NEW YORK, Jan. 27 /PRNewswire/ -- The International Center for Corporate
Accountability (ICCA) today released audit results of manufacturing facilities
of major Mattel, Inc. suppliers in China. The ICCA reports were commissioned
by Mattel (NYSE: MAT) as part of Mattel's commitment to upholding its Global
Manufacturing Principles (GMP) code of conduct. They are intended to provide
an unbiased, third party analysis of working conditions in Mattel's
While voluntary audit reports of Mattel-owned manufacturing facilities
have been published since 1999, today's report marks the first effort to
broaden the scope of the analysis to include the facilities of Mattel's major
vendors. The current audit covers 12 manufacturing facilities in China that
are among the major suppliers of Mattel, constituting approximately 50 percent
of Mattel's total vendor business in China in terms of dollar amount.
Dr. S. Prakash Sethi, chairman of ICCA and University Distinguished
Professor, Zicklin School of Business, Baruch College, commented, "With the
conclusion of this audit, ICCA has determined that while supplier facilities
face many challenges, Mattel's GMP has been instrumental in motivating
facilities to achieve or even surpass compliance standards in safety,
maintenance, employee communications, payroll and working conditions. We were
especially pleased to see significant progress between an initial visit to the
plants two years ago and when we returned to conduct the formal audit."
Sethi noted, "Mattel is the first and only global consumer products
company to apply a required standards system to both its own manufacturing
facilities and those of its major vendors, and to independently monitor and
publicly disclose the results. It is our desire that more companies adopt and
uphold such standards in their manufacturing facilities worldwide, as it is an
extremely important initiative that can benefit workers everywhere."
"I'm proud of the progress made by our vendors and am also proud of
Mattel's efforts in leading this effort. This audit has also fulfilled the
vital function of helping us to identify important areas of performance that
demand improvement," said Tom Debrowski, executive vice president of worldwide
operations for Mattel. "That is why we commission these regular audits -- now
that the challenges are known, we can work with our vendors to ensure they
make the appropriate changes to come into compliance with our GMP standards.
Suppliers understand that compliance is not an option, it is an absolute
requirement if they want to continue doing business with Mattel."
Summary of Report Findings
Following is a summary of the findings of the ICCA report released today:
-- Manufacturing facilities visited by ICCA have shown significant
improvement in a number of areas, and the current audits indicate that
Mattel has committed considerable resources to advise and assist its
vendors in order to improve their level of compliance with Mattel's
-- The minimum worker age of 16 is strictly enforced; investigators did
not find any workers under the age of 18.
-- There has been definite improvement in payment of minimum wages. With
one or two exceptions, all plants were found to be in compliance for
payment of legally mandated minimum wages for regular and normal
overtime working hours.
-- Areas showing significant improvement include safety of the workplace,
dormitories and canteens, workers' access to all levels of management,
and lack of discrimination or promotion based on sex, race or ethnic
-- Some plants showed inadequacies pertaining to environmental issues,
including disposal of wastewater and poor ventilation. Improvements
are also needed with regard to worker safety training and proper use
of personal protective equipment.
-- Areas needing improvement include availability of records to verify
that workers who performed overtime work on rest days received either
double pay or a day off, and consistent application of regulations
with regard to fringe benefits such as maternity leave and paid annual
-- Most facilities exceeded the maximum overtime hours limits for peak
production periods (called consolidated work hours), authorized by the
local labor bureaus.
Mattel is pleased with the progress made by vendors under the rather
difficult competitive manufacturing and procurement environment in China, and
recognizes the challenges that lie ahead in bringing all vendors into full
compliance with GMP. To achieve this goal, Mattel will work with suppliers,
and in consultation with ICCA, to design and implement a plan of action to
correct deficiencies to set the stage for continuous improvements in all of
its overseas facilities and operations. This plan should be finalized within
the next 90 days.
"We strive to continually improve our facilities, both Mattel-owned and
supplier-owned, and for our actions and results to be transparent. In this
way we uphold our commitment to our GMP and to fully responsible corporate
conduct," Debrowski said.
The full text of the ICCA report can be viewed on ICCA's Web site at
www.ICCA-corporateaccountability.org and on the Mattel corporate Web site
located at www.mattel.com/about_us/Corp_Responsibility/default.asp.
Mattel's Global Manufacturing Principles (GMP), launched in November 1997,
form the cornerstone of the company's ongoing commitment to responsible
manufacturing practices around the world. Adherence to GMP seeks to ensure
that wages, working and living conditions and employee access to management
are just and fair, as well as to assure protection of the environment. As
part of Mattel's GMP, the company's primary suppliers are also subject to
compliance with the standards set in the GMP. Mattel contracted with ICCA to
perform regular audits of its owned manufacturing facilities and those of its
major suppliers. ICCA's responsibility is to evaluate and publish findings on
these manufacturing facilities' compliance with GMP.
ICCA's audit protocols are designed to verify vendors' compliance with
Mattel's GMP standards in a manner that is comprehensive, objectively
measured, interpreted in a meaningful manner and independent of any other
consideration except the compliance standards specified in the GMP.
Directed by Dr. S. Prakash Sethi, the International Center for Corporate
Accountability (ICCA) is a not-for-profit, independently incorporated
organization comprised of a council of experts in labor issues worldwide.
ICCA encourages and assists multinational corporations in creating,
implementing and arranging independent monitoring of codes of conduct. As an
academically-affiliated organization, associated with the Zicklin School of
Business of Baruch College-The City University of New York, ICCA also
undertakes independent field research on aspects of corporate governance and
accountability that normally fall outside the purview of corporate boards of
directors, and engages in dialogue with a wide range of stakeholders.
Mattel, Inc. is the worldwide leader in the design, manufacture and
marketing of toys and family products. The company's best-selling brands
include Barbie(R), Hot Wheels(R), Fisher-Price(R) and American Girl(R). With
headquarters in El Segundo, California, Mattel has offices and facilities in
36 countries and sells its product in more than 150 nations throughout the
world. The company's website can be found at www.mattel.com.
SOURCE International Center for Corporate Accountability