Business & Society - Midterm ExaminationEuropean University [Spring Semester 2010]Thomas Ruschke
Who is HanesBrandsInc?• HanesBrandsInc is parent company • Other brands include: • HanesBrandsInc is publically traded on the NYSE (Symbol: HBI), and is based out of Winston- Salem, North Carolina. • Global consumer goods (shirts, bras, panties, underwear, socks, hosiery, casualwear and activewear) company with more than 100 years experience • Earned $4.2 billion in sales revenue in 2008 and employs over 50,000 employees worldwide.
Misson Statement & Core Values• Mission Statement: • „To profitably grow our leading brands by intimately understanding our consumers, out-executing our competition and leveraging our sustainable competitive advantage.“• Core Values • Integrity / Ethical Standards • Inclusivity / Diversity • Quality / Superior Performance • Reliability / Commitment• Offers Global Business Practice Handbook & Global Standards for Suppliers Handbook• Per HBI website: • „HanesBrands was pivotal in the creation of the Worldwide Responsible Apparel Production (WRAP) program in the late 1990‘s to establish common standards in social compliance.“ • „Our Global Environmental Management System (GEMS) ensures smart environmental principles are integrated into our daily business: waste minimization, resource conservation, minimizing overall environmental impact, and enhancing value.“
Corporate Social Responsibility Strategy• “ may • “These standards are really just common sense.” -Ethics Focus Group and Training Participants
People to Report to:HBI Internal Structure 1. Supervisor• HanesBrandInc established a Corporate Business 2. Manager Practices Committee 3. Human Resources • Committee consists of executive officers of HBI 4. Internal Audit 5. Legal, Compliance & • Established appropriate ethical and legal standards & oversees compliance with laws, regulations, and HBI’s established Global Risk Management Business Standards 6. Safety Coordinators 7. Environmental• HBI designated a Corporate Business Practices Officer Coordinators • Responsible for overseeing day to day implementation of 8. Employee Assistance standards & compliance of HBI ethics in communication, training and assessment. Programs • Business Practice Officers have been established in the United 9. HBI Corporate States & abroad Business Practices Officer• Legal, Compliance & Risk Management Department 10. eMail, Website or• Business Practices Resource Phone Number 24 hours, Phone Contact 365 days a year with translators available!• www.HBIResourceLine.com• “HBI Zone” (possible intranet) provides more information about policies.
HBI Code of Conduct• Expectations are thoroughly outlined in two pamphlets: • Global Business Standards • Focused on expectations of employees • Sections include Responsibility to Ourselves, Each Other, Our Consumers, Our Stockholders, Our Business Partners, Our Communities • Discusses: Human Rights, Fair treatment & opportunity, Diversity, Harassment, Safety and Health, Product Safety, Quality and Value, Marketing, Confidentiality, Conflicts of Interest, Gifts Favors and Entertainment, Community Commitment, Environmental, Foreign Corrupt Practices Act and International Trade Regulations • Global Standards for Suppliers • Outlines expectations for suppliers & other business partners • Topics covered include: • Confidential Information, Fair Competition and Anti-Trust, Accuracy of Business Records, Communication Standards, Monitoring and Compliance and HanesBrandInc’s expectations. • Includes acknowledgement card for proof of receipt & promise to abide
HBI Production• Massive Global Supply Chain • Argentina, Bangladesh, Brazil, Canada, China (North and South), Colombia, Costa Rica, Dominican Republic, El Salvador, Germany, Guatamala, Haiti, Honduras, Hong Kong, India, Indonesia, Japan, Mexico, Panama, Philippines, Puerto Rico, Thailand, Turkey and the United States.• Participation in the Fair Labor Association requires submitting to unannounced Independent External Monitoring audits.• HBI offers many communication channels for suppliers’ employees • Real world effectiveness has to be questioned…? • Cultural limitations• No clear verification of compliance procedures, aside from acknowledgement card.
+• HanesBrandsInc is an active participant in the Fair Labor Association• HBI joined the FLA on February 13, 2008• HBI is currently undergoing accreditation process• FLA offers 2-3 year implementation schedule • U.S. and overseas operations must be in compliance with 10 Obligations of Companies 1. Adopt and Communicate FLA Code 2. Train Internal Compliance Staff 3. Provide Employees with Confidential Reporting Channels (HBIResourceLine.com) 4. Conduct Internal Monitoring 5. Submit to Independent External Monitoring 6. Collect and Manage Compliance Information 7. Remediate in a Timely Manner 8. Take Steps necessary to prevent persistent forms of noncompliance 9. Consult with civil society 10. Pay FLA dues and meet other procedural requirements
HanesBrandsInc Stakeholders• Employees • Strives to achieve managerial excellence and easy reporting practices for employees.• Consumers • Product Safety, Quality and Value, Honest Marketing and Confidentiality of Personal Data.• Stockholders • Ethical and truthful procedures for Business Records, Efficient Inquiry Handling, Confidential Information, Conflicts of Interest• Business Partners • Set purchasing practices, Competitive Information, Anti-Trust strategies.• Communities • Legality, Community Commitment, Environmental Best Practices, Political Activities, Government Requests, International Trade Regulations• Global Business Strategy Materials clearly outline strategies for responsible management and interaction between stakeholders.
Better Business Bureau • Hanes Brands Inc is and has been accredited with the BBB since 1959. • A- rating partly because “Length of time Business has been operating • Business started locally 2006. • Number of complaints processed by the BBB: • Last 36 months: 25 • Last 12 months: 16 • All complaints were resolved.
HBI Controversy in Dominican Republic• TOS Dominicana Factory in the Dominican Republic• Also a large supplier for Walmart• Controversy in 2007 surrounding Unionizing of Factory Employees• Mass firings ensued after employees began organizing a Union• HanesBrandsInc’s website addresses the issues surrounding TOS Dominicana directly.• Shows video of employees working and testimonials from employees• Violations included Intimidation, spying on workers outside of the factory, refusing to recognize the union, aggressive harassment, coercion to sign documents.• Issues have since been resolved.
Haiti Relief Operations• HBI contracts three large suppliers in Haiti, two near Port-Au-Prince• Hanes Brands Inc sent $2.2 million in support for victims in Haiti• 10 days after the January 12 th earthquake operations were resuming• HBI setup supply strategies for food, water and basic necessities for Haitian contract workers.• HBI sent 2,000 tents worth $250,000 to Haiti to shelter employees post- earthquake
Living the CSR Strategy…• HBI seems concerned about not just talking about proper CSR Strategy, but actually implementing it.• Rocky history of sweatshop operations, but they have since been taken care of.• Clear guidance from Global Standards for Suppliers• Quick response to reports of employee abuses• HBI seems to be thoroughly ethical in its business practices.
Sources• http://www.hanesbrands.com• HanesBrandsInc’s Global Business Standards Pamphlet• HanesBrandsInc’s Global Standards for Suppliers Pamphlet• Google Image Search• http://www.HBIResourceLine.com• Fair Labor Association (www.fairlabor.org)• Better Business Bureau of Northwest North Carolina (www.nwnc.bb.org)• MarketWatch (http://www.marketwatch.com)• Green America Today (www.greenamericatoday.org)• WikiPedia (http://en.wikipedia.org/wiki/HanesBrands)