The Michigan Daily - Tuesday, January 17, 2006 - 5A
The early history of the
Dispute Review Board
By Prof Frank Stafford / Chairman of the Dispute Review Board
eline of the
In the fall of 2004, the University of Michigan
adopted a Vendor Code of Conduct, and thereby
making a commitment to consider a supplier's
environmental, labor and human rights practices
in purchasing decisions. Vendors are required to
comply with the prevailing local, state and national
laws and rules and, for those operating under for-
eign laws, are expected to comply with applicable
foreign laws. The University strives to have busi-
ness relations with vendors in compliance with
the code. Decisions to contract with a vendor are
ultimately the responsibility of the University's
chief financial officer. Much of the code works
through the purchasing department. Purchas-
ing is expected to advise vendors and candi-
date vendors of the code provisions so as to
achieve compliance without formal review.
If such ongoing communication does not
achieve compliance a grievance can be
submitted by a University organization to
the Dispute Review Board.
Just as the Code was adopted, a
complaint was filed on Nov. 30, 2004
by Students Organizing for Labor
and Economic Equality requesting
the University to discontinue busi-
ness with the Coca-Cola Com-
pany. The newly formed DRB
was faced with the challenge of
both forming rules of procedure
and evaluating SOLE's claims.
These claims involved activi-
ties outside of the United States
pertaining to environmental
practices and product safety in
India and labor rights in bottling plants inColombia,
The DRB sought out and received extensive docu-
mentation and claims both from SOLE and from
Coca-Cola. Under the freshly drafted DRB rules,
Purchasing asked Coke to respond to the claims
and consider remedial steps through what may be
called an informal phase one. That turned out to be,
progressing slowly and a phase two began. A full
documentation of the complaint and related issues
was sent to Coca-Cola on March 8, 2005.
After several communications and additional
informal contact by Purchasing, a formal hearing
was scheduled. This took place on campus last
May and lasted about four hours. The DRB heard
from Coca-Cola representatives, SOLE and other
interested campus parties. Following post-hear-
ing deliberations among the DRB members, in the
early summer the DRB sent a recommendation
to University CFO Tim Slottow. This was a rec-
ommendation that, contingent on a series of steps
and a timeline to remedy environmental and labor
practices, the business relation be continued. Over
the fall, the progress toward these milestones was
judged to be lacking, leading to the recent discon-
tinuance recommendation from the CFO to the
University Board of Regents.
What can we take away from this experience so
far? In my view, the broader issue is doing business
with firms based on both the product and the pro-
cess. In the field of economics, we have considered
a purchase to be largely motivated by the buyer's
assessment of the product and price. Process has
been of interest to some buyers, particularly for
consumer goods such as "hydration products," as
they are referred to in the beverage industry. The
advent of vastly greater information access makes
it far easier for those consumers who care about
process to vote with their dollar outlays, assum-
ing there is credible information supplied from a
brochure, advertisement or website. We see this in
the widespread commercial promotion of 'green'
products - defined by process, not by the product
on the store shelf. I feel this is a good thing. Most
economists can easily accept a buyer's willingness
to factor in process.
Under the University's Vendor Code of Con-
duct, we are creating a more collective purchasing
framework - one that includes the full campus
community. Purchasing decisions can affect us
all, whether we agree to them individually or not..
For this reason, and because we are a public entity,
an open forum such as the DRB process can be of
value. Yet most of the substantial DRB work by fac-
ulty (three members), students (two members) and
administration (two members) has been volunteer
time, with informational input from Purchasing.
As the name suggests, only disputed matters should
be forwarded. For the system to work, most of the
code needs to be administered through the daily
activities of the Purchasing Department. In the
Coke matter, the DRB was presented with a great
deal of technical and often conflicting information,
so forming a recommended course of action that
the Board majority could endorse was not simple.
The benefit is in the wider social responsibility
theme of introducing process into buying decisions
of both individuals and organizations.
Stafford is a professor of economics and
chairman of the Dispute Review Board.
Colombian union leader Luis Cardona visits
the University and blames Coca-Cola and U.S.
government aid for the suppression of union activities
and the murder of 165 union leaders in Colombia.
Students Organizing for Labor and Economic
Equality bring the complaints against Coke to
the Dispute Review Board.
The board finds "credible evidence" to support two
of the four charges brought against Coca-Cola.
The board recommends that the University
renew contracts monthly with Coca-Cola while a
third-party auditor conducts a full investigation.
The University announces that Coca-Cola met
the first deadline of the investigation.
The University announces that it will temporarily
suspend its contract with Coca-Cola due to the
company's lack of cooperation with a third-party
review of company's conduct.
An open letter from the Coke coalition
By Adri Miller and Lindsey Rogers / The C alition tCUtthe Contract with Coca-
Since the University upheld its cutting-edge Vendor Code
of Conduct and suspended its contracts with the Coca-Cola
Company, there have been many concerns about the efforts of
the Coalition to Cut the Contract with Coca-Cola: the effect on local
jobs, the effect on Coca-Cola's business practices and international
solidarity, to name a few. We as a Coalition appreciate these concerns
because they are our concerns as well - they are issues we have tried
to address from the very beginning of our campaign, and we would
like to discuss some of them with you now.
Why target Coke? Do not Pepsi and every other multinational
corporation have similar human rights or environmental viola-
The Coke campaign is an international worker solidarity cam-
paign. We take the potential effects on local workers of cutting
contracts very seriously. The requests by workers in Colombia
and activists in India compelled us to support their struggle on
the University campus. We were asked specifically to take on this
campaign against Coca-Cola, and we have continued to direct our
campaign according to the wishes of the workers. We do not pro-
pose to become international police, nor do we endorse Pepsi. We,
as international consumers, have an international responsibility to
the workers who produce the products we consume.
How can Coca-Cola be responsible for the death of union lead-
ers in Colombia? Colombia is plagued by extrajudicial violence
and notorious government corruption-you can not blame their
deaths on Coca-Cola.
An excellent point. This judicial corruption is the exact reason
SINALTRAINAL (the National Association of Food Industry
Workers, the affected Colombian union) brought a lawsuit against
Coca-Cola to the U.S. District Court in Miami. The reality is that
Coke exploits the situation in Colombia. One lawsuit's claims is that
Ariosto Milan Mosquera, plant manager in Carepa, Colombia, made
public announcements that "he had given an order to the paramilitar-
ies to carry out the task of destroying the union." Isidro Gil, one of the
union leaders, was murdered inside the Carepa plant by paramilitaries
two months later. The paramilitaries encountered no resistance when
entering the plant. After Gil was murdered, the union members were
forced at gunpoint to sign union resignations. Coca-Cola has refused
to acknowledge the details of the murder and rejects the testimony of
Cutting the contract won't create change within Coca-Cola's business
practices - it will just hurt local jobs and businesses.
This was a major concern of ours. Just lately we have met with Bill Black,
the legislative and community affairs director and international representa-
tive of the Michigan Teamsters Joint Council No. 43 (the local chapter of
the Teamsters, the union representing Coke, Pepsi, and Faygo workers), who
assured us that as of yet there has not been any effect on Teamsters locally
and that the International Brotherhood of Teamsters supported our efforts.
The Michigan Daily quoted Percy Wells (Life after Coke, 01/12/2006) as
stating that the University purchases 80,000 cases of Coca-Cola products
each year. According to the transcript from the Dispute Review Board trial
on April 25, 2005, the same Mr. Wells stated that "the local bottling com-
panies produce and distribute over 50 million cases of product ... right here
in Michigan in our Flint, Grand Rapids, and Detroit production centers." A
little basic math reveals that University purchasing constitutes a mere .16
percent of statewide Coke consumption.
So if $1.4 million is nothing but chump change to Coca-Cola, how will
this create change?
While the economic blow to Coca-Cola's profits is negligible, the
effects on the company's public image are vast. The University's contract
suspension has received considerable attention from national and inter-
national media outlets. This coverage has brought Coca-Cola's human
rights and environmental violations to mainstream audiences who have
demanded answers from Coca-Cola and given hope to those fighting
in the affected communities. No company can continue disguise such
abhorrent practices amongst such international uproar.
We hope this letter has assured any concerned members of the com-
munity, but if there are any other concerns you wish us to address, please
e-mail them to email@example.com. We would also like to extend
you an invitation to come to the Michigan Theater on Tuesday, Jan. 24
at 5:00 p.m. to see some videos documenting Coca-Cola's violations and
hear Terry Collingsworth, the director of the International Labor Rights
Fund and the lawyer representing SINALTRAINAL in the Miami law-
suit against Coca-Cola, speak about Coca-Cola's culpability. (Admission
Adri Miller and Lindsey Rogers are LSA sophomores
and are writing on behalf of the
Coalition to Cut the Contract with Coca-Cola.
LETTER TO THE EDITOR
Colombian labor leader thanks
students for support
Dear and esteemed companeros in the struggle,
Hear this brotherly greeting from myself and my companeros at
Sindicato Nacional de Trabajadores de la Industria de Alimentos
(National Union of Food Industry Workers) in Colombia. We are
sure that there was no New Year's gift greater or more important
for ourselves than to receive the great news of the results of our
struggle against the multinational Coca-Cola Company and to
learn that your student campus has decided to remove this drink
of murderers. I also want to tell you that in these moments, I want
nothing more than to be at your University to share my joy with
you, because I must confess that I cried with joy and ran to embrace
my daughter out of happiness (when I learned of the decision).
We will carry you in our hearts always, and we admire you for
your giant hearts, full of the struggle for human rights, the rights of
workers and the defense of the environment.
Compaieros, I say goodbye, but I hope to be with you again to
feel this warmth of humanity you all possess. An embrace from all
of SINALTRAINAL and myself. The struggle continues forever,
but we must fight on! Hasta la victoria, companeros!
Luis Adolfo Cardona
Cardona is a former worker at the Coca-Cola bottling plant
in Carepa, Colombia and a SINALTRAINAL member. Car-
dona is currently living under political asylum in Chicago.
I'd like to buy the world a Coke
By Frank Manley / rDily ditoralboar member
W hile I support any reasonable measure
that aims to help people who can't
help themselves, the Coalition to Cut
the Contract with Coca-Cola has gone too far. If
its members did some basic research, attended
the Michigan Student Assembly's Coke meet-
ings or even stopped to think about the conse-
quences of their actions, it would have been
majority of the financial burden will fall directly on
the shoulders of local bottling businesses. In case
you haven't noticed, the current Michigan economy
isn't exactly what you'd call robust. Under these cir-
cumstances, is it worth trashing good, middle-class
Michigan jobs for what even members of the Coke
coalition describe as a "symbolic victory?" I'm sure
the soon-to-be laid off Michigan workers will com-
of our local unskilled labor force. As much
as I'd like to believe that layoffs and a few
empty vending machines thousands of miles
away will coerce other independent bottlers
around the globe to treat their workers better
in areas that don't legally require them to do
so, I sincerely doubt it is going to happen. One
begins to wonder if there might have been a
Progressivism is generally opposed to per-
sonal views, (especially minority personal
views) being institutionally enforced. Why is
it suddenly acceptable to allow a small, vocal
minority to force its views upon the whole
University? If the coalition wants to live in a
self-deluded fairyland, more power to it, but
shouldn't be allowed to dictate the choices