Nine companies this month launched a process to test newly-developed Key Performance Indicators (KPIs) to assess reputational risks and operational shortcomings associated with labor and human rights factors in corporate supply chains. Collectively, these companies source goods from 1,755 factories that employ around 1.8 million workers in 62 countries. Once tested, finalized, and implemented, these standardized KPIs could allow interested parties to assess companies’ progress toward reducing labor and human rights risks.
Citizens United upends much of campaign finance law, but it maintains at least one feature of that legal regime: the equal treatment of corporations and unions. Prior to Citizens United, that is, corporations and unions were equally constrained in their ability to spend general treasury funds on federal electoral politics. After the decision, campaign finance law leaves both equally unconstrained and free to use their general treasuries to finance political expenditures. But the symmetrical treatment that Citizens United leaves in place masks a less visible, but equally significant, way in which the law treats union and corporate political spending differently. Namely, federal law prohibits a union from spending its general treasury funds on politics if individual employees object to such use - employees, in short, enjoy a federally protected right to opt out of funding union political activity. In contrast, corporations are free to spend their general treasuries on politics even if individual shareholders object - shareholders enjoy no right to opt out of financing corporate political activity. This Article assesses whether the asymmetric rule of political opt-out rights is justified. The Article first offers an affirmative case for symmetry grounded in the principle that the power to control access to economic opportunities - whether employment or investment based - should not be used to secure compliance with or support for the economic actor's political agenda. It then addresses three arguments in favor of asymmetry. Given the relative weakness of these arguments, the Article suggests that the current asymmetry in opt-out rules may be unjustified. The Article concludes by pointing to constitutional questions raised by this asymmetry, and by arguing that lawmakers would be justified in correcting it.
Prepared at the request of the Australian Council of Superannuation Investors (ACSI), this report benchmarks the supply-chain labor and human rights policies of the S&P/ASX 200 (ASX 200) against 2,500 of the largest global companies building on the work of the Project’s previous publication “Benchmarking Corporate Policies on Labor and Human Rights in Global Supply Chains,” (Occasional Paper No. 5) On the whole, the ASX 200 companies lag their peers in other listed markets, with a mere 17% issuing a labor and human rights policy covering their supply chain, versus 35% in the global sample. This trend carries across when analyzing company procedures to implement policies. There is some exception to this pattern for occupational health and safety policies of ASX 200 companies, which were notably strong, which may reflect the impact of strict health and safety legislation in Australia. The largest Australian companies (by market capitalization) also managed to measure up to their global peers on a number of indicators. The majority of ASX 200 firms however paled in comparison to the performance of the global sample
This article describes US unions’ efforts at capital stewardship, that is, the investment and management of the assets accumulated in pension and other retirement plans (frequently termed ‘workers’ or ‘labour’s capital’) — on behalf of plan participants and in the interest of workers more generally. It focuses particularly on the opportunities for direct worker voice in the governance and management of those assets through workers serving as trustees of the plans. The article explores the challenges these trustees face in navigating that role in addition to their possibly conflicting role as a union member or official. It details unions’ visions for capital stewardship and their efforts to integrate trustees’ activities within the broader range of union activities. Finally, it describes ways in which unions have collaborated in support of their trustees and to develop a cross-union capital stewardship agenda.
This paper reviews: (1) what typically are seen as important near- or short-term causes linked to the financial crisis, (2) the kinds of individual and institutional behaviors that many believe contributed to these causes, (3) the most important among the provisions of recently enacted financial markets reform legislation – the Dodd-Frank Act – ostensibly calculated to change those behaviors, and (4) some critical perspective on whether the provisions are suited to the task.
Households in the United States face serious challenges to enjoying income security in retirement. This paper critically appraises two policy initiatives ostensibly geared to helping to meet those challenges. One already embodied in law - the federal Pension Protection Act of 2006 (the "Act") - and the other in the form of Obama administration and legislative proposals, use automatic enrollment in employment-based defined contribution (DC) plans and Individual Retirement Accounts, respectively, along with default investments as means toward that end.
The paper describes the rationales offered at the time for the Act's provisions, the manner in which the enacted policies have been implemented, and how effective they have been and are likely to be. It assesses the strength of the evidence available at the time to support advocates' contentions that automatic enrollment would be a success. It then considers the post-enactment literature on the outcomes of automatic enrollment. It follows with a review of the literature on persistence (over time) of contributions to defined contribution (DC) plans and how realistic or justifiable were expectations for the success of the Act's provisions. The paper then characterizes the IRA proposals and examines studies of the persistence of contributions to IRAs. Next it evaluates the workings and outcomes of New Zealand's KiwiSaver scheme, the one already in operation which most closely resembles what proponents urge should be done with respect to IRAs. Finally, drawing on the findings and observations in the preceding sections, the paper offers a broader perspective on the directions policy should take if there is to be a serious prospect of ensuring retirement income security for all households in this country.
The proposed Employee Free Choice Act (EFCA) has led to fierce debate over how best to ensure employees a choice on the question of unionization. The debate goes to the core of our federal system of labor law. Each of the potential legislative designs under consideration — including both “card check” and “rapid elections” — aims to enhance employee choice by minimizing or eliminating managerial involvement in the unionization process. The central question raised by EFCA, therefore, is whether enabling employees to limit or avoid managerial intervention in union campaigns is an appropriate goal for federal law. This Article answers this foundational question in the affirmative. It reaches this conclusion by conceptualizing federal labor law in terms of legal default rules, drawing in particular on the preference-eliciting default theory of statutory interpretation and the reversible default theory from corporate law. Doing so leads to the argument that card check, rapid elections, and similar mechanisms are best understood as “asymmetry-correcting altering rules” — means of mitigating the impediments that block departure from the nonunion default. Understanding EFCA in this way also requires that we ask how such an altering rule should be constructed. This Article addresses this institutional design question by arguing that card check’s open decisionmaking process is flawed and that rapid elections, while an improvement over the status quo, are an insufficient method of mitigating the relevant impediments to employee choice. Accordingly, this Article offers two new designs — alternatives to both card check and rapid elections — that would accomplish the legitimate function of minimizing managerial intervention while at the same time preserving secrecy in decisionmaking.
This article explores the evolution of labor friendly US investments by pension funds in the period since the downturn of the financial markets in 2001. It argues that both pension funds and investment vehicles that bring intentional targeting to their investments are becoming increasingly sophisticated financial players. Labor friendly investments that focus on risk adjusted rates of return as the driver for investment are increasingly able to point to strong track records that encourage a wide range of pension fund investors to engage with these vehicles and practices.
Near majorities of large corporations have labor and human rights (LHR) policies covering their global supply chains, although far fewer have established follow-up monitoring and enforcement mechanisms. LHR supply-chain policies are also close to the norm among European companies, with the United States and Asia lagging behind. These findings are contained in the first study to benchmark LHR policies among the 2,500 companies found on the major stock market indices. The study was done by Pensions Project Senior Fellow Aaron Bernstein and Christopher Greenwald, Director of Data Content at the Swiss firm ASSET4, using ASSET4 data.
This paper explores how pension funds and other investors can obtain data on the long- term sustainability risks posed by the labor and human rights (LHR) activities of global corporations, with a specific focus on supply chains. It should be read as a companion piece to Bernstein's “Incorporating Labor and Human Rights Risk into Investment Decisions" (Occasional Paper, No. 2)