Top Sports Equipment Firm's 'Cheap Labour' Own Goal

It's not as well-known as mobile phone giant Nokia but fellow Finnish company Amer is the world's No. 1 sports equipment supplier. Tennis fans will recognise one of its brand names, Wilson. Now Amer Sports has been put under the spotlight, alongside other Finnish sporting goods companies, for their lax monitoring of working conditions at suppliers who use cheap labour in the Far East.

Finnish companies have sports clothing, shoes, and Nordic walking and ski poles made in countries of cheap labour, but few have active social responsibility programmes that they would enforce at home.

A recent study shows that those that have guidelines often do not enforce them with their own, systematic inspections. Visits to manufacturers generally focus on quality, with scant attention to what the workers are paid, or the hours that they work. Only Amer Sports uses outside inspectors to check up on foreign manufacturers.

The Asian factories used by Finnish companies often have subcontractors of their own. Not even Amer Sports, which also makes top line Salomon and Atomic skiing equipment., will give details on its chain of subcontractors, although boss Roger Talermo admits that it is with the subcontractors where most of the problems lie. Talermo claims that the reason for the secrecy is to prevent other companies from competing for the same manufacturers. "It is a guarantee of quality that our subcontractors do not work for others", he says.

The company has drawn up a set of ethical guidelines based on the international standard known as SA8000 and on external inspections. The standard is a certificate which guarantees the employees the right to form unions and make contracts, bans the use of child labour, and monitors enforcement of working hours. Researcher Outi Moilala has investigated issues of corporate responsibility implemented in the largest companies in the sporting goods business - retailers, and Finnish sporting good brands.

The information is based on reports supplied by the companies themselves. Nearly 90 per cent of the clothes and shoes sold by Halti come from subcontractors, with the greatest amount of manufacture taking place in China. Halti implements guidelines of the Network of Responsible Import Trade, and plans to join the Business Social Compliance Initiative (BSCI).

However, it dies not implement any inspections on manufacturers. BSCI is a project of European retailers, industry, and importers which monitors compliance with regulations of the International Labour Organisation and other social standards in manufacture. Karhu has all of its ski shoes and boots manufactured in China. It requires its subcontractors to act responsibly, but does not commission inspections by outsiders.

There are visits to the factories, but the main purpose of those is to monitor the quality of manufacture. According to Karhu CEO Pertti Keskitalo, who was interviewed for Moilala's report, workers at the Chinese factories are paid on time. Karhu refused to use a factory where workers were paid just once a year. In the report, Keskitalo admits that Karhu's quality control inspections cannot enforce regular payment of wages. Exel has walking and skiing poles manufactured in China out of tubes that are made in Finland.

The contract requires responsible action, but compliance is not monitored. Erätukku has shoes and textiles manufactured in China, Thailand, and Bangladesh. There are no standards of responsibility set for the factory, and no monitoring. However, if it comes to the company's attention that a factory uses child labour, the factory is changed. The study gives the highest points to store chains that sell sporting goods.

Moilala says that the biggest problems in countries of cheap manufacture are in the poor working conditions and low pay.She notes that in the Clean Clothes campaign, it was calculated that the factory worker who sews together a pair of running shoes that sells for EUR 100, will get just EUR 0.50 for the work. The report, which was published on Monday, was commissioned by the Play Fair 2008 network, whose Finnish partners include a number of trade union confederations, as well as advocates of fair trade.

* See also, 'Ikea exposed over 'child labour' and green issues', The-Latest, World News section.