I. Concerns over Corporate Conduct II. Alternative Trade Organizations

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The Politics of Corporate Conduct

  1. I. Concerns over Corporate Conduct

  2. II. Alternative Trade Organizations

  3. III. Codes of Conduct

  4. A. Response to Public Pressure

  5. B. Child Labor as Central Issue

  6. C. Compliance & Monitoring

I. Concerns over Corporate Conduct

  1. A. Labor Exploitation Concerns

  2. Use of child & prison labor

  3. Working conditions

  4. Right to organize

  5. Minimal wages & benefits

  6. B. Environmental Concerns

  7. Failure to comply w/ host country standards

  8. Failure to meet home country standards

II. Alternative Trade Organizations

ATOs also known as “fair trade organizations (FTOs)

  1. A. Emerged in the 1960s in Europe & spread to North America in the 1970s

  2. B. Account for $400-500m in annual sales

  3. 1 ten-thousandth of world trade in goods

  4. Most visible in certain foodstuffs & crafts

  5. C. Guiding principles

  6. Provide “fair wage” & good working conditions

  7. Eliminate wholesalers & pass savings onto worker

  8. Pursue environmentally sustainable practices

  9. Attempt to provide worker training & education

III. Codes of Conduct

  1. A. Response to Public Pressure

  2. Consumer boycotts & media exposes in garment & foodstuff sectors

  3. Put pressure on MNCs working through subcontractors abroad

  4. Levi Strauss example:

  5. media coverage of use of Chinese prison labor

  6. Levi Strauss & Co. announces first major voluntary corporate code of conduct in 1991

  7. environmental commitment
  8. no child or prison labor
  9. pledge to partnerships w/ companies operating legally
  10. pledge to operate in countries w/o pervasive human rights and safety problems

III. (cont.)

  1. B. The Child Labor Debate

  2. Child labor became focus of media stories in the North (where its use had waned)

  3. Stories led to public pressure for change

  4. Some questioned the movement:

  5. Would some families survive w/o legal child labor?

  6. If outlawed, would children turn to crime?

  7. What do you think should be done?

  1. C. Compliance & Monitoring

  2. Once a voluntary code is announced, who will ensure compliance?

  3. This is particularly challenging in the garment & foodstuff sectors because of the frequent use of subcontractors and home labor.


  5. Creation of NGOs willing to conduct monitoring

  6. Effort to pressure MNCs to use these third-party monitors

  7. Q: Is this enough?

  8. If not, what else could be done?

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