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Corporate Social Responsibility in Global Value Chains: Where Are We Now and Where Are We Going?



We outline the drivers, main features, and conceptual underpinnings of the compliance paradigm. We then use a similar structure to investigate the drivers, main features, and conceptual underpinnings of the cooperative paradigm for working with CSR in global value chains. We argue that the measures proposed in the new cooperation paradigm are unlikely to alter power relationships in global value chains and bring about sustained improvements in workers’ conditions in developing country export industries. After that, we provide a critical appraisal of the potential and limits of the cooperative paradigm, we summarize our findings, and we outline avenues for research: purchasing practices and labor standard noncompliance, CSR capacity building among local suppliers, and improved CSR monitoring by local resources in the developing world.
Corporate Social Responsibility in Global Value Chains: Where
Are We Now and Where Are We Going?
Peter Lund-Thomsen Adam Lindgreen
Received: 28 June 2013 / Accepted: 2 July 2013 / Published online: 10 July 2013
Springer Science+Business Media Dordrecht 2013
Abstract We outline the drivers, main features, and
conceptual underpinnings of the compliance paradigm. We
then use a similar structure to investigate the drivers, main
features, and conceptual underpinnings of the cooperative
paradigm for working with CSR in global value chains. We
argue that the measures proposed in the new cooperation
paradigm are unlikely to alter power relationships in global
value chains and bring about sustained improvements in
workers’ conditions in developing country export indus-
tries. After that, we provide a critical appraisal of the
potential and limits of the cooperative paradigm, we
summarize our findings, and we outline avenues for
research: purchasing practices and labor standard non-
compliance, CSR capacity building among local suppliers,
and improved CSR monitoring by local resources in the
developing world.
Keywords Compliance paradigm Cooperative
paradigm Corporate social responsibility
Global value chains
On Sept 11, 2012, more than 300 workers died in a fire in
the Ali garment factory in the commercial hub of Karachi,
Pakistan. Workers were burned alive, succumbed to smoke
inhalation, or died after trying to jump from the top floors
of the factory building to escape the fire. Many of the
windows and exit doors had been blocked by factory
managers, preventing workers from escaping the blaze
(Walsh and Greenhouse 2012). Shortly before the fire
broke out, the factory complex also had been certified with
a SA8000 label—a seal of legitimacy for factories that
comply with international labor standards (AFL-CIO
2013). In Nov 2012, another 112 workers died in a factory
fire in Dhaka, the capital of Bangladesh, when they found
themselves trapped on the upper floors of a factory and the
fire spread from the bottom to the top floors. This factory
supplied Wal-Mart and Sears, both of which (along with
other international retailers) claimed they had not been
aware that their products were being produced in the Dhaka
factory, despite the extensive social and environmental
auditing programs they had in place for their suppliers
(Yardley 2012).
Such recent events, including the massive collapse of
Bangladesh’s Rana Plaza factory in May 2013 that killed
more than 1,100 workers, have sparked renewed concerns
about the lack of national labor regulations and the inad-
equacy of existing private social auditing schemes that seek
to ensure a basic level of safety and decent work conditions
for laborers in export-oriented industries located in devel-
oping countries (Locke 2013). In this article, we seek to
advance the debate over private social auditing schemes in
global value chains. We trace the development of social
auditing back to the early 1990s, when international
retailers and supermarkets came under public scrutiny for
P. Lund-Thomsen
Center for Corporate Social Responsibility, Copenhagen
Business School, Porcelænshaven 18A, 2000 Frederiksberg,
A. Lindgreen (&)
Cardiff Business School, Cardiff University, Aberconway
Building, Colum Drive, Cardiff CF10 3EU, UK
J Bus Ethics (2014) 123:11–22
DOI 10.1007/s10551-013-1796-x
their sourcing practices, after revelations that workers in
developing countries were laboring under highly exploit-
ative conditions. Private social auditing—also known as
the compliance model—emerged in response to these
criticisms. However, during the 2000s and early 2010s,
impact assessments of corporate codes of conducts have
shown that social auditing schemes (or corporate codes of
conduct) at best have brought about limited improvements
in workers’ conditions, especially in developing country
export industries. A broad-based coalition of leading
international retailers, private consultants, academics, and
nongovernmental organizations (NGOs) thus has started
advocating a new cooperative policy paradigm for insti-
tuting corporate social responsibility (CSR) in global value
For the purposes of this article, we use Blowfield and
Frynas’ (2005, p. 503) definition of CSR, ‘‘an umbrella
term for a variety of theories and practices all of which
recognize the following: (a) that companies have a
responsibility for their impact on society and the natural
environment, sometimes beyond legal compliance and the
liability of individuals; (b) that companies have a respon-
sibility for the behavior of others with whom they do
business (e.g., within supply chains); and (c) that business
needs to manage its relationship with wider society, whe-
ther for reasons of commercial viability or to add value to
This article is not the first to review criticisms of com-
pliance-based models (e.g., AFL-CIO 2013; De Neve
2009; Locke et al. 2007,2009; Locke and Romis 2007;
Lund-Thomsen 2008; Ruwanpura and Wrigley 2011) but it
is the first, to the best of our knowledge, to assess critically
the potential of and limits to an alternative model, namely,
the cooperation paradigm for working with CSR in global
value chains. We argue that the measures proposed by this
paradigm are unlikely to alter power relationships in global
value chains fundamentally. Despite the good intentions of
its advocates, it cannot deliver sustained improvements in
working conditions across developing country export
industries, according to our analysis. Drawing on a critical
review of the cooperation paradigm, we conclude by sug-
gesting other avenues for research on CSR in global value
Compliance-Based Paradigm
Since the fall of the Berlin Wall in 1989, capitalism has
dominated economic activity across the globe (Khara and
Lund-Thomsen 2012). In the 1980s and 1990s, privatiza-
tion of state-owned enterprises, deregulation of national
economies, and liberalization of international trade com-
bined to create an environment in which it was highly
attractive for multinational companies to conduct business
in developing countries (Utting 2005). The arrival of new
communication technologies such as the Internet and the
facsimile, reduced costs for international air travel, and
better transportation infrastructure also made it possible for
international retailers and supermarkets to source products
from countries in Asia, Africa, and Latin America (Haufler
2001). These countries promised abundant labor supplies,
necessary skills and manufacturing capabilities, and much
lower wages, such that international buyers reduced their
cost structures through extensive outsourcing (Tokatli et al.
However, the rise of global value chains, through which
Western retailers and supermarkets controlled vast net-
works of suppliers dispersed throughout the world, also
raised substantial concerns about the social and environ-
mental conditions in which the goods and services were
being manufactured (Seidman 2007). Campaigns initiated
by NGOs, trade unions, student organizations, and the
media highlighted the use of child and slave labor, as well
as the existence of sweatshops that produced items destined
for Western markets (Klein 2000). Initially, the campaigns
largely focused on reforming international policy actors,
such as the World Trade Organization (Locke 2013). As it
became increasingly clear that efforts to introduce uni-
versal minimum labor and environmental standards would
not succeed, due to resistance by developing country
governments (AFL-CIO 2013), labor rights and environ-
mental activists turned their attention to campaigning
against Western retailers and supermarkets (Bair and Pal-
paceur 2012). These campaigns prompted what we call the
‘compliance-based model’’ for working with CSR in glo-
bal value chains (Locke et al. 2009).
Main Features
The compliance-based model assumes that NGOs, trade
unions, and the media could bring sufficient pressure on
international supermarkets and retailers, whether with
naming and shaming campaigns in the public media or by
mobilizing consumer boycotts of corporations that failed to
ensure safe, hygienic work conditions in their supplier
factories in developing countries (Locke et al. 2009). Such
pressure then should force international companies to
develop corporate codes of conduct or ethical guidelines,
stipulating the social and environmental conditions in
which their products and services were to be produced in
developing countries. Compliance with these guidelines
could be checked through social and environmental audits
undertaken by first-, second-, or third-party monitors to
confirm compliance with international buyers’ codes of
12 P. Lund-Thomsen, A. Lindgreen
conduct (O’Rourke 2003,2006). In theory, factories that
displayed a high level of compliance with a buyer’s code of
conduct would be rewarded with longer term trading
relationships and more orders. Factories that did not
attempt to comply with codes of conduct instead would
have their orders reduced or even be completely excluded
from global supply chains (AFL-CIO 2013). Our emphasis
on ‘‘in theory’’ is deliberate. In practice, we find limited
evidence that international buyers systematically cut ties
with factories in response to their low social or environ-
mental compliance levels. Nor is there evidence to suggest
that suppliers that display high levels of social and envi-
ronmental compliance receive rewards in the form of more
orders (Ruwanpura and Wrigley 2011).
This description of the compliance-based model is ide-
alized; in reality, various formulations and implementa-
tions have emerged across different geographical contexts.
As Hughes et al. (2007) observe, some companies and
multistakeholder initiatives have focused less strictly on
auditing than others. For example, the UK-based ethical
trading initiative and some of its NGO and company
members adopt more aspirational, developmentally ori-
ented approaches, with a focus on long-term improvements
in labor conditions in global value chains. Multistakeholder
initiatives and corporations in the United States instead
tend to adopt a more short-term, compliance-oriented
approach. Nevertheless, in both the United States and
Europe, widespread agreement admits that the compliance-
based model has brought about limited improvements in
work conditions in developing country export industries
(AFL-CIO 2013; Locke 2013; Locke et al. 2007,2009;
Lund-Thomsen et al. 2012; Ruwanpura 2012).
Throughout the 2000s and into the early 2010s, impact
assessment studies showed that codes of conduct improved
tangible work conditions, such as the payment of minimum
wages, occupational health and safety, and the reduction of
overtime work (Barrientos and Smith 2007; Egels-Zande
forthcoming; ETI 2006). Although not directly framed as a
impact assessment study, a recent article by Raj-Reichert
(2013) indicates that it may not be clear whether measures
used in the implementation of corporate codes of conduct
(such as indicators, benchmarks, and audits) have any
effect on the health and safety of workers.
But codes of conduct had little effect on less tangible
issues, such as freedom of association and the right to
collective bargaining (Barrientos and Smith 2007; McIn-
tyre 2008; Oxfam 2013). In some cases, it was unclear
whether improvements in work conditions resulted from
code implementations or other factors, such as a predis-
position among supplier managers to treat the workforce
well, or broader environmental factors, such as changes in
national legislation (Nelson et al. 2007). Such studies also
noted inherent problems with this compliance model. First,
discrepancies often arose between the commercial prac-
tices of international buyers (e.g., demand for lower prices,
seasonal products, completion of orders within a short time
span) and their insistence on compliance with their codes
of conduct (Barrientos 2013). To meet price points, sup-
pliers could not pay their workers the minimum wage; to
address seasonal demand, they could not provide stable
employment year round; and they often were compelled to
make workers engage in overtime work to meet last-minute
orders (or changes) (Oxfam 2004; Ruwanpura and Wrigley
2011; Tokatli et al. 2008). The incoherence between
international buyers’ purchasing practices and their codes
of conduct even became institutionalized in their separate
purchasing and CSR departments (Harney 2008). These
distinct departments would visit supplier factories at dif-
ferent times and make contradictory demands, such that the
purchasing department might require price cuts a week
before the CSR compliance staff insisted on higher wages
for workers in supplier factories (Khara and Lund-Thom-
sen 2012; Ruwanpura and Wrigley 2011).
Second, this lack of consistency across buyers’ pur-
chasing and social auditing practices pushed some local
suppliers to engage in auditing fraud—a practice that
became particularly widespread in China (Egels-Zande
forthcoming; Oxfam 2013). These suppliers trained work-
ers to provide ‘‘correct’’ answers to auditors and used tai-
lored computer programs to falsify worker records. Thus,
they met the commercial requirements of international
buyers while maintaining the appearance of compliance
with corporate codes of conduct (Harney 2008). When
third-party monitors discovered such auditing fraud, they
often lacked sufficient incentives to ‘‘rock the boat’’ by
demanding significant changes in work conditions, from
either buyers or suppliers. These monitors usually were
commercial auditing firms, so their continued business
depended on maintaining good relations with either buyers
or suppliers—that is, the clients that paid for the audits to
take place. Thus, doubts arose regarding whether the rarely
publicized third-party audits could really generate credible
evidence about work conditions inside supplier factories
(O’Rourke 2003,2006). Even more recently, dangerous
factory conditions that have caused the deaths of hundreds
or thousands of garment workers raised serious concerns
about the validity of social auditing, considering that the
Karachi-based factory and some of the buildings in Rana
Plaza had been certified as compliant with international
standards shortly before the deadly incidents (AFL-CIO
2013; Clean Clothes Campaign/SOMO 2013).
Conceptual Underpinnings
Many assumptions inherent to the compliance paradigm are
reminiscent of those in the global value chain framework. For
Corporate Social Responsibility in Global Value Chains 13
example, Gereffi (1994) proposes that ‘‘lead firms,’’ such as
European and North American supermarkets and retailers,
drive global value chains. Their role is to ‘‘govern’’ the global
value chain,by determining what kinds of products/services to
produce, in which quantity, when, where, and at what price,
using dispersed networks of suppliers across the developing
world. According to this perspective, suppliers are generally
‘powerless,’’ with few or limited options for influencing the
governance of the chain by the lead firms. Gereffi et al. (2005)
add nuance to this view by proposing a theory to explain the
nature of value chain relationships among international buyers
and their first-tier suppliers in the developing world. These
relationships can range from arm’s-length, market-based
relationships (buyers have full control over suppliers) to
hierarchies (buyers own suppliers). In between, modular or
relational value chains might be characterized by more equal
power relationships between buyers and suppliers.
The compliance-based paradigm similarly assumed that
lead firms had the power to dictate and control how products
were produced by supplier factories in the developing world.
This assumption further indicated that international super-
markets and retailers could control both working and envi-
ronmental conditions in export-oriented industries. Although
this compliance-based paradigm avoided the assumption that
all lead firms owned their suppliers (hierarchy), power rela-
tionships in the chain were regarded as highly unequal, with
first-tier suppliers held ‘‘captive’’ to the social and environ-
mental requirements of buyers.
Gereffi’s (1994) original conceptualization of global
value chain analysis mentions the role of institutional
contexts, as part of the global value chain framework.
However, this element remained generally underdeveloped
until relatively recently, when authors began elaborating on
the institutional part of the framework (Neilson and Prit-
chard 2009,2010). In this view, the functioning of global
value chains can be understood only in relation to vertical
and horizontal dimensions. The vertical dimension refers to
the question of who determines the kinds of products that
are to be purchased, when, and at what price in global value
chains (Gibbon and Ponte 2005). The horizontal dimension
instead entails local socio-economic contexts of work and
employment affected by global value chains. These local
institutional contexts include both formal rules of the
game, such as economic, social, and environmental laws,
and the enforcement agencies charged with implementing
such laws (De Neve, forthcoming).
Institutions also refer to the informal rules of the game
or norms and values that various actors hold in relation to
what constitutes global value governance (Neilson and
Pritchard 2010). For example, there may be sharply con-
trasting ideas about ‘‘local’’ and ‘‘global’’ perceptions of
whether child labor should be allowed. International
NGOs, trade unions, supermarkets, and retailers often insist
on prohibitions of child labor; domestic producers may
take the view that child labor constitutes a form of job
training for children that will enable them to earn a live-
lihood, particularly if formal schooling options are either
nonexistent or of very poor quality (Lund-Thomsen 2008).
As Neilson and Pritchard (2009) argue, the interaction of
global value chains and local institutional contexts thus
creates struggles over which norms and values should
guide export-oriented production in developing countries.
The compliance-based paradigm focused primarily on
vertical relations (i.e., trading relationship between inter-
national buyers and their suppliers). It has not paid much
explicit attention to how horizontal relations (i.e., local
socio-economic and socio-cultural contexts of employment
in which global value chains are embedded) affect social
and environmental compliance levels in developing coun-
try export industries. Drawing on Hess (2004), we assert
that the compliance-based paradigm tends to ignore the
societal embeddedness of global value chain participants
(i.e., actors’ origins and the influences on their actions
without or outside of their societies of origin), as well as
their territorial embeddedness (i.e., extent to which indi-
vidual actors are anchored in places that facilitate or con-
strain their actions). Instead, the main focus has been on
how the value chain could improve social and environ-
mental conditions in developing country export industries.
Implicitly at least, the compliance-based approach seems to
have been developed as a response to territorial embedd-
edness. For example, NGOs and trade unions started
campaigning against international lead firms after they
realized that many developing country governments were
failing to safeguard workers’ rights and control environ-
mental pollution levels (Locke 2013). Thus, they turned to
multinational companies to control the social and envi-
ronmental side effects of outsourcing production to sup-
pliers in developing countries (AFL-CIO 2013). At the
same time, there was perhaps an implicit recognition of the
need to ensure the societal embeddedness of corporate
codes of conduct. Multinational companies designed codes
of conduct to ensure that local suppliers abided by their
national laws, such as those dictating how old a person had
to be before she or he could be legally employed in a
company. These codes of conduct deferred to national
laws, even if they also stipulated tougher requirements than
those ensconced in national laws (Kolk and Tulder 2004).
Cooperation Paradigm
In light of these limitations of the compliance-based par-
adigm, a broad-based coalition of actors began pushing for
14 P. Lund-Thomsen, A. Lindgreen
the adoption of what we call a more cooperative policy
paradigm to working with CSR in global value chains
(Lund-Thomsen et al. 2012). First, academic researchers
have actively cooperated with large multinational compa-
nies to research the limitations of the compliance-based
paradigm and document alternative ways that international
brands might cooperate with suppliers to achieve sustained
improvements in work conditions (Locke 2013; Locke
et al. 2007,2009; Locke and Romis 2007).
Second, multistakeholder initiatives, such as the UK
Ethical Trading Initiative (ETI), Dutch Sustainable Trade
Initiative, Danish Ethical Trade Initiative, and Norwegian
Sustainable Trade Initiative cooperate across members to
find ‘‘development-oriented’’ approaches for improving
ethical trade (DIEH 2013). To some extent, their work has
been informed by results from prior impact studies of codes
of conduct (e.g., ETI 2006). These initiatives continue
‘learning by doing,’’ developing and trying new approa-
ches through projects and working groups, with the aim of
establishing best practices for ethical trade. The constant
search for new and improved methods of improving CSR
in global value chains thus is compatible with the organi-
zational mandates of these initiatives. Various NGOs
similarly have participated in broad-based coalitions of
actors, pushing for a more cooperative approach to working
with CSR in global value chains (IDH 2009). Oxfam-UK
asserts that business can serve an important function for
poverty reduction in developing countries (Clay 2005), so
it supports the development of various reports and briefings
that document the impact of businesses on society but also
how companies—and multinationals in particular—con-
tribute to improving these impacts (Oxfam 2013). In 2010,
Oxfam-UK published a briefing, ‘‘Better Jobs in Better
Supply Chains,’’ to document how improved labor stan-
dards in developing country factories might help boost
sales and improve staff recruitment and retention.
Third, private-sector consultants have pioneered a new,
cooperation-based approach to CSR in global value chains.
For example, the London-based consultancy IMPACTT
describes itself as ‘‘leading consultancy company in the
area of ethical trade, human rights, labor rights, and
international development’’ (IMPACTT 2013). In its 2011
report, it detailed how international brands and supermar-
kets have tried to persuade and instruct suppliers to comply
with national labor laws and international labor standards
but also why their efforts have made little difference for the
conditions of workers at the bottom of global value chains.
This report contains several case studies that highlight
ways for international brands, suppliers, and workers to
identify the ‘‘sweet spot’’ at which their interests intersect.
Thus, international brands and suppliers could compete in
‘an increasingly uncertain world by harnessing the power
of the workforces to produce better products more
efficiently’’ (IMPACTT 2011). In short, various actors—
including international buyers, academics with an interest
in CSR in global value chains, consultancy companies, and
NGOs—have pushed for the adoption of a new paradigm to
working with CSR in global value chains.
Main Features
In a somewhat stylized fashion, we can identify the main
characteristics of the new cooperative paradigm to working
with CSR in global value chains. First, international buyers
need to review their purchasing practices and provide
better prices to their suppliers so that the latter can afford to
pay workers higher wages. These buyers also might
introduce better production planning, to provide business to
suppliers throughout the year and avoid last-minute orders
(Barrientos 2013). Maintaining long-term trading rela-
tionships with suppliers, instead of shopping around for the
cheapest deal, thus becomes crucial for securing better
work conditions at the bottom of global value chains
(Oxfam 2010). In addition, coordination between pur-
chasing and CSR departments could enhance the consis-
tency of the demands that these buyers place on suppliers
(IDH 2009).
Second, instead of expecting suppliers to shoulder all of
the costs of compliance with codes of conduct, buyers
might invest in capacity development, for both local sup-
plier managers and workers employed in the factories
(Oxfam 2010). Local factory managers should receive
training in human resources management, product quality,
and production processes. Instead of seeing workers as a
costly input factor, local factory managers need to be
trained to understand them as an important company
resource (Nike 2010). Improving worker–management
relations also could help reduce the high turnover rates at
supplier factories (IMPACTT 2011). By involving workers
more actively in decision-making processes while pro-
moting teamwork and fault-finding on factory floors, such
tactics could increase productivity (Locke et al. 2009).
Moreover, some recommendations include offering work-
ers training in their basic rights and responsibilities in the
workplace. Then traditional code implementation and
auditing could provide top–down pressures on manufac-
turers to improve conditions, while workers aware of their
rights apply a simultaneous bottom–up pressure to receive
safe working conditions (Lund-Thomsen and Coe 2013).
However, a prerequisite for these initiatives was closer
cooperation and frequent interactions between the sourcing
and CSR personnel of international brands and local fac-
tory management. Without such interactions, it would not
be possible to secure the simultaneous objectives of
enhancing factory competitiveness and work conditions
(Locke and Romis 2007).
Corporate Social Responsibility in Global Value Chains 15
Third, considering the poor track record of mainstream
social auditing methods, a new range of policy measures
has aimed to transform standard-setting and auditing in
global value chains. With participatory social auditing,
auditors would need to be knowledgeable of the local
contexts and able communicate in the native languages of
workers (Auret and Barrientos 2004). These auditors then
could move beyond a tick-box approach and short fly in–fly
out visits, which rarely revealed fundamental violations.
Instead, they would have opportunities to be creative, such
as leaving their own contact information with workers, who
then could call after the visit if they wanted to convey
something outside the usual working hours (Harney 2008).
Some companies started experimenting with off-site visits
to interview workers in their homes, where they might feel
less pressured to provide particular answers to an auditor’s
questions. Moreover, cooperation between corporations
and local resources, such as NGOs and trade unions, would
enable closer, more independent, year-round monitoring of
work conditions (Oxfam 2010). Working with such local
resources provided a means to discover unauthorized out-
sourcing of production to local subcontractors, which
otherwise would be difficult to discover through normal
snapshot audits.
Conceptual Underpinnings
In conceptual terms, the shift to the cooperation-based
paradigm marks a change in the nature of value chain
governance between international buyers and first-tier
suppliers. With its emphasis on long-term, trust-based
relationships and close collaboration between international
buyers and suppliers, this paradigm mirrors relational value
chains, which are characterized by high degrees of mutual
dependency in the design, production, and marketing of
products/services between buyers and suppliers. Similarly,
the cooperation paradigm envisages close collaboration by
buyers and first-tier suppliers related to issues such as the
introduction of new production techniques or the reorga-
nization of work processes on the factory floor.
The original global value chain approach considered
how local suppliers could improve their position in global
value chains, with the aim of extracting greater financial
benefits from their participation in the global economy
(Schmitz 1999,2006). The global value chain approach
assumed local suppliers could learn from their interactions
with global buyers, such as how to improve their products
(product upgrading) and production processes (process
upgrading). In addition, by learning production skills dur-
ing interactions with global buyers in one industry, sup-
pliers might transfer these skills and become more
competitive in other industries (intersectoral upgrading)
(Humphrey and Schmitz 2002; Schmitz and Nadvi 1999).
Yet for suppliers to move up the value chain, they also
would have to adopt higher level functions, such as
designing and branding their own products (functional
upgrading). A consensus emerged that lead firms likely
would bar suppliers’ functional upgrading, because this
step would encroach on their own core competence and
turn the suppliers into competitors or new lead firms
(Schmitz 2006). The compliance-based paradigm basically
ignored the potential benefits that developing country
suppliers might obtain from engaging in social and envi-
ronmental upgrades to their factories. Instead, they became
the ‘‘culprits’’ who failed to address social and environ-
mental concerns, whereas more powerful, international
buyers would develop codes of conduct and enforce them
In contrast, the cooperation-based paradigm places more
emphasis on creating opportunities for product and process
upgrading. It emphasizes the business case for social
compliance, such that building suppliers’ human resources
management and production organization capabilities
enhance worker productivity and ensure consistent manu-
facturing of high quality products (IMPACTT 2011). Such
cooperation also implies a commitment to social upgrad-
ing, including increasing the quality and conditions of work
by training of workers about their legal rights and the
relevant codes of conduct (Lund-Thomsen and Coe 2013).
This stylized account of the cooperation paradigm does not
place much emphasis on local institutional contexts, par-
ticularly the territorial embeddedness of global value
chains, but some early signs suggest that this issue is
gaining in importance. For example, the ETI (2012)
recently announced that its future work would focus on a
limited number of value chains (food and farming, hard
goods and household, and apparel/textiles), instead of
concentrating on thematic issues such as child labor or
homework per se (though work continues on these issues).
Therefore, the ETI can concentrate on mapping workers’
rights violations in specific value chains that entail distinct
societal contexts (e.g., southern India). According to this
initiative (ETI 2012, p. 3), ‘‘Addressing workers’ issues in
the context in which they occur will enable us to develop
models for wider change that are rooted in reality.’’
This new approach seems to fit well with insights gained
in research highlighting the importance of a good under-
standing of how CSR becomes embedded in national
institutional contexts, in both developed and developing
countries (Jamali and Neville 2011; Matten and Moon
2008). Institutional perspectives on CSR focus on
explaining how and why CSR differs across national or
institutional contexts (Brammer et al. 2012; Gond et al.
2011), as well as the potential role of CSR as a global
homogenizing force. In this sense, Western conceptions of
CSR might spread across the globe as various organizations
16 P. Lund-Thomsen, A. Lindgreen
(and private companies in particular) seek to achieve
legitimacy with external stakeholders and respond to
mimetic, coercive, and normative pressures (Jamali and
Neville 2011). This search for legitimacy informs the new
cooperation-based paradigm, with its focus on international
buyers cooperating with local resources, such as NGOs and
trade unions that theoretically can provide independent,
year-round monitoring of work and environmental condi-
tions at local supplier factory sites. These local resources
should provide insights into local work conditions at the
bottom of global value chains. From this perspective, the
cooperation-based paradigm encompasses a global pro-
duction networks approach (Henderson et al. 2002). In the
global production networks approach, the starting point is
the network metaphor, which appears better able to capture
global economic organizations than a chain metaphor (Coe
et al. 2008).
In practice, lead firms cannot govern their value chains
completely. Instead, the governance of global production
networks is ‘‘spread out,’’ and diverse actors, such as
international organizations, national governments, NGOs,
trade unions, business associations, workers, and commu-
nities, help determine which products to produce, when,
where, in what quantities, and at what price (Henderson
et al. 2002). The emphasis in the global production net-
works approach includes all relevant actors in the pro-
duction network, not just the direct relationship between
international buyers and first-tier suppliers, to understand
how such networks are governed (Coe et al. 2004). This
line of thinking is reflected in the cooperation-based par-
adigm, in which the effective monitoring of work and
environmental conditions at supplier factories cannot be
limited to lead firms and suppliers. A wider set of actors is
necessary to govern the value chain effectively, including
local, place-based NGOs, and trade unions with the nec-
essary expertise to assist lead firms in monitoring work
conditions in export-oriented industries in developing
The New Cooperation Paradigm: A Critical Assessment
Can this new paradigm for CSR in global value chains
deliver sustained improvements in workers’ conditions, as
its many advocates hope and believe? We briefly examine
some of the main tensions that exist for the new paradigm.
First, just how widespread is the new cooperation-based
paradigm for working with CSR in global value chains? In
other words, is this new paradigm being taken up by
international retailers and supermarkets, or is it mostly an
ideal, preached rather than practiced in global value
chains? Despite the dearth of research into the actual
practices of the new cooperation paradigm, there are
several reasons to question just how widespread it is at the
moment. Locke et al. (2009) document the cooperation
between Nike and some of its suppliers in Central America
and Asia, which brought about improvements in workers’
conditions. Barrientos (2013) and Lund-Thomsen and Coe
(2013) also detail how international brands, NGOs, and
trade unions have sought to collaborate on issues such as
improving purchasing practices and year-round capacity
building. However, Barrientos (2013) also notes that
international buyers resist the adoption of responsible
practices, and Lund-Thomsen and Coe (2013) describe
how the global financial crisis and stakeholder politics
partly undermined Nike’s attempts to link better supplier
incentives, factory management training, and awareness-
raising activities among the workers employed at a Paki-
stani supplier. These important examples suggest how the
new cooperation paradigm may work in practice, but we
find little evidence to suggest that international brands have
fundamentally revised their purchasing practices, engaged
in long-term capacity building with suppliers, or cooper-
ated with local NGOs and trade unions to train workers and
undertake constant factory monitoring. Both Barrientos
(2013) and Lund-Thomsen and Coe (2013) instead offer
examples of how the measures advocated by the coopera-
tion paradigm might fail. Moreover, Locke et al.’s (2009)
examples do not necessarily reflect the general approach
Nike takes to working with its suppliers. The rhetoric
surrounding cooperation sounds valid, but it is difficult to
imagine how vast corporations such as Nike can realisti-
cally engage in close cooperation with more than 800 first-
tier suppliers. Collaboration might be feasible with a few
selected suppliers, engaged in pilot projects; it appears
nearly impossible to replicate such close cooperation
across hundreds of suppliers, considering just the logistical
challenges. Instead, traditional forms of compliance mon-
itoring likely will continue to offer the dominant approach
to working with CSR in global value chains, supplemented
with occasional pilot projects that seek to develop func-
tional alternatives.
Second, the cooperation-based paradigm emphasizes
long-term relationships and investments in capacity build-
ing, but few ‘‘Southern’’ voices have taken part in defining
this new paradigm. Rather, it appears advocated mainly by
international brands, Northern-based consultants, academ-
ics, and NGOs. The voices of developing country suppliers,
workers, and communities have remained largely silent.
This is hardly a new critique of CSR approaches that
originate in Europe and North America (Blowfield and
Frynas 2005; Prieto-Carron et al. 2006), but the absence of
Southern voices in advocating this change to working with
CSR in global value chains can reinforce existing
inequalities in global value chain governance. The new
cooperation paradigm thus appears to do little to change the
Corporate Social Responsibility in Global Value Chains 17
basic status quo, in which only certain actors (i.e., inter-
national retailers) dictate the terms of their trade with local
suppliers. From this perspective, the cooperation paradigm
can do little to alter suppliers’ perceptions that CSR in
global value chains is a form of economic and cultural
imperialism (Khan and Lund-Thomsen 2011). In economic
terms, some actors demand that workers be hired as per-
manent, full-time employees and paid compensation after
layoffs, but if they cannot guarantee sufficient work
throughout the year—or at least not in the same quantity—
it becomes financially impossible for local suppliers to
keep a permanent workforce employed at factories (Lund-
Thomsen 2008). These same corporations often insist that
local suppliers pay the costs associated with upgrading
factories; that is, they demand improvements but are not
willing to share the costs of achieving them (Ruwanpura
and Wrigley 2011). In cultural terms, the norms and values
underlying CSR rhetoric often represent impositions on
developing country suppliers that operate in diverse con-
texts (Nadvi 2008), distinct from those that determine the
norms of Western Europe or North America. For example,
whereas child labor is a social evil in Western views of the
world, it offers a means of informal education and family
support in some areas of South Asia (Khan 2007). This
‘education’’ not only helps support the family but also
enables children to learn a profession that will sustain them
later in life. In contexts characterized by desperate poverty
and unavailable schooling, child labor may be part of
broader livelihood strategies, used to stay alive (Khan
2007; Ruwanpura and Roncolata 2006).
Another question pertains to whether the cooperation-
based approach even is feasible in the context of wider
capitalist competition. For example, international con-
sumers seemingly dictate the price and quality require-
ments for particular goods and services (Gibbon and Ponte
2005). International corporations respond to these con-
sumer demands by designing products with matching price
and quality ranges. Then they place orders reflecting the
quantity, quality, and price ranges demanded by consum-
ers, across vast networks of suppliers in developing coun-
tries that engage in fierce competition to attract and sustain
this business (Gereffi 1994). In response to supply chain
pressures, local suppliers structure networks of contractors,
contractors, and workers to obtain the required inputs at the
lowest possible price. In this competitive context, there is
very little scope for cooperation, beyond the limits set by
international consumer markets that demand simulta-
neously constant price decreases, shorter lead times, and
maintenance of product quality (Khara and Lund-Thomsen
2012; Tokatli et al. 2008). Even were improved coopera-
tion between buyers and suppliers to arise, nothing in the
new paradigm ensures a revised sharing of the benefits
across the value chain participants. As Kaplinsky (2000)
illustrates, securing effective returns on value chain par-
ticipation depends on the kinds of rents that value chain
participants can obtain. Economic rents may be attained
through differential productivity (among enterprises or
workers) and the erection of barriers to entry (Kaplinsky
2005). To the extent that international buyers still com-
mand the most rents in the value chain, through their
control of the design, branding, market, and distribution of
consumer products and services, shifting to a cooperation
paradigm is unlikely to increase supplier incomes sub-
stantially enough to sustain improvements in work condi-
tions and living standards. That is, the cooperation
paradigm does not fundamentally challenge the inequality
inherent in global value chains. Drawing on Lund-Thom-
sen (2008), if a local worker is paid 60 cents for stitching a
football in Pakistan, the management of the local supplier
might be paid 5 dollars for selling that ball to an interna-
tional brand, before it is sold in an outlet store in Europe or
North America at a price of US$100. In other words,
international retailers continue to capture most of the value
from global value chain participation; suppliers and
workers in developing countries obtain marginal shares of
the overall value generated. Nor does the new paradigm do
anything to alter the basic system of ‘‘sweating’’ (Miller
2012). Garment manufacturing had already taken on a
pyramid shape in the early twentieth century in the United
States and Germany: At the top sat so-called jobbers that
had developed their own designs (and sometimes manu-
facturing capabilities). They increasingly used production
mediators (‘‘sweaters’’) that could ‘‘extract[] the most
labourat the lowest possible price from manufacturing
units with the most vulnerable workers that could be
found’’ (Miller 2012, p. 1). In reference to Blackburn
(2007), Miller argues that this system works in contexts
marked by an oversupply of labor and no union organiza-
tion, varying or seasonal demand, and a lack of proper
management. The discourse in the cooperation paradigm
aims to address root causes of poor working conditions at
the bottom of global value chains, but it does little, if
anything, to change the pyramid-shaped, unequal,
exploitative (global) production system. Perhaps the
strongest critique of the cooperation paradigm is that it fails
to grant workers sufficient agency in governing the global
value chains. An emerging body of literature notes local
workers in export-oriented industries, who prefer not to
work in CSR-compliant factories (De Neve 2009; Lund-
Thomsen 2013). The main point is to show the diversity of
lived experiences among workers engaged in export-ori-
ented manufacturing, particularly in South Asia. Workers
are not a uniform input factor; they are living, sentient
beings with great diversity in their sex, age, family, eco-
nomic, cultural, and caste backgrounds. Such diversity
influences their preferences to opt into or out of different
18 P. Lund-Thomsen, A. Lindgreen
work practices and places. Carswell and De Neve (2013)
demonstrate that young, unmarried, female migrant work-
ers appear content working in formalized, export-oriented
factories in Tiruppur, Tamil Nadu, India, because this type
of work helps them maximize their earnings and savings,
which will help them later in their lives. Once these
workers marry, they often are expected to adopt primary
child rearing and domestic household responsibilities, such
that full-time factory-based work in the city may no longer
be feasible for them. Instead, home-based work likely
offers a more appealing option, enabling them to earn some
income, even if relatively meager, while balancing their
domestic duties with income-generating means (see also
Lund-Thomsen 2013).
With this article, we have argued that leading retailers,
consultants, NGOs, and academics recognize the limita-
tions of traditional compliance-based models of working
with CSR in global value chains. With this model, inter-
national NGOs, trade unions, student organizations, and the
media pressured multinational companies to adopt volun-
tary social and environmental guidelines for the perfor-
mance of their supplier factories in developing countries. In
theory (but rarely in practice), this approach would reward
CSR-compliant factories and punish those that did not
comply. In practice, the compliance model induced rela-
tively modest improvements in work conditions for labor-
ers in export-oriented industries in developing countries.
Therefore, a coalition of academics, consultants, leading
retailers, and NGOs has advocated a new, cooperation-
based paradigm to rectify the shortcomings of the com-
pliance-based paradigm. In the new paradigm, international
buyers revise their purchasing practices, help build the
capacity of local factory management and workers, and
cooperate with local resources (e.g., NGOs, trade unions)
to improve factory monitoring and thus labor standard
By critically assessing the potential and limitations of
this new paradigm, we argue that it is unlikely to alter the
power relations of international buyers, suppliers, and
workers in global value chains. In particular, the new
paradigm seems unable to secure significantly higher
incomes or improved conditions for workers, considering
the constraints imposed by worldwide competition among
suppliers. International markets instead appear likely to
remain volatile, ever-changing, and demanding, such that
suppliers realistically cannot undertake significant
upgrades in the conditions of employment for workers
without the threat that corporations will relocate their
production to other capable, cheaper (and less compliant)
suppliers elsewhere in the developing world. Furthermore,
the verdict is still out, regarding whether this cooperative
paradigm will receive wider recognition and uptake among
international brands. Several themes could guide important
investigations into the effects of this new paradigm,
including (a) the link between buyer purchasing practices
and labor standard (non)compliance in developing country
factories, (b) efforts to develop the capacity of local sup-
plier management in the area of human resources man-
agement, and (c) cooperation between international buyers
and local resources.
Purchasing Practices and Labor Standard
Multiple NGO reports and academic articles have pointed
to the potentially adverse consequences of corporate pur-
chasing practices on labor standard compliance in devel-
oping country factories (Barrientos and Smith 2007; Oxfam
2004; Traidcraft 2006), yet the topic lacks sufficient
insights from CSR research in global value chains (cf.
Barrientos 2013). Further investigations of the new CSR
paradigm should fill this gap by linking the hitherto
unconnected literature streams related to supply chain/
operations management and labor standards/codes of con-
duct in global value chains. In the former, the focus has
been mainly on how to optimize processes for sourcing
products from domestic or overseas suppliers and pay the
lowest possible price for the best possible product, deliv-
ered in the shortest possible time frame. Labor research in
global value chains instead has addressed how workers
(a) benefit from participation in global value chains, (b) are
affected by corporations’ ethical guidelines and economic
upgrading or downgrading processes by local supplier
firms, and (c) actively exert their agency to influence their
work conditions (Barrientos et al. 2011; Nadvi 2004; Ri-
isgaard 2009; Riisgaard and Hammer 2011). Investigations
of the effects of the new cooperative paradigm on CSR in
global value chains thus could help build a bridge between
operations and supply chain management studies and
research into labor standards in global value chains by
theorizing and empirically investigating how corporate
purchasing practices affect labor standard compliance
levels, whether positively or negatively, in developing
country export industries.
Another research focus could detail the performance
systems in which purchasing managers operate, to deter-
mine how different policies reward and/or punish decision
making that integrates economic, social, and environmental
criteria in purchasing practices. Such investigations would
require more in-depth analyses or interviews with pur-
chasing managers and personnel regarding pricing, lead
times, product quality, the use of particular production
Corporate Social Responsibility in Global Value Chains 19
technologies, and management systems. An important
theme in this direction might consider how purchasing
managers deal with the multiple sustainability dilemmas
they face when executing purchasing/sourcing/CSR activ-
ities. Researchers would need to ask when and why
‘classical’’ purchasing practices seem compatible or con-
flict with social and environmental sustainability criteria.
Research attention also might address resolutions to the
sustainability dilemma, including the strategies that pur-
chasing managers already employ when they face multiple
requirements. For example, what decision-making pro-
cesses do managers adopt when they must choose between
responding to price pressures by buyers or devoting
resources to improving their social/environmental perfor-
mance? On the other side, how do buyers decide whether to
shop around for the cheapest possible bargain or else
engage in long-term cooperation with their suppliers?
CSR Capacity Building Among Local Suppliers
Research into the effects of the new cooperative paradigm
on CSR should investigate whether pilot projects that have
attempted to improve human resources management
capacity at local supplier factories have been successful.
The new cooperation paradigm predicts that improved
human resources management leads to greater labor stan-
dard compliance (IMPACTT 2011). Theoretically, this
assumption is reminiscent of Grimshaw and Rubery’s
(2005) mutual gains approach, according to which the
formal employment relationship provides guarantees to
workers (e.g., formal contracts, limits to overtime work,
health insurance), in return for workers’ cooperation, such
that both parties gain. That is, employers gain access to a
skilled and committed workforce, turnover declines, and
productivity increases, while workers enjoy stable work,
income, and productive employment. Empirically, the
question is whether such an approach is feasible or realistic
in competitive international environments marked by
declining piece rates, shorter lead times, increasing quality
demands, and demands for buyers and suppliers to main-
tain flexibility to respond quickly to changing market needs
(Tokatli et al. 2008).
We thus call for studies that empirically investigate
whether attempts at building suppliers’ capacity, such as in
human resources management, really improve relations
between management and workers, despite the broader
competitive pressures that global value chain participation
entails. Research attention also should consider how power
relationships in the value chain affect possibilities for
sustaining upgrades. For example, there may be differences
in the ways large retailers and small or medium-sized
importers engage in capacity building. For large retailers
with hundreds or thousands of suppliers, long-term
capacity building measures may be infeasible beyond a few
select suppliers, chosen specifically for this benefit. Smal-
ler importers with fewer suppliers instead may be better
positioned to engage in long-term cooperation, such that a
mutual gains approach could be more applicable. If small-
and medium-sized importers depend on single suppliers in
relational chains, their incentives to invest in long-term
CSR upgrading efforts at local factories in the developing
world likely are greater.
Improved CSR Monitoring by Local Resources
The third part of a research agenda related to the new
cooperation paradigm should consider the use of local
resources that act as the eyes and ears of international
retailers and supermarkets on the ground, offering year-
round monitoring of work conditions in supplier factories
(Oxfam 2010). Similar to the issue with capacity building,
this theme has important implications for power relations.
According to the cooperation paradigm, local resources
might extend the power of international retailers and
supermarkets to control social and environmental condi-
tions in supplier factories—but at a price. For example,
local NGOs risk becoming financially dependent on inter-
national corporations, creating questions about their ability
to assess work conditions independently (Baur and Schmitz
2012). Such cooperation with international firms also cre-
ates the risk that the more radical advocacy agendas of
NGOs might get toned down, in favor of maintaining
cooperative relationships (Newell 2001).
Similarly, local trade unions would confront challenges
were they to engage in year-round monitoring of work
conditions in local export industries. Traditionally, unions
have cited freedom of association and the right to collec-
tive bargaining as the most important labor rights and the
best means to facilitate improved working conditions in
factory-based work settings. Without the right to organize
collectively and negotiate for improved work conditions,
real changes in compliance with labor standards may be
unlikely (AFL-CIO 2013). From this point of view, serving
as a local resource that monitors work conditions at local
supplier factories for international corporations might
dilute the very raison d’etre of trade unions. Instead of
taking a seat at the table and engaging in collective bar-
gaining, unions might suddenly find themselves part of the
private regulatory efforts of Western companies, whose
standards have been determined unilaterally. Further
investigations of the new cooperation paradigm for CSR in
global value chains thus should attend carefully to both the
possibilities and the challenges that such forms of coop-
eration present, not only for international firms but also for
the freedom and independence of local NGOs and trade
20 P. Lund-Thomsen, A. Lindgreen
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22 P. Lund-Thomsen, A. Lindgreen
... However, such volatile purchasing practices represent a violation of relationship procedural justice and can create unstable operations and manufacturing environment for the suppliers that can adversely affect working conditions and labour rights. To make the most of a given order from brands and retailers (due to unstable orders) and to meet their tight delivery deadlines, suppliers may speed up production and simultaneously process multiple production orders to a scale that is considerably above the normal physical and phycological capacity of the workers to handle (Awaysheh and Klassen, 2010;Lund-Thomsen and Lindgreen, 2014;Yu, 2008;. Moreover, suppliers may use the piece-work pay system under which workers are paid only a fixed piece rate (no other benefits) for each unit produced given the unstable order volumes (Anner, 2019). ...
... However, while one could argue that the compliance and collaboration practices can predict supplier's internal social performance and, therefore, leaving them out from the model may lead to an endogeneity problem, this predication ability has been recently theoretically and empirically questioned. From a theoretical perspective, the compliance and collaboration practices were designed based on the assumption that poor supplier's internal social performance is factory technical problem of the supplier, and therefore they overlook one of its main root causes, buyer's unfair practices (Alghababsheh et al., 2020;Anner et al., 2013;Lund-Thomsen and Lindgreen, 2014). For this reason, the majority of the empirical research demonstrated that the compliance practices have no effect on supplier's internal social performance (e.g., Alghababsheh and Gallear, 2021;Jiang, 2009;Sancha et al., 2016;Lim and Phillips, 2008;Yu, 2008). ...
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The absence of an effective public model (e.g., government regulations and law enforcement) in developing countries has driven clothing brands and retailers to rely on a private voluntary formal model (e.g., compliance and collaboration approaches) to manage suppliers' internal social issues (e.g., poor working conditions). However, this model has been recently criticised for falling short in addressing these issues as it overlooks their main root causes. In this study, we suggest that suppliers' internal social issues can be driven by buyers' unfair practices, and therefore, we propose and examine that buyers' justice can ensure suppliers' internal social performance. We further postulate and investigate that addressing these issues would result in advantages for buyers beyond traditional performance outcomes in the form of reduced supply operational risk. Based on a census of the 117 suppliers comprising the ready-made garment industry in a Middle Eastern country (Jordan), we received survey responses from 97 suppliers and their shop floor workers. The analysis revealed that only buyer’s distributive and procedural justice, but not interactional justice, are positively related to suppliers' internal social performance. We also found evidence that improving suppliers' internal social performance can diminish supply operational risk. This study contributes to the extant research by empirically investigating a new approach to handle the increase in suppliers' internal social issues in a developing country context. It also does by capturing suppliers' internal social performance from the workers' perspective and highlighting the role of improved suppliers' internal social performance on mitigating supply operational risk.
... The third-party collaborates with the code of conduct as it shares the norms, wage laws and health and safety issues with the ST that must be followed by the agents in the chain (Egels-Zand en, 2014). Moreover, depending on the location of the suppliers, there is alignment between legislation (as in China, for example) and alignment between all agents (Lund- Thomsen and Lindgreen, 2014). The thirdparty also collaborates with the monitoring mechanism (Zimmer et al., 2016) as it has easier access to ST and credibility to monitor the activities performed (Cai and Yang, 2009;Kannan, 2021) and identify the possible risks existing in ST suppliers, collaborating to build compliance by FC (Zhao et al., 2011). ...
... The cooperation is aligned with the code of conduct established by FC, where it offers assistance to FT suppliers (Inemek and Matthyssens, 2013) as a way of disseminating the (Wilhelm et al., 2016) also to ST suppliers, aligning norms of conduct for all agents in the chain (Villena and Dhanorkar, 2020). Suppliers that show high levels of engagement with the code of conduct (Nath et al., 2020) are rewarded with more long-term negotiations (Lund-Thomsen and Lindgreen, 2014;Chicksand, 2015;Howard et al., 2019). Cooperation also appears associated with monitoring, when FC offers technical support (Roseira et al., 2010) to FT, in raw material handling activities (Talluri and Sarkis, 2002) and this contributes to greater trust between FC and suppliers (Wang and Jap, 2017;Zhao et al., 2021) and greater interaction among them. ...
Purpose To do this, the authors carried out a systematic literature review to answer three questions: (RQ1) Which external pressures affect an FC and its suppliers in an MSC? (RQ2) What influences power relationships between an FC and its suppliers for MSC compliance? and (RQ3) Which governance mechanisms support an FC to achieve compliance for managing its MSC? Design/methodology/approach This research aims to identify how external pressures affect chain agents to achieve compliance and implement governance mechanisms and analyzes the influence of the power relationship between FC and their suppliers. Findings The results identify how external pressures from different stakeholders act on FC and FT and ST suppliers. A combination of contractual governance mechanisms (auditing, certification, assessment, code of conduct and monitoring) with relational ones (third-party, cooperation) is identified, facilitating compliance between agents. Furthermore, different power relationships (power position, level of resources and institutional distance) that influence the implementation of governance mechanisms are explored. Research limitations/implications This article comprised only a systematic literature review and content analysis. Carrying out empirical research, covering the theme of this article, is the next step, which is being completed and will be discussed in due course in another publication. Practical implications The results can help professionals of the FC to understand their role in multi-tier supply chain (MSC), the external pressures exerted and the governance mechanisms that can be implemented to achieve compliance. Originality/value This article develops three relevant issues constantly addressed in MSC, which have not yet been combined to understand the management of multi-tier suppliers.
... Environmental sustainability is increasingly central in scholarly discussions of GVCs and the related international business (IB) domain (De Marchi et al., 2020;Golgeci et al., 2021;Lund-Thomsen & Lindgreen, 2014). Much of this literature has focused on the impact of governance mechanisms of global "lead firms" in driving a cascade of sustainability practices along the GVC (Alexander, 2020;De Marchi et al., 2013;Lund-Thomsen & Lindgreen, 2014). ...
... Environmental sustainability is increasingly central in scholarly discussions of GVCs and the related international business (IB) domain (De Marchi et al., 2020;Golgeci et al., 2021;Lund-Thomsen & Lindgreen, 2014). Much of this literature has focused on the impact of governance mechanisms of global "lead firms" in driving a cascade of sustainability practices along the GVC (Alexander, 2020;De Marchi et al., 2013;Lund-Thomsen & Lindgreen, 2014). Within this realm, attention has been given to the role of (global and local) standards and codes of conduct, often developed within multistakeholder initiatives, and the conditions under which they might effectively drive change (Fransen & Kolk, 2007;Langford et al., 2022;Ponte & Gibbon, 2005). ...
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Climate crises are being experienced all over the world and appear to be accelerating as "extreme weather" events become the "new normal." In today's world economy, where trade and production activities are internationally dispersed and prone to disruptions , the global value chain (GVC) framework provides a systematic approach to understand and combat environmental crises and to advance sustainable development options across global, regional, and local scales. A vast "implementation deficit" characterizes sustainability efforts to date. The GVC framework incorporates firm and policymaker perspectives in a multistakeholder approach that offers multiple building blocks for a progressive environmental agenda, including: a multi-actor perspective to define sustainability; measuring it across diverse geographic scales; analysis of both environmental upgrading and downgrading; distinguishing motivations , actions, and outcomes when assessing environmental performance; viewing GVC resilience in terms of the interplay of economic and environmental forces; and highlighting how context matters in analyzing national, industry, and geopolitical factors.
... They are drafted by powerful private actors in far-flung locations; often fail to address more critical and less easily measured working conditions at point of audit (i.e. protection from discrimination; right to freedom of association); provide insufficient protection to temporary workers and are stymied by lead firms' contradictory demands for high-quality, low-cost goods with short lead times (Alford, 2020;Barrientos & Smith, 2007;Lund-Thomsen & Lindgreen, 2014). However, they do offer a crucial layer of regulatory protection for two key reasons. ...
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A prevailing focus of global value chain (GVC) analysis has been on the dominance of highly consolidated Northern retailers over suppliers in the global South. The rise of regional and domestic value chains (RVCs/DVCs) within the Global South which intersect with GVCs, has been found to involve private governance by Southern lead firms. However, we have limited insight into the implications of this changing value chain context for the role of public governance, or different groups of workers. South African fruit provides a rich example of rapid shifts in RVCs/DVCs governed by different private and public actors. The following two questions are addressed: How is the public–private governance of labour standards evolving in the context of RVCs and DVCs that intersect with GVCs? What are the implications for workers operating across different value chains? Conceptually, the paper draws on GVC analysis of governance and power, to examine the governance of labour standards across intersecting value chains. Our analysis highlights the intentional and unintentional mechanisms through which power and standard-setting are diffused away from Northern lead firms to a wider array of public and private actors operating across RVCs/DVCs. While existing analysis of governance and power focuses on singular GVCs, our study highlights diffusion of power across intersecting value chains, with significant and uneven implications for the public–private governance of labour standards. Our findings carry significant ethical implications for the governance of labour standards, as end-markets continue to shift South.
... Mounting evidence suggests that the aggregate impact of business activities on the world contributes profoundly to damaging the natural environment, including loss of biodiversity, potable water, and clean air and soils (Rockström et al., 2009;Steffen et al., 2015). Recent research underscores GVCs' overwhelming impact on the natural environment (Achabou et al., 2017;Ras & Vermeulen, 2009;Sun et al., 2019) as well as society (Gereffi & Lee, 2016;Goerzen et al., 2020;Lund-Thomsen & Lindgreen, 2014;Serdijn et al., 2021) and the need for a coordinated effort of various actors, organizations, and nations for environmental and social sustainability (e.g., Sharma, 2022). Thus, we propose following areas could be particular areas of interest in exploring GVCs in extreme events and contexts in relation to environmental and social sustainability. ...
Over the last decades, businesses worldwide have witnessed the rise of global value chains (GVCs) as they and their competitors have been able to fine-slice their distinct value-creating activities. The emergence of GVCs has been accompanied by tremendous opportunities and challenges. In this vein, the COVID-19 pandemic exposed the significant vulnerabilities of interconnected and interdependent GVCs. Our special issue and this editorial seek to better understand how GVCs can be reimagined in the face of extreme events and contexts, drawing on insights provided by the COVID-19 pandemic. In so doing, this Special Issue advances knowledge of the dynamic nature of GVCs and changes embedded in the design, structure, and management of GVCs in response to extreme events and contexts. As an introductory background, in this editorial, we summarize GVCs, explain recent developments in GVCs in the aftermath of the COVID-19 pandemic, and highlight the relevance of data analytics GVCs in view of the need for reimagining GVCs amidst extreme events and contexts. Moreover, we distill and synthesize the research this Special Issue encompasses and conclude by proposing new research directions, especially within the three major areas of GVC design and structure, data analytics and GVCs, and environmental and social sustainability of GVCs.
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El objetivo de este trabajo de investigación es analizar la bioeconomía como paradigma para la generación de políticas de desarrollo sostenible en la cadena de café costarricense y opción de mejora de procesos productivos de CoopeAtenas. El enfoque utilizado es cualitativo y se aborda desde un método de estudio de caso basado en el uso de información secundaria, entrevistas a profundidad a actores claves y observación dirigida. Como resultado del análisis se identifican oportunidades para potenciar el desarrollo sostenible en la cadena del café costarricense a través de la bioeconomía, además se conoce como influye el marco institucional, político y organizacional en la implementación de la bioeconomía y por último, se exploran oportunidades de aplicación de la bioeconomía en la organización. La investigación permite concluir que la evolución teórica ha permitido analizar las cadenas de valor desde una perspectiva sostenible e innovadora, que la orquestación institucional es importante en los procesos de implementación de la bioeconomía. Además, esta última se posiciona como una oportunidad importante para el adicionamiento de valor y mejorando el perfil ambiental del café.
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The aim of this article was to assess to what extent self-regulation within the CSR framework contributes to improving workers’ rights worldwide. Transnational company agreements, corporate codes of conduct, NGOs’ social accountability standards, ISO standards, the Dow Jones Sustainability Index and the Global Reporting Initiative were critically analysed us- ing logical-linguistic, historical and comparative legal methods. The research showed some evidence of a limited impact of CSR instruments on labour rights and proved that CSR tools can be perceived only as additional value to law.
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As the world economy becomes increasingly integrated, companies can shift production to wherever wages are lowest and unions weakest. How can workers defend their rights in an era of mobile capital? With national governments forced to compete for foreign investment by rolling back legal protections for workers, fair trade advocates are enlisting consumers to put market pressure on companies to treat their workers fairly. In Beyond the Boycott, sociologist Gay Seidman asks whether this non-governmental approach can reverse the "race to the bottom" in global labor standards. Beyond the Boycott examines three campaigns in which activists successfully used the threat of a consumer boycott to pressure companies to accept voluntary codes of conduct and independent monitoring of work sites. The voluntary Sullivan Code required American corporations operating in apartheid-era South Africa to improve treatment of their workers; in India, the Rugmark inspection team provides 'social labels' for handknotted carpets made without child labor; and in Guatemala, COVERCO monitors conditions in factories producing clothing under contract for major American brands. Seidman compares these cases to explore the ingredients of successful campaigns, as well as the inherent limitations facing voluntary monitoring schemes. Despite activists' emphasis on educating individual consumers to support ethical companies, Seidman finds that, in practice, they have been most successful when they mobilized institutions-such as universities, churches, and shareholder organizations. Moreover, although activists tend to dismiss states' capabilities, all three cases involved governmental threats of trade sanctions against companies and countries with poor labor records. Finally, Seidman points to an intractable difficulty of independent workplace monitoring: since consumers rarely distinguish between monitoring schemes and labels, companies can hand pick monitoring organizations, selecting those with the lowest standards for working conditions and the least aggressive inspections. Transnational consumer movements can increase the bargaining power of the global workforce, Seidman argues, but they cannot replace national governments or local campaigns to expand the meaning of citizenship. As trade and capital move across borders in growing volume and with greater speed, civil society and human rights movements are also becoming more global. Highly original and thought-provoking, Beyond the Boycott vividly depicts the contemporary movement to humanize globalization-its present and its possible future. Copyright © 2007 by the American Sociological Association. All rights reserved.
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Global industrialization is the result of an integrated system of production and trade. Open international trade has encouraged nations to specialize in different branches of manufacturing and even in different stages of production within a specific industry. This process, fueled by the explosion of new products and new technologies since World War II, has led to the emergence of a global manufacturing system in which production capacity is dispersed to an unprecedented number of developing as well as industrialized countries (Harris, 1987; Gereffi, 1989b). The revolution in transportation and communications technology has permitted manufacturers and retailers alike to establish international production and trade networks that cover vast geographical distances. While considerable attention has been given to the involvement of industrial capital in international contracting, the key role played by commercial capital (i.e., large retailers and brand-named companies that buy but don't make the goods they sell) in the expansion of manufactured exports from developing countries has been relatively ignored. This chapter will show how these ‘big buyers’ have shaped the production networks established in the world's most dynamic exporting countries, especially the newly industrialized countries (NICs) of East Asia. The argument proceeds in several stages. First, a distinction is made between producer-driven and buyer-driven commodity chains, which represent alternative modes of organizing international industries. These commodity chains, though primarily controlled by private economic agents, are also influenced by state policies in both the producing (exporting) and consuming (importing) countries. Second, the main organizational features of buyer-driven commodity chains are identified, using the apparel industry as a case study. The apparel commodity chain contains two very different segments. The companies that make and sell standardized clothing have production patterns and sourcing strategies that contrast with firms in the fashion segment of the industry, which has been the most actively committed to global sourcing. Recent changes within the retail sector of the United States are analyzed in this chapter to identify the emergence of new types of big buyers and to show why they have distinct strategies of global sourcing. Third, the locational patterns of global sourcing in apparel are charted, with an emphasis on the production frontiers favored by different kinds of US buyers. Several of the primary mechanisms used by big buyers to source products from overseas are outlined in order to demonstrate how transnational production systems are sustained and altered by American retailers and branded apparel companies.
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ABSTRACTA critical challenge facing developing country producers is to meet international labour standards and codes of conduct in order to engage in global value chains. Evidence of gains for workers from compliance with such standards and codes remains limited and patchy. This article focuses on the global football industry, a sector dominated by leading global brands that manage dispersed global value chains. It assesses the working conditions for football stitchers engaged in different forms of work organization, factories, stitching centres and home‐based settings in Pakistan, India and China. It draws on detailed qualitative primary field research with football‐stitching workers and producers in these three countries. The article explains how and why work conditions of football stitchers differ across these locations through an analytical framework that interweaves both global and local production contexts that influence work conditions. In doing so, it argues that current debates on the role of labour in global value chains have to go beyond a narrow focus on labour standards and corporate social responsibility compliance and engage with economic, technological and social upgrading as factors that could generate sustained improvements in real wages and workers’ conditions.
This report provides initial findings from a three year study, funded by the Economic and Social Research Council, on evolving labour practice responses to ethical trading initiatives at sites of production which focuses on the Sri Lankan apparel sector (Grant number: RES-061-25-0181). The report focuses on what the Sri Lankan apparel sector’s evolution into value-added apparel production implies for labour conditions and practices at production sites. It is also interested in exploring what local institutional factors enables Sri Lanka to position itself as a supplier engaged in ethical production and the extent to which the ‘garments without guilt’ initiative rests upon legitimate adherence to global ethical code regimes. Issues of paramount importance as the world economy go through a downturn. This report is intended as a sole key point summary primarily targeting the non-academic community as its readership; those interested in detailed findings of the project should contact Dr. Kanchana N. Ruwanpura (
Adopting a broad national and long-run approach, this book examines the issue of sweated labour and the legal control of low pay in Britain between 1840 and 1930. It explores the definition of sweated labour and the forces that generate it, as well as tackling the image of the sweated labourer and how it has changed over time. Having focused on these issues, the book then looks at how the problem was dealt with and analyses the success of reforms aimed at eradicating the practice.
Global production and trade networks have significant transformative effects on production regimes across the Global South, and tend to produce particular work regimes and workplaces at the sites of production. CSR (Corporate Social Responsibility) interventions similarly seek to reshape production processes in their search to improve labour conditions and protect workers' rights. However, workers' voices and their preferences for particular work regimes and employment conditions are rarely considered in such debates. Drawing on data from the Tiruppur garment cluster in South India, the article presents ethnographic evidence on what workers themselves make of the work regimes and ethical codes of labour practice produced under neoliberal governance. It explores how garment workers engage with different labour regimes and why some workers actively seek to avoidemployment in companies where Fordist regimes prevail and CSR policies are implemented. Such avoidance and exit strategies amount to a critique of particular neoliberal labour regimes that seek to control labour and curtail its freedom and dignity at work.
This article seeks to understand why developing country suppliers internalize or outsource labour-intensive aspects of production as well as how these internalization/externalization processes affect working conditions in export-orientated industries in the global South. In order to achieve this aim, the article develops a new analytical framework based upon the global value chain approach. Applying this framework to the football manufacturing industry of Jalandhar, India, the article concludes that value chain restructuring produces both new forms of work organization and highly gendered outcomes for labour in this industry.