The levels of wages in essential for workes in export sectors as a potential exit from poverty. Companues have a responsibitly to support this development and workers rights. To have a positive impact companies need to change their assumptions and practices, and adopt a more innovative and collaborative agenda.

Executive summary by DIEH, Report by DIEH, 2015


Addressing low wages in global supply chains1 is a fundamental challenge to ethical trade. The ability to earn enough in a standard week for a worker and his or her family to cover basic needs and live with dignity is recognised as a fundamental human right2. Yet for all too many workers low incomes and poverty wages are the reality and the share of wealth that goes to workers is steadily falling. Falling wage shares, low pay and income inequality are truly a global concern, and pose a significant risk to shared and sustained prosperity. How can we talk meaningfully about ‘doing ethical trade’ where wages are firmly stuck below the level at which people can live decent lives, and companies feel that it is beyond their power to change this?

The hardship that low wages cause for workers and their families is not without cost to business. Low pay commonly equates with high labour turnover and restricted skills development, limiting product quality; there is increased risk of labour unrest; and customer-facing businesses risk increasing reputational damage from exposés about goods produced by chronically low paid workers.

For workers in low-income and industrialising economies, waged work in export sectors is a potential exit from poverty, and contributes to the country’s economic development. Companies have a responsibility to support these benefits by providing decent, regular, adequately paid employment.
If they fail to do so, in-work poverty and imbalances of power at local and global levels become entrenched.

A new agenda on supply chain wages
This report offers a new agenda on global supply chain wages, outlining practical steps for companies – both large and small – to take, informed by the framework established under
the UN Guiding Principles on Business and Human Rights (UNGPs).

The UNGP framework sets down the following two challenges3 for any company to address living wages in its supply chain. First, to understand the root causes that may give rise to adverse impacts on wages. Second, on the basis of this analysis, to identify how a company can use its influence to reduce adverse impacts.

A thorough analysis of low wages in global supply chains suggests that a number of factors combine to keep wages low. Companies can have an impact. But to do so they need to change their assumptions and practices, and adopt a more innovative and collaborative agenda. Companies buying from global supply chains need to:

  • Coordinate and collaborate. Coordinate between themselves, and collaborate effectively with suppliers, employers associations, trade unions, NGOs and national governments, including in relation to setting adequate national minimum wages.
  • Actively support collective bargaining. Support the development of durable, local collective bargaining mechanisms and institutions – trade unions in particular.
  • Review and revise short-term commercial practices to safeguard long-term, sustainable business performance.
  • Take a sector-wide approach, linking up advances made at supplier workplace-level to broader institutional developments

Focus on implementation, not calculation

For companies, benchmarking wages can be an important first step - part of due diligence under the UNGP framework - to understand wage levels and ascertain and prioritise potential adverse impacts, in order to stimulate collective action. One of these benchmarks should be what workers themselves judge to be an adequate wage, ascertained through their representatives.

Ultimately, however, the challenge is not how to calculate living wages, but how to implement them.

Wage benchmarks need to be directly linked to support for the development of collective bargaining mechanisms that ensure wages reflect and keep up with increases in the cost of living.

This requires participatory wage-setting processes such as collective bargaining that allow wages to be regularly revised. Wages which are adequate to meet household basic needs need to be locally determined, and locally ‘owned’. Workers know best what they need to support their families.

Wage levels also need to be understood in the context of working hours and transparency of pay systems. Workers should not have to work excessive hours in order to earn a living wage.

If workers are not clear how their pay is calculated, they may miss out when productivity and quality improve, providing a better margin for their employers.

Support effective institutions...
The focus must be the development of local labour market institutions4 - including tripartite minimum wage setting mechanisms and collective bargaining - which can reconcile the interests of the diverse parties involved. Companies can contribute through promoting ‘social dialogue’ enabled by freedom of association and, emerging from this, collective bargaining on terms and conditions of employment.

The development of such institutions requires all stakeholders, including companies, to make a candid assessment of current power imbalances and to support the capacity of both workers and employers to make these institutions work. This is a long- term programme which should be supplemented by immediate interventions, such as influencing policy-making debates on minimum wage setting and industrial competitiveness.

Ultimately, adequate wages in global value chains will be achieved by institutionalising effective wage floors – establishing levels below which wages cannot be allowed
to fall - across sectors and across regions. This is the joint responsibility of governments, companies (buyers and employers) and trade unions. Wage floors ensure that competition will not be distorted to the disadvantage of the enterprises, sectors or national economies that enable workers and their families to meet their needs.

...through locally driven, sector-wide collaboration
The joint ETIs (JETIs) experience suggests that, in many supply chains, it is unlikely that individual companies will be in a position to promote and effect change on this scale, or at this level. While companies have a responsibility to identify and mitigate adverse human rights impacts through their own supply chains, the best and most appropriate response to inadequate wages will almost always require sector-wide collaboration.




1 In this report we use the phrases ‘supply chain’ and ‘value chain’, following the business literature, with different technical meanings. The ‘supply chain’ describes the flow of products from suppliers to consumers, with a primary focus on costs of materials and efficient delivery: a supply chain is what ensures that the product gets to market. The ‘value chain’ describes the flow from the consumer to the source, where the consumer (the ‘market’) is seen as the source of value: a value chain focuses on who creates value and who gets the value in the chain. It may be surmised that the wage issues described here concern the integration of supply chain management with value chain management.
2 “Everyone who works has the right to just and favourable remuneration ensuring for himself and his family an existence worthy of human dignity, and supplemented, if necessary, by other means of social protection.” Universal Declaration of Human Rights
3 It also sets other challenges such as providing redress to workers whose human rights have been denied or abused.
4 We use ‘labour market institutions’ to refer inter alia to collective bargaining and minimum-wage setting mechanisms, following ILO (2015), Labour Markets, Institutions and Inequality: Building just societies in the 21st century: ‘Good governance, social stabilization and economic justice are not luxuries that weigh down and impede the process of development. They are the essence of development itself.’




Who is DIEH

Practical Solutions to Complex Problems
The Danish Ethical Trading Initiative was established in 2008 and has grown into a strong organisation with more than 60 members that operate across a range of sectors.

Multi-stakeholder collaboration
As a multi-stakeholder organisation, we gather Danish companies, public organisations, trade unions and NGO’s to tackle ethical challenges by developing sustainable solutions that result in responsible production, responsible purchasing practices, and responsible supply chain management in global value chains.

Sustainable Development across international trade
Our goal is to advance and promote international trade in accordance with human – and labour rights, and to facilitate companies and organisations in their efforts to foster a sustainable development in developing countries and growth economies.

We uphold International guidelines
Throughout our work, we contribute to the integration of international principles and guidelines such as UN Guiding Principles on Business and Human Rights; ISO 26000, the OECD Guidelines for Multinational Enterprises, and UN Global Compact




Living Wages in Global Supply Chains - A New Agenda for Business, DIEH, (PDF, 23 pages)



A guidance for businesses with suppliers in low-income countries

A report comprised of studies and materials from a variety of actors working in the area of implementing a living wage. The toolkit for living wage presented here has been compiled by Fair Trade Center and has been inspired by the ongoing discussion.

Executive summar by Fair Trade Center, Report by Fair Trade Center, 2015

Many workers in low-income countries dream of wages that are sufficient to support themselves and their families. The situation for workers in countries such as Cambodia, India and Bangladesh are desperate and legal minimum wages, which purchasing companies often refer to, usually lie far below a living wage.

According to the UN’s Guiding Principles on Business and Human Rights, companies are responsible for respecting human rights in their supply chains. Despite this, there are few purchasing companies working progressively with the issue of living wage in their supply chain.

The aim of this report is to demonstrate that the dream of a living wage can be reality. The report presents how companies can contribute to a positive impact in the wage-setting among their suppliers, in part through their own purchasing methods, but also through creating
conditions for increased workers’ participation. In the report, Fair Trade Center (FTC) presents a toolkit with various tools for living wage. FTC also analyzes the work of companies Marks & Spencer (M&S), Switcher and Tchibo for living wages. The selection of companies are based on the Clean Clothes Campaign (CCC)-report Tailored Wages where these companies were among the highest ranked. The companies work with the issue of living wages with their suppliers, using both tools for purchasing and tools for increased workers’ participation. As methods for living wage are under development, FTC sees the work of the selected companies as interesting efforts to approach the issue, not as holistic strategies for living wages.

Purchasing from suppliers in low-income countries is impacted by different factors to achieve living wages. In order for efforts for living wages to have as great an impact as possible, companies need to combine different tools with these factors in mind.

Fair Trade Center recommends companies to:

  • Adopt a policy that includes living wage,
  • Conduct a risk analysis of wage levels,
  • Develop a living wage strategy,
  • Be transparent in efforts towards living wages.





Living Wage - from Dream to Reality. A guidance for businesses with suppliers in low-income countries, Fair Trade Center (PDF, 36 pages)



I Storbritannien bruger mennesker i gennemsnit kun omkring ⅓ af tøjet i deres garderobe. Men samtidig bliver vi ved med at købe mere og mere. Hvis vi skal skabe mere bæredygtighed i modebranchen har designeren en vigtig rolle at spille. Liz Parker, som underviser i bæredygtig mode i Storbritannien, snakker med Clean Clothes Campaign om hvordan vi, som designere og forbrugere kan forlænge tøjets levetid.


For designeren handler det om at designe nye systemer for den måde vi interagerer med vores tøj på. Vi skal tænke over hvad der sker med tøjet, når vi ikke længere går med det: kan man benytte byttemarkeder; gå på loppemarked og i genbrugsbutikker; og tænke over hvordan vi reparerer tøjet, når det går i stykker?

Det handler blandt andet om at designe tøj der kan holde, og hvor tøjets historie kan indarbejdes i det over tid. Designeren kan arbejde med hvordan man kan indarbejde muligheden for at engagere brugeren af tøjet og arbejde med æstetisk bæredygtighed. En begreb opfundet af Kirstine Harper.


Videoen er produceret af Helle Løvstø Severinsen som en del af Clean Clothes Campaign Danmarks projekt The DIG Project.




Liz Parker, underviser i bæredygtig mode i England, fortæller i et interview med Clean Clothes Campaign om hvordan designere kan gøre en forskel i deres arbejde.



Liz Parker præsenterer nogle forskellige designstrategier.
Det er vigtigt at designe i information flows og arbejde med transparens. Det er ikke nok at vide på hvilken fabrik tøjet bliver lavet, man må også vide hvordan det foregår på de forskellige trin i kæden og hvor kommer materialet fra.

Og så kan designeren arbejde med at designe det negative væk; design out the negative impact. Her fortæller hun om sandblasting og hvordan det ikke er nok bare at forsøge at undgå sandblæsning, men at det er vigtigt at fjerne det look, altså det design, fordi sandblæsning ellers vil blive erstattet af andre måske lige så farlige teknikker.


Når man som designer kommer ud i en virksomhed som fx H&M er det vigtigt at kende sine værdier og vide hvor man gå på kompromis og hvor man ikke kan. Og så er det vigtigt at turde provokere brandet til at skabe forandring. Virksomheder kigge rtil designeren efter nye ideer.

Der sker en enorm transformation af modebranchen til bæredygtighed. Der er mange nye ideer og flere og flere er informerede om hvad der sker i modeindustrien, fx om at arbejderne skal behandles retfærdigt og at deres rettigheder skal respekteres. Der er ved at ske et dramatisk skift i hvordan vi tænker og der opstår nye initiativer. Der er kort sagt et enormt potentiale for forandring i modebranchen.


Videoen er produceret af Helle Løvstø Severinsen som en del af Clean Clothes Campaign Danmarks projekt The DIG Project.




Det svenske tøjbrand Nudie Jeans taler i interviewet om det at have en åben leverandørkæde og betale tekstilarbejderne en leveløn.


Se videoen med Nudie Jeans


Nudie Jeans har, siden brandet startede i 2001, arbejdet med bæredygtighed og for at forbedre arbejdsforholdene hos deres leverandører.

Nudie Jeans lægger vægt på at have en transparent leverandørkæde og mener at det er vigtigt at forbrugere og andre stakeholders har mulighed for at undersøge hvordan brandet producerer deres tøj og som en metode til at vise at de er oprigtige i deres ønske om at producere tøj bæredygtigt. Det betyder bla. at man på deres hjemmeside kan finde en Production Guide og se alle de produkter, de får lavet og undersøge hvordan og hvorhenne tøjet er lavet.

Desuden arbejder Nudie Jeans med implementeringen af en leveløn (living wage) på de fabrikker de køber fra. Nudie Jeans undersøgte, da de begyndte at source fra en fabrik i Indien, om arbejdernes løn, var nok til at dække basale behov. Det viste sig, at det var det ikke, og de indførte derfor betalingen af en levelønsbonus til arbejderne. Samtidig samarbejder Nudie Jeans med de andre indkøbere på fabrikken, og flere andre brands betaler nu også arbejderne på denne fabrik en levelønsbonus. Dette arbejde skal på sigt sikre at det ikke bare er en bonus, men at det bliver helt normalt at lønnen til arbejderne på denne fabrik får en leveløn.


Videoen er produceret af Helle Løvstø Severinsen som en del af Clean Clothes Campaign Danmarks projekt The DIG Project.





Denne udgivelse er en udregnings-hjælp til brands, der ønsker at sikre, at arbejderne på deres leverandørfabrikker som minimum tjener en leveløn.

Rapport Labour Minute Costing - A tool for establishing living wage floors in garment factories af Fair Wear Foundation, resume af Magnus Bundgaard Nielsen

Den er opbygget som en solid metodisk guide til hvordan levelønsniveauet og tøjbrandets samlede omkostninger kan udregnes og anvendes i praksis.

Guiden præsenterer konkrete regneeksempler, der kan overføres direkte til egen produktionskæde. Guiden udregner brandets samlede omkostninger, og tager hensyn til, at prisstigningen skal fordeles mellem alle fabrikkens kunder, og hvordan det gøres uden at EUs konkurrenceregler brydes.

Den primære målgruppe er derfor tøjvirksomheder, men forhåbentlig vil rapporten også være relevant for fagforeninger og fabriksejere.


Labour Minute Costing - A tool for establishing living wage floors in garment factories af Fair Wear Foundation, 2016, (PDF 23 sider)



Hvem er Fair Wear Foundation?
Fair Wear Foundation (FWF) har til formål at give tøjvirksomheder og producenter anvendelige værktøjer til at sikre, at arbejderne får en løn, de kan leve af og anstændige arbejdsforhold.

FWFs udgivelser skal betragtes som en værktøjskasse, som adresserer de mange forskellige problemer, som plager den globale tøjindustri. Fokus ligger på produktionsleddet, da langt de fleste arbejdstimer lægges her.

FWF er et samarbejde mellem NGO’er erhvervsorganisationer, fagbevægelse, virksomheder og producenter.



Denne udgivelse er en hjælp til tøjbrands, der står for at skulle implementere leveløn som et mindstelønsniveau hos deres leverandører. Dette kan være en kompliceret proces med mange facetter for brands, der typisk ikke selv ejer fabrikker, men er én blandt flere ordregivere. 

Rapport Living Wages: An Explorer's Notebook af Fair Wear Foundation, resume af Magnus Bundgaard Nielsen

Fair Wear Foundation har identificeret de største udfordringer, man som tøjbrand står overfor, når man ønsker at implementere en leveløn. Det er blandt andet manglende kollektive lønforhandlinger, tvivl om hvad en leveløn er, manglen på eksempler fra den virkelige verden, konkurrencelove m.m. I rapporten gives konkrete løsningsforslag til hvordan man bedst adresserer de identificerede problemstillinger.

Udgivelsen giver også case-eksempler fra virksomhederne Nudie Jeans, Continental Clothing Company, Albiro, Switcher og Mayerline, der alle har taget væsentlige skridt hen imod sikring af en leveløn, og gjort sig væsentlige erfaringer i processen.


Living Wages: An Explorer's Notebook af Fair Wear Foundation, 2016, (PDF 30 sider)



Hvem er Fair Wear Foundation?
Fair Wear Foundation (FWF) har til formål at give tøjvirksomheder og producenter anvendelige værktøjer til at sikre, at arbejderne får en løn, de kan leve af og anstændige arbejdsforhold.

FWFs udgivelser skal betragtes som en værktøjskasse, som adresserer de mange forskellige problemer, som plager den globale tøjindustri. Fokus ligger på produktionsleddet, da langt de fleste arbejdstimer lægges her.

FWF er et samarbejde mellem NGO’er erhvervsorganisationer, fagbevægelse, virksomheder og producenter.




Bæredygtighed handler både om de sociale forhold, der hvor tøjet bliver produceret, om brugen af tøjet og om miljøet.

Flere og flere brands tager deres ansvar alvorligt og indarbejder overvejelser om bæredygtighed i deres virksomhed. Nogle gør bæredygtighed til en grundsten i deres forretningsmodel og andre indarbejder bæredygtige metoder i forskellige dele af deres værdikæde.

En måde at ændre ved industrien som den er nu er at være transparent. The DIG Project er en opfordring til at designere og studerende deler deres viden og tager del i den positive udvikling i den måde, vi designer og producerer på.

Let’s change the game -

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