Troubling reports on exploitation in the workplace and the use of sweatshops or child labour in developing country supply chains for western consumer goods are unfortunately commonplace. They are perhaps most prevalent in connection with the textile and garment industry, but also relate to the footwear sector, electronics, toys, stone cutting (where children as young as six years old are employed in sandstone quarries), but also increasingly in fruit, flower and vegetable production for export. Low-wage export activities associated with violations of labour standards have of course been spurred by the shift from inward- to outward-oriented development strategies, which often lead to precarious, short-term, informal, flexible and seasonal employment that is more likely to be poorly paid.
Of particular concern is the extensive use of children in labour-intensive industries. According to the United Nations Children's Fund (UNICEF), 69 million children are engaged in child labour in Sub-Saharan Africa, 44 million in South Asia. India apparently is the country with the highest number of child workers in the world.
Big high-street names have been associated with flagrant breaches of ethical labour standards. Often the excuse for this ever having been allowed to happen or to continue to occur is that the purchasing company doesn’t hire people directly but works through middlemen, or contract hirers. But professing ignorance about what is happening behind the scenes in the supply chain is not a valid excuse; in this day and age, it is common knowledge what goes on.
Well-publicized abuses of human rights in global value chains particularly in the garments, footwear and toys industries have led some big companies to address the problem in their supply chains by establishing company codes or helping to develop industry-wide codes and multi-stakeholder initiatives that, in addition to standard setting, involve reporting on implementation and independent evaluation.
Putting ethics at the heart of business as a company policy emerged quite a few years ago: linking ethical performance with profits was hard-headed business logic. In their desire to be considered socially and ethically responsible, companies have promised inquiries into abuses, elimination of wage violations and excessive overtime, a halt to the hiring of children, and so on. Partly in response to “naming and shaming” activities by civil society groups, the business sector, particularly in Europe and the USA, now claims to exercise greater corporate social responsibility as a business strategy. For businesses with a reputation and substantial intangible capital to protect in the form of well-known brand-names, corporate social responsibility efforts are seen as necessary. Having said this, however, professing corporate social responsibility is unfortunately sometimes just one more component of a public relations exercise, a publicity campaign in which the company is seen to be doing the right thing.
Nevertheless, public outrage and ethical shopping can go a long way towards prompting real change and many companies actually are taking appropriate action when they come across non-compliance with labour laws and are working with suppliers to end deplorable conditions. In addition, there are a growing number of organizations that monitor labour standards abuses worldwide and even provide country-specific labour standards reports with the aim of building awareness of responsible decision-making along the supply chain and throughout distribution networks.
Often it is the very nature of the industry itself that shares the blame for abuses in the supply chain. In the fashion world, for instance, with changes in styles from one season to the next and decisions taken at the last minute, everything is a rush job, long work hours are required and increasing demands are placed on suppliers, but if they want to keep their contracts they do whatever it takes to provide the goods. Fresh produce is another sector in which speed is all important and extremely short-term supply contracts are rife.
Big supermarket chains are another culprit in labour law violations; certain supermarket buying practices are harmful in that they limit the scope for improving labour standards lower down the chain. The fierce global competition in the production of non-branded goods and the concentration at the retail end means that an ever smaller number of supermarket chains gain ever-growing leverage in setting prices and in exerting “just-in-time” pressure.
From the developed country perspective, where social welfare safety nets are widespread, labour rights violations that underpin the ability to produce goods cheaply are considered unfair competition in trade, as well as being reprehensible from the human point of view. It is a complex issue and it is difficult to avoid judgemental opinions, but in countries where no such safety nets are available, low-paid, informal workers sometimes prefer that to no income at all. Some consider this attitude to be justifiable as long this type of employment eventually leads to upward mobility; but if it doesn’t, then workers who wittingly accept jobs that violate their rights are in fact collaborating in prolonging the status quo with no better prospects to look forward to. There is no easy solution.