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NRK: What is your opinion on the working conditions described by the workers at the two factories?
Nokia: We are concerned to see the serious allegations made in your film regarding breaches of human rights and labor laws. We are urgently investigating these claims with the two companies concerned. If we find evidence to support these allegations we will take immediate action. All Nokia suppliers must comply with strict social and environmental standards.
We were also surprised by the findings as we have regularly audited our suppliers, including BYD and Flextronics factories in Shenzhen, and whilst we have on occasion found the need for some improvement these issues have already been addressed and we are working closely to continually raise standards.
In the case of BYD, this company has taken many measures to improve ethical and social standards and we have been meeting with them for more than two years now to help them make and implement improvements across all of their factories. We meet with them every 2 -3 months to review the considerable progress they have made. For Flextronics the need for some improvements was identified as far back as 2003 and in an updated audit last year by a not for profit organization we found that the vast majority of the issue had been addressed and actions put in place to address any outstanding issues.
Given the serious nature of the allegations made in your film we are now in discussions with both factories and investigating these claims. We would like to get more details of your findings and view the full footage and any additional evidence you have. If our investigation finds evidence to support the claims made in your program we will take immediate action.
Nokia has been at the forefront of driving action and awareness of ethical standards with its own suppliers and within the wider electronics industry. There will always be areas beyond just legal compliance that can be improved and we feel it is the responsible approach to work with suppliers to address these, rather than walk away when there are problems. We welcome public debate and feedback from external groups where it helps to drive further improvements.
NRK: Are you aware of their complaints?
Nokia: Both of the accused companies have been regularly audited by Nokia and third parties. These audits have included interview with employees. These interviews are conducted confidentially, without management present and employees are randomly selected by the auditors.
We have been working with these two suppliers, and others, for some years now to help them develop and improve their ethical and environmental standards. We have found that in some places their standards, whilst complying with local laws did not meet our global standards and have worked with them to change this and make improvements. For example at BYD we helped them develop a code of conduct and so far this year they have used it to train over 100,000 employees. We feel this is the responsible approach – to work with them when we find problems rather than walking away.
NRK: Have you audited the two factories? In that case, were the audits preannounced?
Nokia: Yes and we continue to monitor them.
Suppliers are advised of audits in advance as this builds a relationship of trust and working together rather than policing or spot checks that only encourage reactive responses rather than ongoing work in these areas. Our audits are rigorous and include on-site inspections and confidential interviews with employees. We also work with third parties and not for profits who conduct independent assessments.
These audits, however, naturally only provide snap shots of the prevailing situation at the time of the audit and thus our suppliers also have to commit to ongoing improvement actions. Audits are part of a process and include environmental as well as labor conditions issues.
Both of the two suppliers referred to here have made considerably improvements and progress by working with Nokia and the audit process.
BYD
We have been working with BYD for some years now and have audited them on a regular basis. We conducted an in-depth environmental and labor conditions assessment of BYD’s Shenzhen factory in 2005, and their HQ in Shenzhen in 2007, and since then we have been meeting with them every 2-3 months.
In our 2007 audit we felt that BYD would benefit from a having a company/global level CSR organization and strategy and policies in place and set up a working group with them to develop this and ensure its effective implementation.
We set up a working group with them to make the necessary changes and have been meeting with them every 2-3 months to review progress on this. Considerable progress has been made. The company has set up an internal CR organization and created a code of conduct based on global standards. They have also begun rolling this out to all of the global sites and ensuring they all use this one, consistent policy. They have been training thousands of employees in these new standards and developed an audit plan themselves to track their progress.
When we meet with them every 2-3 months we review progress, look at the quality of training and ensure they are passing on the same standards to their own suppliers. We will continue to monitor this and work with them.
Flextronics
Nokia audited a Flextronics Shenzhen factory in 2006, and in 2007 we participated in a third party audit by a not for profit organization into one of the Flextronics Shenzhen factories.
The 2007 audit made recommendations for improvements in areas of employee policy and some safety improvements such as better training in some specific areas.
An improvement team was set up by the not for profit who conducted the audit and this group has regularly reported on progress made to address the areas of concern. To date, the vast majority of these issues have been resolved and considerable improvement made. We continue to monitor progress to ensure all of the issues are successfully resolved.
NRK: Do you have any minimum standard for your subcontractors in China?
Nokia: We require ALL suppliers wherever they are in the world to meet the same high global standards. They must comply with all applicable laws and regulations, and encourage them to go beyond legal compliance in areas such as governance, human rights and environmental management, and met our own global standards.
We audit and monitor suppliers environmental and ethical performance in a number of ways. If we find any of these standards are not being met then we work with the factory to improve things. We feel this is a more responsible approach than just walking away and helps to drive up standards overall in developing nations.
It all begins before we agree to work with a company, they must satisfy our criteria in order for us to place contracts with them. We commit to monitoring their performance in these areas on an ongoing basis and to taking immediate action if their ethical performance comes into question.
We then include ethical and environmental standards in our regular business audits of suppliers, and for suppliers that we feel need special focus we conducted dedicated and in-depth ethical and environmental assessments.
Nokia’s global supplier requirements cover the following areas….
- Environment - i.e. waste management, environmental performance and policy
- Ethics - i.e. company values and business code of conduct, fair treatment, confidentiality, feedback and complaint channels
- Labor - i.e. working time, pay, workforce planning and recruitment, employee amenities
- Health & Safety - i.e. occupational health and safety
We audit and monitor suppliers to check they have policies in place to address these areas AND that they are implementing/enforcing these. The environmental and ethical audits involve us spending several days at the facility conducting a number of different activities including:
- Management interviews
- Documentation reviews
- Site inspection of relevant areas i.e. production areas, waste treatment, chemical storage, canteen, health clinic and dormitories.
- Interviews with employees – these are confidential, no managers present, randomly selected workers during site tours, and held in a neutral location.
When the audits are complete we discuss findings with management and agree next step. The supplier has to come up with action plan by an agreed deadline (usually 30 days). Nokia then reviews progress against the action plan on an ongoing basis.
Last year we reviewed ethical and environmental standards at over 60 different suppliers globally. We also worked with a number of additional suppliers on ongoing CR programs – these are suppliers where we feel they needed more focus and ongoing support in putting robust CR policies in place and ensuring these were effectively implemented.
Beyond audits
We also work with suppliers on an ongoing basis to provide training and support to help them implement and improve standards.
For example, recently we have been working with a number of suppliers on ongoing checks and improvements around health and safety. To date this has resulted in improvements including better machine safety, training, promotion of personal protective equipment use, noise reductions, and improving ventilation. In another area, a number of suppliers have over the last year taken measure to increase employee representation, establish employee welfare committees, and created feedback and grievance mechanisms for employees to raise and resolve concerns.
Nokia has been at the forefront of driving action and awareness of ethical standards with its own suppliers and within the wider electronics industry. There will always be areas beyond just legal compliance that can be improved and we feel it is the responsible approach to work with suppliers to address these, rather than walk away when there are problems. We welcome public debate and feedback from external groups where it helps to drive further improvements.
NRK: What are the main challenges related to working conditions in China, compared to what most people think is acceptable here in Scandinavia?
Nokia: This is not a specific China issue. Every nation has different laws and standards and that we try to level the playing field by applying global standards. Where laws prohibit this i.e. freedom of association/unions being restricted we work on finding other ways to meet the goal, for example in this case by ensuring that employee forums and feedback mechanisms are in place, interviewing employees confidentially in our audits, and encouraging the creation of employee councils or other forms of regular dialogue with management.
The main challenge is ensuring that these measures are effectively implemented and enforced. We feel the best way to do this create an environment of trust and support where we can share best practice globally and work WITH suppliers to make improvements. Taking this approach has enabled us to considerably improve standards amongst suppliers in many countries.
NRK: Should the consumers have the right to know which subcontractors you use?
Nokia: We work with literally thousands of suppliers right across our business and providing a long list of names of these would have very limited impact for consumers. What we think is more valuable is publishing publicly the standards we require all of our suppliers to meet and if are not met that we take action to improve things and are open about this.
