The supply chain chaos in the pandemic shows how fragile the industry is. Precarious working conditions, which are an integral part of globalization, also come into focus. “Corona has taken people’s suffering to the extreme,” says Austrian labor law expert Veronica Bohrn Mena. Corona also has advantages for them. With the virus, a German supply chain law from 2023 and an avalanche of lawsuits against large corporations, a change is announced. The author of “Corporations on the chain!” hopes for an “avalanche” that will ensure more fairness along the supply chains and progress in human rights and climate protection. Corporations need to rethink.
ntv.de: Mit With cheap production conditions at the other end of the supply chain, a lot of profit is made in the West. You have studied the dark side of this system for a long time. The result is your book “Corporations on the Chain!”, which you wrote together with your husband, the economist Sebastian Bohrn Mena. The appeal expresses anger. Or is that misleading?
Veronika Bohrn Mena: The title actually came about out of frustration. I have dealt a lot with precarious workers who work on fixed-term contracts, for example. When people called for improvements, I heard the argument again and again: If harvest workers earn, for example, just one euro more an hour, the business location will suffer. That’s an eternal killer argument. We are stuck in a negative spiral of competition, everyone should aim to ensure that a business location does not suffer. But the people, the employees and the environment suffer as a result.
Did a particular event break the camel’s back?
The Tönnies scandal at the beginning of the pandemic two years ago. Wherever there were slaughterhouses with many workers – who are terribly housed – large corona clusters emerged. The discussions then either revolved around the fact that schnitzel would become more expensive or that other work contracts would have to be concluded. For us, that doesn’t solve the problem. The corporations have shamelessly exploited the situation. You are the culprit. They are the beneficiaries of the deregulation measures of the last 40 years in the EU.
Supply chains are suddenly a big issue in the pandemic. “Made in Germany” or “Made in Europe” is said to be making a comeback. Is Corona something of a stroke of luck for you, because the living and working conditions of the precarious employees may improve as a result?
Corona is actually beneficial. The pandemic has shown dependency on China and on raw materials from China. But I believe that the rethinking of consumers had already begun before that. The pandemic has only massively accelerated the whole thing. Crises always work like a magnifying glass, problems get bigger. The fact that an apple from Chile is cheaper in the supermarket in Austria than an apple from Styria was previously incomprehensible. In the pandemic, however, supply chains became a bigger problem because, for example, too few masks from China arrived in Germany. We have also learned that diseases are transported via the movement of goods. Corona amplifies the problems of globalization – makes them more visible.
The Tönnies scandal was practically on our doorstep. Controlling production sites in the Far East is more difficult. From 2023, a supply chain law will apply in Germany, which is intended to ensure that suppliers comply with human rights and environmental protection. What do you think of the law?
I think the law is good and important, even if it has been severely weakened and no great success has been achieved. In my view, smaller companies should have been made more accountable from the start. Gross environmental violations and climate-damaging behavior should also be included in the law at the outset. But 10 or 20 years ago such a law would not even have been conceivable, although we already knew then that our production system is based on poorer working conditions in other countries. So today we are one step further. Still, I see a big problem. It’s strange: the law is in the interests of the majority of all people, including the interests of the national economy – both here in the West and in the Global South. It is in the interest of nature and the climate. In fact, it really only has benefits…
But?
… It has disadvantages for the corporations because it restricts them. And the corporations have a strong lobby, not only in Germany or Austria, but throughout Europe. That’s why they spend a lot of money to assert their interests. This is exactly what we are seeing in Europe now.
You say that corporations are putting obstacles in the way of Europe on the way to fairer and more sustainable supply chains?
The draft for a European supply chain law, which should have been presented in May, failed three times in the internal control committee. Something like this has only happened four times, for example when it came to a financial transaction tax and a transparency law. This means that as soon as corporations have the impression that something is happening in Europe that is not in their interest, these laws are delayed or stopped. This is not a democratic process! Because mind you: there was previously a large majority in parliament that wanted to introduce a supply chain law that was even much stricter than the German version.
Which European countries besides Germany already have a supply chain law?
France, the Netherlands and Great Britain, which of course is now no longer part of the EU. Unfortunately, Austria is still fighting for such a law.
You did a lot of research for your book. Your tomato pizza example shows impressively that the problem of exploitation in production processes is closer to us than we think. But very few people are aware of it…
We chose the tomato pizza example precisely for this reason, because supply chains and supply chain law are a very cumbersome matter, but they concern us all. That’s why we chose three everyday objects that we all can’t ignore. Frozen pizza is the most popular convenience product. Everyone has bought them before, but probably didn’t think much about it. The tomato shows that the price of a product and the costs of production are no longer related. We don’t pay for what production costs, but for what retail groups – mind you, not manufacturing groups – can get out of it for themselves. If a tomato costs one euro here, the retail groups pocket 85 cents, and 10 cents go to the wholesaler in Italy. Of the remaining 10 cents, only 2 cents end up where the tomato is grown. One thing is clear: this cannot be produced in a humane and climate-friendly way.
There is something else in the pandemic that looks like a new chapter is being written in globalization: people who have worked and lived in precarious jobs are no longer doing it. In America, the phenomenon is called “The Big Quit”.
Right. In the US, the situation is so advanced that people say they can no longer take part. There is a huge wave of layoffs – from workers across the country – making it difficult for companies to find workers for the menial jobs. In Germany and Austria there is a shortage of carers because care is a system based on cheaply buying services from people from Eastern European countries. The phenomenon can also be seen in Great Britain. Therefore, supermarket shelves remain empty there. There are no truck drivers because Polish drivers can no longer travel to the UK and the British do not drive trucks on the same terms. We also see crops deteriorating due to a lack of field workers. We couldn’t have imagined all this 20 years ago.
Is this a turning point?
It’s an important moment. And that has to do with the fact that Corona has taken people’s suffering to the extreme. Corona has tightened the conditions for workers so much that they are now saying: so far and no further. The reason is that on top of the terrible working conditions there are now health hazards.
There are also more processes that make you sit up and take notice. The five big tech companies are accused of causing the deaths of children in cobalt mining. What importance do you attach to this?
I think the processes are incredibly important. There are organizations that do nothing but sue corporations in different countries. For example, the European Center for Constitutional Humanrights, which filed lawsuits in Germany last year against textile manufacturers like Hugo Boss, who have their goods produced in China by Uighur forced laborers. The German public prosecutor’s office did not pursue this further. A process is now being initiated in France, where the legal system is somewhat more progressive. Corporations are profit-oriented. It has an effect at the moment when there are sensitive fines, personal consequences for the management and a major damage to the image.
Do you think the German supply chain law can prevent such cases?
From the point at which a German managing director has to be liable, immediately. In the area of human rights crimes, i.e. child labour, modern slavery and forced labour, there will definitely be improvements. An avalanche will start rolling. At the end of the day, corporations are run by people who are careful not to fail professionally. This will change the modes of production. We are not faced with an elemental force here.
Diana Dittmer spoke to Veronika Bohrn Mena