London was awarded the 2012 Olympic and Paralympic Games based in some part on the bid’s broad commitment to setting the benchmark for sustainable events management. But because the London Organizing Committee of the Olympic Games (LOCOG) was a temporary organization, it did not have the luxury of nurturing supplier performance improvement on labor conditions over time. Their commitment translated to managing social and environmental risk in 10,000 product lines from 600 direct suppliers and 60 licensees—almost entirely at the start of the business relationship.
Verité was asked to evaluate LOCOG’s efforts, and identify lessons that other time-bound organizations could learn from their experience. Using the Verité Systems Approach model, we looked at LOCOG’s Sustainability Management System with a particular focus on the proactive risk controls most needed by a temporary organization. This report—”Managing compliance with labor standards: Findings and recommendations from an independent assessment of LOCOG’s labor risk management systems”—describes our methods, what we found and our recommendations for future organizers.
Some essential points from the Report follow—and they are relevant for businesses with on-going operations as well.
- Choose the right partner. For a temporary organization like LOCOG, the basic success factor in making sure labor rights are respected over the course of its short relationship with its commercial partners is choosing businesses that already meet—or are able to meet—its standards. Setting and clearly communicating high expectations and diligently screening bidders for their ability to meet these expectations are the key aspects of the process.
- Expand sustainability to include labor issues. Many organizations with a dominant environmental focus struggle to appreciate the enormous scope and complexity of supply chain labor issues, and what it will take to evaluate and address them. Bringing dedicated labor rights expertise on board at the earliest stages of event planning will help the organization anticipate common pitfalls, launch earlier and maximize its finite resource of time.
- Time is leverage. A sustainable supply chain program for a temporary organization is by definition a risk management program. It is only as good—accurate and timely—as the data it collects and analyzes. The buyer needs to clearly understand the potential risk associated with a business partner before approving orders. But given the time pressure associated with an event, the suppliers’ leverage increases as time passes, to the point where the buyer may not be able to reject goods even if they have not been subject to required due diligence. Event organizers and other time-bound organizations will be challenged by both of these dynamics, and should look to business practices that can help avoid them. These include pre-production reporting, high-quality auditing, incentives for supplier transparency, and favoring business partners capable of managing supply chain issues that inevitably arise.
- Avoid reinventing the wheel. Many brands in business sectors like apparel, electronics and foods have tired of the duplication of efforts on codes, auditing, data management and supplier capacity building and have created common standards and processes. The Games industry has a unique opportunity, falling under the umbrellas of the IOC and IPC, to coalesce around a set of policies and processes that will make sustainability an integral, cost-effective and readily measured part of all future Games.
As noted above, while these recommendations are particularly relevant for time-limited organizations including the IOC and IPC, adopting them would help meet the social responsibility goals for any business and its partners.
The full report is here. We appreciate any and all questions or feedback.