Statement on Ali Enterprises

On September 11, 2012 a fire occurred in a textile plant owned by Ali Enterprises in Baldia Town, Karachi, Pakistan.

Situation Summary
In August 2012, RINA conducted a two-stage audit of the Ali Enterprises premises according to SA8000, a voluntary standard for auditable third-party verification, that encourages organizations to develop a management system ensuring socially acceptable practices in the workplace. The audit was satisfactory. When RINA conducted the audit, the company was compliant with the SA8000 standard. Evidence collected following the fire would suggest that at the time of the fire the situation at Ali Enterprises was no longer in compliance with the SA8000 standard, as assessed by RINA two months prior to the incident.

RINA Services’ role and features of the SA8000 certification
Prior to the fire, Ali Enterprises held a SA8000 certificate for the plant in Baldia Town that had been issued by RINA Services. To award the SA8000 certification, RINA is accredited by SAAS (Social Accountability Accreditation Services), which refers to SAI (Social Accountability International), a non-profit organisation that represents the main stakeholders of the SA8000 system. The certification of the management system is based on periodic audits and sample verifications.
Pictures taken after the fire, together with a reconstruction carried out by RINA, also in the light of some information made available by the press after the event, show a substantial difference between the conditions at the time of the fire when compared with the conditions at the time of audit, which occurred about two months prior.

Immediate facts and consequences
After the event, RINA conducted an internal review together with the accreditation body, SAAS. RINA still holds its accreditation and continues its certification business in several countries, with the exclusion of Pakistan, having considered that there isn’t adequate context in that country to carry out the activity effectively.

Authorities inquiries
The fire at the Ali Enterprises has been the subject of investigations by the Authorities in Pakistan and presently.
Documents, including the audit report, cannot be released for legal reasons.

The fire of Ali Enterprises has been and is the subject of investigations by the Authorities in Pakistan and currently a trial, regarding the responsibility of the tragedy, in which Rina has never been involved in any way, not even at a preliminary stage, is underway.

With reference to the conclusion of the conciliation attempt promoted by the National Contact Point (NCP):

• RINA has no responsibility whatsoever for the fire that occurred at the Ali Enterprises plant in 2012, nor has it ever been even involved in the numerous investigations conducted in Pakistan into this tragic event.
• Notwithstanding this and despite not being required to do so, the company has chosen to participate in a voluntary conciliation attempt promoted by the Italian National Contact Point (NCP) of the OECD, considering it important to establish, albeit in a context of open and direct dialogue, a constructive productive relationship with the stakeholders and subjects linked to the event, including NGOs, and in the belief of performing a useful bridging function with the world of social accountability to which it belongs.
• The conciliation procedure as agreed by all parties, excludes any specific assessment as to the cause of the event. During this procedure
• RINA has acted with full transparency, a fact recognized by the conciliator and has consistently offered assistance to the local community (such as the financing of scholarships or educational institutions) as a "humanitarian gesture", without any discharging advantage. This offer has been made in good faith to support progress and social development, in line with the RINA Group's objectives.
• The company has also engaged in further encouraging and promoting the strengthening of certification schemes relating to social accountability, to the organizations that support their application.
• Despite the procedure didn’t bring to an agreement between the parties, RINA believes that it has fulfilled the purposes and behavioural criteria required by it and intends to respond positively to the request from the Conciliator not to disperse the results of the dialogue undertaken.
• With this in mind, the activity aimed at making the certification schemes for social accountability management models effective and transparent continues, while initiatives have already been launched to support education and professional training in local communities through humanitarian organizations that have been operating in Pakistan for many years.
• RINA, as on every previous occasion, and also in the context of conciliation, once again expresses its solidarity and closeness to all