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Aust Super Funds Must Consider Labour Standards

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US Public Sector Fund Leaves SE Asia
Unions help rebuild New York

Australian Super Funds Must Consider Labour Standards
Under the new Financial Services Reform Act Superannuation funds are required to disclose the extent to which labour standards, environmental, social or ethical considerations are taken into account in the selection, retention or realisation of investments.

This provides an important opportunity for unions to ensure that our retirement funds are not being used to bankroll anti-union companies. 

The draft regulations do not force any particular standard. A fund may simply decide not to take any of these matters into account. 

The ACTU believes that the ILO core labour standards are universally accepted as the benchmark. These core conventions cover issues of child labour, discrimination, collective bargaining, freedom of association and the right to organise.

It should be noted that compliance with Australian labour law is insufficient, as the ILO has repeatedly stated that the law does not meet the requirements of the core conventions.

How Good is the measurement of Compliance?
The "Big 5" accountancy firms, have carved out a market as independent labour rights auditors. However their performance of this duty is questionable.

Ethical Consumer reports that PwC monitoring of a Chinese factory making Wal-Mart products was found by a labour rights organisation to have missed serious breaches, including use of dangerous chemicals, denial of collective bargaining and violations of overtime law. A disturbing ignorance of the standards was shown by one auditor, who apparently said that he didn't ask about freedom of association in the factory because there was no union presence.

Source: ACTU website [back to YOUR SUPER page]

US PUBLIC SECTOR FUND LEAVES SE ASIA
The US Public Sector fund 'Calpers', a leading proponent of corporate governance and shareholder activism, has decided to pull out of investments in Thailand, the Philippines, Malaysia and Indonesia. The $150bn fund withdrew in response to the alleged existence of child labour, forced labour, discrimination and lack of freedom of association, together with weak institutional corporate governance. The decision was made even though the Thai, Philippine and Indonesian stock markets have increased by 20% since the start of the year.

Sadly Calpers didn’t look so ethical over Enron. Despite having concerns about the company they failed to take action at the Board level. Calpers had a number of partnerships with Enron in which directors are said to have had serious conflicts of interest. 

The Enron collapse was a disaster for many of its employees' pensions. Unlike in Australia it is possible for a Corporate fund to have substantial shares in the employer company. This is a double jeopardy for the employees. When their company goes bust they not only loose their job but also most of their retirement savings. 

Enron was able to stop employees selling their shares in the pension plan, even though top executives had already sold theirs. 

After the Enron collapse a number of reforms have been proposed including a prohibition on employees holding more than 5 or 10% of their retirement account in one stock, and also allowing employees to sell the shares after a period of 90 days.

President Bush has put forward a plan which Congressional Democrats say is completely inadequate. It does not put a cap on holdings in a single company, and would prevent employees' selling their shares in their employer for three years.

Source: BBC World Business Report

See also the article Attack on US Workers Rights from the Boss Watch website for more information on President Bush’s Attack on US Workers after September 11. 

[back to YOUR SUPER page]

UNIONS HELP REBUILD N.Y. WITH SUPER
The US union confederation AFL-CIO is providing $750m package of housing and community investment for New York City.

The funds will be provided through AFL-CIO investment vehicles - the Housing Investment Trust, the Building Investment Trust and the new Urban Development Fund.

Investors include major pension funds in the health, electrical, manufacturing and services industries, as well as N.Y. City employees.
 

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The Progressive PSA brings together rank and file trade union activists in the Public Service Association of New South Wales and the CPSU (SPSF Branch). 

We work for

  • improved and more equitable pay 
  • greater job security
  • a democratic and strong union



 
 
    progressive@angelfire.com


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