Codes in Context: How States, Markets, and Civil Society Shape Adherence to Global Labor Standards
Michael W. Toffel
Harvard Business School (HBS) - Technology & Operations Management Unit
Jodi L. Short
University of California Hastings College of the Law
Harvard Business School
May 21, 2014
Harvard Business School Technology & Operations Mgt. Unit Working Paper No. 13-045
UC Hastings Research Paper No. 79
Transnational business regulation is increasingly implemented through private voluntary programs — such as certification regimes, codes of conduct, and social monitoring — that seek to enforce global standards governing business practices. But little is known about the conditions under which companies are more likely to comply with the standards these programs impose. Using data from tens of thousands of code-of-conduct audits, we conduct one of the first large-scale comparative studies to determine which international, domestic, civil society, and market institutions promote supply chain factories’ compliance with the global labor standards embodied in codes of conduct imposed by multinational buyers. We find that supplier factories are more likely to comply when they are embedded in states that are active participants in the International Labour Organization treaty regime and that have highly protective domestic labor regulation and high levels of press freedom. We further demonstrate that supplier factory compliance is associated not only with institutions in the supplier’s home country, but also with institutions in the global buyer’s home country: Suppliers are more compliant with global labor standards when they serve buyers located in countries where consumers are wealthy and socially conscious. Taken together, these findings suggest the importance of overlapping state, civil society, and market governance regimes to meaningful transnational regulation.
Number of Pages in PDF File: 45
Keywords: Transnational regulation, Labor standards, Consumer politics, Codes of conduct, Complianceworking papers series
Date posted: November 21, 2012 ; Last revised: May 24, 2014
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