Country Risk Assessment Process for SA8000

Doing business in any country carries risk. Performing credible certification audits in some countries can be difficult due to travel restrictions, a culture of corruption, and poor health and safety standards that can undermine the credibility of that certification.  

After extensive research and consultation, SAAS developed an SA8000 certification country risk assessment process to categorize the oversight and assurance process activities according to risk level. Activities taking place in higher risk locations receive more oversight than those in countries determined to be lower risk - using risk-based systems increases efficiency and enables better resource allocation and focus.  

  • The country list can be downloaded in Excel or PDF. Shifts among categories will be communicated and posted not more frequently than once every three years.  The SAAS listing  describes the current country categories.  

The list itself has been divided into 3 categories:
  • Highest Risk
  • High Risk
  • Lower Risk

See Procedure 200 and Procedure 201A for specific requirements.  
 
It is important to note that, just as SAAS has undertaken a risk assessment, some accredited CBs may choose to not deliver services in certain countries due to political instability, human rights violations and/or concerns over managing local clients.  CBs may make such decisions for a number of reasons to protect the credibility of the SA8000 system and safety of their own staff.
 
Worldwide Governance Indicators
Currently, no public institution produces a single national score, index or ranking directly related to labor conditions.  Rankings need to be systematic and consistent and based upon risk factors that have a basis in objective evidence.  SAAS addressed the question of how to rate country risk by ranking countries based upon the Worldwide Governance Indicators (WGI), grouping them in lower risk, higher risk and highest risk categories.  
 
The WGI reports governance indicators, by country, based upon publicly available data sources, NGOs, international organizations, survey institutes and private sector firms.  It takes this data, aggregates it, and provides analysis on a country by country basis.  In this context, these indicators provide information about the institutions and authority within a country, its stability, citizen participation, and the prevalence of corruption.  This tool is useful for broad cross-country comparisons, includes perceptions within a country and provides insights into governance trends that directly affect the elements in the SA8000 system.
 
SAAS coupled the risk ranking with strategies to provide a greater level of assurance as part of the accredited SA8000 certification process and continually increase confidence in the delivery of SA8000 services as well as the certified organization’s ability to meet the requirements in the standard.  CBs will be asked to report back on the impact of implementing these new requirements.
 
The country-specific policies based upon this country risk assessment address the SA8000 process at several levels: 
  • the amount of oversight and activities for the SA8000 client;
  • the amount of oversight and activities by and within the CB structure;
  • the amount of oversight and activities by SAAS over the CB.
 
The WGI rankings are based upon indicators identified below:
 
 WGI Indicator MeasuresRelationship to Labor Compliance (examples)
Voice and AccountabilityExtent to which a country’s citizens are able to participate in selecting their government, as well as freedom of expression, freedom of association, and a free mediaWorkers’ ability to form unions and express concerns about their working conditions 
Political Stability and Absence of ViolencePerceptions of the likelihood that the government will be destabilized or overthrown by unconstitutional or violent means, including domestic violence and terrorismUnrest, protests, riots caused by unmet worker expectations and needs, e.g., minimum wage
Government Effectiveness Quality of public services, the quality of the civil service and the degree of its independence from political pressures, the quality of policy formulation and implementation, and the credibility of the government’s commitment to such policiesExistence of a Department/Ministry of Labor and other relevant institutions that establish and maintain rules regarding working conditions and that provide work-related services
Regulatory Quality Ability of the government to formulate and implement sound policies and regulations that permit and promote private sector developmentPromulgation of labor laws and related business laws
Rule of Law Extent to which agents have confidence in and abide by the rules of society, in particular the quality of contract enforcement, the police, and the courts, as well as the likelihood of crime and violenceEffectiveness of labor laws; ability to seek redress for non-compliance with labor laws
Control of CorruptionExtent to which public power is exercised for private gain, including petty and grand forms of corruption, as well as “capture” of the state by elites and private interestsPrevalence of bribes to government labor inspectors or private social compliance auditors