On 27 September, the Platform Living Wage Financials was launched with an official event hosted by MN.
What is the Platform Living Wage Financials?
MN is a proud founding member of the Platform Living Wage Financials (PLWF), an unprecedented coalition of eight Dutch financial institutions representing over €725 billion of Assets Under Management. Under the umbrella of the PLWF, MN and other financial institutions, namely, ASN Bank, a.s.r., Achmea Investment Management, Kempen, NN Investment Partners, Robeco, and Triodos Investment Management, come together to encourage, support, and monitor the companies we invest in to address living wage in their global supply chains. The Platform is further supported by a Dutch bank ABN Amro and pension funds PME, PMT, and MITT.
What does MN want to achieve through the collaboration?
Through the collaboration, we aim to ensure that garment and footwear brands in our investment portfolio have adequate processes and policies in place to enable the payment of living wage in their global supply chains. Over time, the companies should also show adequate progress on the way toward living wage implementation. MN works with 14 large listed garment and footwear brands, and the PLWF as a whole has an even broader reach. By guiding and assessing the companies to determine which companies have been leading on the issue and which need to do more, we aim to motivate the ‘laggards’ to follow their better-performing peers.
Launch of the Platform Living Wage Financials (PLWF)
On 27 September, MN and its partners officially launched the collaboration during an event hosted by MN. The event was attended by some 120 participants from Dutch and foreign financial institutions, NGOs, international organizations, multi-stakeholder initiatives, ESG research providers, government representatives, and private sector representatives, including a number of garment and footwear brands that are among the PLWF’s ‘targets’. Apart from serving as a platform to present the PLWF and its goals, the event brought together a wide spectrum of relevant stakeholders. The ultimate objective of the event was to stimulate exchanges, collaborations, and partnerships to enable progress on this extremely complex and challenging topic. The day stood out for its informed level of discussion and produced a number of key takeaways that both MN and other PLWF members will integrate into their work going forward.
Simor: A living wage needs to be clearly recognized as a fundamental human right
Jessica Simor, a prominent Barrister, human rights specialist, and the event’s keynote speaker, stressed that a living wage needs to be clearly recognized as a fundamental human right. She argued that statutory minimum wages in garment producing countries do not provide an adequate living standard for workers. A living wage will continue to be a priority area for The Circle NGO, of which Simor is a leading member. In 2017, The Circle published a 300-page report on the (legal) circumstances related to wages in 14 major garment producing countries and subsequently presented the report at the European Parliament. During her speech, Simor noted that she envisions a harmonized, EU-wide approach to importing foreign goods that were produced in subpar labour conditions where a living wage has not been paid.
Van der Sluijs: Companies should put living wage in the heart of their business
Irina van der Sluijs, Senior Human Rights Advisor at ASN Bank, introduced ASN Bank’s assurance and engagement trajectory on living wage. Van der Sluijs presented the assessment results of 14 garment and footwear brands whose assessment process was formally assured by a UK accounting firm Mazars. She highlighted that most of the assessed companies find themselves in the ‘developing’ and ‘maturing’ stage (25%-50% and 50%-75% respectively), which van de Sluijs perceives to be a positive outcome. It means that most of the garment brands under assessment regard living wage as a ‘salient’ issue. She also stressed, however, that a majority of the companies still need to move toward real integration by putting living wage in the core of their business.
More robust minimum wage regulation in garment producing countries is needed
The core discussion of the day focused on the ways in which garment and footwear brands can enable the payment of living wage to their supply chain workers. Among the four representatives of the PLWF’s ‘target’ companies that were present, namely, Fiona Sadler of Marks & Spencer, Alice Strevens of Asos, Lary Brown of Esprit, and Cecilia Tiblad Berntsson of H&M, there was a widespread agreement that governments in garment producing countries need to set more robust minimum wages that would come closer to local living wage estimates. Fiona Sadler (Marks & Spencer) stressed that “everyone in the industry needs to be paying on a level playing field” and that raising the industry’s minimum wages plays a key role in this process.
We cannot rely on government action alone
The companies and other panellists of the day also recognized that due to a number of inhibiting factors, we cannot rely on government action alone. On one hand, it has been widely acknowledged that workers should be ultimately enabled to negotiate living wages through collective bargaining processes. In that respect, Lary Brown (Esprit) pointed out the enabling role played by ACT, a collaboration of global brands and retailers that pursues industry bargaining mechanisms to address structural barriers to living wages.
Since industry bargaining processes are, however, rather lengthy, it is also important that companies take ownership over the living wage implementation process already today. This angle was emphasized by Cecilia Tiblad Berntsson (H&M), who explained that besides supporting industry bargaining through ACT, H&M focuses on directly influencing the living wage implementation process. It does so, for example, by ensuring that wage management systems at the supplier factory level are fair, transparent, and progressive, and by supporting its suppliers through responsible purchasing practices.
The PLWF shows added value
Although the PLWF has only just launched, the ‘target’ brands as well as other participants of the day noted that the investor collaboration already shows added value. Brown (Esprit) acknowledged that the PLWF and the living wage assessment methodology employed by the investor coalition to track companies’ progress have already enabled Esprit “to move things forward”. Similarly, Tiblad Berntsson (H&M) stressed that financial institutions can help garment brands spread and positively frame the discussion. She noted that H&M recognizes the value of such investor influence since a lot of change comes from awareness raising.
Working together is key
The closing speech of Gerald Cartigny, MN’s CIO and Member of the Executive Committee, strongly resonated with the audience as it echoed a number of the core messages that had been shared throughout the day. Cartigny stressed that pursuing industry-wide change with respect to living wage requires courage, leadership, cooperation, transparency, and ambition. Only if we work together as investors, garment brands, multi-stakeholder initiatives, NGOs, governments and other stakeholders can we address living wage and ensure that globalization becomes more inclusive.