Interview with Mr Steve Jesseph

WRAP was formed in January 2000 as an international, non-profit NGO standards setting and certification body in response to allegations of poor working conditions in sewn products factories around the world.

The WRAP Certification Program is based on 12 Principles focusing on compliance with local laws, workplace regulations, universal workers’ rights, the environment, customs compliance and security. Facilities that demonstrate proper adoption, deployment and monitoring of all 12 Principles receive certification for six months to two years. The certificate applies to the individual facility, not a parent company or brand. Over the years, WRAP’s comprehensive facility-based model helped it grow into the world’s largest certification program for the apparel industry. In 2007, WRAP’s facility certification expanded to include all labor-intensive sectors such as house textile, fashion accessories, leather, hotels, jewelry, furniture, construction materials, food processing, glassware, home accessories and more.

The apparel industry probably has the highest level of concern for ethical performance as it has been dealing strongly with these issues for over 10 years.

While there is still progress to be made, significant progress has been made in working conditions and environmental performance in the major apparel producing factories around the world.

Many brands and retailers have established their own codes of conduct with often conflicting standards. As a result, factories spend a great deal of wasted time trying to satisfy these conflicting demands. The WRAP program was designed to create a rigorous yet achievable standard for all factories worldwide. Thanks to increasing acceptance of brands and retailers for the WRAP standard and certification, the number of audits is being reduced and compliance costs are starting to go down.

WRAP employs a management systems approach to compliance, and requires that all policies and procedures be in writing with staff assigned and an internal audit mechanism put in place. Taking this approach allows the factory owners to determine their own level of compliance on an ongoing basis, and transfer the management systems approach to other areas of the business such as quality, human resources, production planning and more.

As noted above, WRAP certification is accepted by an increasing number of brands and retailers helping to reduce the number of social compliance audits, thus reducing allocated manpower and cost.

Brands and retailers across the world have sought lower labor costs for over the past decade by moving production from the US, EU, Japan and Australia to various parts of Asia, Latin America and Africa. It seems that wages are starting to equalize and other factors such as the cost of transport of raw materials and finished product, lead times, order quantities, delivery time, availability of water and energy, and other factors are beginning to drive sourcing decisions as much or more than labor costs.

Taken in context, the cost of CSR compliance is negligible versus cost of operations. The average cost for a WRAP certification process is less than $US5,000. Managed properly, sustainability solutions should drive significant bottom line savings in energy, transport, waste reduction, etc. Lean Manufacturing techniques, as taught by the large consultancy TC2, have shown this for years.

A very large, multinational apparel company recently did a correlation study looking at their most reliable suppliers and those that had the highest levels of compliance with their CSR program – and found a direct correlation between the two. Factory management that focuses on excellence in all they do i.e. quality, delivery and compliance, also have the highest levels of social compliance. They also view the “cost” of training, quality management systems, health & safety, environmental management and good employee relations programs as an investment that provides positive returns in all parts of the business.

#######