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    Wileymoore topicofthe day slideshare Wileymoore topicofthe day slideshare Presentation Transcript

    • ET HI CS IN SO W UR IT H CIN VE G ND AN OR D S WO ily RK Em ley IN i G W la Ky ore o M
    • WHAT IS ETHICS? How do you define ethics? Ethics is “the basic concepts and fundamental principles of right human conduct. It includes study of universal values such as the essential equality of all men and women, human or natural rights, obedience to the law of land, concern for health and safety and, increasingly, also for the natural environment” (BusinessDictionary.com). Ethics is hard to enforce because it can be subject to individual interpretations
    • VOCABULARY Ethical sourcing: means that the products are created in safe working environments by employees who are treated well, paid reasonable salaries, and work legal hours. (Sanctus Mundo) Unethical sourcing: products are created in environments that are not safe for the employees, where they are possibly not paid or treated well, and work far more than the legal hours. Sweat shop: “a shop or factory in which employees work for long hours at low wages and under unhealthy conditions” (Merriam Webster) Child labor: use of young workers in factories farms and mines, employing them to the point of “virtual slavery” (Korshunova)
    • ETHICS IN SOURCING ANDWORKING WITH VENDORS Consumers have voiced concerns over human rights and the environmental impact that comes with where their clothes are made Contradictory with demands for fast fashion (Just-Style). Retailers need to make sure the manufacturers that produce their products are ethical  Safe, legal working conditions  Friendly to the environment
    • SWEAT SHOPS U.S. Department of Labor: sweatshop is a factory that violates two or more labor laws Workers are subject to extreme exploitation Could include absence of a living wage/benefits Poor working conditions Verbal/physical abuse Could be so bad they do not improve the economic condition of their employees (Vegan Peace Home).
    • SWEAT SHOPS CONTINUED In order to no longer be a sweat shop  Employees must  be paid a minimum wage  Keep a time card  Be paid overtime  Be paid on time  Be allowed to organize an independent union Often apparel factories are sweat shops (Global Exchange)
    • CHILD LABOR Child Labor first became a problem in 18th century Britain with the introduction of the factory system Grew from apprenticeships and family employment, which became virtual slavery, “especially among British orphans” (The Free Dictionary by Farfalex). Most European countries passed child labor laws by 1940 Child labor became a recognized U.S.problem after the civil war
    • CHILD LABOR CONTINUED First Labor Standards Act was passed 1838  Set a minimum age limit of 18 for hazardous occupations  16 for employment during school hours for companies in Interstate commerce  14 for employment outside school hours in nonmanufacturing companies In 1941 Congress passed this act International Labor Organization regulate the employment of children In 2000, 2%-29% of children between the ages of 5 to 14 were a part of economic activity 1999 the International Labor Organization banning any form of child labor that endangers the morals, health and safety of children  Such as: slaver, forced labor, prostitution, criminal activity, forced military recruitment (The Free Dictionary by Farfalex).
    • U.S. LAWS Sweatshops  U.S. Department of Labor requires…  Workers to be paid minimum wage  Workers to keep a time card  Workers to be paid overtime  Workers to be paid on time  The Union of Needletrades Industrial and Textile Employees (UNITE) requires…  that workers be allowed to their right to organize an independent union (Global Exchange)
    • U.S. LAWS Child-Labor  Exist to protect children from exposure to hazardous, unsanitary, immoral conditions or overwork  Primarily applies to business enterprises but some non profit companies in certain states as well  The law controlling child labor is the Fair Standards Act of 1838  Federal law provides the basic framework for the employment of children  Minimum requirements include age restrictions, minimum wage provisions, hours of work provisions, and the prohibition of certain occupations  Each state also has its own child labor laws (The Free Dictionary by Farfalex)
    • COMMON OUTSOURCINGCOUNTRIES Top most common outsourcing countries  India  China (Sourcing Line)
    • LAWS IN INDIA Workmen’s Compensation Act 1923  Compensation will be provided to an employee in the case of injury or to his dependents in the case of his death Minimum Wages Act 1948  provides minimum wage to all employees in all establishments Payment of Wages Act 1936  Regulates that time in which employees must be paid  No pay deductions unless specified by law Similar to U.S. with the minimum wage laws, payment in a timely manner, and compensation This does not mean sweatshops do not exist in India (Embassy of India)
    • LAWS IN CHINA All employees must receive rests, holidays and ethical working conditions Women and children not allowed to work underground or in mines Employers have to pay 150% of wages for overtime, 200% for working without breaks, 300% for working national holidays No national minimum wage Children under 14 not legally allowed to work New law stating the guarantee of their job if they work for a company for more than 10 years, but must be offered a contract, which they can negotiate Under diminishing economy, employers paying employees less  Firing employees who complain  Labor laws not evenly enforced (Andromeda)
    • APPLE In 2010, Apple’s audits found that 9 of its suppliers in china had hired workers below the legal working age of 16 Other plants falsified audit materials Coached workers on how to respond to questions from auditors 137 workers were exposed to toxic chemical n-hexane, causing adverse side effects A large number of suicides at Apple’s Foxconn supplier Explosion that killed 3 workers and injured 15 caused by combustible dust trapped in vents (Barboza, 2011) (Apple Computer Support)
    • FOREVER 21 Sweatshop located in downtown LA, not only overseas Workers work 10-12 hour days for low wages No overtime pay Unethical, dirty conditions (Fast Fashion) Reputation for counterfeit goods
    • THE GAP Clothing being manufactured by children as young as eight under unethical conditions Sold by their parents to recruiters in India and taken to factories where they abused and forced to work morning until after midnight without pay Gap worked to clean up its image by sending inspectors to India and by not selling the clothes produced by the children Gap has not severed ties with the vendor in question (Ethical Shopping, 2007)
    • HOW TO AVOID UNETHICALSOURCING? Companies can avoid unethical sourcing by…  Sending representatives regularly, often and unannounced to check on conditions  Do extensive research on vendors before agreeing to work with them  Check labor laws in sourcing country and make sure vendors actually follow and enforce the laws  Visit showrooms before agreeing to work with them
    • oo ds fei tG un terP CoRO PE IN RT T Y E LL EC TU AL
    • VOCABULARY Intellectual Property: the ownership of ideas and control over the tangible or virtual representation of those ideas Intellectual Property Law: protects Intellectual property rights (IPR) of creators/owners by ensuring exclusive use of these creations  Copyright Law: Covers literary, musical, artistic works and software  Trademark Law: Covers words, pictures, logo or other graphic symbol  Patent Law: Grants monopoly for a limited period of time for the used and development of inventions  Trade Secret Law: Any formula, process, pattern, device or idea that provides the owner a competitive advantage
    • VOCABULARY CONTINUED Trademark Infringement: taking advantage of the value of a brand by applying a trademark to products without permission of the owner of the brand Patent: the exclusive right granted by a government to an inventor to manufacture, use, or sell an invention/idea/process for a certain number of years. Counterfeit: something that a perpetrator forges, copies, or imitates without having the right to do so with the purpose of defrauding Knockof fs: is an imitation, usually using lower-cost fabric and production methods and sold at a lower price. Gray Market Goods: original goods (not knockoffs) sold by unauthorized vendors Piracy: Act of selling and buying the counterfeit goods Illegal Transshipment: occurs when goods are shipped through a third country or port to produce counterfeit documents that illegally change the COO Inferior Goods: goods that have become in less demand as
    • HOW CAN YOU LEGALLY GET AWAYWITH IT?• Licensing Agreements: The licensee pays the licensor a royalty to use their company’s name, logo. Etc.  You see this a lot with perfumes and sunglasses Knockoffs: knockoffs are imitations of products and are not being passed off as the real products, therefore they are not illegal
    • TRADEMARKS Trademarks are the symbols, taglines, etc. that you associate with the company Trademark Infringement is the biggest violation of intellectual property right
    • COUNTERFEIT GOODS Top 10 Seized Counterfeit Goods 10. Pharmaceuticals (3% of total goods seized) 9. Jewelry (4% of total goods seized) 8.Watches/Parts (4% of total goods seized) 7.Cigarettes (5% of total goods seized) 6.Computers/Hardware (5% of total goods seized) 5.Media (7% of total goods seized) 4.Handbags/Wallets/Backpacks (8% of total goods seized) 3.Apparel (10% of total goods seized) 2. Consumer Electronics (18% of seized goods) 1. Footwear (24% of seized goods) (Top 10, n.d)
    • TOP 5 COUNTERFEIT PORTS IN THEWORLD5. Markets in Rome4. The Old City in Shanghai3. Santee Alley in Silicon Valley2. Namdaemun Market in Seoul1. Canal Street in New York (JetSetTV, 2009)
    • CANAL The OldSTREET City Namdaemun
    • WHY IS COUNTERFEITING APROBLEM? Sweatshops Child Labor Economically damaging Funding of Terrorism Parts in the counterfeit goods http://www.youtube.com/watch?v=TQJckaa_Wm8
    • COUNTERFEITING TODAY In March 2012, Officials in New Jersey seized an estimated $325 million worth of counterfeit goods. This is the biggest of it’s kind by U.S. Department of Justice. Goods included Coach, Louis Vuitton and other handbags; UGG boots, Nike sneakers, other shoes, and clothing. The plan to seize the goods and shut down the ring was a 2-3 year process. The smugglers were initially successful through the use of false ID documents and stealing corporate identities. They covered up the UGG tags with fake brand names, and would have one letter missing from a word to hide the counterfeit goods. (Bates, 2012)
    • KNOCK-OFFS The difference between a counterfeit and knockoff is that counterfeits are passed off as the real product and knock-offs are purely imitations.
    • KARDASHIAN KNOCK-OFFS The Kardashian Kollection at Sear’s recently got in trouble with their handbag line that looked oddly familiar to a few famous designers. They have already been delivered cease-and- desist letters from Monica Botkier and it won’t be surprising if they get a few more. (Fenner,2011)
    • BALENCIAGA
    • CHLOE
    • YVES SAINT LAURENT
    • GUCCI VS. GUESS “Guess is being accused of specifically ripping off 4 designs  1. Gucci’s Red and Green Stripe  2. The interlocking G pattern  3. The square G  4. The Brand name’s delicate script front” (Krupnick, 2012)
    • HOW CAN YOU TELL? Retailer Knowledge Know your product and quality
    • THINGS TO LOOK FOR Look for spelling Errors on products and packaging Look to see whether there is a barcode or not Products from different manufacturers sold together No contact information on product
    • QUIZ QUESTIONS What is the name of the company who owned a sweatshop in downtown LA? Name one way to avoid unethical sourcing. Which country has no national minimum wage? What is the main difference between a counterfeit good and a knockoff? What is the number one counterfeit good sold?
    • REFERENCES Andromeda, R. (n.d.). eHow Money. Retrieved from Labor Laws in China: http://www.ehow.com/list_7810908_labor-laws-china.html Apple Computer Support. (n.d.). Retrieved from Apple and Ethics: Consumer Response to Unethical and Inhumane Factory Labor Practices in China: http://www.resourcesforlife.com/apple/ethics Barboza, D. (2011, May 24). The New York Times. Retrieved from Explosion at Apple Supplier Caused by Dust, China Says: http://www.nytimes.com/2011/05/25/technology/25foxconn.html Bates, T. (2012, March 2). Millions of dollars in fake goods stopped at port, officials say. Retrieved from http://www.app.com/article/20120302/NJNEWS10/303020100/Millions- dollars-fake-goods-stopped-port-officials-say BusinessDictionary.com. (n.d.). Retrieved from Ethics: http://www.businessdictionary.com/definition/ethics.html Embassy of India. (n.d.). Retrieved from Labor Laws: http://www.indianembassy.org/labor- laws.php Ethical Shopping. (2007, October 30). Retrieved from Gap Caught in Child Labor Scandal: http://www.ethicalshopping.com/clothing-accessories/clothes/gap-caught-child-labor-scandal.html Fast Fashion. (n.d.). Retrieved from What is a Sweatshop?: http://fastfashion.weebly.com/unethical- production.html Fenner, J. (2011, November 4). Kim Kardashian’s Purses Are Pretty Flagrant Designer Knockoffs. Retrieved from http://www.styleite.com/media/kim-kardashians-knockoff- handbags/#4 Global Exchange. (n.d.). Retrieved from "Free Trade" and Sweatshops: http://www.globalexchange.org/fairtrade/sweatfree/faq
    • REFERENCES CONTINUED JetSetCD. (2009, September 9). The Top Five Counterfeit Shopping Districts In The World. Retrieved from http://www.jaunted.com/story/2009/9/9/121143/4651/travel/The+Top+Five+Counterfeit+Sho pping+Districts+In+The+World Just-Style. (n.d.). Retrieved from The Ethics of Sourcing: http://www.just-style.com/hot-issues/the- ethics-of-sourcing_id154.aspx Krupnick, E. (2012, April 5). Guess vs. Gucci trademark case heats up in court. Huffington Post. Retrieved from http://www.huffingtonpost.com/2012/04/05/gucci-guess-trademark- lawsuit_n_1405784.html#s824192&title=Guess Korshunova, E. N. (n.d.). The Free Dictionary by Farfalax. Retrieved from Child Labor: http://encyclopedia2.thefreedictionary.com/Child+Labor Merriam Webster. (n.d.). Retrieved from Sweatshop: http://www.merriam- webster.com/dictionary/sweatshop Sanctus Mundo. (n.d.). Retrieved from Ethical Sourcing: http://sanctusmundo.com/products/ethical- sourcing Sourcing Line. (n.d.). Retrieved from Top Outsourcing Countries: http://www.sourcingline.com/top- outsourcing-countries The Free Dictionary by Farfalex. (n.d.). Retrieved from Child Labor Laws: http://legal- dictionary.thefreedictionary.com/Child+labor+laws+in+the+United+States Vegan Peace Home. (n.d.). Retrieved from Sweat Shops and Child Labor: http://www.veganpeace.com/sweatshops/sweatshops_and_child_labor.htm