1.Using Carrol’s pyramid of CSR and information from the case study, identify the corporate social responsibilities...

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Finance

1.Using Carrol’s pyramid of CSR and information from the casestudy, identify the corporate social responsibilities of PhilipMorris International in the context of its operations in NorthCarolina. In your view, discuss why these responsibilities areimportant to Philip Morris International?

The US children working in tobacco fields: 'I wanted to help mymama'

Luis is just 14 years old, but he already has an exhausting,dawn-till-dusk job. Last summer, he started working in tobaccofields in North Carolina.

Even though Luis is just a child – too young to buy cigarettes –it is legal for him to work here in the US.

The job pays about $7.25 per hour.

Monday through Saturday last summer, when he was not in school,he rose at 5am, dressed in long sleeves, jeans, boots, gloves, ahat and a plastic poncho, and waited for a van to drive him tofields as far as an hour away. He came home around 7pm. This is atypical schedule for laborers in this tough and dangerous job.

Workers in tobacco are vulnerable to heat sickness, intemperatures which regularly reach 32C (89F); they risk injuriesfrom sharp objects; and, if the Trump administration has its way,children will return to using the most toxic agrochemicals.

Then there is the plant itself. Tobacco naturally containswater-soluble nicotine. This makes morning dew or overnight rain avehicle for huge doses of nicotine. Workers are regularly exposedto six cigarettes’ worth of nicotine per day, one study found. Thiscan result in acute nicotine poisoning, called green tobaccosickness, characterized by nausea, vomiting, headaches anddizziness.

“I wanted to help my mama,” said Luis. He wanted to work, hesaid, “to get school supplies, so she doesn’t have to waste money”.Luis is the son of a cervical cancer survivor. He started to workwhen his mother, a waitress, was too ill to hold a job. (TheGuardian has changed the names of workers and theirfamilies in this report.)

“It’s heavy work, very hard,” said Luis’s mother. But, she said,“there’s no choice”. Children need to help buy “clothes, shoes,their own things, things they need”. She said it would be “betterwhen they were older, but he started because I had cancer ... Hewas helping me as well as my older son.”

In the US, lax laws and an informal economy in which landownersare removed from hiring laborers allow teens to work growing andharvesting tobacco. This contravenes some tobacco companies’ ownpolicies, which often prohibit children from performing hazardouswork.

“There’s a lot of 14-, 15-year-olds working in the fields,” saidAntonio, a 19-year-old who has done so since he was 15, a historyconfirmed by his mother. “They need money or they want to work,”Antonio said.

Altria, parent company of Philip Morris USA, which producesMarlboro cigarettes, said growers were “prohibited from hiringthose less than 16 years of age, and may only assign hazardousduties to workers 18 and older. Both are above the legalrequirements. We require parental consent for those under 18working in tobacco farming.”

The company also said it reviewed all growers every three years.In 2017, it found only one case of child labor, in which a farmerhired two 15-year-olds.

“While the individuals were no longer employed by the grower,the contract requirements were reviewed with the grower tostrengthen their understanding of the minimum age requirement,” thecompany said. The company also said it had hired third-partyassessors to monitor labor conditions.

Miguel Coleta, director of sustainability for Philip MorrisInternational, said the company had been “making progress intackling complex labor issues on farms supplying to PMI and ourstandards exceed US in many areas”.

“Challenges remain, and PMI continues to work with Verité andthe Farm Labor Practices Group on systemic issues associated withchild labor, grievance mechanisms to protect workers’ rights and toachieve meaningful improvements on the ground,” said Coleta.

In 2015, PMI adopted a new leaf-buying model in the US, and itnow buys through the third-party leaf buyers Alliance OneInternational Inc and Universal Leaf North America. At the time,Human Rights Watch said the move would improve labor conditions onUS farms.

The Guardian interviewed several teens, parents, andlabor organizers for this story. They described a picture in whichchild labor was commonplace. However, many said they depended ontheir children’s income to make ends meet. Many of thoseinterviewed also work in other crops, including picking cucumbers,peppers or other vegetables.

“It’s the fact that we have to do it, because there is noalternative,” said Laticia Savala, a labor organizer with the FarmLabor Organizing Committee (Floc) in North Carolina. Floc does notsupport outlawing child labor in fields, because organizers feel itwould harm families who depend on children’s income. However,needing the money does not lessen the harm.

“What mom wouldn’t want their kids studying [rather] thanworking in the fields?” asked Savala. “You’re forced into doingsomething.” If labor conditions on farms “were better, probablychild labor wouldn’t exist”.

The world’s largest tobacco-producing countries span the globe.They include Brazil, China, India, Indonesia, Malawi, Pakistan andthe United States.

Together, North Carolina and Kentucky produce 70% of the 700mpounds of tobacco grown in the US each year. Only 0.04% of USfarmland grows tobacco, but the United States is still aninternational juggernaut, the fourth-largest producer in theworld.

North Carolina is just one part of a global supply chain thatfeeds cigarette makers with tobacco leaf. However, the value oftobacco farming is dwarfed by the value of the global tobaccoproducts. Tobacco farming was worth $19.1bn in 2013. Once leaf ismanufactured, marketed and branded, tobacco products were worth$783bn the same year.

North Carolina’s farmers employ mostly Latin American workers,who toil in fields owned by white, ageing farmers. The US does notgrant agricultural workers collective bargaining rights and workersare sometimes undocumented. Workers are vulnerable to wage theft,exploitation and dangerous working conditions.

Because children work in an informal economy, there is no dataon how many might work in fields in summer months, or even whenthey should be in school. A 2014 report by Human Rights Watch (HRW)was the first in recent memory to ignite debate about child laborin tobacco in the US. The advocacy group followed up the report in2015, and found little had fundamentally changed in fields.

“If you appear younger than 16, they’ll ask,” said 19-year-oldJohn about children working on the fields. “But otherwise, no,”they don’t ask. Many contractors, one mother said, encouragedchildren to lie about their age.

Attempts have been made to regulate tobacco growing in the past.In 2012, the Obama administration attempted to make it illegal forchildren younger than 16 to work in tobacco. But the Department ofLabor backed down after Republicans falsely argued the measurewould prevent children from working on family farms.

At the state level, as recently as 2017, the Democratic Virginiadelegate Alfonso Lopez tried to introduce a bill to bar child laboron tobacco farms. He was blocked by Republicans.

“If this was your kid, would you be OK with having them work inthis job?” Lopez asked at the time as the bill was shelved. “Wouldyou? I don’t think you would. So why is it OK for kids you don’tknow to do this job?”

When criticism of child labor on US farms reached its peak in2014, Philip Morris International hired a company to audit itssupply chain. It found children working in hazardous conditions on16% of the US farms it visited.

However, auditors concluded: “The root cause of many laborrelated issues in the US is the lack of sustainable, reliableworkforce exacerbated by poor US immigration policies.”

The US has signed an international human rights convention meantto protect children “from economic exploitation” and work likely“to be harmful to the child’s health or physical, mental,spiritual, moral or social development”. To that end, it encouragestrading partners to meet these standards, and publishes an annualreport on the “worst forms of child labor” around the world.

One country singled out in the report was Malawi, visited by theGuardian earlier this year as part of an investigation, wherechildren “continue to engage in the worst forms of child labor,including in the harvesting of tobacco”, the most recent report bythe US Bureau of International Labor Affairs said.

The tobacco industry, through its Eliminating Child Labor inTobacco Growing Foundation, agrees “in principle” children shouldbe prohibited from hazardous work, “particularly the use ofmachinery and agrochemicals by children in tobacco farming”.

The Trump administration, meanwhile, is hoping to furtherderegulate farm labor. Rules put into place after the 2014 HRWreport are being rolled back by the US Environmental ProtectionAgency, which is examining whether children should again be allowedto work with dangerous pesticides on farms.

“I’ve worked in the field as well; it’s very difficult. For ayoung person it’s worse,” said Antonio’s mother, a 37-year-old withthree sons who works behind the counter of a rural conveniencestore. Teens often prefer farm work to other work, she said,“because they’re given jobs despite their age”.

Dominance of American tobacco has waned in recent decades, asthe tobacco supply chain has globalized. This and the deregulationof US tobacco price controls has encouraged consolidation. Where in1978 there were 188,000 tobacco farms, today there are around4,200.

“A lot of times they’re underage and they lie and say they’re 16or 17, but they’re actually 13 or 14 years [old],” Antonio’s mothersaid. “It’s hard, but there aren’t any more options.” She saidclaims that child labor was not happening on tobacco farms were “alie”.

• The names of workers and their families have been changed

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The Carrolls pyramid for CSR is one of the simplest frame workto help organization to achieve its CSR The pyramid structurestart with profit economic related activities at the    See Answer
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