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Who is ethically responsible?
The Swedish watchdog SwedWatch, a non-governmental organisation monitoring Swedish business relations with developing nations, has in its latest report attacked Swedish shipowners with newbuildings ordered from Chinese shipyards.

SwedWatch engaged a Swedish journalist stationed in Shanghai to study conditions at the Jinling Shipyard and the Shanghai Edwards Shipyard, where vessels are built for Swedish owners Broström, Donsötank, Furetank, Tarbit and Tärntank.

According to the report, the work forces in the shipyards are divided into a first and a second division. The first consists of permanent workers with, for China, good working conditions, paid vacation and free weekends. The second division is made up by migrant contract workers from the Chinese countryside working seven days a week, 12 hours per day and they are paid below minimum wages.

SwedWatch claims that the shipyards this way are violating Chinese law and that the work environment is deplorable with lack of protective clothing, eye protection etc.

The watchdog organisation recommends that Swedish shipowners develop an ethical policy in which suppliers are requested to respect internationally accepted norms such as ILO conventions.

SwedWatch also says that shipowning companies ordering vessels in China should negotiate a newbuilding price that reflects costs for salaries at liveable levels for the shipyard workers, based on a 48 hours working week, acceptable living conditions, permanent work agreements and a sound and safe working environment.

Further, the companies should execute inspections together with employees, trade unions and “trustworthy” local organisations to secure that the shipyard lives up to the policy. Workers on the shipyard should also have access to information on decisions taken to improve conditions and they should have possibilities to report if decided improvements have been enforced.

The targeted shipowners have a different view. They say that the work environment is not at all as bad as the report claims. They also argue that just by having high quality demands and by being constantly present with own personnel during the building, they contribute to a continuous improvement of the working environment and safety standards.

And they do have a point. The shipowners’ own Swedish personnel do actually climb the same scaffoldings as the Chinese workers, and it is not probable that they would accept safety standards below the standards they are used to on Swedish work places.

By working side by side there is also a competence flow between the Swedish staff and the Chinese. This will lead to increased demands for safer conditions from the shipyard workers and their unions.

There is also another dimension to this. The two shipyards in the report face major changes. Shanghai Edwards will be closed and replaced by a new modern site. Jinling is in for a significant modernisation program. This will lead to further improved working conditions. The basis for the modernisation of the Chinese shipyard industry is the large amount of newbuilding orders from foreign shipowners. Without those, the industry would have no incentive for development.

Irrespective of one’s view on Chinese politics, corruption and state-controlled unions, a company making business in China must respect the laws and culture of the country. It can’t be the role of a shipping company to decide on salaries, especially if there is a collective bargaining agreement between the shipyard and its workers. If the shipyard violates the law, this must be handled by Chinese authorities.

Increased international pressure can lead to improved conditions in China, but this must be done on international arenas and can not be the responsibility of a single shipping company.

There is however one greater force that, if used, would create the greatest incentive for improved working conditions for Chinese workers in shipyards and elsewhere, and that is us.

Ships are built by Chinese shipyards because they build good ships at low prices and charterers are not willing to pay more. And the reason for the charterers not willing to pay more, is that we, as consumers, want cheap t-shirts, shoes, toys and cds.

The ethical responsibility lies in the end with us as consumers. The day that we are prepared to pay a little more, living conditions will improve in many parts of the world.

//Rolf P Nilsson