Students & Scholars Against Corporate Misbehaviour

Telephone: (852) 2392 5464 Fax: (852) 2392 5463Email: sacom@sacom.hk Website: www.sacom.hk Mailing Address: P.O.Box No. 79583, Mongkok Post Office, HONG KONG

LOCOG's Empty Promise to Respect Labour Rights:Olympic mascots made in sweatshops

23 January 2012

Introduction

The London Organising Committee of the Olympic and Paralympic Games (LOCOG) expects togenerate at least GBP 86 million from sales of “London 2012” merchandise. Among themerchandise, the majority of products feature the official mascots, Wenlock and Mandeville, andthe Team GB mascot, Pride-the-Lion.In 2008, LOCOG issued sustainable and ethical sourcing codes with the aim of ensuring that allproducts associated with LOCOG are produced under internationally acceptable social standards.In terms of labour practices, the codes refer to the provisions of the Ethical Trading Initiative(ETI) Base Code which spells out that workers should receive at least the minimum wage asspecified in their national legal standards and have a contract defining their terms of employmentand payment. The ETI Code also states that punitive fines are prohibited and that working hoursshould not be excessive. Regrettably, LOCOG has not issued any lists detailing the firms thatsupply goods to the licensees. Moreover, there have been no reports on the levels of compliancewith the code by these suppliers. Consumers are kept in the dark about the conditions in whichthe goods are produced.In summer and autumn 2011, Students & Scholars Against Corporate Misbehaviour (SACOM)investigated the Yancheng Rainbow Arts and Crafts Company, a manufacturer of Wenlock,

Mandeville and Pride-the-Lion goods in Dafeng City, China. The factory is also a supplier toDisney. This investigation revealed numerous violations of workers' rights violations in theRainbow Factory, which puts it far outside the promises of the code. The following are the majorlabour rights violations found in the factory:- Workers are told to tell lies to the auditors during factory inspections.- No labour contract is given to workers.- The factory does not pay a basic salary to workers.- Workers do not know about the piece rate before production.- Overtime premium is not paid in accordance with legal standards.- Sewing workers have muscle fatigue, due to the repetitive work, and cloth-cutting workers haveto stand during the whole day.- No paid maternity leave for workers.“The quality control of Olympic products is demanding. It is very difficult to produce the mascots.There cannot be any flaws. Although they are Olympic products, the unit price is lower than forother products. I am not proud of making the mascots at all,” explained one sewing worker.According to the workers, the Olympic products were to be sent to the British companies, GoldenBear and John Lewis. It is disappointing that the client puts so much effort into quality control of the products but turns a blind eye to the labour rights violations. The Rainbow Factory is aprimary labour rights violator and Golden Bear and John Lewis failed to examine the workingconditions at their supplier. Nevertheless, LOCOG cannot evade its responsibility for enforcingits own sustainable and ethical sourcing codes.

Wenlocks and Mandevilles.

SACOM’s Demands to LOCOG and IOC

The rampant labour rights violations in the Rainbow Factory demonstrate that, at present, thesustainable and ethical sourcing codes are nothing more than pieces of paper. In line with itsproclaimed goal of respecting labour rights, LOCOG should:

- publish the full list of suppliers to its license holders;- conduct selective investigations at the licensees' suppliers to examine the level of complianceand publicise the reports; and- work with the licensees to launch remedial actions in any factory where rights violations arefound.The International Olympic Committee (IOC) should establish a policy to prevent violation of labour rights at the suppliers of Olympic products. On top of the demands for disclosure of supplier lists and selective audits at the licensee suppliers, SACOM further demands that the IOCshould:- adopt a code of conduct for the suppliers which should include terms like living wages, freedomof association and the right to remedy; and- require the licensees to ensure that every worker, at every supplier, receives a copy of this code.

Contact Persons

CHAN Sze Wan, DebbyProject OfficerEmail: debby@sacom.hk Tel: +852 2392 5464 or +852 6756 8964CHENG Yi YiProject OfficerEmail: yycheng@sacom.hk Tel: +852 2392 5464 or +852 6012 0312