Steering Corporate Social ResponsibilityMaking Social Audit Work in the Tirupur Garment Cluster

Documented by Koshy Mathewfor Prakruthi and Solidaridad-South & SE Asia

Published for TSG and Solidaridad by

PrakruthiPrakruthiPrakruthiPrakruthiPrakruthi#43, 2nd Cross, Ramaya LayoutKammanahalli, St. Thomas Town PostBangalore 560 084Tel: 080-25438935/36 :: Fax: 080-41732338E-mail: director@prakruthi.orgURL: www.prakruthi.org

Designed by MV RajeshPrinted at National Printing Press, Bangalore

This little booklet is not a publicity brochure. This is an attempt to documentthe efforts that went into the process of setting up one of the most uniqueformations in the history of social intervention. What was thought to beunattainable at one point, when we commenced our innocuous researchin Tirupur in 2004, became a reality two years later. Our major concernwas, apart from the research findings, was to explore the possibility ofbringing together all interested parties on to one table and see if a commonagenda can be agreed upon to address the host of issues we were confrontingthen – child labour, pollution of the environment, fair wages, fair trade,women’s and children’s rights, schooling, migration and the like.

The parallel process that we set in motion while carrying out the studyfructified in quick time, in fact, within a few months after the study waspublished in April 2006. Political parties, trade unions and non-governmental organisations saw the validity of the study and agreed rathertentatively they would converge into a Steering Group and take forwardthe agenda of encouraging and enabling textile enterprises in India tohave a positive and growing impact on the quality of life of the peoplethrough adoption of improved CSR practices.

What has transpired in the course of these few years is that TSG has becomea major partner for ensuring social audit. Social Accountability International(SAI), the creators of the SA8000 standards, has formally endorsed TirupurSteering Group and has strongly recommended that the SAI-accreditedCertification bodies consult with the Steering Group throughout theSA 8000 certification process. This is the first time such formal endorsementfrom SAI has been given in India and even in the developing world.

This booklet is only a small attempt to portray what multi-stakeholderscutting across political ideologies and social divisions can achieve.

What this little book is all about

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Shatadru ChattopadhayayDirector, South & SE Asia

Solidaridad

Pramod JohnExecutive Director

Prakruthi

Tirupur is a district in Tamil Nadu in southern India. Tirupur is knownby many names – dollar city, hosiery city and banian city are some ofthem. The names that Tirupur has earned is owed to the fact that it hasgained international recognition as the leading source for hosiery, knittedgarments, casual and sports wear. Some of the world’s largest brands sourcetheir products from Tirupur and the city provides employment to over3,00,000 people. The annual export turnover of Tirupur is over Rs 12,000crore.

The origin of the hosiery industry in Tirupur goes back to the 1930swhen it began as a cottage industry, supplying knitwear to domestic andlocal markets. This included the production of low value cotton hosiery,mainly undergarments. The knitting industry of Tirupur began when oneMr Gulam Kadar established the first baby knitting industry in the Kaderpetarea of Tirupur.

Tirupur, in many ways, was a place that was ideally suited to the settingup of weaving and knitting industries as the dry climate of this region wasconducive for the growth of this industry.

Textiles are not new to this region. Even before the knitting industrypicked up, the locals were weaving textiles by hand. Graduating to theknitted process was logical.

The textile industry is one of the main pillars of the Indian economy. Itconstitutes about 14 per cent of industrial production, 20 per cent of totalexport earnings, 4 percent of GDP and direct employment to an estimated35 million people.

By 1960, there were about 450 knitting units that serviced domestic demand.The shift from supplying local markets to export began in 1972 as aresponse to the shrinking domestic markets owing to fierce competitionamong the local manufacturers. The first export from Tirupur was madeto the US and Ghana.

By 1987, the export revenue of Tirupur had reached around Rs. 75 crore.Since then, exports from Tirupur have been growing steadily and, in 2004,the total exports touched a figure of more than Rs. 5,000 crore. Tirupurcontributes 75 per cent of the total production of cotton knitwear, whichis exported from India.

Tirupur and the Garment Industry

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Trade Unions and NGOs have been active in Tirupur for several decades.While the former address issues related to workers such as wages andworking conditions, the latter’s intervention is centred around social issuesof child labour, women’s rights, environmental pollution and the like.Seldom did the two share a common platform to address issues that cutacross the entire garment sector and the populace.

In 2004, Solidaridad, the Netherlands-based NGO, having its focus onbringing industry and social action on a single platform to address businessand human-related issues, initiated a study of the Tirupur garment industrythrough its local partner, Partners in Change (PiC). Mr. Pramod John,Programme Manager of PiC and Mr. Latheef, journalist and social scienceresearcher, jointly conducted the study, the outcome of which was asubstantial publication titled, Knitted Together. The research wascoordinated by Dr. Shatadru Chattopadhayay and M. Janet Menslink.

Knitted Together raised a host of serious intertwining issues and made aset of recommendations, one of which was the need for a unified workinggroup composed of all stakeholders in the garment industry to evolve amechanism to audit the social practices of manufacturers.

Mr. Pramod John took it upon himself as a personal mission to make thispossible and called for several consultations among political parties, tradeunions, NGOs, suppliers, manufacturers and buyers to arrive at a consensusfor social audit. That consensus was reached in October 2006 and theTirupur Steering Group (TSG) was given shape to on 19 November 2006.In the latter half of 2008, PiC formally requested Mr. Pramod John, bythen executive head of Prakruthi, to take over the work in Tirupur andnurture the TSG under the umbrella of Prakruthi. Beginning 01 September2008, Prakruthi assumed the responsibilities of the Tirupur programmewith the support of Solidaridad.

The target group of the Tirupur programme are medium, micro- andsmall enterprises in the knitware industry who are producing for brandsoverseas. Another target group is workers in the garment clusters whoseliving and working conditions will improve as suppliers undertakeimprovement programmes based on their enhanced understanding anduse of the Code of Conduct that governs the supply chain.

Evolution of the Tirupur Steering Group

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Prior to the publication of the book, Knitted Together, in April 2006,efforts were devoted primarily for identification of existing standards,prescription of continuous improvements in social and environmentalstandards and regular monitoring of such standards in Tirupur incollaboration with different stakeholders. Termed as the First Phase, thisgave way to the Second Phase, which commenced in June 2006.

In the Second Phase (June to September 2006), the project sought tobuild capacity of all stakeholders in the Tirupur garment cluster onsustainable garment production and on codes of conduct. The secondphase also concentrated on developing a common position of the differentstakeholders in the Tirupur garment cluster on sustainable garmentproduction.

The next was from October 2006 to February 2007 and this period sawheightened activity in training of almost all stakeholders in Tirupur garmentcluster and to bring them together under one umbrella so that they mayhave a collective and coherent approach towards key aspects of social,economic and environmental standards in the garment industry in India.

The efforts paid of in knitting together a steering group, officially calledthe Tirupur Steering Group (TSG) at a consultation organized on 19November 2006 at Connoor, Tamil Nadu.

The Tirupur Steering Group consists of seven trade unions – the IndianNational Trade Union Congress (INTUC), trade union wing of theCongress Party; Centre for Indian Trade Unions (CITU), trade unionwing of the Communist Party of India (Marxist); All India Trade UnionCongress (AITUC), trade union wing of the Communist Party of India;Hind Mazdoor Sabha (HMS), an independent trade union started in thewake of Emergency in India during the 1970s; Labour ProgressiveFederation, affiliated to the Dravida Munnetra Kazhagam (DMK); – andfour NGOs – Partners in Change (PiC), SAVE, CSED, and CARE.Prakruthi took the place of PiC in the TSG in 2008.

TSG decided to work together in making social audits in the garmentsector more effective in addressing labour and environmental issues. Italso decided to work with SA 8000 codes in the beginning as majority ofthe garment companies in Tirupur are adopting SA 8000 standards.Subsequently, it was agreed to engage with various other multi-stakeholdercode-setting bodies.

Knitted Together

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SA8000 and Alliance with SAI

SA8000 is a global social accountability standard for decent workingconditions, developed and overseen by Social Accountability International(SAI). SAI offers training in SA8000 and other workplace standards tomanagers, workers and auditors. It contracts with a global accreditationagency, Social Accountability Accreditation Services (SAAS) that licencesand oversees auditing organisations to award certification to employersthat comply with SA8000.SA8000 is based on the UN Universal Declaration of Human Rights,Convention on the Rights of the Child and various International LabourOrganization (ILO) conventions. SA8000 covers the following areas ofaccountability:

Child labor: No workers under the age of 15; minimum lowered to14 for countries operating under the ILO Convention 138 developingcountry exception; remediation of any child found to be working.Forced labor: No forced labor, including prison or debt bondagelabor; no lodging of deposits or identity papers by employers or outsiderecruiters.Workplace safety and health: Provide a safe and healthy workenvironment; take steps to prevent injuries; regular health and safetyworker training; system to detect threats to health and safety; access tobathrooms and potable water.Freedom of Association and Right to Collective Bargaining: Respectthe right to form and join trade unions and bargain collectively.Discrimination: No discrimination based on race, caste, origin, religion,disability, gender, sexual orientation, union or political affiliation, orage; no sexual harassment.Discipline: No corporal punishment, mental or physical coercion orverbal abuse.Working hours: Comply with the applicable law but, in any event, nomore than 48 hours per week with at least one day off for every sevenday period; voluntary overtime paid at a premium rate and not toexceed 12 hours per week on a regular basis; overtime may bemandatory if part of a collective bargaining agreement.Remuneration: Wages paid for a standard work week must meet thelegal and industry standards and be sufficient to meet the basic needof workers and their families; no disciplinary deductionsManagement system for Human Resources: Facilities seeking to gainand maintain certification must go beyond simple compliance tointegrate the standard into their management systems and practices.

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Major Stakeholders

The major stakeholders that constitute the TSG are the Trade Unions andNGOs as at present. Suppliers, buyers, and women’s organisations haveexpressed interest in having a stake in TSG.

The Trade Unions

1. Indian National Trade Union Congress (INTUC), the oldest of thetrade unions, affiliated the Indian National Congress, is representedby Mr. P K N Dhandapani, its Secretary. Mr. Dhandapani is alsoConvener of the TSG.

2. Centre of Indian Trade Unions (CITU), affiliated to the CommunistParty of India (Marxist), is represented by its Secretary Mr. Chandran.

3. All-India Trade Union Congress (AITUC), affiliated to the CommunistParty of India (CPI), is represented by Mr. Balamani, its Secretary.

4. Hind Mazdoor Sabha (HMS), an independent trade union, isrepresented by its Secretary, Mr. Kaliappan.

5. Marumalarchi Labour Federation (MLF), affiliated to the MarumalarchiDravida Munnetra Kazhagam (MDMK), is represented byMr. Muthukumaraswamy, its Secretary.

6. Labour Progressive Federation (LPF), affiliated to Dravida MunnetraKazhagam (DMK), is represented by its Secretary, Mr. Ramakrishnan.

7. Anna Thozhirsanga Peravai (ATP), affiliated to All India DravidaMunnetra Kazhagam (AIDMK), is represented by its Secretary,Mr. Centwin Mani.

The NGOs

1. Social Awareness and Voluntary Education (SAVE), represented by itsDirector, Mr. Aloysius.

2. Centre for Social Education and Development (CSED), representedby its Director, Mr. C. Nambi.

3. Community Awareness Research Education Trust (CARE), representedby its Director, Mr. S.M. Prithiviraj.

4. Prakruthi, Bangalore based NGO and partner of Solidar idad,represented by its Executive Director, Mr. Pramod John. Prakruthi’sprogramme office in Tirupur hosts the TSG Secretariat.

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Activities

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The Steering Group engages itself in the following activities:Pre-Audit and Post-Audit Consultations: Certifying bodies issuingSA8000 Certificates engage TSG in ascertaining the social and welfarereputation or standing, through its trade union channels, of factoriesseeking certification prior to the audit. Once the independent audit iscomplete, TSG is once again engaged to either validate or refute thefindings of the auditing body.When a manufacturing unit expresses interest in being certified bySAI, the Steering Group is alerted to the same. The Group is thenengaged in a confidential assessment of the said firm through its reliablechannels, namely the trade unions and the NGOs. The process, calledthe pre-audit consultation between SAI/Certifying Body and the TSG,forms the base data/information for the actual audit by the CB.Following the audit by the accredited certifying body, the TSG is, onceagain, engaged in a consultative process to either validate or refute thefindings of the CB. This three-pronged audit process - pre, actual, andpost – ensures that the interests of all stakeholders are protected.Independent monitoring of the observance of the code of conduct:Following certification, the factory undertakes to observe the SA 8000Code of Conduct. TSG, as an independent body, is empowered tomake monitor the certified unit independently, and report any violationof the Code.Filing of complaints and reporting on serious violations of thecodes: Any serious violation in the observance of the said Code ofConduct can be pursued by TSG and reported to the certifying bodyand/or the buyer(s).Verification of the remediation programmes initiated by the factory:When a factory has completed the remedial measures following acomplaint, the TSG is empowered to ensure that such measures takenare in compliance with the desired codes.Training for the workers on codes of conduct at the factory level:In order to effectively addresses the concerns of civil societyorganisations (CSOs) and trade unions about the ‘top-down’ approachof the code, workers at the certified factories are trained to monitor itsimplementation. Empowered workers in the SA 8000 certified factorieswith the knowledge of SA 8000 code ensures better checks and balancesat the factory floor and better implementation of the standard.Training of young trade union activists on compliance: In order topush ahead with the agenda of social compliance, young trade unionactivists are constantly given training in various aspects of compliance.Every year, six such sessions are conducted and reaching out to over150 activists.

Prakruthi’s Role

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Prakruthi’s experience in formation of TSG in India, in Tirupur hasdemonstrated the efficacy of such monitoring body with recommendatorypowers. In this case, not only the mere TSG structure is important but alsothe processes adopted to setting-up the TSG and actors who eventuallybecame part of TSG are also essential.

The formation has done with extraordinary sensitivity, since each socialgeographical context may throw up different stakeholders who becameintegral part of the actor’s active in the TSG. For example in India, inTirupur, Prakruthi learned that the farmers, in the surroundings of Tirupurare also important stakeholders as the militant industrial activities in Tirupuraffect the livelihood of farmers, in the form of effluents destroying waterbodies and land masses.

Such learnings are important. Because in others countries different actorsmay came to play a crucial role.

The learnings from the actual and potential roles of TSG are such thatmere SA8000 certification process and the incentives it offers in the formof export opportunities can be a limited incentive for the companies toadopt sustainable business practices. Moreover, as its exists, the SA8000certification involves actors who are external agents without local culturalsensitivity.

Indeed Prakruthi’s experience has been such that SA8000 certificationprocess cannot be visualized as a legal process, but as a social process.Though legal-rights framework of many varieties provide the backdropand context for evolution of principles and requirements the process itselfcannot be conceived merely as law-enforcing process. If anything the legalthreat should remain largely in the background, with social pressuresfrontally playing up minds of those seek SA8000 certificates.

In a nutshell, Prakruthi’s role may be identified as:

• Hosting TSG’s Secretariat Office.

• Strengthening the SA 8000 audit process.

• Building capacity of TSG and its individual members.

• Building the capacity of workers in SA 8000 certified factories.

• Promoting corporate community investment programmes in associationwith the Tirupur Steering Group.

The Charter of the Steering Group

We, a group of seven Trade unions and four NGOs, united in our concerns andcommitted to promoting better labour and environmental responsibilities in theTirupur garment cluster have come together to establish the Garment SectorSteering Group of Tirupur - an informal assembly of trade unions and non-governmental organizations. We seek to work together in making social auditsin garment sector more effective in addressing labour and environmental issues.

We Recognize

In response to the demands by the stakeholder groups, increasing number ofimporting companies are asking their suppliers in Tirupur to adhere to oneor other codes of conduct to check working conditions in production facilities.The trade unions and NGOs have often very limited or no role in the audit,verification, monitoring and remediation programmes initiated by the code-setting bodies. There is a need for comprehensive and accountable mechanismfor the trade unions and NGOs to engage with the various codes-settingand code-implementing bodies.Due to lack of awareness about the codes of conduct the workers have limitedfaith in codes of conduct and have failed to fully participate in audits, andmake the implementation of codes more sustainable.

We Believe

That active participation of the trade unions and NGOs in the entire socialaudit process could lead to good quality monitoring and credible verification.That implementing Codes of Conduct in partnership with trade unions andNGOs would lead to increased competitiveness of Tirupur garment clusterby the way of better access to markets, reputational benefits, increased workerssatisfaction and loyalty leading to increased productivity, increased savingsthrough better environmental management and reduction of cost ofproduction.That issue-specific cooperation and coordination amongst trade unions andNGOs have a better chance of achieving their goals in far more effectivemanner than singular approaches.That we approach this agenda with different entry points and perspectivesand this very diversity is the strength of the Steering Group rather than thedistances that separates us.

Our Approach

To be a one point reference for Pre-Audit and Post-Audit consultations.Facilitate independent monitoring of the observation of the codes of conduct.To participate in verification of the remediation programmes initiated bythe factory.

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Filing of complaints and reporting on serious violations of the codes.

Training for the workers on codes of conduct at the factory floor.

To collaborate on work towards issues of common priorities.

To engage with various code-setting bodies.

Working of Garments Steering Group

The Steering Group comprises seven trade unions - CITU, AITUC, LPF,ATP, INTUC, MLF and HMS and NGO members - Prakruthi, SAVE,CSED & CARE.

The Steering Group has come together informally on specific issue of socialaudits in Tirupur and it will have no room with regard to independentactivities of its members.

The Steering Group would work with SA 8000 codes in the beginning asmajority of the garment companies in Tirupur are adopting SA 8000 standards.Subsequently, the group will engage with various other multi-stakeholdercode setting bodies.

The Tirupur office of Prakruthi would host the secretariat of the SteeringGroup.

Dr. T. Parthiban would act as a coordinator of the Steering group and wouldbe responsible for facilitating various activities from time to time under theguidance of the Steering Group Members.

The steering group would be meeting at least once in 2 months. This wouldnot prohibit the steering group to conduct meetings or workshops on specificthemes.

A quorum of seven members would be necessary for conducting the SteeringGroup meeting. Out of the seven members a minimum of three trade unionleaders and three NGOs need to be present in the meeting.

The Steering Group Meetings would be given a top priority and the headsof the NGOs and the senior most trade union leaders would be participatingin the deliberations. However, in case of extreme difficulties, a nominee ofthe Steering Group member could participate. Such nominees should beempowered to take decision on behalf of the organization he/she represents

The Steering Group would have the right to invite observers or special inviteesin its meetings from time to time.

The group will decide by simple majority about the inclusion of new membersin the Steering Group

Signed by representatives of the seven trade unions – CITU, AITUC, LPF, ATP, INTUC,MLF and HMS and NGO members - Prakruthi, SAVE, CSED & CARE.

The Charter of the Steering Group

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What the Leaders say....

It gives me immense pleasure that Steering Group plays a major role inthe development of Knitted wear at Tirupur. Their efficient steps inhand with the 7 Trade Unions and 5 NGO’s for the past 3 years isc ommendab l e .

The Steering Group works for the welfare of laborers, to developquality exports, and Social Auditing for the SA 8000 certified factories.The book is published to realize the above activities of TSG to thegeneral public, Laborers and Industrialists. I extend my bestcompliments to Steering Group on behalf of me and also the residentsof Tirupur Corporation.

K. Selvaraj, Mayor, Tirupur Corporation

I am extremely happy to know that “Tirupur Steering Group” has beenassisting Social audit certificate SA8000. Besides, giving training toGarment Factory Labours it also gives important to welfare of theLabours. I am glad that the Garment Industry and the Labours aregetting help and guidance by this group for continuous improvement.

My best wishes for the betterment activities of the group. Further, alsomy wishes to the “Prakruthi Institution”for all their efforts and integration.

Tirupur.C.Sivasami, Member of Loksabha, Tirupur Constituency

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I came to know that seven Trade Unions and five NGOs in Tirupur arejointly forming a Steering Group and act as a Consultative body toSA 8000. I hope that this intiative will facilitate to implement thesystems in a better manner in the Kintwear Garment Units under thedirect monitoring of steering Group. I wish this group will act asbridge between buyers and garment manufaactures and do help for theoverall growth of knitwear sector

A.Sakthivel, President Tirupur Exporters’s Association (TEA)

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What the Leaders say....

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TSG plays major role in inculcating CSR values among exporters.TSG’s services of implementing the labour legislations so as to sustainthe business, to ensure quality, to enhance labour life standard, protecttheir rights and responsibilities are remarkable.

Subrabharathimanian, Writer, Kanavu Literary Organisation

I am really happy to know that the organization [Prakruthi] wasestablished in the year 1991 and continuously working for the welfareof farmers and supporting them with new techniques. Moreover,I really have to applaud them for educating children of these farmers,especially girl children.

On behalf of our Association [TEKMA], I take this opportunity to wishPrakruthi and the TSG members grand success on launching thewebsite.

K.P. Govindaswamy, President, Tirupur Export Knit-wearManufactures Association

We are extremely pleased to note that Tirupur Steering Group ispublishing a booklet on its activities. Having associated with theTirupur Steering Group over 2 years, we are aware of their deepcommitment towards social upliftment and supply chain developmentamong industrial Workers. The services rendered by Tirupur Steer ingGroup during pre and post audit consultation process of SocialAccountability Certification, were focused, well meaning andcontr ibuted to the success of people and companies alike.A noteworthy aspect is the selfless service provided by them to meetthe intent and spirit of social compliance standards including resolutionto any prevailing issue, without any personal motive. We wish enduringsuccess to Tirupur Steering Group.

K.T. Ramakrishnan, Managing Director, RINA, India

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What the Leaders say....

Nobody can deny that TSG is working for labourwelfare and for environmental protection. TSGhas created a platform for all NGOs andTradeUnions to address workers’ problems.SA 8000 paved the way for this. Social Auditingconducted by TSG in Tirupur is very successful.Recently we started a website.

P.K.N. Dhandapani, General Secretary, INTUC

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The Way TSG works for the welfare of labour isremarkable. There is no second thought about the

imperative services done by TSG.Hats off to them.

R. Kalliappan, General Secretary, HMS

TSG acts as a major organization in trainingemployees, empowering Trade Unions andequipping Corporates to follow SA8000 normsin Tirupur garments factories. I wish them successin their efforts.

K. Ramakrishnan, General Secretary, LPF

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What the Leaders say....

The benefits for employees being attained withhelp of TSG are significant. Social Auditing by

TSG helps to ensure 8 hours works and to availESI, PF and others statutory and non-statutory

benefits. I am very grateful for the services of TSG.

Ceintwin A. Mani, President, ATP

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TSG gives us a greater opportunity to learn abouteach other and grow as one group all those whoare interested in well being of garment workers ofTirupur. It has grown as an institution to influenceand promote growth of the industry in a positiveway and advocates labour rights.

Certainly it has created a platform to debate on theissues to evolve common consensus among thevarious stake holders.

A. Aloysius, Director, SAVE

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Tirupur Steering Group (TSG) is a unique effort initself. Trade Union and Civil Society Organisationshave come together to play the Monitoring role in

the context of SA 8000 and thereby promote andprotect the interest of workers in the Garment

Industry. I wish them good luck.

C.Nambi, Director, CSED

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I have great pleasure in inviting the employees ofgarment export companies and Internationalbrand organizations to utilize the consultancyservices of member organizations of TirupurSteering Group are known for best promoters ofsocial, labour and environmental standards. Theneed of the hour especially in the context ofglobal economic recession is to work together forbuilding a sustainable and equitable garment andtextile industry with a global reputation forCorporate Social Accountability.

S.M.Prithiviraj, Executive Director, CARE-T

What the Leaders say....

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The Fact that Social Accountability International(SAI), the creators of the SA8000 standards, hasformally endorsed Tirupur Steering Group and

has strongly recommended that the SAI-accredited Certification bodies consult with the

Steering Group throughout the SA 8000certification process shows the importance of

Tirupur Steering Group. We are happy to be apart of it to host the secretariat in Tirupur.

Mr. Pramod John, Executive Director, Prakruthi

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