PUBLIC PROCUREMENT AS A TOOL FOR THE

PROTECTION AND PROMOTION OF HUMAN RIGHTS:

A STUDY OF LEVERAGE AND LEGAL OPTIONS IN THE
ELECTRONICS INDUSTRY
Olga Martin-Ortega*
* Olga Martin-Ortega, Ph.D., is add current position,
University of Greenwich, United Kingdom. o.martinortega@gre.ac.uk. Dr. Martin-Ortega has been a
member of the International Advisory Group and
several working groups of Electronics Watch and is
currently a member of the Board of Trustees. The
opinions expressed in this paper are the authors alone
and do not necessarily reflect those of Electronic
Watch.
Please take care of Notes and references. I tried to fix
them up to Note #39 (p.7). Then, please organize your
REFERENCES Section in an alphabetical order.

1. INTRODUCTION
Public buyers, as large scale consumers of goods, hold
significant leverage over the behaviour of brands and
suppliers in the global supply chain. Whilst states tend to
use their discretion to promote domestic social issues
through public procurement, this has rarely being used to
influence conditions of those outside their jurisdiction;
those working to produce the goods they purchase.
The use of public procurement as a tool for the
promotion and protection of human rights in the supply
chain is underdeveloped both in theory and practice. This
paper explores the potential for the improvement of

labour rights, with a particular focus in one specific

industry: the electronics
industry. It analyses the
specificities of the industry, the buying power of public
bodies and the legal options for the promotion of social
considerations in the supply chain under European Union
regulation. The paper provides a study the legal model
and initial implementation steps of Electronics Watch, a
very recent and highly innovative initiative to use public
buying power to transform the electronics supply chain.

PUBLIC PROCUREMENT AND HUMAN RIGHTS IN THE

GLOBAL SUPPLY CHAIN
The initiatives for the improvement of human rights in
the global supply chain (GSC) have mainly focused on
responsibilities of the companies involved in such
chain and states obligations to regulate working
conditions under their jurisdiction. However, recent
developments have shifted the
focus to another
dimension of the states role: the state itself as an
element of the supply chain, the state as a buyer. Public
procurement offers a potentially valuable contribution to
the search for strategies to improve working conditions
in the GSC and could be an important tool in the creation
of market demand for responsibly manufactured goods
(Martin-Ortega, Outhwaite, & Rook, 2015; Outhwaite &
Martin-Ortega, 2016; Metheven OBrien, Mehra, Andrecka,
& Vander Meulen (2016).
Public procurement contracts worldwide are estimated
to be worth
one-thousand-billion
euros annually
(European Commission, Public Procurement in a Nutshell
year). Governments in OECD member states spend on

average 12% of their GDP on public

procurement

(OECD, 2011) and an average of 16% in the European

Union (European Commission, Public Procurement in a
Nutshell year). Given this volume of purchase
the
buying power of public bodies means that they hold
the potential for significant economic leverage over
their contractors, and therefore the capacity to influence
their behaviour in their own supply chain. Equally, the
procurement regime is an important regulatory tool to
pursue of so called horizontal or secondary policies.
Thus, public procurement regulation represents a
powerful legal instrument available to contracting
authorities to ensure compliance with secondary or noncommercial goals (Arnaiz, 2011) which related to the
supply chain would involve increase compliance with
existing labour laws and promote the improvement of
working conditions in the absence of state regulation
(Howe, 2010).
Socially responsible procurement is not a new
proposition but the extent of its application remains
limited (Leire, & Mont, 2010) and particularly its capacity
to influence social conditions and rights beyond the
borders of the state of the purchasing authority (MartinOrtega, Outwaite, & Rook, 2015; Outwaite & MartinOrtega, 2016.). Whilst procurement to achieve social
aims has been used since the 19th century, within the
framework of the welfare state, mainly to achieve
horizontal policies linked with domestic employment
policies such as promoting local employment and
manufacturing (McCrudden, 2010), it is only recently that
the potential for public procurement to positively
influence working conditions in the global supply chain
is being explored. At international level the United

Nations Guiding Principles on Business and Human Rights

(Ruggie, 2011) have established the link between the
obligations of the state to respect, protect and
promote human rights and public procurement (Guiding
Principle 6) (Metheven OBrien, Mehra, Andrecka, &
Vander Meulen, 2016).
The main hurdles of using public procurement as a tool
for the protection of human rights, specially, human
rights in the supply chain therefore abroad and outside
of the jurisdiction of the purchasing state- are the
underlying principles which inspire this regulatory
regime.
The
underpinning
purpose
of
public
procurement regulation is to establish a fair system for
providing goods and services to public authorities
through the application of rules on transparency, nondiscrimination and fair competition. The Plurilateral
Agreement on Government Procurement (WTO (1994),
like other WTO Agreements, aims to increase
international
trade
and
eliminate
or
reduce
discriminatory trade rules and the protection of national
markets, and is therefore based in the key principles of
the wider WTO framework: national treatment and nondiscrimination WTO, 1994, Article III, GPA and see Articles
IV, V and preamble). And within this framework the
emphasis has been placed on the concept of 'value for
money', narrowly defined, to exclude most social
considerations, and the aim of promoting free trade and
competition.
As a signatory of the GPA the EUs public
procurement regulation is based in the same free trade
focused principles. In the framework of the EU, all public
sector authorities, whatever the procurement, are
subject to the Treaty on the Functioning of the European

Union (TFEU), most significantly in relation to rules on

equal treatment, freedom of establishment, and
freedom to provide services. This means that at the
very least contracting entities must act transparently
and
must
treat
all
bidding
parties
equally,
proportionately and without discrimination. The current
regulations are contained, mostly, in the Public
Procurement Directive (2014/24/EU), which entered into
forced in April 2014 and must be implemented by
Member States within two years of that date.1 This
regulation was passed with the aim to modernise public
procurement rules including through simplification and
increased flexibility, improved market access and a
reduction in the 'missed opportunities for society'
including through additional provisions for social
objectives (European Parliament and of the Council on
Public Procurement, 2011). The Directive can be seen
as developing the procurement framework rather than
introducing radical changes (Martin-Ortega, Outhwaite, &
Rook, 2015; Outhwaite & Martin-Ortega, 2016). These
reforms respond to calls for fair trade and sustainability to
take a more central role in the EU economy and to
advances by the jurisprudence of the Court of Justice of
the European Union European Parliament and of the
Council on Public Procurement, 2011).
The new regulatory regime has therefore opened
up to enable better integration of social and
environmental considerations into public procurement
procedures. This is reflected throughout the preamble of
Directive 2014/24 in which reference to the importance of
integration
of
environmental, social and labour
requirements into public procurement procedures is made
(Recital 37), recognition is given to the potential use of
labelling for works, supplies or services conforming with

specific environmental, social or other characteristics

(Recital 75) and the potential to incorporate social and
environmental considerations into various stages of the
procurement process and to ensure that international
agreements and standards are respected (Recitals 97105).
Contracting authorities have been much freer to
impose environmental and social conditions when
negotiating conditions governing how the contract with
the tenderer must be performed, whilst these are
relatively restricted in the other phases of procurement,
i.e. technical specifications and award criteria. Since
contract performance conditions apply after the contract
has been awarded they do not impact the assessment of
tenders and therefore are less likely to cause problems
related to the principles of equal treatment, nondiscrimination and so on. Contract performance
conditions must relate to the execution of the contract,
rather than forming the basis of the award, and it is not
necessary for tenderers to demonstrate compliance prior
to the award of the contract (European Parliament and
Council on Public Procurement, 2010).
Contract performance conditions are permitted under
Article 70 where related to the subject-matter of the
contract within the broader meaning established in Art
67(3) (Chapter IV as a whole deals with contract
performance) Article 70 expressly states that
those
conditions may include economic, innovation-related,
environmental,
social
or employment-related
considerations'. Thus a wider and apparently more
permissive rule than those applicable at earlier stages of
the procurement process applies here.
An important innovation with regards to human

rights and labor conditions in the new Directive 2014/24

is article 18. Art 18(2) establishes as a principle of
procurement the position that Member States shall take
appropriate steps to ensure that in the performance of
public contracts, economic operators comply with
applicable obligations of social, environmental and
labour law including those specified in Annex X which
includes the core International Labour Organisation
Conventions such as those addressing freedom of
association, right to organise and collective bargaining;
forced and child labour, discrimination and equal pay
(ILO, year). Further, Art 71(6) provides: with the aim of
avoiding breaches of Art 18(2), (a) 'where the national
law of a Member State provides for a mechanism of
joint liability between subcontractors and the main
contractor, the Member State concerned shall ensure
that the relevant rules are applied in compliance with the
conditions set out in Article 18(2)' and (b) the
contracting authorities may required to confirm whether
there are grounds for exclusion of subcontractors
pursuant to Art 57. In this case the economic operator
may be required to replace the subcontractor. The
question of subcontractors is also referred to in the
preamble, which recognised that [it] is important that
observance by subcontractors of applicable obligations
in the fields of environmental, social and labour law...be
ensured through appropriate actions by the competent
national
authorities
within
the
scope
of
their
responsibilities and remit, such as labour inspection
agencies or environmental protection agencies (Recital
105). Reference is also made to the importance of
transparency in the subcontracting chain but here the
emphasis is specifically on the presence of employees
within a domestic context.

WORKING CONDITIONS IN THE ELECTRONICS

INDUSTRY SUPPLY CHAIN2
Electronic goods comprise a significant portion of
public purchases, are often high value items and are
procured in high volumes (Chan & Ho, 2008, p. 28). The
electronics industry supply chain extends from the
extraction of raw materials to the manufacture and
assembly of products at huge factories contracted by
global brands. The brand or 'lead firm' conceives of the
product and initiates its production as well as carrying the
product branding. In the electronics industry these firms
are very high value enterprises. Given that hardware
producers are noted as seven out of the top ten most
valuable brands in the world and Apple Inc. has been
named the worlds most valuable company,3 electronic
goods are the tangible and very visible output of a supply
chain that generates significant profits for those firms.4
In common with other sectors operating in
international markets the production of electronic goods
often takes place in the context of a multi-level global
supply chain.5 A single product may contain work
carried out by several companies in multiple countries
and global sourcing and relocation of factories is
common (Sturgeon, & Kawakami, 2010). The lead firm
frequently carries out little or no manufacturing or
production itself and contracted suppliers (or 'contract
manufacturers') are instead used by the brand. These
suppliers may be large enterprises with many employees
and multiple locations such as FoxxConn, Flextronics and
Inventec. These companies assemble the products and
may purchase components and assemble parts of the
final product such as circuit boards. The OECD reports

that these companies are often large companies with

operations in different countries but they have limited
market power and are less likely (than the lead firms) to
be based in developed countries (OECD, 2012).
The
contracted
suppliers
may
carry
out
manufacturing themselves but they may also, or
alternatively, work with subcontractors who manufacture
specific components which form part of the final product
(Good Electronics, 2009). The factories that produce the
components and finished electronic goods often employ
vast numbers of people to work on their production
lines. A significant proportion of this manufacturing
takes place in China and East Asia (Sturgeon &
Kawakami, 2010). China is the largest producer of
electronics goods worldwide, employing an estimated 7.6
million people in the industry but electronics factories are
also present in many other (mostly low-income)
jurisdictions, including Taiwan, Mexico, Malaysia, and the
Philippines (Decision, 2009).
Beyond manufacturing, there are a great many human
rights considerations that affect other parts of the
electronics supply chain, such as in the extraction, trade,
processing and transportation of raw materials. This
article focuses however on the upper levels of the supply
chain where products and components are manufactured
and assembled and not on the extraction of raw materials.
A number of difficulties with governance of global
supply chains in general have been recognised. The lead
firm is typically not in a contractual relationship with the
employees of its suppliers or with subcontractors nor in
turn
do
those
suppliers
assume
equivalent
responsibilities in relation to their own subcontractors.
Consequently, where there is a failure to adhere to

particular standards or to respect employees rights, the

failure has been the responsibility of the employer in that
specific part of the supply chain, rather than the
responsibility of the brand.
In tandem with this separation of obligations and
responsibilities along the supply chain, the industry,
having a global market with a reported worth upwards
of USD $3.2 trillion (Good Electronics, 2009) is under
significant consumer and investor pressure to innovate
and to reduce the lead-times to bring new products to
market. These demands create pressure on contracted
suppliers to increase productivity and reduce costs. At
the manufacturing level this has led to concerns
about conditions for employees including inadequate
working conditions and human rights violations.6 In
recent times the manufacture of electronic goods has
been subject to widespread media coverage highlighting
poor working conditions in the supply chain and in
extreme cases suicide of factory workers (Duhigg, &
Barboza, 2012; Barboza, 2013)Problems sometimes relate
to a lack of enforcement with national laws but in other
instances laws may be inadequate or absent. Further,
some countries in which manufacturing takes place may
not have signed core International Labour Organisation
(ILO) Conventions.7
Reports into working conditions in the electronics
industry supply chain consistently highlight a number of
problems. Pressure to get products to market in a short
time frame has been associated with the use of flexible
labour (Chan & Ho, 2008). Reports highlight the use of
contracted labour which limits job security and often
prevents employees from accruing benefits that would
be available through permanent employment as well

10

as preventing opportunities for advancement (FerusComelo & Pyhnen, 2011). Employment of student
workers or employees on a probationary basis can also
prevent employees benefiting from conditions and wages
that would be available to permanent employees (Chan &
40
Ho, 2008; China Labor Watch, 2012).
Staff turnover
may be high in factories, again preventing workers from
deriving employment benefits.

41

The use of migrant

42
labour has also been as identified as a problem;
these
employees can be more vulnerable to the demands of
employers and more willing to tolerate exploitative
43
practices.
Again they may be subject to precarious
terms of employment and those commuting long
distances have been found to live in poor quality,
overcrowded accommodation in order to reduce their
44
own expenditure.
For 'local' workers accommodation
can also be a problem, with similarly inadequate
standards and overcrowding being reported in employee
45
dormitories.
Conditions in the factories themselves may also be
poor. Strict rules for employees are reported for
instance, with inadequate time for rest or meal breaks
together with punitive sanctions for breaches of these
46
rules.
Health and safety is also an identified problem,
including exposure to hazards, especially chemicals,
47
along with other health problems among employees.
For employees of all types wages may be inadequate
48
and can be less than a living wage.
Routine overtime
and excessive working hours may be used both by

11

employees as a means of making wages reach an

adequate level and by employers to ensure that lead
49
times are met. Forced overtime has been reported.
For contract workers, deductions by agencies further
50
reduce these wages.
Discriminatory practices are a
further area of concern. In some instances women have
been favoured as employees because they attract lower
wages, in others discrimination has been identified
51
against pregnant women.
Attempts to assert
employment rights or improve conditions are difficult
where
there
are
barriers
to
association
and
representation or because participation in strikes or
other action lead to punitive action from the employer.

52

Although demand for electronic goods continues to

53
grow,
concern about working conditions in the
electronics supply chain is also growing. The increasing
profile of these concerns along with additional pressure
on corporations to recognise responsibilities throughout
54
their supply chain
point to a need for new and more
effective responses to managing the electronics industry
supply chain. In the electronics industry however
consideration of labour and social criteria is reported to
have emerged only recently. Sony, for instance, is
identified as having published environmental reports
since 1994 but it is only as of 2000 that some
electronics companies have been looking at working
55
conditions in their supply chains.
Some industry
initiatives have also emerged. The Electronic Industry
Citizenship Coalition Code of Conduct (EICC Code)
comprises members from the electronics industry who

12

56
are encouraged to adopt and implement the Code.
The
EICC currently lists 84 members including many major
57
brands and suppliers.
The Code of Conduct 'provides
guidance on five critical areas of CSR performance':
Environment, Ethics, Health and
Safety, Labour,
Management System [sic] and is monitored through an
58
auditing process.
The Global e-Sustainability Initiative
(GeSI) focuses on 'achieving integrated social and
environmental sustainability through ICT' and includes a
programme to raise labour and environmental standards
in the supply chain, from primary production (mineral
extraction) to manufacture (i.e. of components). In
collaboration with the EICC, GeSI develops common
tools that aim to improve standards as well as reducing
the resource burden and other barriers for companies
59
seeking to raise standards in their supply chain.
In
2014 a new independent monitoring organisation,
Electronics Watch, was launched. Electronics Watch
works specifically with public buyers to support their
efforts for socially responsible public procurement of
60
electronics goods.
Despite this, reports by labour
organisations have continued to identify the presence of
conditions contrary to the asserted aims of these
initiatives and limited knowledge, if any, of the
61
existence of codes of conduct by employees.
THE ELECTRONICS WATCH MODEL: USING PUBLIC
BUYERS POWER TO IMPROVE WORKING
62
CONDITIONS IN THE ELECTRONICS SUPPLY CHAIN
Electronics Watch is a very new organisation which
aims to transform supply chain relationships through the

13

63
power of public buying.
Whilst most of its basic
instruments are in place practice on the ground is still
limited.
The Power of Collaboration: The Affiliations Model
Electronics Watch is sustained on an affiliations
model, this is public buyers affiliate, paying an annual
fee proportional to their volume of annual ICT
hardware spending, to access the EW instruments,
mainly its Code of Labor Practices, model contract
clauses (EW Contract Conditions) and most importantly,
the network of local monitors which will develop the
monitoring. This capitalises on the power of the
collaboration among public buyers, which if joint in their
buying efforts, amount for contracts significantly bigger
than individually and therefore a greater leverage over
their contractors, as they have more economic power.
The power of collaboration and engagement is a
confluence of common practices in domestic public
buying, i.e. buying consortia, and international practices
of multi-stakeholder interaction, which is also common
in corporate social responsibility and business and
64
human rights initiatives.
The ultimate goal is to
transform supply chains through creating a market
demand through public purchasing practices.
There are antecedents of the use of public buyers
power in other sectors, specifically garments and similar
models. The Worker Rights Consortium (WRC) for
instance, is an independent monitoring organisation that
works with colleagues and universities in the US to
support them in their apparel-related purchases to avoid
sweatshop labor and defend workers rights in the
supply chain of apparel.

65

A more similar model is

14

that of the Sweatfree Purchasing Consortium (SFPC),

established in 2010 as a membership organisation of
public entities that seek to avoid sweatshop practices in
the supply chain of the products mainly garments- they
66
buy.
The initiative is based upon recognition of the
economic influence of public procurement as a means
of influencing working conditions in the supply chain.
The specific obligations assumed by the EW affiliates
are: pay their annual fee, Affiliates commit to incorporate
the Electronics Watch Contract Conditions, or equivalent,
in their ICT hardware contracts with new suppliers or
when contracts are renewed, and to nominate a point of
contact in the organisation with Electronics Watch.
The Standards: Code of Labour Practices
The standards of the EW Code of Labour Practices
are comprehensive and based in international law and
well defined state obligations to respect, protect and
promote human rights, but have also been drafted
taking into account the specificities of the industry. The
Code contains a series of standards and substandards,
based on the fact that in many international labour
regulation lacks the detail and specificity to make
standards. For each standard the Code contains a set of
sub-standards that describes specific practices that are
67
not allowed.
This way the standards in the Code are
general enough that they capture the widest possible
range of violations, but also specific enough to be easily
interpreted and enforced.
The Code contains provisions related to domestic law,
international labour law and a clause dealing with the
potential contradiction between the two. Firstly,
contractors must comply with domestic labour law in

15

the countries where they produce goods or services

and must ensure that their subcontractors do the
same. Contractors must also comply with the
international labour standards and sub-standards listed,
which refer to the ILO Core Conventions (ILO No. 29, 105,
87, 98, 100, 111, 138 and 182) as well as to ILO
Conventions No. 1, 95, 102, 115, 131, 135, 155, 158, 170,
ILO Recommendations No. 35 and 143, Article 34 of
the ILO Tripartite Declaration of Principles concerning
Multinational Enterprises and Social Policy and Article 32
of the United Nations Convention on Rights of the Child.
The core international labour standards refer to: free
choice of employment; freedom of association and the
right to collective bargaining; no discrimination in
employment; no exploitative child labour. Additional
international labour standards refer to: no excessive
working hours; safe and healthy working conditions; no
abusive termination of employment and living wages.
In the case of international and domestic standards
differing the standard that affords the greater protection
for workers shall apply. Whilst the Code is clear in that it
does not require a contractor or subcontractor to violate
domestic law in a country of production to comply with it,
it also demands
contractors honour international
standards by: permitting all activities related to freedom
of association that are not prohibited by domestic law,
and avoiding practices that violate international
standards unless a practice is mandated by domestic law.
Contract Performance Conditions: A Due Diligence
Model
As previously mentioned, one of the obligations
assumed by affiliates is to incorporate a model contract
clause the Contract Conditions- or equivalent, which
establishes the contractor responsibility. Contractor

16

responsibility is based on due diligence.

Contractor due diligence is a model inserted in the
current tendency in the field of business and human
rights. Having emerged as the main measure of the
responsibility of businesses with regard to their impact in
68
human rights,
due diligence is now the standard
demanded in some of the main international instruments
in the matter, such as UN Guiding Principles on
Business and Human Rights and the OECD Guidelines on
Multinational Enterprises, and domestic initiatives such as
US Dodd Frank Act, which establishes requirements for
disclosure and reporting including the adoption of
appropriate due diligence measures, to companies which
require specific metals for the manufacture of their
products which could have been mined in the Democratic
69
Republic of Congo.
The Guiding Principles identify the
responsibilities of business enterprises as including 'a
due-diligence process to identify, prevent, mitigate and
account for how they address their impact on human
rights.' (PG 15). In the sphere of human rights,
businesses are expected to 'base their activities on the
exercise of due diligence and have in place the processes
and mechanisms to track, monitor and respond to any
70
negative human rights impact their activities create'.
Equally, the OECD Guidelines give a prominent role to
corporate due diligence when defining business
71
responsibility to respect human rights.
The corporate
human rights due diligence approach therefore assumes
an active role on the part of businesses in identifying,
preventing and mitigating, and on some occasions
remediating, their impacts on human rights.
Due diligence has to have the necessary flexibility to

17

allow a progressive process of responsibility and supplier

engagement- disclosure and understanding of the supply
chain. In fact all the documents which have defined due
72
diligence have insisted on this.
The EW model also
relies on a flexible approach and recognises that a
contractor may be a brand, with relatively more control
over the supply chain, or a reseller with less leverage.
Both types of companies are capable of complying with
the Electronics Watch Contract Conditions.
The EW due diligence model is based on leverage.
The contractor needs to exercise leverage to perform its
responsibilities in order to achieve compliance with the
Code of Labour Practices. Under the Contract Conditions, a
73
contractor must:

a) Disclose the names and locations of the factories

producing the goods to be supplied under the
contract, and any industry audit report of those
factories accessible to the contractor, within 30 days
of the contract signing. Factories are assembly
factories in which the goods purchased by the
affiliate are assembled or component supplier
factories in which the electronic components used in
the assembly of the goods are produced.

b) Plan the steps it will take to mitigate the risk of

breach of the Code among factories where the goods
are made, and, when a breach is discovered, the
steps it will take to remedy the breach and
compensate affected workers.

c) Report the Contractor Compliance Plan within 30

days
of
contract
signing,
and
implementation every six months.

report

on

d) Engage the different actors: Suppliers, to prevent

18

them from contributing to or causing breaches of

the Code in the production of the goods, and to
cause them to cooperate and engage with
Electronics Watch in remedying and preventing
breaches; factories, to obtain access for Electronics
Watch's independent monitors and affiliates, to
report on actions to address actual or potential
breaches of the Contract Conditions.
The Contract Conditions contain verification and
enforcement provisions, meaning that affiliates or
Electronics Watch acting on behalf of affiliatescan hold
contractors accountable for their due diligence. These
provisions include the requirement to disclose their main
factories and Contractor Compliance Plans, and to
collaborate
with
Electronics
Watch
independent
monitoring of factories.
Where Electronics Watch
identifies unsatisfactory performance of the terms, for
example failure to exercise leverage to address breaches
of the Code, Electronics Watch can engage with
contractors,
on behalf of affiliates, to achieve
compliance. As a last resort, the affiliate can decide to
use contractual sanctions to obtain remedy.

74

Monitoring the Supply Chain

Providing access to reliable monitoring of the supply
chain is of course one of the main value added to EW. A
public buyer is highly unlikely to have the resources to
undertake this role even if it did have a willingness to
take on this burden, which it must be assumed is also
highly unlikely. Equally, the contracting supplier may not
have the means or willingness to undertake such
monitoring, and leaving it to each contractor raises
questions of independence.

19

The most important contribution of EW is the creation

of a extensive network of local monitoring organisations
which have the rapport and trust to provide a significant
engagement with workers. EWs monitoring is based on
a worker-driven monitoring. This type of monitoring has
at its core the goal of strengthening workers own voices
so they are able to report on and address safety and
labour issues on their own or in collaboration with the
companies, rather than having externally based, and/or
imposed processed of monitoring and supply chain
reform. The premise is that workers are the best
monitors because they are on site all day, every day.
They know the process and problems of normal
operations; they have ideas for resolving safety and
labour rights problems; and they can verify whether
corrections are implemented and actually work. In this
monitoring model, workers are active; they bring
attention to issues and can set in motion investigations
75
and remedial activities.
EW monitors are qualified
local
civil
society
organisations
who
undertake
continuous intelligence gathering through trusted
relationships with workers. An important criteria for the
selection, beyond their experience and expertise an
independence from the industry is that they have
ongoing relationship of trust with workers in electronics
factories. This is important as they must be able to
meet with electronics workers in safe settings where
workers can share information about workplace hazards
and
rights
violations
without
fearing
employer
retaliation.
Electronics
Watch
monitors
close
relationships with workers enable these organisations to
detect and understand hard-to-measure violations, such
as union repression and discrimination. They are also
able to react quickly to issues that must be addressed

20

promptly and to stay engaged over a long period of time,

when needed, to oversee the process of remedying long76
term violations and achieving sustainable compliance.
Working with local monitoring partners is also
presented as an economically efficient model, which
avoids the high costs generally associated to third party
monitoring. In this regard, EW would not need to pay
for expensive international travel or for the timeconsuming groundwork of worker
outreach
and
networking, but can focus its resources on specific
investigatory and compliance activities valuable to
affiliates.

77

The monitoring activity of EW results in a series of

assessments, which include regional risk assessments
and factory risk assessments.
Remediation and Supply Chain Reform
A common criticism of current monitoring processes is
that they do not serve as basis for remediation of the
situation of abuse of workers rights nor leads to
reparation processes. Even if specific instances get
resolved problems tend to resurface and ultimately
auditing and monitoring do not lead to supply chain
reform. In line with the UN Guiding Principles,
mechanisms for remediation are needed when human
rights violations in corporate environments occur. Such
mechanisms should ideally provide a means by which all
relevant parties, including supply chain employees, subcontractors, the contracted supplier and the public buyer,
can raise issues and seek resolution and remedies.
The main tools EW provides are: a) compliance

21

investigation and corrective Action Plans and b) worker

complain reports.
Corrective Action Plans are based on the extensive
evidence gathering through off-site worker interviews,
interviews with factory management and supervisors,
review of factory personnel records and other factory
documents. The reports present conclusive findings
regarding the potential violations identified in the risk
analyses or in related allegations or complaints. If
Electronics Watch finds breaches of the Electronics Watch
Code of Labour Practices, a corrective action plan is
recommended for the factory and the organisation
would work with the factory management, workers and
their representatives, the contractor, and the brand
company as necessary, to implement the steps needed
to correct the violations. Affiliates can use these reports
and updates on the corrective action plans to hold the
contractor accountable for any failure to address
contract breaches, and use escalation or enforcement
actions as necessary.

78

Worker Complaint Reports are based on in-person

worker complaints, hotline reports, and other forms of
worker testimonies, the report identifies actual or
potential violations of the Electronics Watch Code of
Labour Practices in any of the disclosed factories, and
recommends steps that factories, contractors, or brands
companies should take to mitigate and prevent risk of
violations. Affiliates can use these reports in contractor
engagement either to ensure the contractors address the
issues adequately in their compliance plans, or, if the
issue is not remedied, use escalation or enforcement
79
actions as necessary to ensure corrective action.
EWs
ethos is to serve as an instrument of supply chain

22

transformation and therefore facilitate supply chain

reform. The infrastructure to do this is in place, and
practice in this regard is now needed.
CONCLUSIONS
This article has analysed the options for capitalising
the significant leverage that public buyers have over
corporate practices in the supply chain and serve as a tool
to promote respect and protection of human rights. The
Electronics Watch initiative provides an innovative
example of practices which bring state purchasing to the
centre of the state responsibility to protect the human
rights of those who produce their products. Through its
model it articulates the economic leverage of public
buyers into a transformative tool for working conditions in
the global supply chain.
NOTES

1. EU legislation only applies to public contracts above

the specified economic threshold therefore national
legislators are free to regulate public procedures for
lower amounts in different ways to those specified in
the Directives, as long as they comply with EU Treaty
provisions.

2. This section is reproduced from Martin-Ortega, O.,

Outhwaite, O. and Rook, R., Buying power and
working conditions in the electronics supply chain:
legal
options
for
socially
responsible
public
procurement, International Journal of Human Rights,
vol. 19, issue 3, 2015, pp. 341-368.

3. See for instance Interbrand Best Global Brands 2013,

available at http://www.interbrand.com/en/best-globalbrands/2013/Best-Global-Brands-2013.aspx. In this
report the top 10 companies include Apple Inc.,

23

Google, IBM, Microsoft, Samsung and Intel.

4. See for instance CNN, Fortune Global 500: The most

profitable companies in the Global 500, 8 July 2013,
available
at
http://money.cnn.com/gallery/magazines/fortune/2013/
07/08/global-500-most-profitable.fortune/2.html. In this
report
Apple Inc. are ranked 2nd and Samsung
Electronics ranked the 12th most profitable companies
in the world.

5. See

OECD
(2012).
The
report
notes
that
standardisation, codification and computerisation
allow for a large interoperability of parts and
components which in turn allows for the fragmentation
of the production process across different stages.

6.

REFERENCES
1. University of Greenwich, United Kingdom. o.martinortega@gre.ac.uk. Dr. Martin-Ortega has been a
member of the International Advisory Group and
several working groups of Electronics Watch and is
currently a member of the Board of Trustees. The
opinions expressed in this paper are the authors alone
and do not necessarily reflect those of Electronic
Watch.
2. Martin-Ortega, O., Outhwaite, O. and Rook, R.,
Buying power and working conditions in the
electronics supply chain: legal options for socially
responsible public procurement, International Journal
of Human Rights, vol. 19, issue 3, 2015, pp. 341-368;
Opi Outhwaite and Olga Martin-Ortega, Human Rights
in
Global
Supply
Chains:
Corporate
Social

24

Responsibility and Public Procurement in the European

Union, Human Rights & International Legal Discourse,
Issue 1 (2016, forthcoming) and Metheven OBrien, C.,
Mehra, A., Andrecka, M., Vander Meulen, N. "Mapping
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3 European Commission, DG Trade website Public
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Nutshell
available
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4. OECD (2011). Size of Public Procurement Market, in
Government at a Glance 2011, 2011: 148
5 European Commission, DG Trade website Public
Procurement in a Nutshell
6 Arnaiz, T.M., Social considerations in Spanish public
procurement law, Public Procurement Law Review, 2011:
56
7 Howe, J., The Regulatory Impact of Using Public
Procurement to Promote Better Labour in Corporate
Supply Chains, Legal Studies Research Paper No. 528,
Melbourne Law School, 2010:2
8 Leire, C., & Mont, O., The Implementation of Socially
Responsible Purchasing, Corporate Social Responsibility
and Environmental Management 17, 27-39, 2010
10 See McCrudden, C., Using public procurement to
achieve social outcomes, Natural Resources Forum 28,
2004: 257267; and see Howe, 2010.
11 Ruggie, J., Report of the Special Representative of the

25

Secretary General on the issue of human rights and

transnational corporations and other business enterprises,
Guiding Principles on Business and Human Rights:
Implementing the United Nations Protect, Respect and
Remedy Framework, 21 March 2011, A/HRC/17/31
12 See Metheven OBrien, C., Mehra, A., Andrecka, M.,
Vander Meulen, N. "Mapping Report of Public Procurement
Legal
and
Policy
Frameworks
across
Selected
Jurisdictions", International Learning Lab on Procurement
and Human Rights (2016, forthcoming), for international
and national regulatory regimes.
13 WTO (1994). Agreement on Public Procurement (GAP),
1994, entered into force on 1 January 1996. The GPA is
one of the plurilateral agreements included in Annex 4 to
the Marrakesh Agreement Establishing the WTO. This
means only those WTO Members who are a party to the
Agreement
are
bound
by
its
obligations
and
responsibilities. The EU is a party to the Agreement.
14 Article III, GPA and see Articles IV, V and preamble.
15 Directive 2014/24/EU of the European Parliament and
of the Council or 26 February 2014 on public procurement
and repealing Directive 2004/18/EC
16 EU legislation only applies to public contracts above
the specified economic threshold therefore national
legislators
are free to regulate public procedures for lower amounts
in different ways to those specified in the Directives, as
long as they comply with EU Treaty provisions.
17 Impact Assessment Accompanying the Proposal for a
Directive of the European Parliament and of the Council

26

on Public Procurement, SEC(2011) 1585 final, Brussels,

20.12.2011 at 23
19

European Parliament and Council on Public

Procurement (2011, December 20). Impact Assessment
Accompanying the Proposal for a Directive of the
European Parliament and of the Council on Public
Procurement, (SEC(2011) 1585 final). Brussels, Belgium:
Author.
20

European Parliament and Council on

Public
Procurement (2010). Buying Social - A Guide to Taking
Account of Social Considerations in Public Procurement
(SEC(2010) 1258 at 53
21 Chapter IV as a whole deals with contract performance.
22

For ILO Conventions and Recommendations see

http://ilo.org/global/standards/introduction-tointernational-labourstandards/conventions-andrecommendations/lang--en/index.htm
25 Chan & Ho, 2008: 28 (needs full reference)
27 CNN (2013, July 8). Fortune Global 500: The most
profitable companies in the Global 500. [On;ine].
Available
at
http://money.cnn.com/gallery/magazines/fortune/2013/07/
08/global-500-most-profitable.fortune/2.html. In this report
Apple Inc. are ranked 2nd and Samsung Electronics
ranked the 12th most profitable companies in the world.
28 OECD (2012, December 3). Mapping Global Value
Chains.
(Report
TAD/TC/WP/RD(2012)9),
Brussels,
Belgium: Author.
29 Sturgeon, T.J., & Kawakami, M. (2010, September).

27

Global Value Chains in the Electronics Industry: Was the

Crisis a Window of
Opportunity for Developing
Countries? (The World Bank, Policy Research Working
Paper 5417). Washington, DC: World Bank.
30 OECD, 2012: 28
31 Good Electronics, Reset. Corporate social responsibility
in the global electronics supply chain, October 2009: 19.
32 Sturgeon & Kawakami, 2010: 4-5
33 Decision, World Electronic Industries 2008-2013, April
2009:
14,
available
at
http://www.decision.eu/doc/brochures/exec_wei_current.p
df.
34 Good Electronics, 2009: 19
35 Independent research bodies, NGOs and collaborative
campaigning initiatives in particular have published
several reports highlighting these issues. See for
instance: DanWatch, IT workers still pay the price for
cheap computers, 2013; Ferus-Comelo, A., & Pyhnen,
P., Phony Equality, Make IT Fair, 2011; Kakuli, A. &
Schipper, I., Out of Focus: Labour rights in Vietnams
digital camera factories, Make IT Fair, 2011; Chan, J., &
Ho, C., The Dark Side of Cyberspace, World Economy,
Ecology and Development (WEED), 2008; and China Labor
Watch, An Investigation of Eight Samsung Factories in
China: Is Samsung Infringing Upon Apples Patent to Bully
Workers?, 2012.
36 See for example Duhigg, C. & Barboza, D., In China,
Human Costs Are Built Into an iPad, New York Times, 25
January
2012,
available
at
http://www.nytimes.com/2012/01/26/business/ieconomy-

28

apples-ipad-and-the-human-costs-for-workers-inchina.html?pagewanted=all&_r=1&; and Barboza, D.,

Worker Deaths Raise Questions at an Apple Contractor in
China, New York Times, 10 December 2013, available at
http://www.nytimes.com/2013/12/11/technology/workerdeaths-raise-questions-at-an-apple-contractor-inchina.html
37 See Kakuli & Schipper, 2011. The ILO has established
eight 'fundamental conventions', these are Freedom of
Association and Protection of the Right to Organise
Convention, 1948 (No. 87); Right to Organise and
Collective Bargaining Convention, 1949 (No. 98); Forced
Labour Convention, 1930 (No. 29); Abolition of Forced
Labour Convention, 1957 (No. 105); Minimum Age
Convention, 1973 (No. 138); Worst Forms of Child Labour
Convention,
1999 (No. 182); Equal Remuneration
Convention, 1951 (No. 100); Discrimination (Employment
and Occupation) Convention, 1958 (No. 111). A further
four conventions have been designated as priority
instruments; these are recognised in the ILO Declaration
on Social Justice for a Fair Globalization (2008) as the
most significant with respect to governance. The priority
conventions are Labour Inspection Convention, 1947 (No.
81); Employment Policy Convention, 1964 (No. 122);
Labour Inspection (Agriculture) Convention, 1969 (No.
129); Tripartite Consultation
(International Labour
Standards) Convention, 1976 (No. 14).
38 Chan & Ho, 2008
39 Ferus-Comelo & Pyhnen, 2011
40 Chan & Ho, 2008; China Labor Watch, 2012
41 Kakuli & Schipper, 2011; China Labor Watch, 2012

29

42 Pringle, T., Reflections on Labor in China: From a

Moment to a Movement, South Atlantic Quarterly, 112:1,
2013
43 Pringle, 2013
44 Ferus-Comelo & Pyhnen, 2011
45 Ngai, P., & Chan, J., Global Capital, the State, and
Chinese Workers: The Foxconn Experience, Modern China,
38, 383
46 Chan & Ho, 2008
47 Kakuli & Schipper, 2011
48 Ferus-Comelo & Pyhnen, 2011Kakuli & Schipper,
2011Chan & Ho, 2008
49 China Labor Watch, 2012
50 Chan & Ho, 2008; China Labor Watch, 2012
51 Chan & Ho, 2008; Kakuli & Schipper, 2011
52 Chan, A., Organising Wal-Mart in China: Two Steps
Forward, One Step Back for Chinas Unions. New Labor
Forum, 16:2, 2007: 86-96; Chan & Ho, 2008; FerusComelo & Pyhnen, 2011
53 According to the consultants PwC, worldwide combined
shipments of consumer electronics devices are projected
to
reach 2.5 billion units in 2014, a 7.6% increase from 2013.
Report
available
at
http://www.pwc.com/gx/en/technology/scorecard/consume

30

r-electronics.jhtml 54 See discussion of due diligence

below.
55 de Hann, E., & Schipper, I., Computer Connections.
Supply chain policies and practices of seven computer
companies, SOMO, 2009
56

The EICC Code of Conduct

http://www.eicc.info/eicc_code.shtml

is

available

at

As noted on the EICC website,

http://www.eicc.info/about_us05.shtml

available

at

57

58 For discussion of compliance with the EICC Code by the

electronics brand HP see Locke, R., Distelhorst, G., Pal, T.,
& Samel, H., Production Goes Global, Standards Stay
Local: Private Labor Regulation in the Global Electronics
Industry, Massachusetts Institute of Technology, Working
Paper No 2012-1, 2012: 10.
59 See further GeSI (the Global e-Sustainability Initiative)
at http://gesi.org/
60

Electronics Watch brings together a coalition of

international non-governmental organisations, European
public
buyers, local monitoring organisations and trade unions.
The initiative was launched in early 2014 and is expected
to be
fully functioning by mid-2015. For further
information see http://electronicswatch.org/en.
61 Chan & Ho, 2008; Kakuli & Schipper, 2011
62 This section is based on the debates in the Working
Groups that provided the background work for the
creation of EW, and on internal documents on file with

31

the author, particularly Claeson, B., Combining The

Strength Of Public Sector Buyers To Ensure Respect For
The Rights Of Electronics Workers In Contractor Supply
Chains. Documentation for participants in the Symposium
Socially responsible public procurement of electronic
products. Challenges of monitoring the global supply
chain, University of Greenwich, December 2015.
63

Electronics Watch is the result of European

Commission funded project from 2013-2015, led by the
Spanish NGO, SETEM. Other project partners included
Centrum CSR (Poland), DanWatch (Denmark), People and
Planet (UK),
SOMO (Netherlands), Sdwind (Austria), and WEED
(Germany). This consortium conducted research on the
electronics industry, developed model contract clauses, a
code of labour standards, and other procurement tools
consistent with the EU procurement directive, developed
dialogue and educational forums with public sector buyers
in their own regions, recruited 70 advisors and the first
affiliates to Electronics Watch, and incorporated. The
project ended in 2015 and Electronics Watch was
incorporated under Dutch law and started conducting
activities in its own right.
64 Many of these multi-stakeholder initiatives include
NGOs, business and governments. EW does not include
businesses.
65 http://www.workersrights.org/
66 For further information see the Consortiums website at
http://www.sweatfree.org/about_us
67 These sub-standards condense the more than 300
compliance points developed by the ILO Better Work

32

Programme
into a more manageable number of
compliance points that serve as indicators of broad
compliance.
68 Martin-Ortega, O., Human Rights Due Diligence for
Corporations: form Voluntary Standards to Hard Law at
Last? Netherlands Quarterly of Human Rights, 32, 2014:
49-50; see as well, McCorquodale, R., Corporate Social
Responsibility and International Human Rights Law,
Journal of Business Ethics, 87, 2009: 392.
70 Martin-Ortega, O. and Wallace, R., Business, Human
Rights and Children: the Developing International Agenda,
Denning Law Journal, 25, 2013: 105-127
71 The OECD Guidelines on Multinational Enterprises were
first passed in 1976 as part of the Declaration on
International Investment and Multinational Enterprises.
The current revised version was adopted by the OECD
Investment Committee on 25 May 2011. See particularly,
Section IV on Human Rights.
72 See Martin-Ortega, O., Human Rights Due Diligence
for Corporations: form Voluntary Standards to Hard Law at
Last?, Netherlands Quarterly of Human Rights, 32, 2014:
49-50; see as well, McCorquodale, R., Corporate Social
Responsibility and International Human Rights Law,
Journal of Business Ethics, 87, 2009: 392
73 Reproduced from Claeson, B., Combining the Strength
of Public Sector Buyers To Ensure Respect For The Rights
Of Electronics Workers In Contractor Supply Chains.
Documentation for participants in the Symposium
Socially responsible public procurement of electronic
products. Challenges of monitoring the global supply
chain, University of Greenwich, December 2015.

33

74 Ibid.
75 Ibid.
76 Ibid.
77 Ibid.
78 Ibid.
79 Ibid.

34