The Executive Summary of the Child Labour Resource Guide provides an introduction to the issue of child labour, highlighting the reasons why children work, the types of work they do and the numbers believed to be working. It goes on to present the business case for managing child labour responsibly and provides a step-by-step strategy for taking action. Finally, it explains a socially responsible investment (SRI) approach to child labour with reference to SRI funds and indices.

What is child labour?

It is not easy to clearly distinguish between work that is acceptable and that which is deemed “child labour”. Issues such as the child’s age, the type of work in question and cultural attitudes shape this distinction. Gauging child labour is further complicated by the millions of “invisible” child labourers, mainly girls, working in the home as domestic servants or home-workers.

A general benchmark of child labour would include all children that are engaged in work that could be harmful to them.

The ILO Convention No 182 defines the worst forms of child labour as slavery and forced labour, commercial sexual exploitation, illicit activities and hazardous work.

Globally, it is estimated that:

211 million children (aged between 5 and 14) are engaged in some type of work
1 in 12 children (180 million young people under 18) are involved in the worst forms of child labour

Why do children work?

The main factor ‘pushing’ children to work is poverty. This is often compounded by a lack of access to, or poor quality, education, the effects of HIV/AIDS and discrimination based on gender or social grouping. In addition, the demand for child workers is high because they are usually cheaper, less demanding and more easily intimidated.

Managing the risk of child labour

Increasingly NGOs, trade unions, governments and businesses are broaching the question of corporate responsibility and more specifically the issue of child labour.

Early calls for the elimination of child labour sometimes resulted in large numbers of young workers being summarily dismissed with no recourse to an alternative income. Since then corporate strategies to deal with child labour have evolved from a “cut and run” response to more responsible engagement with the community where child labour is present.

Managing the supply chain

In a global economy, companies form part of a complex supply network of goods and services and consequently the potential for child labour to occur in the supply chain is very real. This can significantly affect corporate reputations and brand values.

Business benefits

However, there are clear benefits for companies that address child labour in their supply chains, which include, amongst others:

Increased brand capital
Higher consumer/customer reputation and loyalty
Higher quality of goods
Reduced health and safety risks
Reduced risk of “anti” campaigning
Support of global socially responsible investors

A step-by-step strategy for taking action would involve:

Developing a policy statement or code of conduct
Risk assessment and analysis
Management process and systems
What to do if child labour is found
Reporting and communication

Socially responsible investment (SRI) is one of the fastest growing sectors of the global investment industry and a key motivator for corporate social responsibility (CSR) in companies. SRI funds and indices such as FTSE4Good generally require assessment of how companies are managing the risk of finding child labour in their workplaces and supply chains.