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7 April 2009
SRI-Adviser: Trafficking and Sex Tourism: Crimes of Global Proportions Intersect with Corporate Responsibility
Source: www.sri-advisor.com

byRobert Kropp

Activist shareowner engagement leads to progress in corporate action against human trafficking and child sex tourism, but much work yet remains to be done, especially among US-based corporations. First of a two-part series.

To the casual observer, responsibility for curbing the international crimes of human trafficking and child sex tourism might not seem to belong to business. Forcing individuals into slavery or indentured servitude, and traveling to mostly developing countries for the purpose of the sexual exploitation of children, might be seen as the exclusive responsibility of national governments and the rule of law instead.

According to Lauren Compere, the Director of Shareholder Advocacy at Boston Common Asset Management, "For years, companies have pushed back against activist shareholders and said that matters of human rights are really government issues."

But in reality, governmental intervention is often insufficient at best, and in some cases government complicity in the practices is undisguised. In Uzbekistan, for instance, children as young as twelve years old are forced into laboring in cotton fields at harvest time for long hours. Local governments in countries in Asia and Central America too often turn a blind eye to the presence of a lucrative sex tourism industry that exploits an estimated one to two million children worldwide.

In recent years, inroads have been made in combating what the Interfaith Center on Corporate Responsibility (ICCR), a faith-based shareowner advocacy organization, has called "globalization's darkest secret." But what contribution can business make in helping to eradicate human trafficking and child sex tourism?

Merely expounding upon the examples listed above indicates that business is uniquely positioned to play an important role. Manufacturers of clothing purchase the cotton that the children of Uzbekistan are forced to harvest. Sexual predators travel on airlines to arrive at the destinations where they exploit children forced into prostitution. Those same predators often use the facilities of international hotel chains as the locations where their crimes are committed.

As Ursula Wynhoven of the UN Global Compact said, "The private sector has an important role, not only in trying to avoid contributing to the problems of human trafficking and child sex tourism, but also in making a positive contribution to their eradication."

Compere talked with SocialFunds.com about some of the early efforts by shareowners to engage US companies in the travel and tourism industry on the issue of child sex tourism.

"By 2005, hotel chains based in the US lagged behind their European counterparts in developing policies to deal with the issue," she said. "A group of American shareholders then helped a Swedish investment group craft a proposal for the Marriott hotel chain. Marriott turned out to be very concerned about the issue, and developed a human rights task force of senior executives to develop procedures for education and training of its employees on the issue."

Another industry that responded to shareowner engagement on the issues with at least a measure of concrete results was the airline industry. European airlines have been far more proactive than their US-based counterparts in their attempts to educate their customers about child sex tourism. Air France, for instance, regularly shows an in-flight film on the issue. In the US, only United agreed to show the film at all, and then only for a short while.

Compere said, "US Airways provided us with free ad space in an in-flight magazine for a month, which was an important first step, but thus far has not shown a willingness to do much more. We asked them to provide training for their employees to help them identify human trafficking victims, but they were unwilling to provide employees with a paid day off for the training. However, we continue to work with US Airways on the issues."

Widespread publicity of the use of child labor in Uzbekistan led eight major clothing companies and four major industry trade groups representing 90% of US purchases of cotton and cotton merchandise to demand an immediate end to the use of forced child labor in cotton harvesting. In September 2008, the Uzbek government responded by issuing a plan to eradicate the use of child labor.

According to Compere, the eight companies that engaged with the Uzbek government on the issue of forced child labor learned that it is indeed possible to track human rights violations back through the supply chains to the raw materials. Five years ago, Compere noted, such recognition of their increased responsibility might not have been acknowledged by companies.

Byraising the profiles of human trafficking and child sex tourism, shareowner advocates see their campaign as evolving from a focus on mitigation of the issues toward engaging with companies to develop a more proactive approach to the problem.

Compere said, "We've begun to see companies looking beyond just mitigating the issue and acting in a positive way by supporting some of the organizations on the ground, like the Polaris Project," an anti-trafficking organization.

Wynhoven of the UN Global Compact said, "Along with the industry sectors directly impacted by the issues, there are key roles in expanding awareness and sharing best practices among other sectors whose potential contributions may be less obvious."

"For instance," she continued, "There is currently an interesting initiative involving financial companies trying to bust child pornography on the Internet."

The The Financial Coalition Against Child Pornography (FCACP) , launched in 2006, is an initiative uniting financial institutions and the National Center for Missing & Exploited Children, the goal of which is to eradicate the commercial viability of child pornography by following the flow of funds and shutting down the payment accounts that are being used by these illegal enterprises.

Yet even as progress is made in some areas, other important steps that companies could be making are being avoided instead. Carol Smolenski, Executive Director of ECPAT-USA, a network of organizations and individuals working together to eliminate the commercial sexual exploitation of children, has found that most US-based companies in particular are leery of engaging on the issues by becoming signatories of the Code of Conduct for the Protection of Children from Sexual Exploitation in Travel and Tourism, to cite one example.

The Code requires its signatories to commit themselves to the implementation of criteria that actively promote a socially responsible, child-wise tourism. Of the 623 signatories, only five are based in the United States.

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