidence of increasing insecure work informality and forced labour is mounting. There is no moral compass for business that makes profit from exploitation. This must change," says Burrow.

Many of ITUC's recommendations coincide with those highlighted in Verisk Maplecroft's report: provide a safe working environment, end short-term contracts, pay a minimum wage and allow for collective bargaining. None are impossible. With their cash reserves alone, the world's 25 largest companies could pay informal workers in their supply chain $5,000 extra per year, ITUC calculates.

Getting a clearer view of working conditions among suppliers and sub-suppliers is becoming simpler too. For instance, Sedex, a specialist in supply chain data, provides 38,000 suppliers in 150 countries with a self-assessment questionnaire that corporations can access to determine their exposure to human rights risks. A handful of brands, including UK retailers such as Marks & Spencer and Boden, are also experimenting with mobile technology [pdf] to enable workers to anonymously report working conditions in real time.

Even if such systems were faultless (which they're not: suppliers can fudge self-assessment forms; vulnerable workers may not have phones), the problem of migrant abuse will persist. Migrant workers and refugees frequently find themselves in situations of effective forced labour even before they turn up at the factory gates.

Gangmasters and agencies

The only long-term solution is to tackle the issue at source, says Lara White, senior labour mobility specialist at the International Organisation for Migration. That means stamping out the unscrupulous recruitment agencies that oversee the so-called migrant "corridors" feeding global demand for cheap foreign labour.

"What you have is a worker who is being brought into a job and is in debt already," says White, who adds that some workers pay as much as two years' salary to recruiters.

"If there is a breakdown in the employer-employee relationship, they [workers] are either told they have to stay until they have paid off their debt or they can leave but they may still owe money back home, so they don't have realistic choices about leaving exploitative situations."

According to the International Labour Organization's private employment convention recruitment fees should be met by employers, not workers. Not only does such an approach protect workers, but it should also drive criminality out of the system: fees would normalise, selection processes would closer reflect business needs and expectations of both employer and employee would be better understood from the start.

"These [exorbitant fees] are not an aberration - it's the way the business model operates throughout the global south," says Neill Wilkins, a project manager at the Institute for Human Rights and Business (IHRB). "The fees that migrants are paying bear no relationship whatsoever to the true costs of recruitment."

IHRB is the co-promoter of the Dhaka Principles for Migration with Dignity, which set out 10 measures to reduce the risk of migrant abuse in corporate supply chains. Top of the list is the "employer pays" principle. Big business has failed to publicly back this simple principle, with the exception of the Electronic Industry Citizenship Coalition (EICC), which recently changed its code of conduct to prohibit the payment of recruitment fees by workers.

The EICC's revised code of conduct sets a bar for global companies in other respects too. As well as banning fee payments, it prohibits abusive practices such as withholding workers' passports and placing unreasonable restrictions on their movements. Migrant workers must also be provided with a written employment agreement in their native language prior to departing from their country of origin.
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Abuse of migrant workers is now a top risk for businesses

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The illegal and often abusive treatment of migrant workers is one of the most pressing reputational risks for global corporations, according to a report released on Monday. Recent exposés concerning forced labour - from the Thai seafood industry to the Turkish garment sector - reveal how pervasive the problem of migrant abuse is.

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Top bosses will have earned more money by the end of Tuesday than the average worker will do in a year, campaign group the High Pay Centre has claimed.

The group has declared the day Fat Cat Tuesday, based on FTSE 100 chief executives earning £5m a year, compared with the median UK salary of £27,645.

The think tank says its aim is to highlight the "unfair pay gap".

The calculations were criticised as "pub economics, not serious analysis" by the Adam Smith Institute.

"None of these complaints are valid unless the High Pay Centre thinks it has a better way of estimating the value of executives to firms than those firms themselves," said the institute's executive director, Sam Bowman.

"The High Pay Commission's complaints only make sense if you assume firms don't actually care about making money - which is to say, they don't make sense at all."

12-hour days

The High Pay Centre's estimates are based on chief executives working 12-hour days and taking few holidays, giving them an average hourly pay of £1,260 an hour.

At this rate, it means bosses only need to work 22 hours - taking them to Tuesday afternoon, assuming they started work on 4 January - to reach the median full-time employee salary.

The body uses a mean average for chief executive pay and a median average for workers' pay, which means the figures are not directly comparable.

Nonetheless, High Pay Centre director Stefan Stern said its figures raised doubts about the effectiveness of government efforts to curb top pay.

"Overpayment at the top is fuelling distrust of business," he said.

High executive pay has been in the spotlight since the financial crisis.

Since 2013, UK-listed companies have had to publish a single figure detailing their top executive's salary, as well as being required to give shareholders a binding vote on directors' pay.

The High Pay Centre is calling for further measures to be taken, such as representation for workers on company remuneration committees that set executive pay, as well as publication of the pay gap between the highest and median earner within a firm.

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Top bosses will have earned more money by the end of Tuesday than the average worker will do in a year, campaign group the High Pay Centre has claimed. The group has declared the day Fat Cat Tuesday, based on FTSE 100 chief executives earning £5m a year, compared with the median UK salary of £27,645.

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The chairman of Barclays is making an unlikely critic of bankers' bonuses.

John McFarlane spoke at the annual conference of the British Bankers' Association on Thursday night, and argued that bankers now earn too much.

"I used to run the markets side of various institutions and I was never paid anything close to anything people get paid in these areas now," MacFarlane said.

In the speech, McFarlane, a former head of the Australia and New Zealand Banking Group, argued that bonuses encourage bankers to "cut corners." This problem could be solved by creating "geared incentives in retail or investment banking" he said.

Despite his strong views, McFarlane said he doubted change will come any time soon. He expressed a belief that bankers should be given performance-based bonuses once it was clear what their work had acheived

"If I had my own way ... I would reward people at the end, once you know the results sometimes three or five years down the road. At least you are then rewarding them for what you know in terms of the value they have created." McFarlane added that he believes "this can never happen."

During his speech, McFarlane was also keen to stress that regardless of the strength of his feelings about bonuses, Barclays won't be able to act alone in changing the bonus culture in banking.

He warned that "all that happens is you lose your best people" if bonuses and pay are cut, adding "In order to motivate them we have to pay them,"

While McFarlane is pessimistic about changing the way in which bankers get bonuses, there is some evidence to suggest that the bonus culture is changing. In February, Barclays said it would cut its bonus pool by at least 16% to less than £2 billion ($3.1 billion), and earlier this week Business Insider reported that major banks in the USA are setting aside less money for bonuses this year. Morgan Stanley is believed to have taken up to $1 billion (£650 million) out of its remuneration pot.

After the conference, the Financial Times reports, McFarlane told reporters that "most of the returns at investment banks went to employees and not to shareholders and I think that game is over."

McFarlane also jumped to the defence of former JPMorgan banker Jes Staley, who is tipped to become Barclays' chief executive, after speculation that the appointment of an investment banker may lead the bank back to

MacFarlane said that people "jumped to conclusions" over the possible appointment, adding: "If we hire him, we're not hiring an investment banker. He is not an investment banker. He started life like me, as a commercial banker, he is a corporate banker."

"He then ran the equities division, but he didn't trade equities. He ran the fund management division, and then ran the investment banking. He is a client guy, like I started life, lending money to corporations."

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Barclays boss: Bonuses just make bankers 'cut corners'

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The chairman of Barclays is making an unlikely critic of bankers' bonuses. John McFarlane spoke at the annual conference of the British Bankers' Association on Thursday night, and argued that bankers now earn too much. "I used to run the markets side of various institutions and I was never paid anything close to anything people get paid in these areas now," MacFarlane said.

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It is time to take a hard look at the universally accepted principle that the goal of business is to maximise shareholder value.

Although the concept seems entrenched in business practise, it actually originated in a 1976 article by two business school professors at the University of Rochester who postulated that corporate executives act as agents on behalf of the shareholders, who are in turn the corporation's principals.

This raised the spectre of 'agency costs', which might be incurred if executives acted in their own interests rather than in the interests of their principals. The only safeguard against executives profiting at the expense of shareholders was to align both of their interests through a commitment to maximising shareholder value, and best incentivised by stock options for senior executives.

This idea is so deeply ingrained that many people assume corporations are legally required to maximise shareholder value. But this erroneous assumption is thoroughly dispelled by Lynn Stout of Cornell Law School in a recent book, The Shareholder Value Myth and in a recent article in the Stanford Social Innovation Review by Antony Page and Robert Katz. These legal scholars persuasively debunk any such legal or fiduciary duty.

Another excellent book, Fixing the Game, by Roger Martin, dean of the Rotman School of Management at the University of Toronto, goes further by pointing out that maximising shareholder value is actually a bad way to run a business.

Martin explains the danger of managers who aim to optimise the price of the stock rather than the performance of the company with an analogy of football players betting on their own games. If the players focus on winning the game, all of their incentives align with excellent performance. However, if they are rewarded based on the betting pool, they begin to worry about managing the odds.

Betting odds are like stocks

Betting odds, like stocks, are based on expectations of future performance. The better a team does, the higher expectations run. Players who want to make money by betting must manage the bookies' expectations, either by strategically losing some games to lower expectations, or by taking greater and greater risks to achieve unprecedented levels of success. Either way, when players start playing to meet 'expectations' rather than to win the game itself, their team's performance suffers.

The same insidious incentives arise when executives start managing to meet analysts' expectations rather than managing the business itself.

Martin and Stout both compile evidence to suggest that the primacy of shareholder value has not actually benefitted shareholders but has instead turned into a bonanza for senior executives: in 1970, only 1% of a Fortune 500 chief executive's compensation was in stock options and the average salary of was $700,000 (£438,000). Today stock and stock options account for 80% of the vastly inflated average compensation, which has increased more than 1,800% to $12.9m (£8m).

The ultimate irony

The ultimate irony may be that the allegiance to shareholder value has caused the very problem it was intended to cure: enriching senior executives at the shareholders' expense.

Given long enough time on the horizon, the interests of the company, the investors, and the executives would ultimately align. But with an average chief executive tenure of four and a half years, and an average stock holding period of only four months, short-term pressures exacerbate the focus on manipulating the stock rather than building the business. The increase in high speed trading and the proliferation of hedge funds and private equity firms has further increased the short-term pressure for financial engineering rather than long-term value creation.

The biggest cost of all, however, is neither to the company nor its shareholders, but to our society and our planet. The ubiquitous mandate to maximise short-term shareholder value has driven a deep wedge between business and society. The long term success of any company depends on the health and wellbeing of its employees, customers, and the communities in which it operates.

Unfortunately, these factors do not affect the quarterly earnings that drive analysts' expectations. CEOs who manage the stock, rather than the company, have little reason to think about the social and environmental consequences of their actions. And the result - whether in oil spills or credit derivatives - brings devastation far beyond the company's own shareholders.

But a small, yet growing cadre of sophisticated business leaders are beginning to expand their focus beyond merely maximising shareholder value to creating shared value. They are building strong companies and healthier societies at the same time; making money by reducing their environmental footprint, meeting the needs of low-income populations, and finding innovative, profitable solutions to social problems. One might expect that such an "altruistic" approach would diminish shareholder returns: instead, it keeps corporate leaders focused on the most powerful emerging trends and the long term fundamentals of their businesses.

As investors like Generation Investment Management are increasingly discovering, maximising shared value is the best way to maximise shareholder value.
Mark Kramer This content is brought to you by Guardian Professional. Become a GSB member to get more stories like this direct to your inbox is founder and managing director at and a senior fellow of the CSR Initiative, at Harvard Kennedy School of Government Topics

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What's wrong with maximising shareholder value?

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It is time to take a hard look at the universally accepted principle that the goal of business is to maximise shareholder value. Although the concept seems entrenched in business practise, it actually originated in a 1976 article by two business school professors at the University of Rochester who postulated that corporate executives act as agents on behalf of the shareholders, who are in turn the corporation's principals.

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In business school, we used to debate whether your business ethics should adapt to the local environment or be the same around the world. Many of my classmates argued, "When in Rome, do as the Romans do." In other words, follow local practices. Those were the days when leading ethicists like Joseph Fletcher and James Adams at Harvard were promoting "situation ethics," based on flexible, pragmatic approaches to complex dilemmas.

I listened to their arguments but never could figure out how leaders of business organizations could operate with one set of principles in their homeland and another overseas.

In the 1970s, the Foreign Corrupt Practices Act (FPCA) sent a chill throughout the business community by criminalizing the act of making payments outside the U.S. in pursuit of contracts. Yet the practice persisted. Many U.S. executives lobbied to relax the FPCA's provisions, arguing that they were at a competitive disadvantage in bidding against non-U.S. companies.

Risking the Company's Reputation

These days the business world has gone global, which has intensified the ethics debate. Making payments to obtain business is common practice in many developing markets in Asia, Africa, the Middle East, and Eastern Europe, and some companies feel obliged to play the game to compete. Witness Germany's Siemens (SI), which has admitted to nearly $2 billion in bribes, leading to the resignations of both its board chairman and its CEO in 2007. Then there's Britain's BAE Systems, which has been accused of making a $2 billion payment to a Saudi prince to secure $80 billion in government contracts. (The company denied the allegation, which is being investigated by the U.S. Justice Dept.)

What's significant about these ethical scandals is the damage they do to great institutions. If you were leading such an organization, would you risk permanently damaging your company in order to win a few overseas contracts? Regrettably, for some executives the answer is yes.

Forty years of experience has strengthened my belief that the only way to build a great global company is with a single global standard of business practices, vigorously communicated and rigorously enforced. Applying "situation ethics" in developing countries is the fastest way to destroy a global organization. To sustain their success, companies must follow the same standards of business conduct in Shanghai, Mumbai, Kiev, and Riyadh as in Chicago.

Engage the CEO in the Process

How else will employees in far-flung locations know what to do when pressured by customers or competitors to deviate from company standards? If overseas managers miss their financial targets because they adhere to strict ethical standards, can they be confident management will back them up?

Operating ethically requires much more than a code of conduct. The CEO and top management must engage with employees around the world to insist on transparency and compliance. Otherwise, they will never know what's going on. The company must have a closed-loop system of monitoring and auditing local marketing practices. The "don't look, don't tell" approach is bound to destroy your company's reputation. High standards must be enforced with a zero tolerance policy.

This well-established approach is employed by the companies on whose boards I serve-ExxonMobil (XOM), Goldman Sachs (GS), and Novartis (NOVN). Their employees throughout the world know precisely what is expected of them. Nothing is more important to these companies than their reputations, and they know that nothing destroys reputations faster than ethical violations.

Ethics Create Shareholder Value

General Electric's (GE) former general counsel, Ben Heineman, writes in "Avoiding Integrity Land Mines" in the Harvard Business Review about high performance with high integrity, proposing that performance and ethics go hand in hand. Heineman argues persuasively that CEOs can't just publish their policies and enforce them. Rather, they must get personally involved in ensuring ethical behavior and engaging employees in vigorous discussions of real-world issues. Otherwise, marginal practices like using agents to make payments will abound.

Despite the best efforts, there will be deviations. That's when leaders are watched most closely by their subordinates. Will management make an exception for a top performer?

Early in my time as CEO of Medtronic (MDT) I had to deal with numerous such deviations that led to the termination of such high-performing executives as the president of our European operations and country managers of Japan, Argentina, and Italy. These actions sent a powerful message that we were serious about company standards, and no one was exempt.

The bottom line is that good ethics is good business. There is a direct correlation between behaving ethically and creating long-term shareholder value. Furthermore, high integrity in external business dealings goes hand in hand with creating greater transparency and increased integrity in internal relationships. This necessitates choosing leaders who are not only ethical themselves but also committed to ensuring their organizations operate ethically at all times.

Bill's True North Principle: Great global organizations can be built only from a solid ethical foundation.

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In business school, we used to debate whether your business ethics should adapt to the local environment or be the same around the world. Many of my classmates argued, "When in Rome, do as the Romans do." In other words, follow local practices.

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SEOUL, South Korea (AP) - South Korean police on Saturday braced for more violence between opponents and supporters of ousted President Park Geun-hye, who was stripped of her powers by the Constitutional Court over a corruption scandal that has plunged the country into a political turmoil.

Three people died and dozens were injured in clashes between police and Park's supporters after the ruling Friday, according to police, which detained seven protesters for questioning.

The Seoul Metropolitan Police Agency was planning to deploy nearly 20,000 officers and hundreds of buses to separate the two crowds, whose passionate rallies have divided the streets near the presidential palace in the past several weekends as the scandal worsened.

The court's decision capped a stunning fall for the country's first female leader. Park rode a wave of lingering conservative nostalgia for her late dictator father to victory in 2012, only to see her presidency crumble as millions of furious protesters filled the nation's streets.

The ruling allows possible criminal proceedings against the 65-year-old Park - prosecutors have already named her a criminal suspect - and makes her South Korea's first democratically elected leader to be removed from office since democracy replaced dictatorship in the late 1980s.

It also deepens South Korea's political and security uncertainty as it faces existential threats from North Korea, reported economic retaliation from a China furious about Seoul's cooperation with the U.S. on an anti-missile system, and questions in Seoul about the new Trump administration's commitment to the countries' security alliance.

South Korea must now hold an election within two months to choose Park's successor. Liberal Moon Jae-in, who lost to Park in the 2012 election, currently enjoys a comfortable lead in opinion surveys.

Kim Yong-deok, the chief of the National Election Commission, said Saturday that the election will be managed "accurately and perfectly" and urged the public to participate in a vote that would "determine the fate of the Republic of Korea," referring to South Korea's formal name.

Park's "acts of violating the constitution and law are a betrayal of the public trust," Acting Chief Justice Lee Jung-mi said. "The benefits of protecting the constitution that can be earned by dismissing the defendant are overwhelmingly big. Hereupon, in a unanimous decision by the court panel, we issue a verdict: We dismiss the defendant, President Park Geun-hye."

Lee accused Park of colluding with longtime confidante Choi Soon-sil to extort tens of millions of dollars from businesses and letting Choi, a private citizen, meddle in state affairs and receive and look at documents with state secrets. Those allegations were previously made by prosecutors, but Park has refused to undergo any questioning, citing a law that gives a sitting leader immunity from prosecution.

It is not clear when prosecutors will try to interview her.

Park hasn't vacated the presidential Blue House yet, as her aides are preparing for her return to her private home in southern Seoul, according to her office. Park has not made a public statement on her removal.

Park's lawyer, Seo Seok-gu, who had previously compared her impeachment to the crucifixion of Jesus Christ, called the verdict a "tragic decision" made under popular pressure and questioned the fairness of what he called a "kangaroo court."

Pre-verdict surveys showed that 70 to 80 percent of South Koreans wanted the court to approve Park's impeachment. But there have been worries that Park's ouster would further polarize the country and cause violence.

Sensing history, thousands of people - both pro-Park supporters, many of them dressed in army-style fatigues and wearing red berets, and those who wanted Park gone - gathered around the Constitutional Court building and a huge public square in downtown Seoul.

Some of Park's supporters reacted with anger after the ruling, shouting and hitting police officers and reporters with plastic flag poles and steel ladders and climbing on police buses. Prime Minister Hwang Kyo-ahn, the acting head of state, pleaded for peace and urge protesters to move on. Anti-Park protesters celebrated by marching in the streets near the Blue House, carrying flags, signs and an effigy of Park dressed in prison clothes and tied up with rope.

Police and hospital officials said three people died while protesting Park's removal. A man in his 70s, believed to be a Park supporter, died after a large speaker that had been mounted on a police truck fell on his head, police said. They are questioning a Park supporter who allegedly knocked off the speaker by stealing a police bus and crashing it into the truck.

Police said that another man in his 70s died early Saturday after collapsing near the court. An official from the nearby Kangbuk Samsung Hospital said another man brought from the pro-Park rally died shortly after receiving CPR at the hospital.

Prosecutors have arrested and indicted a slew of high-profile figures over the scandal, including Park's confidante Choi, top Park administration officials and Samsung heir Lee Jae-yong.

___

Associated Press writers Hyung-jing Kim and Foster Klug contributed to this report.

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3rd protester dies as S. Korea braces for more rallies

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SEOUL, South Korea (AP) - South Korean police on Saturday braced for more violence between opponents and supporters of ousted President Park Geun-hye, who was stripped of her powers by the Constitutional Court over a corruption scandal that has plunged the country into a political turmoil.

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2 - Ethics and controlling MNCs case study - Question sheet

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2 - Ethics and controlling MNCs case study

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2 - Ethics and controlling MNCs - Answers