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Telenor Is Still Shifting Ethical Responsibility on to Grameenphone

Telenor is letting Grameenphone decide the fate of one of the contractors that Telenor is now rejecting after the Bangladesh scandal. "This is a business decision, but it is not a matter of principle. We can resume the dialogue, but the decision rests with Grameenphone," Pål Kvalheim, Vice President Communications at Telenor, told Norwatch.
Artikkelen er mer enn to år gammel. Ting kan ha endret seg.
Telenor is letting Grameenphone decide the fate of one of the contractors that Telenor is now rejecting after the Bangladesh scandal. "This is a business decision, but it is not a matter of principle. We can resume the dialogue, but the decision rests with Grameenphone," Pål Kvalheim, Vice President Communications at Telenor, told Norwatch.

(First published in Norwegian 23 May 2008)

By Pia A. Gaarder
Norwatch

Whether or not 500 persons at Mizan Hatim Engineering will lose their jobs will now be decided by the same company that for 11 years has neither reacted to nor warned the parent company of the terrible working conditions at the subcontractors in Bangladesh.

Telenor is in fact giving Grameenphone the responsibility to decide whether the rejection of Mizan Hatim is an ethically correct way to tackle the situation that has arisen after the exposure of the dangerous and unlawful working conditions at the suppliers of antenna towers and base stations in Bangladesh. 

Mizan Hatim is the only one of the five subcontractors in Bangladesh to be discarded in the wake of the scandal. Telenor has previously informed Norwatch that the reason for the breach with Mizan Hatim is not that the conditions in this company are worse than in other places but that the company during the past month is supposed not to have shown willingness to improve conditions at the factory. A month of possible reluctance is not compensated for by 11 years of contribution to the development of Grameenphone and Telenor’s cell-phone empire in Bangladesh.

Not True
Yesterday the management of Mizan Hatim strongly denied to Norwatch that it is correct that they resist improving the conditions at the factory. They also claim that they have made many improvements since Tom Heinemann filmed inside the factory 7 months ago.

"It is not true that we resist introducing improvements in the factory. Just consider this: We have worked with Grameenphone (GP) during the past 11 years, and from 70% to 75% of our production capacity goes to GP," Ali Asgar, the general manager, wrote in an e-mail to Norwatch.

He pointed out that over the years Mizan Hatim has specialised its production and introduced constantly more advanced products to comply with Grameenphone’s demands.

"Originally we invested half a million dollars in the factory, but now we have invested a total of $2.8 million to be able to improve our quality and service for Grameenphone. This shows that we wish to increase our business connections with GP. We consider ourselves one of GP’s family members. How could we say, then, that we will not comply with and follow their terms," Asgar asked, adding that 500 people now risk losing their jobs and that the factory is in a desperate situation.

Returning the Ball to Grameenphone
Telenor won’t discuss or go into detail about why precisely Mizan Hatim Engineering was rejected as supplier of antenna towers to Grameenphone.

"I won’t make any further comments on this matter now. There is in principle nothing to prevent us from resuming the dialogue with Mizan Hatim at a later date. But that decision and that dialogue lie with Grameenphone," Vice President Communications Kvalheim told Norwatch.

"It is very unusual that a subcontractor absolutely refuses to comply with his most important customer’s demands. As I understand it, there had been a conflict between Grameenphone and Mizan Hatim with regard to a competitive tendering right before this scandal. It is therefore possible that there are other reasons behind the exclusion of this company alone. Shouldn’t Telenor examine this case more closely?"

"I won’t give any further details about the decision at this time, nor about the dialogue with the subcontractors. When we say that we have not been satisfied with the response, then we won’t go into detail about the business relations. Mizan Hatim has its contacts at Grameenphone. I can only relate to the business decision that Grameenphone has made. But, as I said, the decision we made is not a matter of principle, and we can resume the dialogue if it becomes apparent that we can implement improvements and collaborate with this contractor too," Kvalheim said.    

"That implies that it is Grameenphone alone that has made the decision to break off with Mizan Hatim?"

"Yes. Grameenphone has had the dialogue with all these contractors lately," Kvalhein told Norwatch.

Facts
Telenor and its 62%-owned subsidiary Grameenphone constitute the largest supplier of mobile phone services in Bangladesh and have an estimated market share of 46% in the first quarter of 2008.

The documentary "A Tower of Promises" has revealed grave child labour, environmental offences, and a series of serious breaches of elementary safety regulations at Telenor and Ericsson’s suppliers of antenna towers in Bangladesh. The film was made by Danish journalist Tom Heinemann and co-produced by Erling Borgen.

Grameenphone made use of five subcontractors in Bangladesh that produce mobile phone towers and base stations. These are as follows:

  • Mizan Hatim Engineering Co. Ltd., Gazipur, Dhaka
  • Confidence Steel Limited, Nayapur, Barabo, Sonargaon, Narayanganj
  • Concrete & Steel Technologies Ltd., Dhaka
  • Brothers Fabrication Engineering Ltd., Dhaka
  • Mak International, Chittagong