|
Working Paper
| HBS Working Paper Series
| 2012
Reinforcing Regulatory Regimes: How States, Civil Society, and Codes of Conduct Promote Adherence to Global Labor Standards
by
Michael W. Toffel, Jodi L. Short and Melissa Ouellet
|
Abstract
In response to pressure from various stakeholders, many transnational businesses have developed codes of conduct and monitoring systems to ensure that working conditions in their supply chain factories meet global labor standards. Many observers have questioned whether these codes of conduct have any impact on working conditions or are merely a marketing tool to deflect criticism of valuable global brands. Using a proprietary dataset from one of the world's largest social auditors, containing audit-level data for 31,915 audits of 14,922 establishments in 43 countries on behalf of 689 clients in 33 countries, we conduct one of the first large-scale comparative studies of adherence to labor codes of conduct to determine what combination of institutional conditions promotes compliance with the global labor standards embodied in codes. We find that these private transnational governance tools are most effective when they are embedded in states that have made binding domestic and international legal commitments to protect workers' rights and that have high levels of press freedom and nongovernmental organization activity. Taken together, these findings suggest the importance of multiple, robust, overlapping, and reinforcing governance regimes to meaningful transnational regulation.
Keywords: supply chain management;
governance;
Government and Politics;
legal aspects of business;
Operational Control;
quality;
operations strategy;
outsourcing;
social responsibility;
labor management;
Accounting Audits;
Corporate Accountability;
Governance Compliance;
Governance Controls;
Working Conditions;
Law Enforcement;
Production;
Corporate Social Responsibility and Impact;
Performance Evaluation;
Safety;
Quality;
Nonprofit Organizations;
Non-Governmental Organizations;
Supply Chain;
Supply Chain Management;
Apparel and Accessories Industry;
Electronics Industry;
Manufacturing Industry;
Asia;
Europe;
China;
United States;