A new International Trade Union Federation report charges 50 major corporations — including Wal-Mart Stores Inc., Gap Inc., Nike Inc. and Hennes & Mauritz — with prioritizing profit over the well-being of its millions of workers, despite having record-high of assets that could augment wages.
Released this week, the report — titled “Scandal: Inside the Global Supply Chains of 50 Top Companies” — criticizes the “hidden workforce” of these corporations, their multimillion-dollar cash holdings, their alleged tax evasion practices and their chief executive officer payment schemes, ranging from $3 million to almost $40 million.
Yet these 50 companies, which hold a combined wealth equivalent to 100 countries, do little to ensure a fair minimum or living wage for workers in less-developed countries, cannot guarantee a safe and secure working environment for their workers and often turn a blind eye to their workers’ right to freedom of association and collective bargaining, according to ITUC’s general secretary Sharan Burrow.
“We have a business model that has lost its moral compass. For big business, labor is increasingly just a commodity and labor rights are bad for business,” she said in the forward. “Sixty percent of global trade is now driven by big business which, without apology, uses a business model based on exploitation and abuse of human rights in supply chains.”
Wal-Mart, Nike and Gap declined to comment on the report as of press time. A spokeswoman for H&M outlined the company’s sustainability and transparency efforts.
As the world’s largest retailer, Wal-Mart is repeatedly singled out for its contracting and labor practices.
“Of all the major retailers, none exemplifies this rapaciousness better than Wal-Mart,” the report said, pointing to reported instances of forced labor, union busting, inadequate working conditions and “poverty-level wages.”
According to the report, with cash holdings of $9.1 billion, the retail giant could conceivably increase the annual salary of its 2.2 million workers by more than $2,000 using just 50 percent of its assets. It is also relying on an estimated “hidden workforce” — referring to people employed by Wal-Mart’s sourcing factories and subcontracting factories — of roughly 10 million in a supply chain that lacks transparency and accountability.
Meanwhile, ITUC said the ceo pay there is $19.3 million a year, while the company reportedly avoids paying up to $1 billion a year in taxes, and shelters up to $76 billion in overseas profits under subsidiaries.
Another company with a far-reaching global footprint is Gap, which ITUC said generated $16.4 billion in revenues in 2014. With a supply chain that includes more than 1,000 contractors across 40 countries, the company — which includes Gap, Banana Republic and Old Navy — is a common client for countries with low wages, such as Cambodia, Bangladesh, Indonesia and Burma. With cash assets of $1.5 billion, Gap could direct 50 percent of it to increasing the wages of its 1.5 million workers by more than $500 a year.
Many other global conglomerates and brands did not emerge unscathed. Yue Yuen Industrial Holdings, which accounts for a fifth of the global footwear market and manufactures for Nike, Adidas and Reebok, could raise workers’ wages by $1,816 a year and has been accused of revoking maternity leave from pregnant workers; Nike could afford to augment the wages of 2.5 million by $1,020 annually, yet has still been plagued by accusations of sweatshop and child labor in its supplier factories, and Apple earns $150 for every iPad sold, while the average Chinese worker takes home $8.
H&M, being the second-biggest retailer in the world, was also featured in the report as having the ability to increase the wages of every worker in its supply chain by $1,187 a year using 50 percent of its cash holdings, but it fared better as the Swedish brand has made strides in transparency in recent years.
“Just like ITUC highlights, we also believe transparency is a key catalyst of positive change,” said Ulrika Isaksson, a press representative at H&M. “We were one of the first fashion brands to publish our supplier list and we keep full track of where our products are being produced. In this way, we can focus our sustainability program and continuously improve the working conditions for the 1.6 million workers who are employed by our suppliers.”