The Call for an Ethical Society

In the processes of modernization and development, ethical development is a major factor. It reflects the decrease of corruption in society. In fact, as a modernized economy develops, a decrease in the corruption index is one of its major measurements.

The five indexes for modernization include:

1. Population growth approaching zero and the national average educational level approaching 13 to 14 years;
2. A balanced level between natural resources and energy production and the consumption index;
3. Decreased government involvement in private sector investments when approaching a higher per capita GDP level;
4. Improvement of the national information exchange index; and
5. A decrease of the corruption index.

Other modernization indexes include a national per capita GDP of US$3,000 or more, an agricultural production index approaching 12 to 15 percent of the total GDP, a nonagricultural production population above 15 percent of the total employed population, an urban population greater than 50 percent of the total population and a literacy rate over 80 percent. According to reports by the Ministry of Science, the Chinese Academy of Sciences and the State Natural Science Foundation Committee, in the year 2000, eight regions in China have basically realized the country’s first modernization. These eight regions are Hong Kong, Macau, Taiwan, Shanghai, Beijing, Tianjin, Liaoning, and Guangdong. China has now become a primary advanced country.

Following World Trade Organization accession, China is on the road to improve her business environment and to create a more ethical society in which both national and international businesses may operate. Recently, in the last decade or so, China has rapidly become a major manufacturing economy. Especially in the coastal regions, thousands upon thousands of factories have been built. Many recruit workers from all over the country. These individuals, called migrant workers, have come from other provinces, often inland, looking for work. Many of these migrants settle down as factory workers living and working inside the factory compounds.

For humanitarian reason, buyers (such as Avon and McDonalds) will adhere to a social accountability standard (SA 8000) for factory management. SA 8000 is an international standard created by a few major American companies to satisfy the need for buying merchandise from an ethical manufacturer in developing countries. The SA 8000 provides a formula to prevent manufacturers from unethical humanitarian practices such as child labor, prison labor, forced labor, unfair overtime wages and unsafe working and living environments for the workers. Certain companies require their manufacturers to adhere closely to the standards listed by SA 8000. If manufacturers violate any labor practices covered in this standard, they will not receive orders from purchasing agents. Although many labor unions and labor representatives argue that the SA 8000 is propaganda of Western buyers and companies to promote so called “ethical humanitarian practices,” SA 8000 still provides a framework to rely on for manufacturers of developing countries. For this reason, we have developed a strategy for ethical business development among the manufacturing sector in China.

Two years ago, a management association was formed in southern China. We now call this association “QOL Management Association.” The Association, which currently has a network of over 30 factories in China, called for an alliance of ethical Christian businesses to ensure an ethical standard for manufacturers that we call the Quality of Life Standard (QOL). Similar to the SA 8000, the QOL standard has four aspects: (1) employment standards; (2) safety standards; (3) working conditions/environment standards; and (4) living conditions/environment standards. (See box below.)

With this standard, the QOL Management Association is calling for ethical humanitarian practices among manufacturers in China and then, worldwide. The QOL standard is an extension of the SA 8000 standard. It has become a social accountability standard for China and other developing countries. Hopefully, this business society will create a force to change the ethical environment in China.  To the buyers and factories in developed countries, this standard is also a general framework to rely upon.

The membership standard in the QOL Association is extremely strict in its ethical commitment. Members must sign a members’ commitment which includes statements such as: I pledge to undertake all business operations according to the legal ordinances as set forth by the respective government. I pledge to keep and to declare correctly all financial accounts and to pay all taxes and dues accordingly. I pledge to produce and provide all the products and services which are legal and beneficial to the public with no effort to infringe upon copyright regulations. I pledge to promote a product or a service as specified, without intention to exaggerate or mislead the customer. I pledge that I will not intentionally hide any known defect or potential danger of the product or service. I pledge that I will not selfishly influence or put pressure on the legislative arm of the government to pass laws which only bring benefit to me but unfairly cause damages to other competing companies or the public. I pledge that I will not monopolize the business market.

This is the beginning of a pledge to ethical practice among businesses in China. In fact, it is the beginning of an ethical movement for the development of an ethical society. For the past two years, the Association has been trying to promote the QOL standard in China and worldwide. However, our influence is little because of the limitations of our network and our resources. The author believes that it must be a cooperative effort of the international community to participate in and promote this movement. An ethical society would enhance a fair and just business environment. Decreased corruption would create less economic waste, which economists call the “spill-over effect.” Corruption creates enormous economic waste which can cause a society or economy to collapse. We have witnessed such cases in Indonesia, Brazil, Japan and China. Corruption is not modernization; rather, it is backwardness of civilization. Therefore, we are not just calling for a movement for ethical development, a movement for modernization; we are calling for a movement towards a fair and just society, a movement to show forth the righteousness of God.

The Four Aspects of the Quality of Life Standard

1. Standards for Employment

Discrimination: A factory shall employ workers on the basis of their ability to do the job, not on the basis of their personal characteristics or beliefs.

Forced Labor:  Factories shall not use any prison or forced labor.

Child Labor:  Factories shall employ only workers who meet the applicable minimum legal age requirement of the government. Factories must also comply with other applicable child labor laws.

Wages and Hours:  Factories shall set working hours, wages and overtime pay in compliance with all applicable laws. Workers shall be paid at least the minimum legal wage or a wage that meets local industry standards, whichever is greater. While it is understood that overtime is often required in production, factories shall carry out operations in ways that limit overtime to a level that ensures humane and productive working conditions.

2. Standards for Safety

Factories must treat all workers with respect and dignity and provide them with a safe and healthy environment. Factories should comply with all applicable laws and regulations regarding factory safety standards. Factories should not use corporal punishment or any other form of physical or psychological coercion.

3. Standards for Work Environments

Health and Safety:  Factories must provide a safe, clean and healthy working environment for workers that includes fire safety, sanitation, risk protection and electrical, mechanical and structural safety.

Recreational and Educational Programs:  Factories are encouraged to develop workplace apprenticeship and training programs for the educational benefit of their workers. Factories are also encouraged to provide workers with recreational and educational programs and facilities.

4. Standards for Living Environments

Factories providing housing for workers must keep these facilities healthy, clean and safe. Factories shall comply with all applicable laws and regulations regarding workers’ housing conditions, health and safety including fire safety, sanitation, risk protection and electrical, mechanical and structural safety.

Image credit: All Friends factory shajing China 2005 by Chris via Flickr.