Can Corporate Social Responsibility Improve Labor Standards?

by Henry Farrell on April 29, 2013 · 1 comment

in International Political Economy,Political Economy

The disaster in Bangladesh has led to much heated discussion in the blogosphere and elsewhere about how best to improve labor and safety standards for workers in the developing world. Can corporate social responsibility help do this? Richard M. Locke, who has conducted extensive research on this question, thinks not. From his article in the new Boston Review:

have these private efforts improved labor standards? Not by much. Despite many good faith efforts over the past fifteen years, private regulation has had limited impact. Child labor, hazardous working conditions, excessive hours, and poor wages continue to plague many workplaces in the developing world, creating scandal and embarrassment for the global companies that source from these factories and farms. …
I began studying Nike because I was impressed with its commitment to labor standards. After several years of effort, with many conversations and visits to corporate headquarters, I convinced the company to share its factory audit reports and facilitate visits to its suppliers. Eventually my case study evolved into a full-fledged research project involving the collection, coding, and analysis of thousands of factory audit reports; more than 700 interviews with company managers, factory directors, NGO representatives, and government labor inspectors; and field research in 120 factories in fourteen different countries. What began as a study of one company (Nike) in a particular industry (athletic footwear) grew to include several global corporations competing in different industries, with different supply chain dynamics, operating across numerous national boundaries. …
… Today, lead firms are coordinating the production of thousands of independent suppliers located for the most part in developing countries. … In the absence of an enforceable system of global justice, private, voluntary regulation became the dominant approach, promoted by labor rights NGOs and global corporations alike. … Given all that Nike invested in staff, time, and resources, one might expect that conditions at their supplier factories improved significantly. But while some factories appear to have been substantially or fully compliant with Nike’s code of conduct, others have suffered from persistent problems with wages, work hours, and employee health and safety.

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