Survey of stakeholder views

As part of the human rights assessment, customers’ and employees’ views on the implementation of human rights in Kesko’s operations were surveyed. Interviews in high-risk countries were carried out to find out the opinions of employees at Kesko’s supplier factories about the implementation of human rights in the purchasing chain.

Customers

TNS Gallup looked into the implementation of human rights in the K-Group’s operations on the basis of four small-group discussions and an online questionnaire sent to 567 K-Group customers and 41 specialists.

1. Qualitative section of the survey

The small-group discussions confirmed the impression that from customers’ point of view, the right to health, children’s right to special protection and the prohibition of discrimination are the main human rights of which Kesko has to take special care at its customer interface.

A special emphasis in the discussions was given to the implementation of human rights among people who differ in some way from the majority of the population.

In consequence, a special attention at the customer interface has to be paid to:
• zero-tolerance for discrimination and the development and maintenance of grievance mechanisms for cases of discrimination
• the development and maintenance of accessibility and availability

2. Quantitative section of the survey

The online questionnaire was targeted to representatives of both the majority of the population and special groups. The ethnic or national origin of the representatives of special groups is other than that of the majority of Finnish population, their Finnish language skills are inadequate, or they have some disability or illness that prevents them from equal social participation with others. Representatives of special groups account for 11% of all consumers. This means that every ninth K-store customer has some issue that makes their shopping difficult!

Kesko was considered to be slightly better than an ordinary Finnish company in implementing the different human rights. However, the ratings given by the special groups were in some respects clearly lower compared to those given by the rest of the population. The special groups gave best ratings to equal checkout treatment of persons with some external deviation, and to the accessibility of disabled parking. The poorest ratings were related to the following issues:

• Store accessibility is not mentioned on the website
• Store fixtures are not easy for persons with reduced mobility
• There is not enough staff to provide assistance
• Accessibility of neighbourhood stores has not been taken care of
• Ethnic or visual diversity of staff is not sufficient

Research report: Kesko and human rights – listening to customer stakeholders, TNS Gallup Oy

Personnel

Employees’ opinions were surveyed based on the results of the personnel survey and a questionnaire targeted to shop stewards.

1. Personnel survey results

A personnel survey is implemented at Kesko at around 18-month intervals. The entire personnel in all operating countries is invited to the survey. The survey indices are Employee Engagement, Performance Enablement, Supervisory Work, People Principles, Wellbeing at Work. A unit specific action plan is prepared based on the results and its fulfilment is monitored.

The table below lists the survey questions especially related to the human rights assessment.

Statement

2016

Fully agree, %, and average score

2014

Fully agree, %, and average score

2013

Fully agree, %, and average score

I participate in decisions that affect my work.

63%  - 3.59

63% - 3.58

63% - 3.59

I am satisfied with my work-life balance

68 % - 3.70

66% - 3.64

66% - 3.66

The company is working in a good way to promote good working environment and health.

64% - 3.60

54% - 3.38

53% - 3.38

My immediate supervisor/manager is committed to the fair treatment of each individual.

73% - 3.88

74% - 3.9

74% – 3.89

In my department, an open expression of different ideas and opinions is encouraged.

64% - 3.65

62% - 3.6

61% - 3.57

Employees are treated equally and fairly regardless of gender, age, race, disability, religion, or sexual orientation at this company.

75% - 3.93

74% - 3.89

74% - 3.89

This company is socially and environmentally responsible.

81% - 4.02

75% - 3.86

76% - 3.90

Number of respondents (whole Group)

11,860 (respondents 63%)

12,193 (61%)

13,442 (69%)

The supervisors always discuss the results of their personnel surveys with their personnel. In addition, each supervisor discusses their results in private with their own supervisors. Based on the survey results, development actions are agreed and included in the annual action and personnel plan. A summary of the results is discussed by the company’s management board.

2. Questionnaire to shop stewards

The questionnaire was sent to the chief shop stewards of the Finnish functions (or corresponding elected personnel representatives). Five of the seven chief shop stewards responded. 

The criticism from the chief shop stewards focused on the following issues in particular:

• The employer does not sufficiently listen to the employees.
• Suitability and/or condition of working conditions and tools is poor.
• Diversity has not been genuinely promoted.
• Part-time job at a store does not guarantee living wages.

The questionnaire results summary has been discussed with the chief shop stewards.
Concrete development actions will be agreed to address the grievances that came up in the questionnaire results.

Stakeholder questionnaire to personnel representatives:

Questions:

  • Does the employer/management listen to employees?
  • Are issues negotiated?
  • What is your opinion about the feedback channels on Keskonet?

Are some of the subject areas below defective?
How would you correct them?

  • Right to enjoy equitable and favourable working conditions
  • General working conditions and tools
  • Accessibility and safety of work
  • Occupational health and wellbeing at work
  • Prohibition of discrimination
  • Equal treatment of personnel; diversity
  • Right to freedom of association
  • Freedom of association
  • Right to freedom of thought, conscience and religion
  • Diversity
  • Freedom of thought, conscience and religion
  • Right to adequate standard of living
  • Right to a living wage
  • Right to private life and the protection against arbitrary interference with his/her family
  • Acknowledgement and respect for private and family life

Purchasing chains in high-risk countries

1. Kesko’s purchasing chains

Kesko operates in three divisions: the grocery trade, the building and technical trade and the car trade. Further information on the divisions.

There are around 20,000 suppliers of goods and providers of services. In 2015, there were own direct imports from 23 EU countries and from 37 non-EU countries. Going backward in the purchasing chains, however, they can be said to extend nearly all over the globe.

2. Kesko’s assurance procedures

Kesko pays special attention to human rights issues and working conditions in the purchasing chain and, in monitoring these, primarily focuses on suppliers in high-risk countries. In accordance with the BSCI (Business Social Compliance Initiative), these are countries where there is a risk of violations of human rights and labour rights. The classification is based on the World Bank's Worldwide Governance Indicators.

High-risk countries typically produce clothing and home textiles, shoes and other leather goods, furniture, carpets, interior decoration items, tools, sports equipment, toys, agricultural products (such as coffee, tea, cocoa, fruit, vegetables, wines) and canned fish, fruit and vegetables. The annual total of direct purchases by Kesko's Finnish companies from suppliers in high-risk countries accounts for approximately 1 – 2% of Kesko's total purchases.

Kesko requires its suppliers in high-risk countries to have social responsibility certification or audits. Kesko is a member in the European BSCI audit system and is committed to the BSCI Code of Conduct, the content of which is practically the same as Kesko's own purchasing principles. In cooperation with the BSCI, Kesko follows other audit systems in the market and accepts audits based on them, provided that the level of requirements is the same as in the BSCI audit.

Kesko’s Annual Reports provide more detailed information on purchase quantities, high-risk countries from which purchases are made, and audits. See information for 2015: purchase quantities, audit systems accepted by Kesko, conducted audits and high-risk countries.

3. Human rights survey at factories in high-risk countries

The survey was conducted in cooperation with the Trade Union Solidarity Centre of Finland (SASK). Measured in terms of the volume of direct imports, four countries from among Kesko’s 10 largest high-risk countries, China, India, Bangladesh and the Philippines, were selected as survey targets. In each of these countries, factories that are Kesko’s current, long time suppliers were chosen as survey targets.

SASK’s local partners interviewed factory employees outside the factories. The aim of the interviews was to find out the views of the factory workers on the general human rights situation at the factory and on whether Kesko’s operations had any particular impacts on the human rights situation at the factory. However, the interviewed workers did not recognize the name ‘Kesko’, which is why information on any particular impacts from Kesko’s operations was unfortunately not obtained.

SASK’s country-specific reports provide valuable information for developing Kesko’s operations, since their point of view is very different from that of the audit reports of the audit systems Kesko uses.

Kesko forwarded the information it had obtained to the BSCI organization in order for a further development of the audit procedure. The information was submitted mirrored against audit results in general terms without factory or personal information in order not to jeopardize the interviewed workers’ position.

As this survey also shows, all parties – members of the BSCI and other audit systems, as well as purchasing chains, states, authorities and NGOs – still have an enormous amount of work to do in order that human rights are identified, recognised and implemented equally all over the world in all purchasing chains.

4. Results by country

a. China

The survey was conducted at two factories, one of which produces carpets and the other one home textiles. The factories are BSCI audited. The survey results are largely consistent with those of BSCI reports, although significant additional information was obtained on practices concerning working hours and contracts of employment, among other things. A great number of employees were missing written employment contracts. Omissions were detected in working hours and overtime pays. Some employment relationships were found to be fragile. Health insurance and employment pension insurance payments of non-permanent employees were found to be defaulted.

At the carpet factory, it was found that a large portion of the employees worked almost every day, excluding an unpaid leave of approximately two weeks at the time of the Chinese Spring Festival. This is likely to reflect the general situation in Chinese factories in remote regions. In order for factories to recruit employees, they must be able to offer equivalent opportunities to work overtime and to earn as other factories in the same region.

Read the country report 1 and country report 2

b. India 

The survey was conducted at three factories, one of which a shoe manufacturer and two knitted garment manufacturers. The factories are BSCI audited and/or SA8000 certified. The survey results are largely consistent with the results of the BSCI and SA8000 reports, although significant additional information was obtained on working hour practices, among other things. Omissions were detected in working hours, overtime pays and holiday pays. Employment relationships were found to be fragile. Employee organisations were found to be practically prohibited. Health insurance and employment pension insurance payments were found to be defaulted.  In addition, indications of bribery of officials were detected. 

Read the country report

c. Bangladesh 

The survey was conducted at two factories, one of which a shoe manufacturer and the other a sportswear manufacturer. Both factories are BSCI audited. The survey results are largely consistent with the results of the BSCI reports, although significant additional information was obtained on practices concerning working hours and contracts of employment. Omissions were detected in working hours and overtime pays. Employment relationships were found to be fragile. Health insurance and employment pension insurance payments were found to be defaulted. In addition, indications of bribery of officials and trade unions were detected. 

In addition, appropriate documents and bookkeeping at the sportswear factory were found to be incomplete. Young, over 15-year-old employees have to claim to be 18 in order to get a job at the factory. During the first part of 2016, there had been confusion in the payment of holiday pays, which had caused unrest at the factory. The language of some foremen was told to be inappropriate and offensive. The report presents a view that earning a living wage to provide livelihood for the family requires both parents to have a job.

The shoe factory was found to be one of the most responsible companies in Bangladesh.

Read the country report

d. The Philippines

The survey was conducted at a factory manufacturing canned tuna. The factory is BSCI audited. The BSCI audit revealed serious malpractice in working hour practices. SASK’s report pays special attention to the fact the majority of the factory workers are hired through so-called multipurpose cooperatives, as a result of which those workers are not covered by the factory’s employment contract system. Problems were also seen in overtime pays and piecework contracts. 

Read the country report

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