Youâ€™ve probably heard the phrase â€œthe race to the bottom.â€ It’s used by critics of globalization who accuse companies of roaming the world in search of cheap labor and lax environmental standards, as they seek to drive down costs. But you may not be aware of the â€œrace to the topâ€ â€“ the idea that companies and governments export their own labor and environmental rules to the global south, lifting standards. I wrote about the race to the top for FORTUNE in 2005, citing the EUâ€™s chemical and take-back rules and Nikeâ€™s monitoring of its supply chain as examples of this little-noticed phenomenon. At the time, I didnâ€™t like the headline my editor put on the story: â€œCops of the Global Village.â€ Now, though, I think itâ€™s apt.
Consider two timely examples of companies that acting like cops. They are taking an expansive view of their responsibilities as they try to raise â€“ and enforce — environmental standards in their supply chains.
According to this story in the Los Angeles Times, jewelry retailers Tiffany & Co., Helzberg Diamonds, Fortunoff and others have decided to publicly oppose Pebble Mine, a gold and copper mine being planned for Alaskaâ€™s spectacularly beautiful Bristol Bay watershed, site of the worldâ€™s largest sockeye salmon run.
This marks the first time that retailers have joined to stop a specific mine, spurred on by activistsâ€™ â€œNo Dirty Goldâ€ campaign against destructive mining practices. Tiffany et al may soon be joined by Wal-Mart, the nationâ€™s biggest jewelry retailer, which is reviewing what called the Bristol Bay Protection Pledge. That’s a document drawn up by local activists to protect a watershed that is home to rainbow trout and caribou as well as wild salmon.
The last time I was in Bentonville, I recall hearing that Wal-Mart is looking at ways to use recycled (as opposed to virgin) gold in its jewelry. Maybe it’s worried that buying gold from polluting mines will undermine its high-profile sustainability campaign.
There’s no doubt that gold mining is a dirty business. “The more you know, the less gold glows,” says the No Dirty Gold campaign. According to its website, the production of one gold ring generates 20 tons (!) of waste. Metals mining is said to be the leading contributor of toxic emissions in the United States. No wonder companies like Tiffany are paying attention to the environmental impact of miningâ€”the allure of gold is all about allure and glitter and reputation and glitter. Jewelers donâ€™t want customers to look at a gold necklace and think â€œtoxic emissions.â€
Sean McGee, a spokesman for the Pebble Mine, told the LA Times, â€œWe support high environmental standards for mining. If the fisheries canâ€™t be protected, we wonâ€™t advance the project.â€ Pebble Mine is a partnership of Northern Dynasty Minerals Ltd. and Anglo American plc. We’ll keep an eye on developments up in Bristol Bay.
The other story that caught my eye came out of Staples, a company that takes its environmental impact seriously, much to the credit of Mark Buckley, the companyâ€™s vice president for environmental issues. Mark will be a speaker at FORTUNEâ€™s Brainstorm: Green conference on Earth Day.
Staples says it stopped doing business last month with Asia Pulp & Paper, a giant forest products company based in Singapore. In this instance, Staples was following Office Depot, which earlier severed ties with APP because the papermaker has been accused of illegal logging in Indonesia by the World Wildlife Fund and Greenpeace, among others.
Staples called APP â€œa great peril to our brandâ€ because of the companyâ€™s environmental misdeeds. APP had supplied about 9% of Staples branded photocopy and office paper.
â€œWe decided engagement was not possible anymore,â€ Buckley said, according to this story in The Wall Street Journal. Unfortunately, APP is making up for lost orders from big Western buyers by selling more paper in India and China where the demand for paper is growing fast.
Thatâ€™s a reminder that corporate cops can only do so much.