Wednesday, October 28, 2009

No Child's Play: Tackling Child Labour in Pakistan

The serious issue of child labour is as multifaceted as it is serious. It follows then that resolving this issue requires concerted, often collaborative and always non-sequential effort from several stakeholders across the public, private and civil society sectors. These efforts have a new entrant: the Federal and Provincial Ombudsmen in Pakistan. In partnership with a wonderful team at UNICEF Pakistan, I was privileged to have led the initiative of establishing a Children's Complaint Office as part of the institution of the Federal Ombudsman of Pakistan and later in the offices of the Sindh Ombudsman and Punjab Ombudsman. These Child Ombudsmen offices will help protect and promote child rights and fill a massive void in the justice system by providing access to children to have their grievances redressed. Hitherto, the only recourse was to approach the courts, which are largely inaccesible to children, costly and time consuming. The Ombudsmen, by their very nature, resolve disputes and redress rights through mediation and are therefore quicker and their services are free to the public. The Federal Ombudsman has already started offering an online complaint service and others will follow this model soon. Moreover, the Child Ombudsmen will address systemic issues and hold public agencies accountable for their acts of omission or commission in relation to child rights.

The Punjab Ombudsman recently held an official launch of its services in Lahore. The occasion served to remind everyone of some grim facts: there are over 3m child labourers in Pakistan; the enforcement of existing laws and compliance with the UN Convention on Child Rights is poor; and agencies dealing with child rights tend to under-resourced and on the fringes of priority of policy makers. Although not discussed at the event, one also has to realise that the Child Ombudsmen's jurisdiction does not extend to private sector organisations. In that respect, its work on child labour will be focused on holding public agencies accountable for their actions to prevent and reduce child labour, including in the private sector.

Ofcourse, child labour continues to be tackled by other stakeholders. Ever since Life Magazine broke the story in 1996 about Nike using child labour to produce its footballs in Pakistan, Pakistan has come under scrutiny. Nike owned up to its mistake and has since launched a rehabilitation program and now requires its supply chain vendors to not employ any child labour and if they do, to take him/her out of the factory, provide education and re-hire them only when they were legally employable. The story scarred both Nike and Pakistan.

Subsequently, the ILO in Pakistan has implemented several industry specific and broad based projects, aimed at reducing child labour. These projects have had strong allies in the respective industries and have helped clean up the country's image a tad, if not remove the scourge of child labour.

Two issues arise from this overview: one, to address child labour issues in private sector organisations, what should be done? Establish private sector Ombudsmen or extend the jurisdiction of the public sector ones? Get the SECP involved through its Code of Corporate Governance? And what about using SMEDA to tackle this issue as a priority?; and two, what steps can or should companies take to prevent use of child labour not only in their own factories, but also down their supply chains? Export-driven industries have to meet certification requirements from buyers, but what about companies catering to domestic markets? The new National Child Protection Policy is under finalisation, but it too does not offer any answers to either of these issues. The UN Global Compact's Pakistan network also has little to show for its efforts on this front, although it counts the Employers Federation of Pakistan as a member.

The search for solutions to this issue, it seems, shall continue.

Sunday, October 4, 2009

Bringing Better Corporate Governance on Board

Absence of adequate professional capacity is a persistent bane for efforts aimed at developing a strong corporate sector anywhere and Pakistan is no exception. Along with cross-representation of family members on Boards which tends to lead to conflicts of interest and to a hazy corporate culture, the fact that members on Boards of Directors are not always up to speed on the cutting edge of knowledge, international best practice and even the country's own laws and regulations, weakens corporate governance. The promulgation and enforcement by the SECP of the Code of Corporate Governance in 2002 has helped raise standards but has a supply-side bias and does not stress capacity building of Board members enough. Now it seems the regulators may finally be taking steps to correct this.

According to a report in the daily News, the Karachi Stock Exchange has been directed by the Securities and Exchange Commission of Pakistan to amend its listing regulations to include a provision that members of the Board must possess a certification under a Board Development Series, an internationally accredited Director Education Program developed by the Pakistan Institute of Corporate Governance. This regulation would be implemented in phases, with at least one member of the Board to have this certification before 30 June 2011 and thereafter, every following year minimum one director on the board "shall acquire the said certification under this programme".

The Pakistan Institute of Corporate Governance was established a few years back as a not-for-profit company and hopes that this Business Development Series, which is accredited by RiskMetrics Group of USA, and allows for due recognition by rating companies when evaluating the participant’s organization, will strengthen corporate governance in Pakistan.

Time will be the judge of whether this aim is met.