56 Pages Posted: 20 Oct 2008 Last revised: 6 Feb 2011
Date Written: October 3, 2008
Private, voluntary compliance programs, promoted by global corporations and non-governmental organizations alike, have produced only modest and uneven improvements in working conditions and labor rights in most global supply chains. Through a detailed study of a major global apparel company and its suppliers, this paper argues that this compliance model rests upon misguided theoretical and empirical assumptions concerning the power of multinational corporations in global supply chains; the role information (derived from factory audits) plays in shaping the behavior of key actors (i.e., global brands, transnational activist networks, suppliers, purchasing agents, etc.) in these production networks; and the appropriate incentives required to change behavior and promote improvements in labor standards in these emergent centers of global production. We argue that it is precisely these faulty assumptions and the way they have come to shape various labor compliance initiatives throughout the world - even more than a lack of commitment, resources, or transparency by global brands and their suppliers to these programs - that explains why this compliance-focused model of private voluntary regulation has not succeeded. In contrast, this paper documents that a more commitment-oriented approach to improving labor standards co-exists, and in many of the same factories, complements the traditional compliance model. This commitment-oriented approach, based upon joint problem solving, information exchange, and the diffusion of best-practices, is often obscured by the debates over traditional compliance programs but it exists in myriad factories throughout the world and has led to sustained improvements in working conditions and labor rights at these workplaces.
Keywords: codes of conduct, labor standards, globalization
Suggested Citation: Suggested Citation
Locke, Richard M. and Amengual, Matthew and Mangla, Akshay, Virtue Out of Necessity?: Compliance, Commitment and the Improvement of Labor Conditions in Global Supply Chains (October 3, 2008). MIT Sloan Research Paper No. 4719-08. Available at SSRN: https://ssrn.com/abstract=1286142 or http://dx.doi.org/10.2139/ssrn.1286142