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Strengthening Developing Country Governments’ Engagement with Corporate Social Responsibility:

Conclusions and Recommendations from

Technical Assistance in Vietnam

FINAL REPORT Nigel Twose and Tara Rao December 2003

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Table of contents

1. Executive summary and recommendations 1 2. Summary report of global findings from the World Bank CSR program 4 3. The CSR program in Vietnam 9 The research framework 9 Background of the two sectors 13 Textile sector status 13 Footwear sector status 14 4. Research findings; recommendations for public sector roles 16 Recommendations 17 Appendices Appendix A: CSR implementation matrix for Vietnam Appendix B: Stakeholder driver matrix for CSR in Vietnam Appendix C: Government Role Matrix: Strengthening CSR in Vietnam References

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1. Executive summary and recommendations The World Bank’s program Strengthening developing country governments’ engagement with Corporate Social Responsibility was set up to explore the potential roles of the public sector within developing countries to encourage and strengthen corporate social responsibility, or CSR. It has been based on activities and dialogue on specific sectoral or thematic issues in four countries (Angola, El Salvador, The Philippines and Vietnam), plus commissioned research on cross-cutting themes. It began in April 2002 and concluded with an international conference in November 2003. The concept of CSR is based on the recognition that businesses are part of society, and that they have the potential to make a positive contribution to societal goals and aspirations in ways that are both god for business and good for development. But why should a government engage with the CSR agenda? Four arguments have emerged: To enhance international competitiveness; To address current gaps in government capacity; To create synergies that use the complementary competencies of government,

private and civil society actors to achieve common goals; To ensure that CSR practice is in line with national policy goals.

In Vietnam, the technical assistance aimed to build CSR awareness among key stakeholders and government officials, to engage and stimulate broader stakeholder dialogue on government roles in strengthening CSR. It focused on labor standards in the footwear and textile industry. The supporting research analyzed barriers to CSR awareness and implementation within a sample of enterprises (based on ownership, scale and location) and amongst key stakeholders. The research revealed the following barriers and challenges: There are wide variations in awareness and understanding of CSR among and

within Vietnamese firms. Implementation of multiple buyers’ CSR Codes of Conduct, or CoCs, by one

Vietnamese supplier of is creating inefficiencies. Differences between the national Labor Code and CoCs are resulting in firm-level

confusion, e.g. freedom of association and overtime. Inconsistencies in national regulations create inefficiencies in CoC implementation,

e.g. wage rate, benefits and employment conditions. Unequal access to financial and technical resources is creating CSR disparities at

enterprise level, especially for SMEs. Shifting, anonymous, complex supply chains inhibit longer-term commitment to

CSR. The lack of transparency over current CSR practices is hindering potential market

reward.

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The research also revealed advantages and opportunities: A section of Vietnamese firms have gained clear market benefits from their CSR

practices: new and expanded contracts from international buyers. The same section of Vietnamese firms say that they have experienced productivity

gains from more contented and healthier workers. CSR implementation has the potential to facilitate law enforcement at enterprise

level. Buyers are looking for collaborative solutions that would allow cost sharing and

greater impact, in areas such as capacity building. Based on the research findings in Vietnam, and comparable work in other countries in this program, the World Bank makes the following six sets of recommendations to the Government of Vietnam: #1. MOLISA should continue its work of the last 12 months in providing factual information on CSR codes to Vietnamese enterprises and their stakeholders. This should involve continued data gathering to enhance information dissemination approaches; a website and written materials, perhaps in collaboration with the business associations. #2. MOLISA should encourage collaborative approaches amongst buyers towards monitoring and agreement on one single audit for multiple buyers from the same factory, focused on the high percentage of shared CSR code content #3. MOLISA should lead a process to get CSR capacity-building undertaken collaboratively, in a manner that pools the complementary competencies of buyers and other stakeholders, and reaches a larger group of Vietnamese suppliers and potential suppliers. This should have a particular focus on SMEs. #4. MOLISA should build on its comparison of CSR code content and Vietnamese national law, to determine shared content, and to advise on areas of discrepancy. This should include discussion with buyers and CSR standards agencies about those areas where harmonization appears possible, such as freedom of association. It should also include discussion with buyers on a common strategy to reach consensus, for example on overtime. This work should be led by MOLISA’s Legal Department. #5. MOLISA should seek learning opportunities for its labor inspectorate through improved collaboration with the private sector monitors and auditors associated with CSR codes, both for-profit and not-for-profit. This could include data sharing, with buyers providing aggregated data from their CoC monitoring, that would reveal useful patterns of violation patterns and trends. It could also include information sharing on inspection techniques. The Labor Inspectorate should be fully briefed on the comparative analysis of the national labor code and CSR codes, and able to offer advice and support to Vietnamese firms in dealing with these matters, maintaining the sanctioning power of inspectorates, but shifting the focus to technical assistance for

those firms that are developing their own CSR benchmarks and improvement plans. MOLISA should pilot joint visits for its inspectors with those of CoC inspectors, to reduce the time burden on enterprises of multiple visits, and to increase learning opportunities for MOLISA inspectors and for the private inspectors. MOLISA should re-prioritize the workload of its inspectorate, with less emphasis on those enterprises that are subject to regular robust monitoring and inspection through CoCs, and more on those enterprises that are not involved with any CoC and typically have far lower labor standards. #6. MOLISA should encourage increased transparency and reporting on labor standards, including firm-level reporting on core data. This would help individual firms distinguish themselves in a highly competitive marketplace, and the data could also be aggregated anonymously at national level to show how seriously the country takes this issue. MOLISA should work with MPI on the new Trade Promotion Agency which the Government has decided to create, since labor standards data generated by firms would be directly helpful to this promotional effort. Vietnam needs to compete internationally on the basis on cost + quality + demonstrated standards.

2. Summary report of global findings from the World Bank CSR program

About this section This section summarizes findings from the World Bank’s program Strengthening developing country governments’ engagement with Corporate Social Responsibility. Through activities and dialogue on specific sectoral or thematic issues in four countries (listed below), and a series of commissioned research projects on cross-cutting themes, the program explored the potential roles of the public sector within developing countries in relation to CSR.

Country Sector Issues

Vietnam El Salvador The Philippines Angola

Footwear General Mining Oil

Labor Business and education Socio-economic and environmental impacts Local content, transparency and social development

The concept of corporate social responsibility (CSR) is based on the recognition that businesses are part of society, and that they have the potential to make a positive contribution to societal goals and aspirations. The CSR agenda places significant emphasis on relationships between enterprises and their stakeholders, both internal (e.g. workers, shareholders and investors) and external (e.g. customers, suppliers, civil society and community groups). Yet one set of key actors is often omitted from this conversation – the government. This is despite the overarching role of the government in setting the framework within which businesses operate, and the potential for aligning the outcomes of business activity to public policy goals. To some extent, the absence of attention to the role of the government is a reflection of the immaturity of the CSR agenda, and that the term “CSR” has not yet taken hold within many government agencies. Yet there already is a wealth of examples of government actions that can and do promote corporate social responsibility, many of which have not been undertaken explicitly as CSR initiatives. These include traditional activities of labor and environmental regulators and inspectorates, and elements of the work of investment and export promotion agencies. Government agencies that do not use the term CSR are not necessarily doing any less than those that do. Indeed, they may prefer to deal with the challenges brought by the CSR agenda through more established terminology and approaches, in order to focus on the necessary responses and to communicate these to other actors. Just as the significance of the government is often underplayed within the CSR agenda, so the link between public governance and CSR is seldom given due attention. But governance is an overriding factor in defining the type and trajectory of CSR that will emerge, and the respective roles of different stakeholders. Where the state provides a transparent and predictable business environment, with clear signals for business and enforcement of the law, not only are minimum standards more likely to be upheld, but also the efforts of private sector and civil society actors to promote better social and environmental practices through voluntary measures will be

supported. In Angola, companies investing in the oil sector are realizing that if they are to respond to civil society demands that the revenues they generate are harnessed in support of public good such as poverty reduction, they need government support in ensuring transparency. The extent to which the government can underpin CSR through good governance has a strong bearing on the necessary roles of other actors. But why should the government engage with the CSR agenda at all? The first reason is the desire to maintain and enhance international competitiveness. In El Salvador, the Government sees CSR as a route to long-term national competitiveness, by capitalizing on the willingness of employers to invest in education and their desire for an educated workforce. There are indications that CSR issues are increasingly influencing the investment and purchasing decisions of some multinational enterprises.1 This survey of 107 MNEs in the extractive, agriculture and manufacturing sectors found that over 80% of respondents consider the CSR performance of potential partners and locations before they enter into a new venture, with just under half choosing one host or source country over another on the basis of CSR issues. Indeed, the most striking link between CSR and competitiveness is made through codes of conduct, developed by buyers to manage social and environmental issues within their supply chains. These have become among the most widespread tools of the existing CSR agenda, alongside the compliance or monitoring schemes that are used to ensure that suppliers implement the codes. In Vietnam, the direct benefit of helping the domestic footwear sector to understand and adhere to labor codes of conduct is securing international contracts that would otherwise be awarded elsewhere. There may also be indirect benefits for individual enterprises in terms of productivity and quality improvements2, and for the sector as a whole in attracting other buyers and investors. Cambodia accepts that its textile industry cannot compete with China simply on the basis of low input costs, and instead is seeking to position itself as a location for ‘responsible’ purchasing by building the capacity of suppliers to implement labor codes of conduct. If codes of conduct can lead to the exclusion of enterprises (particularly SMEs) from international supply chains, there is a clear rationale for government support to help enterprises respond to them; we discuss possible interventions below. Having said this, it is important not to overstate the significance of codes of conduct. It is clear that they are being applied within the supply chains of a core of multinational enterprises in certain industrial sectors, notably garments and footwear, and to some extent agribusiness.3 For enterprises aiming to supply these sectors, there is increasing

1 J. E. Berman and T. Webb 2003 Race to the Top: Attracting and Enabling Global Sustainable Business: Business Survey Report, Washington, D.C., World Bank. 2 Jørgensen et al. (2003) note that there is currently little understanding of the indirect business benefits of adhering to codes of conduct, such as improved productivity and lower staff turnover. 3 For detailed information and analysis of codes of conduct applied to five sectors (apparel; footwear and light manufacturing; agribusiness; tourism; mining; oil and gas), see G. Smith and D. Feldman 2003

pressure to implement codes of conduct. But this is often not the case for enterprises in other sectors or for those supplying domestic markets. A second reason for government engagement with CSR is to address current gaps in government capacity. This is a pragmatic response to situations where government agencies lack capacity to secure enforcement of legislation (for example in countries where codes of conduct are seen as a good tool to enforce implementation of the law) or resources for government expenditure (for example in El Salvador, where the fiscal gap undermines government investment in education). The idea of CSR filling temporary gaps also extends to the global regulatory context – CSR may prove to be a symptom of the current lack of a mature global governance framework, and developments in global governance may eventually reduce the need for codes of conduct and other CSR tools.4 Thirdly, the government can apply CSR to facilitate partnerships and create synergies that use the complementary skills of government, private and civil society actors to achieve public policy goals. Even where there are fully functioning and well-resourced regulatory structures, it still makes sense to make the most of what different stakeholders can offer. For example, in El Salvador, the business community is able to provide financial expertise and mentoring for school managers, while in the Philippines, the Department of Environment and Natural Resources sees communities as “active partners, not beneficiaries” in the context of the mining sector.5 A fourth rationale for government engagement with the CSR agenda is to ensure that it is in line with the interests of local stakeholders and with national policy goals. The current CSR agenda, and its emphasis on top-down codes of conduct, reflects its primary association with large multinational companies and their stakeholders, particularly consumers, investors and international civil society organizations. As discussed above, government interventions may be necessary to ensure that domestic companies (particularly SMEs) are able to meet the supply chain requirements imposed by foreign buyers. But there is also a need to support the positive practices of domestic companies, including those operating outside international supply chains. Local visions of what it means to be socially responsible may well be quite different to those of international buyers. In Vietnam, some invitees to a conference on CSR assumed that the topics to be discussed would be assistance for flood victims and other needy people, rather than labor codes of conduct. In the Philippines, there is a need for mechanisms that involve and engage local stakeholders

Company Codes of Conduct and International Standards: An Analytical Comparison (Parts I and II), Washington D.C., World Bank. 4 Michael Klein, Vice President Private Sector Development: The World Bank, and Chief Economist, International Finance Corporation, addressing the International Conference on Public Policy and CSR, Washington, D.C. 8-9 November 2003. 5 Edwin G. Domingo, Assistant Director, Mines and Geosciences Bureau, Department of Environment and Natural Resources, addressing the International Conference on Public Policy and CSR, Washington, D.C. 8-9 November 2003.

in planning a sustainable future for the mining sector. Workers and their representatives, the perceived beneficiaries of codes of conduct, are not often involved in their development or even in the implementation. The government has an interest in promoting worker involvement in CSR and, more generally, in promoting stable and effective systems of industrial relations. Given the complexity of these drivers for government engagement, it may be useful to take a systematic approach to deciding on the most appropriate responses. The range of roles that government agencies might play can be situated within an overarching framework under four broad categories: mandating, facilitating, partnering and endorsing.6 The aim should be to map the overlaps between the CSR agenda and existing government activities, and to identify interventions that align business activities with public policy goals.7 For example, the Government of El Salvador is seeking to integrate CSR into a national plan for education, and sees its roles as, firstly, to establish clear policies in relation to CSR, and secondly, to facilitate partnerships between the private sector and educational institutions.8 The Government of Angola has passed legislation to set targets for hiring of local labor by foreign oil companies, in order to develop local skills and training. There is clearly a range of activities that the government could play with respect to codes of conduct and other supply chain requirements. Ensuring consistent and transparent enforcement of the law is fundamental to supporting responsible business activity. A logical next step is providing information, training and other capacity building for local enterprises, both in terms of what standards are required and how they relate to national legislation. This could involve key stakeholders such as trade unions, industry associations and civil society groups. By coordinating the different actors, the government may be able to encourage collaborative capacity building that pools resources and expertise. But a more dynamic response would be to attempt to shape the codes of conduct and their implementation processes, both in the interests of domestic enterprises and the economy as a whole, and to maximize the benefits in terms of higher standards. For example, stakeholders in Vietnam have discussed the notion of a national framework for codes of conduct, which might form a basis to encourage coherence between different buyers’ codes and national legislation, and may even facilitate joint audits of factories.9

6 See Fox, Ward and Howard (2002) for a discussion of this framework and examples of public sector action under each of the categories. 7 See the Diagnostic and Appraisal Tool developed by Michael Warner for the CSR Practice, which takes users through a series of steps, helping them form recommendations on appropriate public sector interventions and instruments. 8 H. E. Rolando Ernesto Marin Coto, Minister of Education, El Salvador, addressing the International Conference on Public Policy and CSR, Washington, D.C. 8-9 November 2003. 9 Jørgensen et al. (2003) note that one of the main barriers to implementation of codes of conduct by suppliers is the fact that different buyers interpret even identical provisions in codes of conduct in different ways. This appears to be a greater barrier than the absolute number of different codes.

But there remains a need to explore how auditors inspecting against private codes of conduct, and the information gathered by them on standards within individual enterprises, could usefully complement and built the capacity of government inspectorates. By doing so, there may be scope to raise standards not only in export sectors, but also in enterprises producing for the domestic sector and in industries beyond those touched directly by codes of conduct. And questions remain about the limits to the implementation of codes of conduct in sectors characterized by short-term contracts and complex supply chains. While the case of Angola demonstrates how the CSR agenda relies on transparency with regard to the activities of the government, government also has a role to play in ensuring the provision of transparent and reliable information on the activities and impacts of enterprises. It is in the interests of individual companies to differentiate themselves within a market in which discerning buyers (and increasingly, investors10) favor high standards. There may be a role for the government in establishing a comparative framework to allow this, possibly linking higher standards to incentives such as tax concessions or export licenses.11 In addition to these enterprise-level effects, data collected could be aggregated and used at a national level in positioning the country as a location for responsible sourcing or investment. To make the most of the leverage that transparency can bring to bear on corporate performance, it may also be necessary for the public sector to support the capacity of civil society to demand and make use of this information, thus creating additional local pressure for better practice. Providing balanced information on the positive and negative impacts of business activity also has the potential to bring stakeholders into constructive debates. For example, in the Philippines, there is a clear need for broad civil society engagement and a mechanism that builds mutual trust and informed choices between stakeholders, as well as expanding each stakeholder’s awareness of the possibilities presented by the mining sector.12 In exploring and performing its potential roles, the government can play an important function in shaping a national CSR agenda not only responds to external pressures such as codes of conduct, but is also in line with local needs. In assessing the opportunities that CSR provides, the challenge is for governments to identify priorities and incentives that are meaningful in the national context, building on the strengths of local enterprises as well as those of foreign multinationals. By doing so, there is a

10 For example, ten leading banks recently adopted the Equator Principles, a voluntary set of guidelines for managing the social and environmental issues related to the financing of development projects. 11 For example, the Government of Cambodia has linked the granting of export licenses to garment manufacturers to their engagement in an ILO standards scheme. 12 C. L. Hubo (2003) Corporate Social Responsibility (CSR) and Public Policy in the Philippine Mining Sector, paper presented to the International Conference on Public Policy and CSR, Washington, D.C. 8-9 November 2003.

significant opportunity for the government to harness current enthusiasm for CSR to delivery against public policy goals and priorities. 3. The CSR program in Vietnam

About this section This section summarizes the objectives and activities of the CSR program in Vietnam and the research framework.

Strengthening CSR is seen as an important mechanism for building Vietnam’s comparative advantage as a responsible sourcing location for global companies. The goal of the technical assistance to the Government of Vietnam has been to identify potential government roles in strengthening CSR, to build agreement around that analysis and to develop a subsequent implementation plan to serve as a roadmap for future action by the government. The objectives of this technical assistance were:

1. To build awareness about CSR among key government officials (representing government ministries and agencies concerned with social and economic policies), to engage in a discussion about government roles in strengthening CSR;

2. To identify realistic and appropriate government roles for strengthening CSR in Vietnam using labor standards and the footwear industry as a case study;

3. To support government in stimulating broad dialogue with key stakeholders in key export sectors about proposed government roles in strengthening CSR.

In partnership with the Institute for Labor Sciences and Social Affairs (ILSSA) and the Ministry of Labor, Invalids and Social Affairs (MOLISA) the key activities implemented under this Program of Technical Assistance included: • Multi-stakeholders’ Seminars on CSR (HCMC and Hanoi) • Establishment of a multi-sectoral Advisory Group • Research to support further study of proposed public sector roles to strengthen

CSR The research framework The research was undertaken by a team from ILSSA, coordinated with the Advisory Group as stakeholder representatives, to ensure common understanding and enhanced ownership of the research process and outcomes.

Goal of the research To strengthen CSR by providing input to a dialogue on stakeholder roles with specific focuson government roles, to strengthen corporate social responsibility (CSR) in Vietnam and feedinto the government’s strategic planning on Vietnamese business competitiveness within aglobalizing economy. Objective of the research To identify the challenges/barriers and opportunities in the existing CSR environment inVietnam, with a focus on identifying government roles in addressing the challenges/barriersand extending the opportunities with respect to CSR implementation, and policy dialogue. Intermediate objectives 1. To provide viable options for addressing challenges to information dissemination among the

various CSR stakeholder groups; 2. To identify the challenges/barriers and opportunities and prioritize viable options for

addressing challenges to CSR implementation by identifying the − comparative impact in improving working conditions through various CSR practices; − −

comparative costs vs. benefits, and associated tradeoffs of the various initiatives; sustainability of the comparative approaches and the associated assumptions ofstakeholder roles and capacity in ensuring the sustainability of the approach or incompelling companies to undertake CSR.

3. To determine the government’s role in − −

supporting and strengthening existing initiatives/approaches and; stimulating broader implementation of particular models embodied in various initiatives for adoption/implementation by various scales and profiles of enterprise.

The research focused on the apparel and footwear sectors in Vietnam, given their importance to the national economy, their demonstrated susceptibility to market-based CSR pressures, and their urgent need to adapt to a quota-free world post 2005. Enterprises represented in the research were both from the north and south covering enterprises of varying scale and types, targeting both the suppliers and the buyers, surveying state-owned enterprises (SOEs), and national private enterprises, serving both national and international markets The sample was self-selected, with enterprises volunteering to share their experience on CSR implementation: this suggests caution in extrapolating conclusions for the sector as a whole. The researchers selected enterprises in three categories: 1) those undertaking CSR; 2) those initiating CSR and; 3) those presently not engaging in CSR. The research framework was based on why there is CSR engagement (i.e. the drivers); how enterprises engage in CSR (i.e. the profile of the CSR strategy); what is the content (i.e. the systems and mechanisms); and what next has been planned. This framework formed the basis for semi-structured interviews, questionnaires and focus group discussions.

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Enterprise

CSR implemented CSR initiated CSR detached

Enterprise profile

Scale/ ownership/ sector /

Reason for disengagement

How Approaches/ Strategies

- Nature/profile of CSR initiative

- Process of initiation; assistant & support

- Stakeholder engagement/capacity (union, community, etc.)

- Nature/profile of CSR initiative

- Process of initiation; assistance & support

- Stakeholder engagement/capacity (union, community, etc.)

- Status of implementation of labor legislation

- Level of awareness of CSR - Stakeholder

engagement/capacity (union, community, etc.)

What Systems/ Mechanisms

- Process and content of implementation

- On-going barriers/ challenges

- Auditing process - Costs and benefits (short

& long term) - Effect and impact (in &

outside the work place) - Reporting initiatives

- Process and content of implementation

- Initial barriers/ challenges

- Costs and benefits (short term – in & outside the work place)

- Reporting initiatives

- Working conditions/ outside the work place

- On-going barriers/ challenges

What next Further Approaches/ Systems

Time frames & targets Barriers and trade-offs

Time frames & targets Barriers and trade-offs

Time frames & targets Barriers and trade-offs

Background to the two sectors International economic integration for Vietnam takes an important step forward with the implementation of the bilateral trade agreement with the United States; application for WTO accession, and; the ASEAN Free Trade Agreement (AFTA), which requires the reduction of tariffs and import barriers among all ASEAN member nations by 2006. This will further advance Vietnam’s process of integration, exposing domestic enterprises to expanded opportunity as well as fierce competition within the current export-led growth strategy of Vietnam. The labor-intensive apparel and footwear sector are important sectors for economic growth for Vietnam, accounting for approximately 23% of exports. The WTO Agreement on Textile and Clothing calls for the elimination of quotas by 2005 and is expected to cause major shifts in global production. This offers both an opportunity and a challenge for Vietnam: government allocated quotas will be replaced by market-based decisions. In a highly competitive marketplace with no quotas, most experts agree that Vietnam will be unable to compete on the basis of cost + quality alone. Building Vietnam’s comparative advantage will require an enhancement of Vietnam’s reputation on the basis of cost, quality and demonstrated standards.

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The implementation of CSR at enterprise level focuses mainly on labor and environment issues. Most individual buyers specify their requirements within a Code of Conduct (CoC). The research documenting enterprise level experience within Vietnam, shows many enterprises see benefit in raising their standards in this way, due to their improved reputation, better working conditions, increased productivity and quality. Vietnam is not alone in seeking to attract and retain buyers by emphasizing labor standards: the Government of Cambodia, for example, has pioneered a transparent factory monitoring and reporting initiative with its 200 garment factories, and is competing aggressively to retain CSR-sensitive buyers and investment post 2005. Textile sector status13 By December 2002, 1200 textile firms were operating in Vietnam, with 1 million workers. 65% are SMEs. By quantity, non state-owned enterprises constitute the highest proportion; by investment, foreign invested enterprises top the list. Table 1: Structure of Textile enterprises by investment rate and ownership (Unit: %)

State-owned enterprises

Non state-owned Foreign invested enterprises

By quantity 22 44 34 By proportion of investment to total investment in textile industry

28 32 40

Source: Vietnam Textile Association (VITAS)

In 2002, the textile sector stood second after petroleum and gas, responsible for 15% of national exports. Between 1995-2002, exports increased from US$850m to US$ 2750m. The Vietnam-United States Trade Agreement and the US Bilateral Agreement on Textiles and Garments generated favorable conditions for the export of Vietnamese textile and garment products, seen as a temporary period (2003-2004) for the Vietnamese sector to identify business partners and increase exports. The sector relies on cheap labor, overwhelmingly young female migrant workers. Productivity and quality are still low, prices are not competitive. Many firms have poor management and technology. Almost 80% of materials and accessories are imported: cotton, rush, thread, chemical, dye, accessories.

13 Based on Sub-segment Report on the Textile Sector, ILSSA-WB Initiative.

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Footwear sector status14 There has been rapid growth in the footwear industry in recent years, in terms of number of firms, output and export turnover. Table 2. Total of production and export turnover of Footwear Industry

Products Unit 1998 1999 2000 2001 2002 Production Mil. Pairs 212.65 240.82 302.80 320,01 360 Shoes

styles Export Mil. Pairs 333 Production mil.

Units 27 28.5 31.3 32 33.7

Hand bag Export mil.

Units 32

Production Mil. Sqft 10.75 12.57 15.1 17 25 Tanned Leather Export Mil. Sqft 12

Total export turnover mil. US$ 1.000,82 1.334,46 1468.12 1.575 1.846

Source: LEFASO Between 2000-2002, footwear exports increased from US$1,468 bn to US$1846bn. Table 3: Export turnover by ownership forms

1999 2000 2001 2002 Ownership mil. USD % mil. USD % mil. USD % mil. USD %

787,33 59 778,95 53,1 811,25 51,1 884,08 47,9 386,61 26,3 331,49 21,0 347,86 18,8 392,34 26,7 479,76 30,0 536,22 29,1

VN Enterprise State-owned Non state-owned 100% of foreign capital

471,58 35 838,65 45,4

Joint -venture 75,54 6 123,4 6,7 Total 1345,5 1468 100 1575 100 1846 100 Source: Report of LEFASO Main export markets are in the EU, with Germany, the Netherlands, France, Belgium, and the UK accounting for nearly 80% of exports. Sport shoes and women’s shoes are on the increase, with fabric shoes getting a smaller share of exports, but a larger share of the domestic market. The output of leather products is increasing rapidly. Vietnam is among the 10 largest footwear producers and exporters worldwide, with 350 enterprises employing 450,000 workers in HCM City, Dong Nai, Binh Duong, Hanoi and Hai Phong. Many firms are boosting their investment and improving production capability, especially FDI and joint venture enterprises. Table 4. Development target of Footwear Industry to 2010

Products Unit 2002 2005 2010 Production 1000 pairs 360.000 470.000 720.000 All styles of

shoes Export 1000 pairs 333.150 427.700 655.200 Production 1000 units 33.700 51.700 80.700 Hand bags Export 1000 units 32.000 50.500 78.470 Production 1000sqft 25.000 40.000 80.000 Tanned Leather Export 1000sqft 12.000 25.000 65.000

14 Based on Sub-segment Report on the Footwear Sector, ILSSA-WB Initiative.

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Total of export turnover 1000 USD 1.846.000 3.100.000 6.200.000

Source: LEFASO. The sector has not been subject to an export quota regime, and is exposed to fierce competition, now increased by economic integration. As with textiles, Vietnamese production capacity lags behind regional competitors, with outdated technology insufficient high-skilled workers, and poor design. 4. Research findings; recommendations for public sector roles

About this section This section summarizes key findings of ILSSA’s research in the two sectors, and offers World Bank recommendations on appropriate public sector roles to help address identified challenges. The recommendations are in blue and bold.

The research found that almost all suppliers, textile and footwear, first confront CSR through Codes of Conduct, or CoCs, developed by individual buyers. This relationship sees the buyer specifying social and environmental standards through the code, and acting as the monitoring partner (directly or through third-party involvement). Suppliers implement the buyer’s code, in the hope of improving their reputation and attracting larger and more stable contracts. Suppliers commonly work with more than one buyer, and therefore implement more than one code, with the number ranging between 2 -6 at any one time. Suppliers reported that the buyer is the primary source of information. The business associations (VITAS - textile or LEFASO – footwear) also play a role in basic information dissemination, but do not disseminated detailed information about CoC content or requirements. This relationship between supplier enterprises and buyers creates a top-down approach, with most Vietnamese firms passively implementing their buyers’ codes, rather than proactively seeking increased market share through CSR practices. However, the research found that some suppliers that were initially responding to their short-term buyer requirements now see CSR investments can help them win more stable and numerous contracts. A small number have also identified that CSR investments can increase worker satisfaction and hence factory production, with less worker turnover or ill health. Firms told the researchers that CSR implementation is contributing towards enterprises meeting their customer demands with regard to delivery time, improving-product quality, and noticeable reduction of defective products. For some firms, order quantity and customers are increasing, especially from those US buyers (export turnover into US market is up to 11% from 7%), with a high tendency to consider CSR

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considerations while engaging in production contracts overseas15. In some cases Vietnamese enterprises have built their reputation with clients, such that they not only purchase directly from enterprises but also choose enterprises as manufacturers when signing business contracts through intermediate partners. Further, enterprises implementing one CoC can provide other potential clients with confidence that requirements will be met. #1 Knowledge/Information disparity The CSR agenda is relatively new in the country, although safeguards for workers rights and working conditions are well articulated in national legislation. The term “CSR” is not widely used and often creates confusion when translated into Vietnamese due to its dual business and social agenda. The research revealed that knowledge and understanding of CSR varies between firms, and within them. The majority of Northern enterprises work mainly as subcontractors for mid-level or intermediary partners (Korea, Taiwan), who often focus only on quality, quantity, delivery time, monitoring and supervision as technical concerns, with third party assessment and monitoring, while consultancy, information provision on CSR for enterprises remain limited. Southern enterprises have more chances to promote enterprise development as they are often acting as subcontractors or producers for brands such as Nike, Adidas, Reebok, Timberland, Bata. These buyers inform and provide CSR advisory support to the suppliers. The consequence is that understanding and capacity within enterprises and their key stakeholders often varies, with senior management having the most knowledge and workers the least. Unsurprisingly, CSR and OSH staff have a greater awareness than finance staff. Managerial staff often lack CSR competence, restricting their ability to provide appropriate guidance: many managers have been promoted from the workers, and lack professional and management skills. This pervasive lack of awareness and capacity contributes to Vietnamese firms generally being “passive implementers” of CSR, reacting to buyer requirements, rather than proactive seekers of market gain through improved standards. Each Vietnamese firm has to analyze potential CSR costs and benefits, in the context of their own resources, competencies and business plan, but few have access to the information that would enable them to do so. Recommendation: MOLISA should continue its work of the last 12 months in providing factual information on CSR codes to Vietnamese enterprises and their stakeholders. This should involve continued data gathering to enhance information dissemination approaches; a website and written materials, perhaps in collaboration with the business associations. 15 For more data on US firms’ prioritization of CSR issues, see J. E. Berman and T. Webb 2003 Race to the Top: Attracting and Enabling Global Sustainable Business: Business Survey Report, Washington, D.C., World Bank.

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#2 Multiple code management All CSR codes cover the same broad areas, but implementation requirements vary widely. The research found suppliers adopting multiple CoCs, dealing with different implementation requirements for the same provision (e.g. fire extinguisher position and other health and safety specifications). This causes inefficiencies due to multiple audits, time and resources used to comply, and different management requirements, creating an unnecessary burden for suppliers. The extent to which suppliers comply is highly dependent on the supplier’s profit margin and capacity. The research found a lack of proactive and more sustainable engagement on the part of Vietnamese firms. This reactive approach contributes to the tendency of Vietnamese firms perceiving CSR-related improvements as a cost not as an investment. Recommendation: MOLISA should encourage collaborative approaches amongst buyers towards monitoring and agreement on one single audit for multiple buyers from the same factory, focused on the high percentage of shared CSR code content.

#3 Unequal access to capacity-building resources The multi-stakeholder Advisory Group for this program was intended to support and inform the research work; it also illustrated the need for partnerships that use the complementary competencies of government and the private sector to achieve common goals. The suppliers and buyers, the trade union responsible for protecting the rights of the worker, the business associations, NGOs – all of these actors have skills and resources that could be brought to bear on the capacity-building challenge. (Refer Stakeholder Driver Matrix: Appendix B) Enterprises expressed the lack of a level “playing field” to investment and capacity-building resources, based on ownership and scale. They argued for incentive systems, advisory services and revised policies on capital borrowing, with improved access for all types of enterprises, to encourage improved CSR-related standards. Recommendation: MOLISA should facilitate a process to get CSR capacity-building undertaken collaboratively, in a manner that pools the complementary competencies of buyers and other stakeholders, and reaches a larger group of Vietnamese suppliers and potential suppliers. This should include: data gathering on responsive capacity building packages and approaches; identifying relevant buyers to participate in capacity building activities; facilitating collaboration between buyers and business associations to develop capacity building packages for suppliers, sub-contractors and potential suppliers as well as other key stakeholders. This should have a particular focus on SMEs, and MPDF could play a useful role through their relationship with the business associations, helping achieve economies of scale in delivery of training and information, and in negotiating with buyers. #4 Differences between the Labor Code and CSR codes CSR codes generally refer to national legislation as the standard of reference, and state that national law must be respected. These statements are backed up by codes’

1

rigorous monitoring and inspection systems. The research confirmed that CSR implementation is therefore helping ensure law enforcement at the firm level. CoCs and their associated guidelines are also raising awareness on labor standards, and in some factories are facilitating continuous improvement, including to standards that exceed national law stipulations. However, a small number of elements of some CSR codes do not currently align with national legislation requirements. Critical elements include overtime and freedom association.

Overtime: Some CoCs allow a maximum that is higher than the maximum of 300 hours/person/year stipulated by the Labor Code. Research interviews with workers, particularly from rural areas, show that most want to work overtime to increase their income while also saving on subsistence expenditures, as they often have meals, bathe, wash at the enterprise premises. Interviews with enterprises’ senior management revealed that almost all are not currently complying with the Labor Code regulation, but were instead allowing 450 - 600 hours/person/year of overtime. The key objective in the overtime debate is not reducing worker's income, but instead is that the expected productivity gains from reducing overtime translate into higher wages or at least equal total income: the real issue is productivity, and has strong potential for a “win-win” outcome if framed as a multi-stakeholder dialogue with a focus on capacity building/productivity.

Freedom of association: Under Vietnamese law, workers are given the right to

have their own organization. However, this organization must be the Trade Union which is part of the Labor Federation system and must be approved by the same. Other forms of association are not legally recognized. Some CoCs, on the other hand, require that if freedom of association is restricted by law, the employer provides parallel means of independent and free association. This discrepancy is creating confusion for Vietnamese firms, and masking the real question - the capacity and genuine interest in defending worker's interests.

Recommendation: MOLISA should build on its comparison of CSR code content and Vietnamese national law, to determine shared content, and to advise on areas of discrepancy. This should include discussion with buyers and CSR standards agencies about those areas where harmonization appears possible. On overtime, robust evidence from other countries shows that a reduction in excessive overtime generates productivity gains for the enterprise, as well as improvements to worker health. On freedom of association, the fact that SAI, for example, is currently certifying Vietnamese firms suggests that harmonization is possible. MOLISA should include discussion with buyers on a common strategy to reach consensus, especially on overtime. This work should be led by MOLISA’s Legal Department, with input from industry, workers and outside experts.

1

#5 Parallel inspection systems of factory standards The research revealed parallel inspection and support systems. The national labor inspectorate has approximately 400 inspectors, seeking to ensure that the Labor Code in enforced in all workplaces in Vietnam. At the same time, an increasing number of Vietnamese firms are adopting CSR codes that involve regular and robust monitoring systems, and external audit of standards. The first of these two systems is regulatory, with the potential penalty of state sanction; the second is voluntary, with the potential penalty of market loss and the potential reward of increased business. The research revealed that the current disconnect between the two systems is imposing significant opportunity cost on the Vietnamese firms that ironically have the highest standards and least need of such scrutiny. This finding is consistent with other reports that enterprises throughout the country regularly complain about their production activities being hindered by repeated inspections from different State agencies. Recommendation: MOLISA should seek learning opportunities for its labor inspectorate through improved collaboration with the private sector monitors and auditors associated with CSR codes, both for-profit and not-for-profit. This could include data sharing, with buyers providing aggregated data from their CoC monitoring, that would reveal useful patterns of violation patterns and trends. It could also include information sharing on inspection techniques. The Labor Inspectorate should be fully briefed on the comparative analysis of the national labor code and CSR codes, and able to offer advice and support to Vietnamese firms in dealing with these matters, maintaining the sanctioning power of inspectorates, but shifting the focus to technical assistance for those firms that are developing their own CSR benchmarks and improvement plans. MOLISA should pilot joint visits for its inspectors with those of CoC inspectors, to reduce the time burden on enterprises of multiple visits, and to increase learning opportunities for MOLISA inspectors and for the private inspectors. MOLISA should re-prioritize the workload of its inspectorate, with less emphasis on those enterprises that are subject to regular robust monitoring and inspection through CoCs, and more on those enterprises that are not involved with any CoC and typically have far lower labor standards. These steps should be linked to the ILO project which is seeking to build capacity of the inspectorate and enhance efficiency by working toward integration of the various departments and ministries responsible for inspection. #6 Transparency As in any market-based system, CSR depends on accurate information flows in order for firms to receive a market reward for their CSR investments. Similarly, in Vietnam wishes to position itself internationally as a country that takes standards seriously and that CSR-sensitive buyers can source from with confidence, the country needs data to back up its claims of high standards. Other countries are experimenting with new information systems, but Vietnamese firms to date are highly secretive about the detail of their labor standards. Transparent, voluntary reporting on labor standards at

1

enterprise level will help individual firms distinguish themselves in the global marketplace, and will enhance Vietnam’s reputation as a place to do business. Recommendation: MOLISA should encourage increased transparency and reporting on labor standards, including firm-level reporting on core data. This would help individual firms distinguish themselves in a highly competitive marketplace, and the data could also be aggregated anonymously at national level to show how seriously the country takes this issue. MOLISA should work with MPI on the new Trade Promotion Agency which the Government has decided to create, since labor standards data generated by firms would be directly helpful to this promotional effort. Vietnam needs to compete internationally on the basis on cost + quality + demonstrated standards.

1

APPENDICES

2

App

endi

x A

: CSR

impl

emen

tatio

n m

atri

x fo

r Vie

tnam

It

em

Foot

wea

r Te

xtile

In

fras

truc

ture

im

prov

emen

t A

ll en

terp

rise

s und

erto

ok

All

ente

rpri

ses u

nder

took

Equi

pmen

t 40

% b

ough

t all

new

equ

ipm

ent;

80%

sup

plem

ente

d w

ith n

ew

equi

pmen

t; 40

% s

uppl

ied

by b

uyer

So

me

ente

rpri

ses

boug

ht a

ll ne

w; s

ome

supp

lem

ente

d; s

ome

upgr

aded

/rep

aire

d

Ove

rtim

e St

eady

rise

bet

wee

n 19

97-2

002

rang

ing

betw

een

200-

600

hour

s/pe

rson

/yea

r for

foot

wea

r, w

hile

text

ile se

ctor

mor

e st

retc

hed

than

any

oth

er s

ecto

r can

go

up to

13

hrs/

day

or 4

50-6

00 h

ours

/per

son/

year

. En

terp

rise

s in

the

Sout

h ha

ve h

ighe

r ove

rtim

e ho

urs c

ompa

red

to th

ose

in th

e N

orth

. 10

0% h

ave

over

time,

esp

ecia

lly

duri

ng p

eak

prod

uctio

n pe

riod

s. 1

00%

ent

erpr

ises

pro

duct

ivity

not

hig

h du

ring

ove

rtim

e w

ork

and

the

expe

nditu

res

on e

lect

rici

ty a

nd w

ater

incr

ease

con

side

rabl

y,

but t

hey

still

mob

ilize

wor

kers

to w

ork

over

time

to m

eet t

he c

ontr

actu

al ti

me

requ

irem

ents

, whi

ch a

re in

crea

sing

in te

rm o

f bot

h qu

antit

y an

d qu

ality

. Mos

t of

wor

kers

, par

ticul

arly

wor

kers

from

rura

l are

as w

ant t

o w

ork

over

time

for i

ncom

e. O

vert

ime

wor

king

hel

ps s

ave

on s

ubsi

sten

ce e

xpen

ditu

res,

as t

hey

ofte

n ha

ve

mea

ls, b

athe

, was

h at

the

ente

rpri

se.

W

ages

Sh

iftin

g to

a ti

me

rate

syst

em, w

ith w

age

leve

ls d

eter

min

ed b

y pr

oduc

tivity

, nat

ure

of c

ompl

exity

of w

ork,

ski

ll le

vel;

Ove

rtim

e pa

id

by la

w; A

ccor

ding

to s

ome

ente

rpri

se d

irec

tors

, in

situ

atio

ns o

f str

ong

com

petit

ion,

man

y bu

yers

inte

ntio

nally

cre

ate

the

fals

e pr

essu

res i

n te

rm o

f tim

e fo

r pro

duct

del

iver

y in

ord

er to

redu

ce th

e un

it co

st

with

in th

e co

ntra

ct.

Rate

syst

em b

ased

on

time

or b

y pr

oduc

t; Fo

reig

n-in

vest

ed u

se ti

me

rate

; Wag

e eq

ual t

o or

gr

eate

r tha

n th

e st

ipul

ated

min

imum

wag

e –

wag

e ra

nge

amon

g 30

% o

f ent

erpr

ises

300

,000

-40

0,00

0 V

ND

/mon

th; 7

0% 6

00,0

00-1

,000

,000

Soci

al &

M

edic

al

insu

ranc

e

Seen

a g

radu

al in

crea

se in

wor

kers

par

ticip

atin

g –

rang

ing

betw

een

35-8

3% o

f wor

kers

. But

not

hig

h du

e to

hig

h la

bor t

urno

ver (

mig

rant

la

bor)

; low

aw

aren

ess;

bad

impl

emen

tatio

n; w

orke

rs p

refe

r it a

s pa

rt

of th

e sa

lary

.

SOE

& fo

reig

n-in

vest

ed h

ighe

st p

ropo

rtio

n of

wor

kers

(70%

for s

ocia

l ins

uran

ce; 9

6% fo

r m

edic

al in

sura

nce)

. But

not

hig

h du

e to

hig

h la

bor t

urno

ver (

mig

rant

labo

r); l

ow

awar

enes

s; b

ad im

plem

enta

tion;

wor

kers

pre

fer i

t as p

art o

f the

sala

ry.

Labo

r or

gani

zatio

n &

m

anag

emen

t

Reor

gani

zatio

n in

crea

sed

prod

uctiv

ity; d

ecre

ase

in n

umbe

r of w

orke

rs in

eac

h pr

oduc

tion

line

Rear

rang

emen

t red

uced

pro

duct

ion

time;

few

er d

efec

tive

prod

ucts

Trai

ning

A

ll en

terp

rise

s ha

ve H

RD p

lans

; Ong

oing

pro

cess

due

to h

igh

labo

r tu

rnov

er; P

rovi

sion

of s

kill

trai

ning

, lite

racy

skill

s, O

SH, l

abor

le

gisl

atio

n; T

rain

ing

in th

e fo

otw

ear e

nter

pris

es v

arie

s bas

ed o

n fo

rms

of o

wne

rshi

p of

ent

erpr

ises

. The

diff

eren

ces a

re se

en in

cos

ts, f

orm

s an

d cu

rric

ula

for t

rain

ing.

Vie

tnam

ese

priv

ate

ente

rpri

ses

ofte

n pr

ovid

e on

ly s

kill

trai

ning

for n

ew w

orke

rs, n

o to

retr

aini

ng o

r up

grad

ing

skill

for m

anag

eria

l sta

ff, n

or to

impr

ovin

g le

gal

know

ledg

e, w

ith o

ften

no se

para

te b

udge

t for

trai

ning

. How

ever

, on

an a

vera

ge, a

pri

vate

ent

erpr

ise

who

has

a se

para

ted

trai

ning

acc

ount

in

vest

s app

rox.

45

mill

ions

VN

D p

er y

ear,

SOE

(trai

ning

and

re

trai

ning

for m

anag

eria

l sta

ff) 2

00 m

illio

n V

ND

/yea

r, fo

reig

n in

vest

ed e

nter

pris

es (m

ore

com

preh

ensi

ve a

ppro

ach)

with

an

aver

age

inve

stm

ent o

f 400

mill

ion

VN

D/y

ear.

Onl

y on

e en

terp

rise

had

form

al te

chni

cal t

rain

ing

unit,

whi

le o

ther

s pro

vide

on-

the-

job-

trai

ning

. The

wor

k fo

rce

prim

arily

con

sist

s of r

ural

mig

rant

s - n

ot v

ery

skill

ed o

r edu

cate

d.

Labo

r tur

nove

r hig

h, w

ith a

vera

ge s

enio

rity

onl

y 3.

5 ye

ars

ther

efor

e, tr

aini

ng a

n on

goin

g ac

tivity

; Mos

t wor

kers

trai

ned

at v

ocat

iona

l ins

titut

ions

not

abl

e to

imm

edia

tely

mee

t pr

oduc

tion

requ

irem

ents

and

requ

ired

furt

her s

kill

trai

ning

; Fre

sh g

radu

ates

form

vo

catio

nal t

rain

ing

inst

itutio

ns re

crui

ted

by fo

reig

n in

vest

ed e

nter

pris

es, f

or in

stan

ce,

unde

rtoo

k a

3 m

onth

tria

l per

iod

for u

pgra

ding

ski

lls; L

abor

saf

ety

and

hygi

ene

task

wer

e in

trod

uced

thro

ugh

trai

ning

- 92

% w

orke

rs re

spon

ded

they

had

bee

n tr

aine

d la

bor s

afet

y an

d hy

gien

e an

nual

ly.

Chi

ld la

bor

A m

inim

um a

ge o

f 18

is n

orm

ally

follo

wed

, how

ever

, som

e en

terp

rise

s do

em

ploy

dow

n to

15

year

old

s in

area

s of s

carc

ity o

f lab

or, o

ften

with

loca

l aut

hori

ties

cert

ifica

tion

Fo

rced

labo

r C

erta

in e

nter

pris

es ta

ke d

epos

its fr

om w

orke

rs w

hile

em

ploy

ing

them

; som

e re

stri

ct v

isits

/tim

e to

the

toile

t

Dis

crim

inat

ion

No

appa

rent

dis

crim

inat

ion

21

OSH

D

iffer

ed a

t ent

erpr

ise

leve

l by

qual

ity a

nd q

uant

ity w

ith fo

reig

n-in

vest

ed p

erfo

rmin

g w

ell a

nd d

omes

tic e

nter

pris

es n

ot fu

lly o

r wel

l equ

ippe

d; M

ost h

ave

inst

alle

d sa

fety

/hyg

iene

equ

ipm

ent l

ike

vent

ilato

rs, c

oolin

g sy

stem

s; O

SH is

add

ress

ed th

roug

h tr

aini

ng a

ctiv

ities

ofte

n la

unch

in c

ampa

igns

, or c

ompe

titio

ns o

n la

bor s

afet

y,

sani

tary

, fir

e pr

even

tion

and

envi

ronm

ent p

rote

ctio

n, d

urin

g th

e na

tiona

l wee

k on

labo

r saf

ety;

aw

aren

ess

low

am

ong

wor

kers

; 90%

of t

extil

e en

terp

rise

s in

volv

ed in

O

SH in

itiat

ive

- “in

itiat

ive

on c

oalit

ion

for a

pol

icy

on O

SH in

foot

wea

r sec

tor”

, whi

ch a

lso

aim

s to

pro

mot

e cl

eane

r pro

duct

ion,

eco

nom

izin

g on

mat

eria

l and

fuel

; 10

0%of

text

ile e

nter

pris

es se

tup

a La

bor P

rote

ctio

n Bo

ard

or T

ask

Forc

e fo

r CSR

with

a sp

ecia

lized

sect

ion

in c

harg

e of

tech

nica

l ope

ratio

nal t

asks

suc

h as

tech

nica

l sa

fety

, fir

e an

d ex

plos

ion

safe

ty, h

ealth

car

e, e

nvir

onm

ent.

A p

erso

n in

cha

rge

of sa

fety

is a

ssig

ned

in e

ach

prod

uctio

n w

orks

hop.

H

ealth

90

% h

ad a

clin

ic w

ith m

edic

al o

ffice

rs; 3

fore

ign-

inve

sted

pro

vide

d do

ctor

s; 5

0% h

ad fi

rst-a

id fa

cilit

ies

in th

e w

orks

hops

; Ofte

n pr

ovis

ion

of se

rvic

es fo

r wom

en w

orke

rs. A

ll en

terp

rise

s ha

ve p

aid

grea

t at

tent

ion.

New

ly re

crui

ted

wor

kers

hav

e he

alth

cer

tific

ate

issu

ed b

y th

e cl

inic

sta

tion.

The

y ar

e ex

amin

ed b

y en

terp

rise

's he

alth

car

e se

ctio

n be

fore

bei

ng o

ffici

ally

em

ploy

ed b

y th

e en

terp

rise

, with

an

ongo

ing

mon

itori

ng o

f hea

lth d

ossi

ers f

or w

orke

rs.

Mos

t had

clin

ic fa

cilit

ies;

som

e pr

ovid

e se

rvic

es fo

r wom

en w

orke

rs

Haz

ardo

us

wor

k an

d pr

otec

tion

Diff

ered

at e

nter

pris

e le

vel b

y qu

ality

and

qua

ntity

with

fore

ign-

inve

sted

per

form

ing

wel

l and

dom

estic

ent

erpr

ises

not

fully

or w

ell e

quip

ped;

All

have

labo

r pr

otec

tion

equi

pmen

t, w

ith F

orei

gn-in

vest

ed m

ore

stri

ct a

bout

usa

ge o

f equ

ipm

ent;

still

low

aw

aren

ess

amon

g w

orke

rs, t

here

fore

, ent

erpr

ises

use

aw

aren

ess r

aisi

ng,

regu

lar s

uper

visi

on, w

ith a

num

ber o

f ent

erpr

ises

dev

elop

ing

regu

latio

ns

Com

puls

ory

prov

isio

n an

d us

e; c

ompe

nsat

ion

for h

azar

dous

wor

k ra

ngin

g be

twee

n 30

,000

-500

,000

VN

D/m

onth

in te

xtile

ent

erpr

ises

. Fi

re p

reve

ntio

n an

d sa

fety

A

ll en

terp

rise

s ha

ve b

ut q

ualit

y an

d qu

antit

y va

ry, w

ith d

omes

tic-o

wne

d en

terp

rise

s w

ith m

ore

limite

d ca

paci

ty; S

outh

ern

ente

rpri

ses

(mos

tly fo

reig

n-in

vest

ed)

bette

r tha

n th

e N

orth

ern;

90%

of w

orke

rs p

rovi

ded

trai

ning

ann

ually

Supe

rvis

ion

All

unde

rtak

en im

prov

emen

t act

iviti

es, i

ncre

asin

g re

spon

sibi

litie

s for

trad

e un

ion,

alth

ough

trad

e un

ion

have

lim

ited

know

ledg

e/ca

paci

ty

100%

hav

e in

trod

uced

sup

ervi

sing

and

man

agem

ent s

yste

ms,

thou

gh s

yste

m n

ot fu

nctio

ning

cur

rent

ly fu

nctio

ning

opt

imal

ly a

s ent

erpr

ises

are

stil

l in

the

proc

ess

of

esta

blis

hing

thei

r CSR

dep

artm

ent w

ith ta

sks l

ike

rece

ivin

g in

spec

tion

grou

ps; o

rgan

izin

g an

d ac

ting

on th

e re

med

ial m

easu

res

reco

mm

ende

d by

buy

ers/

aud

itors

; cu

rren

tly, s

uper

visi

on a

nd m

anag

emen

t act

iviti

es a

re p

rim

arily

und

erta

ken

by fu

nctio

nal s

taff,

who

hav

e to

com

bine

thes

e ne

w C

SR-im

plem

entin

g re

late

d re

spon

sibi

litie

s w

ith th

eir e

xist

ing

func

tiona

l one

s, w

hich

is p

rovi

ng to

be

a bu

rden

and

resu

lting

in in

adeq

uate

impl

emen

tatio

n, s

uper

visi

on a

nd re

port

ing.

M

onito

ring

D

irec

t buy

er o

r thi

rd p

arty

mon

itori

ng a

dopt

ed d

epen

ding

on

the

buye

r; as

sess

men

t rep

ort p

rovi

ded

to e

nter

pris

es li

stin

g re

quir

ed re

med

ial m

easu

res;

Mon

itori

ng

freq

uenc

y de

pend

s on

the

conc

erne

d cu

stom

er/b

uyer

with

buy

ers d

irec

tly o

r thr

ough

a th

ird

part

y m

onito

ring

. Som

e cu

stom

ers

like

Nik

e, A

dida

s m

onito

r eve

ry 6

m

onth

s or q

uart

er, w

ith so

me

rand

om c

heck

ing,

whi

le o

ther

s (C

olom

bia,

Hag

gar,

Jone

s) c

heck

onl

y on

ce a

t the

beg

inni

ng, w

ith n

o fu

rthe

r mon

itori

ng. S

ome

othe

rs

(Li &

Fun

g, Ji

axin

g an

d K

W) r

ely

on o

ther

cus

tom

er’s

ass

essm

ents

. A m

onito

ring

gro

up u

sual

ly in

clud

es 1

-2 p

eopl

e. T

hey

wor

k fo

r 1 o

r 2 d

ays,

with

the

cust

omer

pa

ying

all

cost

. Mul

tiple

CoC

ado

ptio

n in

crea

ses

the

burd

en (h

uman

and

fina

ncia

l) on

the

ente

rpri

se, a

ffect

ing

prod

uctio

n sc

hedu

les.

tim

e an

d re

sour

ce is

sues

due

to

mul

tiple

aud

its; l

ow g

over

nmen

t ins

pect

ion

Rep

ortin

g Re

form

in m

ost e

nter

pris

es in

term

s of

con

tent

, fre

quen

cy a

nd p

roce

dure

. No

sepa

rate

repo

rtin

g sy

stem

rela

ted

to C

SR im

plem

enta

tion

and

ther

e se

ems

to b

e no

ap

pare

nt c

hang

e in

the

repo

rtin

g pr

oces

s of e

nter

pris

es a

fter h

avin

g ad

opte

d C

SR im

plem

enta

tion.

How

ever

, the

freq

uenc

y of

repo

rtin

g ha

s in

crea

sed

afte

r CSR

im

plem

enta

tion

to m

eet a

ll re

quir

emen

ts o

f pro

duct

ion

as w

ell a

s C

oCs.

The

con

tent

s of t

he re

port

ing

syst

em, h

owev

er, h

ave

beco

me

mor

e de

taile

d an

d co

ver l

abor

pr

otec

tion,

fire

pre

vent

ion

and

safe

ty, h

ealth

, wor

king

hou

rs, r

est p

erio

ds, w

age/

sala

ry, l

abor

pro

duct

ivity

, pro

duct

qua

lity

and

labo

r saf

ety.

22

App

endi

x B:

Sta

keho

lder

dri

ver m

atri

x fo

r CSR

in V

ietn

am

Ope

ratio

nal

cond

ition

s So

urce

of

Dri

vers

Leve

l/typ

e of

in

dust

ry/s

take

hold

er m

ost

rele

vant

to

(A)

Stak

ehol

der

oppo

rtun

ity/

ince

ntiv

e (B

)

Stre

ngth

of

Dri

vers

(C

)

Proc

ess

of

resp

ondi

ng &

ca

paci

ty

(D)

Effe

ctiv

enes

s of

D

rive

r in

achi

evin

g go

als

(E)

Effe

ct/I

mpa

ct

(F)

Inte

rnat

iona

l po

licy

leve

l (I

LO

Con

vent

ions

; D

ecla

ratio

n on

Hum

an

Rig

hts;

etc

.)

BR:

CoC

s ar

e ba

sed

on In

tern

atio

nal

Con

vent

ions

G

ovt:

Sign

ator

y to

so

me

of th

e re

leva

nt

Con

vent

ions

SP

to d

eliv

er to

the

CoC

s fo

r win

ning

co

ntra

ct a

gree

men

ts

CF:

Con

sulti

ng/

busi

ness

opp

ortu

nity

IN

P: L

aw e

nfor

cem

ent

BR/

SP: T

he d

rive

r co

mpe

ls a

ctio

n, b

ut

base

d on

a m

ore

“top

-do

wn”

app

roac

h S

P: R

estr

icts

bot

tom

-up

initi

ativ

e fo

r SP

SP

impl

emen

t CoC

s in

or

der t

o w

in la

rger

an

d m

ore

num

erou

s co

ntra

cts

SP:

Cap

acity

to e

ngag

e di

ffers

with

in a

nd

betw

een

ente

rpri

ses

SP:

The

fina

ncia

l dep

t. of

ten

is n

ot a

ctiv

ely

enga

ged

SP:

The

sen

ior

man

agem

ent,

CSR

, O

SH o

ffici

als

mor

e ac

tive

SP:

For

eign

inve

sted

ar

e m

ost s

ucce

ssfu

l S

P: S

MEs

can

not

affo

rd to

eng

age

BR:

bra

nd v

alue

, re

venu

e ge

nera

tion,

cu

stom

er a

ttrac

tion,

lic

ense

to o

pera

te, r

isk

miti

gatio

n S

P: re

venu

e ge

nera

tion,

cus

tom

er

attr

actio

n (b

uyer

) W

K/TU

: Wor

ker w

ell-

bein

g

Gov

t: Tr

ade

&

inve

stm

ent,

natio

nal

law

com

plia

nce,

w

orke

r wel

l-bei

ng,

Trad

e &

In

vest

men

t Pr

omot

ion

(N

atio

nal a

nd

ente

rpri

se

leve

l)

Gov

t in

resp

onse

to

(exp

ortin

g an

d im

port

ing

coun

trie

s) b

ilate

ral

trad

e ag

reem

ents

S

P en

terp

rise

pr

omot

ion/

im

prov

emen

ts to

at

trac

t con

trac

ts

from

buy

ers

BA

pro

mot

ing

trad

e an

d in

vest

men

t

EN

T ar

e ex

pose

d to

co

mpe

titio

n an

d op

port

unity

W

K: Im

prov

emen

t in

wor

king

con

ditio

ns

EN

T pr

ovid

ed th

e op

tions

and

op

port

unity

to e

ngag

e

EN

T ca

n in

crea

se s

ize

and

num

ber o

f ord

ers

over

tim

e

SP/

BR: B

ut a

lso

tend

ency

for u

nsta

ble

cont

ract

ual

arra

ngem

ents

due

to

pric

e co

mpe

titio

n an

d la

ck o

f mai

nten

ance

of

stan

dard

s W

K: A

t tim

es p

iece

-m

eal/p

atch

y im

prov

emen

ts

BA

: Lac

k of

in

form

atio

n di

ssem

inat

ion

and

capa

city

rest

rict

s en

gage

men

t

TU

lack

cap

acity

to

enga

ge fu

lly

SP:

Une

ven

awar

enes

s le

vels

ham

per

impl

emen

tatio

n (w

ithin

an

ente

rpri

se)

and

enga

gem

ent

(am

ong

ente

rpri

ses)

SP:

For

eign

inve

sted

ar

e m

ost s

ucce

ssfu

l S

P: S

MEs

can

not

affo

rd to

eng

age

Gov

t: Ec

onom

ic

grow

th

SP:

Rep

utat

ion/

bra

nd

prot

ectio

n, re

venu

e ge

nera

tion

BA

: Inc

reas

ed in

tere

st

from

BA

mem

bers

; as

sist

ance

to p

rofil

e tr

ade

prom

otio

n st

rate

gy; i

ncre

ased

nu

mbe

r of c

ontr

acts

am

ong

mem

bers

23

Mai

ntai

ning

m

inim

um

stan

dard

s (W

eak

enfo

rcem

ent

of lo

cal l

aws)

Gov

t/IN

P: E

nsur

e th

e en

forc

emen

t of

the

Labo

r Cod

e T

U: S

afeg

uard

ing

the

righ

ts/b

enef

its

of th

e w

orke

rs

BR:

Ens

ure

impl

emen

tatio

n of

C

oC

SP:

Ens

ure

stab

le

cont

ract

s

BA

: Tra

de p

rom

otio

n C

F: C

onsu

ltanc

y op

port

unity

IN

P: L

aw e

nfor

cem

ent

WR/

TU/G

ovt:

Impr

oved

wor

king

co

nditi

ons

Gov

t/IN

P: W

eak

law

en

forc

emen

t T

U: L

ack

of h

uman

(C

SR a

war

enes

s &

ca

paci

ty) r

esou

rces

re

stri

cts

resp

onsi

vene

ss B

R: C

oC e

nfor

cem

ent

does

not

gua

rant

ee

impr

oved

sta

ndar

ds

SP:

Lac

k of

fina

ncia

l an

d hu

man

(C

SR

awar

enes

s &

cap

acity

) re

sour

ces h

ampe

r im

plem

enta

tion

SP/

BR: P

ossi

ble

incr

ease

in

prod

uctiv

ity

Gov

t/TU

: Wor

ker w

ell-

bein

g B

R/SP

: Wor

ker w

ell-

bein

g, b

rand

pr

otec

tion

Part

ners

hip/

st

akeh

olde

r/ci

vil s

ocie

ty

dem

ands

(N

atio

nal a

nd

inte

rnat

iona

l le

vel)

BR:

Res

pons

ive

to

cons

umer

and

civ

il ac

tion

grou

p de

man

ds

Gov

t: To

ens

ure

law

en

forc

emen

t W

K: P

rote

ctin

g w

orke

rs’ r

ight

s S

P: B

uild

ing

repu

tatio

n an

d co

ntra

ct s

tabi

lity

BA

: Tra

de p

rom

otio

n C

F: C

onsu

ltanc

y op

port

unity

BR/

SP: T

he d

rive

r co

mpe

ls a

ctio

n, b

ut

base

d on

a m

ore

“top

-do

wn”

app

roac

h S

P: R

estr

icts

bot

tom

-up

initi

ativ

e fo

r SP

SP/

TU/W

K/BA

: Lac

k of

aw

aren

ess/

un

ders

tand

ing/

ca

paci

ty re

stri

cts

resp

onsi

vene

ss

SP/

ENT:

Doe

s no

t re

late

to th

is d

rive

r. H

owev

er, e

nsur

es

bette

r wor

king

co

nditi

ons

thro

ugh

CoC

impl

emen

tatio

n

BR:

Bra

nd p

rote

ctio

n,

licen

se to

ope

rate

NO

TE: B

uyer

s: B

R; S

uppl

iers:

SP; W

orke

rs: W

K; T

rade

Uni

on: T

U; E

nter

prise

s: EN

T; B

usin

ess a

ssoc

iatio

ns: B

A; C

onsu

lting

firm

s: CF

; Ins

pect

orat

e :IN

P (A

): Le

vel/t

ype

of in

dust

ry/s

take

hold

er m

ost r

elev

ant t

o: N

ot a

ll dr

iver

s per

tain

to a

ll ty

pes o

r lev

el o

f ent

erpr

ises

/ sta

keho

lder

(B

): St

akeh

olde

r opp

ortu

nity

/ inc

entiv

e: W

hat d

rive

s ot

her s

take

hold

er in

cent

ive

and

wha

t is t

he e

xist

ing

oppo

rtun

ity to

eng

age?

(C

): St

reng

th o

f Dri

vers

: Whe

ther

the

driv

er is

suf

ficie

nt to

com

pel a

ctio

n (D

): Pr

oces

s of

resp

ondi

ng &

cap

acity

: Who

dec

ides

to re

spon

d or

igno

re a

dri

ver w

ithin

the

ente

rpri

se a

nd w

hat i

s th

eir l

evel

of c

apac

ity to

eng

age?

(E

): Ef

fect

iven

ess

of D

rive

r in

achi

evin

g go

als:

Wha

t are

the

leve

ls o

f ach

ieve

men

t at v

ario

us ty

pes/

leve

ls o

f ent

erpr

ise

(F):

Effe

ct/I

mpa

ct: e

.g. b

rand

val

ue, r

even

ue g

ener

atio

n, c

usto

mer

attr

actio

n, w

orke

r wel

l-bei

ng, l

icen

se to

ope

rate

, im

pact

on

natio

nal

legi

slat

ion

com

plia

nce

24

App

endi

x C

: Gov

ernm

ent R

ole

Mat

rix

- Str

engt

heni

ng C

SR in

Vie

tnam

G

over

nmen

t rol

e Sp

ecif

icat

ions

M

anda

ting

Defi

ning

min

imum

stan

dard

s fo

r bus

ines

s per

form

ance

, em

bedd

ed w

ithin

the l

egal

fra

mew

ork.

E.g

. set

ting

min

imum

stan

dard

s, th

e ac

tiviti

es o

f reg

ulat

ors a

nd

insp

ecto

rate

s, an

d leg

al a

nd

fisca

l pen

altie

s and

rew

ards

• Le

gally

cre

atin

g a

leve

l “pl

ayin

g fie

ld fo

r all

type

s of

ent

erpr

ises

- C

oncr

etiz

e, o

rgan

ize

and

mon

itor a

dequ

ate

and

com

preh

ensi

ve im

plem

enta

tion

of p

olic

ies

rela

ted

to la

nd u

se, i

nves

tmen

t, fin

ance

and

taxa

tion.

•

Def

inin

g m

inim

um s

tand

ards

for b

usin

ess p

erfo

rman

ce, e

mbe

dded

with

in th

e le

gal f

ram

ewor

k e.

g. s

ettin

g th

e ac

tiviti

es o

f re

gula

tors

and

insp

ecto

rate

s, an

d le

gal a

nd fi

scal

pen

altie

s and

rew

ards

. •

Build

com

preh

ensi

ve, a

dequ

ate

lega

l sys

tem

to h

arm

oniz

e em

ploy

ee a

nd e

nter

pris

e be

nefit

s, a

nd n

atio

nal b

enef

its, w

ith

rele

vanc

e to

the

inte

rnat

iona

l int

egra

tion

proc

ess

in o

rder

to fa

cilit

ate

and

enco

urag

e en

terp

rise

s to

enga

ge a

nd e

ffect

ivel

y im

plem

ent C

SR.

• M

odify

the

role

of t

he in

spec

tora

te in

ord

er to

pro

mot

e C

SR p

erfo

rman

ce in

ent

erpr

ises

. •

Ass

ess,

chec

k an

d m

odify

con

tent

s of

Vie

tnam

ese

law

that

are

not

rele

vant

to re

ality

, e.g

. leg

al m

axim

um le

vel o

f ove

rtim

e.

Faci

litat

ing

Enab

ling

or in

cent

iviz

ing

com

pani

es to

enga

ge w

ith th

e CS

R ag

enda

or t

o dr

ive s

ocia

l an

d en

viro

nmen

tal

impr

ovem

ents

. E.g

. ‘en

ablin

g’

legisl

atio

n; ra

ising

aw

aren

ess;

stim

ulat

ing

mar

kets

thro

ugh

publ

ic p

rocu

rem

ent;

fund

ing

rese

arch

; and

bui

ldin

g th

e ca

paci

ty o

f civ

il so

ciet

y or

gani

zatio

ns a

nd b

usin

esse

s to

enga

ge w

ith C

SR

Ince

ntiv

e cr

eatio

n

• En

ablin

g or

ince

ntiv

izin

g co

mpa

nies

to e

ngag

e w

ith th

e C

SR a

gend

a or

to d

rive

soci

al a

nd e

nvir

onm

enta

l im

prov

emen

ts e

.g.

thro

ugh

‘ena

blin

g’ le

gisl

atio

n.

• St

imul

atin

g m

arke

ts th

roug

h “r

espo

nsib

le”

gove

rnm

ent p

rocu

rem

ent.

•

To b

uild

up

a C

oC fr

amew

ork

whi

ch re

late

s to

the

mai

n co

nten

ts o

f CoC

s, w

hile

rela

ting

to n

atio

nal s

tand

ards

. •

Cre

ate

oppo

rtun

ity fo

r sm

all a

nd m

ediu

m s

ecto

r and

ent

erpr

ises

by

build

ing

a fu

nd to

supp

ort s

mal

l and

med

ium

ent

erpr

ises

in

garm

ent a

nd te

xtile

indu

stry

with

cle

ar ta

rget

s.

Rep

ortin

g an

d in

form

atio

n sy

stem

s dev

elop

men

t •

Enco

urag

ing

key

stak

ehol

ders

(ent

erpr

ises

, ins

pect

orat

e, b

uyer

s, e

tc.)

not o

nly

prov

ide,

col

lect

and

shar

e m

eani

ngfu

l and

ac

cura

te in

form

atio

n on

act

iviti

es a

nd im

pact

s, bu

t als

o fa

cilit

ate

supp

ortin

g th

e ca

paci

ty o

f civ

il so

ciet

y to

mak

e us

e of

this

in

form

atio

n, a

nd in

doi

ng s

o cr

eatin

g pr

essu

re fo

r bet

ter p

ract

ice

thro

ugh

volu

ntar

y re

port

ing,

whi

ch th

en c

an b

e us

ed fo

r tra

de

prom

otio

n ac

tiviti

es.

• Re

leva

nt g

over

nmen

t age

ncie

s as

wel

l as

unio

ns a

nd b

usin

ess

asso

ciat

ions

upd

ate

info

rmat

ion

rela

ted

to C

SR p

erfo

rman

ce a

t na

tiona

l and

glo

bal l

evel

in o

rder

to d

isse

min

ate,

adv

ise

and

guid

e do

mes

tic e

nter

pris

es to

effe

ctiv

ely

impl

emen

t CSR

’s c

onte

nts

as w

ell a

s V

ietn

ames

e la

w.

• C

onso

lidat

e em

ploy

men

t ser

vice

and

labo

r mar

ket i

nfor

mat

ion

syst

em.

• St

reng

then

ing

info

rmat

ion

dist

ribu

tion

thro

ugh

med

ia, r

adio

, new

spap

er, w

ebsi

te o

f CSR

con

tent

, ap

proa

ch, s

ucce

ssfu

l CSR

ap

proa

ches

and

exp

erie

nces

. T

rain

ing

and

capa

city

bui

ldin

g •

Dev

elop

CSR

trai

ning

pro

gram

in c

olla

bora

tion

with

rele

vant

sta

keho

lder

s lik

e bu

sine

ss a

ssoc

iatio

ns, b

uyer

s, fo

r inc

reas

ing

awar

enes

s of

man

agem

ent s

taff,

trad

e un

ion

staf

f and

wor

kers

abo

ut C

SR; t

he a

dvan

tage

s of

CSR

per

form

ance

, and

; abo

ut b

oth

impl

emen

ting

proc

ess

and

mea

sure

men

t, an

d us

ing

a co

st-b

enef

it an

alys

is fr

amew

ork.

•

Build

ing

the

capa

city

of t

he tr

ade

unio

n as

an

info

rmat

ion

prov

ider

to h

elp

wor

kers

und

erst

and

CSR

and

hel

p co

nnec

t em

ploy

ees’

ben

efit

and

ente

rpri

ses’

ben

efit;

to b

uild

cap

acity

in s

uper

visi

on; t

o co

mm

unic

ate

timel

y in

vent

ions

, ini

tiativ

es,

legi

timat

e re

quir

emen

ts o

f em

ploy

ees

to e

nter

pris

e’s

man

ager

s, k

ey s

take

hold

ers

25

Part

neri

ng

Act

ing

as p

artic

ipan

ts,

conv

ener

s, or

faci

litat

ors

with

in st

rate

gic p

artn

ersh

ips

and

in d

ialo

gue b

etw

een

stak

ehol

ders

• C

olla

bora

te w

ith b

usin

ess a

ssoc

iatio

ns fo

r the

m to

pro

vide

info

rmat

ion

rela

ted

to C

SR p

erfo

rman

ce o

f dom

estic

and

in

tern

atio

nal e

nter

pris

es; p

rovi

de in

form

atio

n re

late

d to

inte

rnat

iona

l im

port

mar

ket,

dem

and

and

requ

irem

ent o

f mar

ket;

orga

nize

sem

inar

s an

d w

orks

hops

in o

rder

to e

xcha

nge

info

rmat

ion

abou

t CSR

per

form

ance

am

ong

ente

rpri

ses.

• Ex

plor

e co

nsul

tanc

y se

rvic

e de

velo

pmen

t with

bus

ines

s as

soci

atio

ns, e

nter

pris

es, b

uyer

s, e

tc.

• C

olla

bora

ting

with

trad

e un

ions

on

rese

arch

pro

ject

s w

ith M

OLI

SA in

ord

er to

hel

p th

e G

over

nmen

t to

mod

ify th

e La

bor L

aw

and

rela

ted

mec

hani

sms

and

polic

ies

base

d on

ben

efit

harm

oniz

atio

n am

ong

part

ners

in la

bor r

elat

ions

hip

and

it re

leva

nce

to

the

inte

rnat

iona

l int

egra

tion

proc

ess.

• C

reat

e co

llabo

ratio

n be

twee

n en

terp

rise

s an

d M

OLI

SA a

nd o

ther

rele

vant

min

istr

ies

to re

view

rele

vant

voc

atio

nal t

rain

ing

curr

icul

a

• C

reat

e m

ulti-

stak

ehol

der c

onsu

ltativ

e gr

oups

with

par

ticip

atio

n of

rele

vant

min

istr

ies

like

Min

istr

y of

Tra

de, M

inis

try

of

Indu

stry

; MO

LISA

, etc

. and

oth

er k

ey s

take

hold

ers

to d

evel

op p

ublic

dia

logu

e an

d C

SR re

late

d st

akeh

olde

r con

sulta

tion,

ex

chan

ge b

est e

xper

ienc

es, s

olut

ions

or s

hort

com

ing

poin

ts b

etw

een

CoC

and

Vie

tnam

ese

legi

slat

ion

and

com

mon

con

stra

ints

fa

ced

in im

plem

entin

g C

SR; C

SR a

s par

t of t

rade

pro

mot

ion

activ

ities

. En

dors

ing

Prov

idin

g po

litic

al su

ppor

t an

d pu

blic

sect

or en

dors

emen

t of

the c

once

pt o

f CSR

and

pa

rtic

ular

CSR

-rela

ted

initi

ativ

es

• To

rew

ard

ente

rpri

ses i

mpl

emen

ting

CSR

effe

ctiv

ely:

est

ablis

h an

d en

dors

e a

“CSR

Bes

t Pra

ctic

e A

war

d” jo

intly

bet

wee

n M

inis

try

of T

rade

, Min

istr

y of

Indu

stry

, VC

CI a

nd th

e bu

sine

ss a

ssoc

iatio

ns

• To

ack

now

ledg

e th

at a

chie

ve C

SR g

ood

prac

tice

stan

dard

s with

in th

e do

mes

tic m

arke

t •

To la

unch

a C

SR w

eek

at e

nter

pris

e le

vel.

26

27

LIST OF REFERENCES Sub-segment Report: The Textile Sector, ILSSA-WB Initiative, Hanoi, Vietnam, 2003. Sub-segment Report: The Footwear Sector, ILSSA-WB Initiative, Hanoi, Vietnam, 2003. Segment III Report, ILSSA-WB Initiative, Hanoi, Vietnam, 2003. Codes of Conduct in Vietnam: Labor Content of CSR Codes of Conduct in the Footwear Industry in Vietnam, December 2003. Analysis undertaken for the World Bank by D. Feldman, G. Smith, F. Hoag, LLP, Washington DC and Bui Thi Phuong and F. Burke, Baker Mckenzie, LLP, HCMC, Vietnam. J. E. Berman and T. Webb 2003 Race to the Top: Attracting and Enabling Global Sustainable Business: Business Survey Report, Washington, D.C., World Bank. G. Smith and D. Feldman 2003 Company Codes of Conduct and International Standards: An Analytical Comparison (Parts I and II), Washington D.C., World Bank. T. Fox, H. Ward and B. Howard (2002), Baseline Study of Public Sector Roles in Strengthening Corporate Social Responsibility, IIED for the World Bank, October 2002. M. Warner, Diagnostic and Appraisal Tool, for the CSR Practice, World Bank. C. L. Hubo (2003) Corporate Social Responsibility (CSR) and Public Policy in the Philippine Mining Sector, paper presented to the International Conference on Public Policy and CSR, Washington, D.C. 8-9 November 2003. H.B. Joergensen, P.M. Pruzan-Joergensen, M. Jungk, A. Cramer, Strengthening Implementation of Corporate Social Responsibility in Global Supply Chains, for CSR Practice, Investment Climate Department, World Bank, 2003. WB19080 N:\CSR\Vietnam\Final CSR Vietnam Report-Dec 2003.doc December 3, 2003 5:08 PM

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