INTERNATIONAL TRAINING CENTRE OF THE ILO IUF and ICEM Seminar November 24-28, 2003 Turin Italy Globalisation and the ICEM Strategy Jim Catterson Director

INTERNATIONAL TRAINING CENTRE OF THE ILO IUF and ICEM Seminar

November 24-28, 2003 Turin Italy

Globalisation and the ICEM Strategy

Jim Catterson Director of Organization

Viale Maestri del Lavoro 10, 10127, Turin Italy



51 of the largest 100 economies in the world are corporations. Multinational companies hold ninety percent of all technology

and product patents worldwide. Multinational companies are involved in 70 percent of world

trade. More than thirty percent of this trade is "intra- firm"; in other words, it occurs between units of the same corporation.

The 300 largest corporations account for one-quarter of the world's productive assets.

Globalisation



Over the last decade, global FDI has grown four times as fast as GDP, and three times as fast as trade.

400 MNC's account for 50 per cent of global FDI and 95 per cent originates in developed countries.

The combined revenues of GM and Ford exceed the combined GDP of all sub-Saharan Africa.

One fifth of the world's population live on a dollar a day or less. In the US the ratio of average CEO pay in Fortune 500 companies

to the average factory worker has risen from 42 to 1 in 1980 to 419 to 1.

Globalisation



Mergers & Acquisitions

Strategic Alliances

Joint Ventures

Foreign Direct Investment

Global Sourcing

Deregulation

Globalisation



Reduction of Workforce– Redundancies– Out-sourcing– Replacing permanent workers with temporary

workersLowering Wages and BenefitsShifting Production to lower wage areas

Cost-Cutting Impact:

Globalisation



Oil Industry ConsolidationBP started the mega-merger wave in August 1998. The Exxon-Mobil, BP Amoco-Arco and TotalFinaElf-Elf Aquitaine mergers closely followed. Combined, these deals totalled a quarter of a trillion US dollars in value, and raised the share of market cap held by the four largest players (ExxonMobil, Royal Dutch/Shell, BP, TotalFinaElf) by almost half.

These three super-majors ExxonMobil, Shell and BP have combined sales greater than the total annual domestic production (GDP) of the one billion people of India. The merger of Conoco and Phillips has created the largest refiner in the US and the third-largest integrated US energy company.

Next the Russian Companies?



Pilkington16%

Guardian Industries10%

Saint Gobain9%

PPG Industries7%

other Companies35%

Asahi Glass18%

Nippon Sheet Glass5%

Flat Glass Sales by Company 1998



TOP 10 Global Market Share 1999

Chemical US$ 1,500 Bn US$ 180 Bn 12

Pharma. US$ 338 Bn US$ 160 Bn 47

Total Top 10 %



Dow/UCC Chemical 11.00 9.7Exxon/Mobil 8.07 7.2Shell 6.27 5.6Equistar 5.11 4.5SABIC 4.16 3.7Chevron/Phillips 3.89 3.5BP/Amoco 3.46 3.1ElfTotalFina 2.99 2.7Nova 2.96 2.6Formosa Plastics 2.85 2.5Total Top Ten 50.76 45.1

Company Capacity Global Market Share %

TOP ETHYLENE PRODUCERS 2003Mtpa



Air Liquide 5,863.54 17.15BOC 4,826.17 14.11Praxair 4,442.67 12.99Air Products 3,466.00 10.13Linde/Aga 3,447.84 10.08NSC 2,072.49 6.06Messer 1,579.89 4.62Others 8,500.00 24.85 Total 34,198.62

Company Sales ($m.) Market Share (%)

Industrial Gases Market 2000



TOP 10 PHARMACEUTICAL CO’s1988 1999

Merck 3.9% Glaxo/SKB7.0%

Glaxo 2.9% Pfizer/Warner-Lambert6.8%

Ciba 2.8% Merck4.5%

Hoechst 2.5% AstraZeneca 4.4%AHP 2,2% BMS

4.0%Bayer 2.2% Novartis

4.0%J & J 2.2% Aventis

3.9%SKB 2.1% J & J

3.8%Pfizer 2.1% AHP

3.1%Sandoz 2.0% Roche

3.0%



TOP 10 companies

represent

29% of world production

PULP AND PAPER INDUSTRY



Concentration Process

• 1995 80% of World Market is Covered by Top 9

Companies

• 2005 80% of World Market is Covered by Top 3

Companies

Global Tyre Industry



Three Firms Dominate Global Tyre Market

15,114,2

13,5

4,9

2,9 2,72,1

1,5

0

2

4

6

8

10

12

14

16

GOODYEAR-SUMITOMO

BRIDGESTONE MICHELIN CONTI PIRELLI YOKOHAMA TOYO COOPER

Goodyear & Cooper Are Only US Firms in the TOP-10

Global Tyre Sales, 1999

US $ billions



““WE ARE IN AN ERA OF UNPARALLELED WE ARE IN AN ERA OF UNPARALLELED CONSOLIDATION”CONSOLIDATION” BRIAN GILBERTSON, CHAIRMAN, BILLITONBRIAN GILBERTSON, CHAIRMAN, BILLITON

OLIGOPOLIES DEVELOPING OLIGOPOLIES DEVELOPING IRON ORE: RIO TINTO, BHP, CVRD – 80%IRON ORE: RIO TINTO, BHP, CVRD – 80% COALCOAL

MININGMININGBILLION DOLLAR DEALSBILLION DOLLAR DEALS



ICEM382 affiliated trade

unions117 countries

20 million members

Head OfficeBrusselsBelgium

Regional Offices

Washington

Rio de Janeiro

Johannesburg

Seoul

Moscow

Global Union Federation



Industries Energy (Electric Power, Oil, Gas) Mining & Quarrying (Coal, other Mining) Chemical & Bio-Science (Pharmaceuticals) Rubber (Tyre, Other Rubber) Materials (Glass, Ceramics, Cement) Pulp & Paper Service and Miscellaneous Diamond (Gem, Ornament, Jewellery)



Regions Asia / Pacific South and Central Africa North Africa and Middle East North America South and Central America & the Caribbean Central Europe Eastern Europe, Central Asia and Trans-Caucasus Western Europe Nordic Countries



ICEM Structure

Affiliates• form ICEM Coordinating Committee• are members of Regional Organisation• send delegates to the Congress

Regional OrganisationElects:

• Chair Person of Regional Organisation who is nominated ICEM Vice President

Elects:• President – John Maitland, CFMEU, Australia• General Secretary – Fred Higgs• Presidium (ICEM Vice Presidents)• Countries for Executive Committee Members• Auditing Committee

Congress



ICEM Central EuropeRegional Chairperson

Seats on Executive Committee

Regional Committee

Regional Conference

Regional Statutes



ICEM Central European Regional Conference

April 15-16, 2003Kranjska Gora, Slovenia



ICEM South East Europe Project

A Joint Project with IUF

1st year of 4 year program. 2nd stage following 4 years of general training in the region.

Zagreb office

ICEM Balkan and SE Mediterranean Energy Network

ICEM Central Europe

ICEM 1st World Conference for the

Materials Industries Section

Slovenia June 20-22, 2001





Titan Cement

Holcim(Holderbank)

Heidelberger

Seament

Lafarge





ICEM and EMCEF

CooperationJurisdictionsRelationships (eg ETUC ICFTU TUAC)

Expertise



EMCEF SEMINAR EU ACCESSION

Kranjska Gora, Slovenia

April 14, 2003

Jim CattersonICEM Director of Organization



GDP per head

Bulgaria: 24% of EU average

Estonia: 38%

Poland: 39%

Hungary: 52%



Bargaining coverage rates and unionisation rates in candidate countries (%)

Country Coverage rate of collective agreements Unionisation rate

Czech Republic 25-30 30

Hungary 45-50 20

Poland * 15

Slovakia 50 40

Slovenia Almost total 41.3







3rd ICEM World Congress, Stavanger August 28-30, 2003



Recognition an important issue for ICEM, as for any trade union organisation Recognition has been achieved in 3 ways:

In negotiating and achieving Global Agreements

When companies enter into dialog following representation

by the ICEM on behalf of an affiliate

When companies or employer organisations seek our view on issues effecting ICEM sectors

Recognition



ICEM Congress, Durban 3-5 November 1999



“The ICEM needs to operate more like an international trade union and not just a service organization”

Fred HiggsICEM General Secretary



Unite and Organise

Global Trade Union Networks Dialog with Multinational Companies Global Agreements with Multinational

Companies Global Solidarity

ICEM Future Work Plan



Global Trade Union

Networks



Global Trade Union Networks Exchange of Information & Experiences

Collective Agreements wages working hours shift systems bonus systems holidays retirement schemes

Occupational Health, Safety & Environment Microeconomic data



Global Trade Union Networks Organizing International Solidarity

Representative Structure– country– region– worldwide

Dialog with Central Management



ICEM Global company networks in existence

Rio Tinto (administered by CFMEU, Australia) Goodyear (administered by USWA, USA) Bridgestone (administered by GOMU-RENGO, Japan) Novartis (administered by SIB, Switzerland) International Paper (PACE, USA) Endesa (FIA-UGT/FM-CC.OO., Spain) BASF (IGBCE, Germany) Exxon Mobil (PACE USA)



Prerequisites to forming an ICEM Network

An affiliate must take responsibility for carrying out and providing resources for the administration.

The main activities must be resourced by the network participants.

Global gatherings are not essential to a successful network.



Global Agreements withMultinational

Companies



Priority activity agreed at our last 2 Congresses to negotiate global agreementsThe objective of such agreements:-

To establish a set of principles / standardswhich a multinational company will applywherever it operates in the world. Regardlessof whether it is required to do so by nationallaw



ICEM Congress, Presidium and Executive

Committees given mandate on issues to be covered:

Human & Trade Union Rights, Health Safety and Environment, Other issues not normally subject to local or

national collective bargaining.

Global Framework Agreements



The Congress, Presidium and Executive Committees have developed

the following process for securing such agreements:Prioritise companies with a strong union base in their home country First approach to companies normally made by affiliates in the company's home countryTry to improve provisions within each new agreementAll agreements to be subject to annual review

Global Framework Agreements



ICEM Global AgreementsICEM Global Agreements

Statoil Statoil July 1998, March 2001, August 2003 Freudenberg Freudenberg June 2000Endesa Endesa January 2002Norske Skog Norske Skog June 2002Anglogold Anglogold September 2002ENI November 2002



Content of Global Agreements

To secure a continuous improvement

and development of good working

relations and to establish an open

information channel between ICEM,

its Affiliates and the Management.




Right to every employee to be represented by a union of his/her own choice & right to basic trade union rights (ILO 87, 98) company agrees not to oppose efforts to unionize its employees

To employ no force or bonded labour (ILO 29, 105)



To employ no child labour (ILO 138) To exercise equality of opportunity & treatment in

employment (ILO 100, 111) To pay fair wages & benefits according to good

industry standards in the country concerned To provide a safe work environment, deploying

common “best practice” standards




Monitoring

Training

Information Exchange

Regular Consultations




Lock-out Lock-out ends atends at

Crown PetroleumCrown Petroleum



Crown Central PetroleumPasadena Texas

January 17, 2001 five-year lockout defeated by PACE Local 4-227 atTexas oil refinery

Campaign Actions

A consumer boycott was carried out in seven states and the District of Columbia.

The company received a $1.1 million air pollution fine from the Texas National Resource Conservation Commission.

Widespread support came from the rest of the labour movement, civil rights and religious organizations, and environmental activists



Crown Central PetroleumPasadena Texas

Campaign Actions (continued)

PACE waged a sophisticated shareholder campaign to block Crown CEO Henry Rosenberg from acquiring the company.

In October 2000, Statoil, cancelled its contract for the processing of Statoil's crude oil at Crown's Pasadena refinery. This single contract used 35 percent of the Pasadena refinery's capacity and its cancellation was a powerful blow to the company.

Lars Myhre, chairman of the ICEM's Energy Industries Section visited the PACE picket line at the Pasadena refinery



Extracts from Statoil report to the Global Compact Learning Forum, October 29-30, 2001 London.

Implementation of the agreement has so far covered: Meetings to discuss specific challenges in Statoil's international portfolio; Training, eg. Statoil's participation in ICEM's training of trade union representatives from SOCAR in Azerbaijan; Consultations whereby Statoil has contributed to the resolution of labour disputes; Mutual support: Statoil attended ICEM World Congress in 1999, ICEM attended the Scandinavian (sub-)group of Global Compact convened by Statoil.

ICEM STATOIL AGREEMENTICEM STATOIL AGREEMENT



ICEM STATOIL AGREEMENTICEM STATOIL AGREEMENT

“As far as Statoil is concerned, the agreement with ICEM can contribute to improved risk management by way of increased insight into the causes of labour disputes and how to resolve them. Statoil will enhance its reputation as a socially responsible company by becoming better at managing labour relations.” “It is important that labour relations are managed in accordance with local conditions. Considerations of legitimacy and efficiency require that employee concerns should be handled by those closest to the issues. We believe that the ICEM agreement will help us address this requirement without interfering with established local practices.” Statoil report to the Global Compact Learning Forum, October 29-30, 2001 London.



A Global Agreement is not

a Code of Conduct

Negotiated not unilateral

Monitored by the organized workforce

Network can develop to be an enforcement procedure



Global Compact: Basis for New Global Compact: Basis for New Agreements ? Agreements ?



Kofi Annan first tabled the GC initiative January 1999,

(launched in 2000)Voluntary initiative creating a partnership between the UN,

International Corporations, Labour, Civil Society and National

GovernmentsCalls on corporations to adopt a set of nine principles to guide

their worldwide business practices.

Global Compact



What Are The 9 Principles?Human Rights

1. Business should support and respect the protection of internationally proclaimed human rights within their sphere of influence.

2. Make sure they are not complicit in human rights abuses.



What Are The 9 Principles?Labour

3 Businesses should uphold freedom of association and the effective recognition of the right to collective bargaining.

4 The elimination of all forms of forced and compulsory Labour.

5 The effective abolition of child Labour

6 Eliminate discrimination in respect of employment and occupation.



What Are The 9 Principles?Environment

7 Businesses should support a precautionary approach to environmental challenges

8 Undertake initiatives to promote greater environmental responsibility

9 Encourage the development and diffusion of environmental friendly technologies.



International Trade Union Response

The ICFTU was involved in the development of this initiative and are supportive.

The ICEM also supports the initiative and is involved with the U.N. and the ICFTU in its further development. Fred Higgs is one of two Trade Union Members of the Advisory Council



Making it Meaningful

Companies should not just make grand statements

Should ensure there is commitment at all managerial levels to applying the 9 principles

Involve all employees and their unions Underpin company commitment with a

Global Agreement with the relevant Global Union Federation (GUF)



Solidarity Actions Workers and their unions continue to face problems at national and local level

Increasingly the solutions will be found at international level



Binda Panday NepalAugust 29, 2003 elected ICEM Vice-President Stavanger

September 5 arrested with other trade unionists Katmandhu Nepal



June 2002After International support Canadian Strikers at

Lafarge win a six-month strike against the cement multinational



January 2002Global labour campaign helps force Saint-Gobain to

Recognise UAW in the United States –Struggle for a 1ST Contract Continues



New Zealand EPMU international pressure

through ICEM IP Network

ends 82 day strikeJune 2003Kinleith



Rhodia UK September 2003

GMB Amicus-MSFRolling Strikes to safeguard future

pensions



More global agreements Increased use of ICEM multinational union networks to ensure that global agreements are working and are monitored effectively Hot-line communications between ICEM leadership and MNCs in order to identify and respond to major issues before they become international problems Development of better links with employers’ organisations in the various ICEM sectors

THE FUTURE

Jim Catterson November 2003

Documents

INTERNATIONAL TRAINING CENTRE OF THE ILO IUF and ICEM Seminar November 24-28, 2003 Turin Italy Globalisation and the ICEM Strategy Jim Catterson Director