To what extent do CSR norms represent a useful tool for the anti-sweatshop movement? [Essay]

note: I don’t agree with fur being used in fashion (this will make sense eventually)

The anti-sweatshop movement refers to a movement in the 1990s, exposing labour rights violations in the clothing and footwear industry via transnational networks. This movement amassed the support of various demographics and organisations, including religious groups, students, human rights organisations, and activist networks.  While previous movements defending labour rights were focused on the actions of governments, this movement primarily targeted clothing companies with public exposure campaigns (Bartley & Child, 2014). By associating the actions of brands to working conditions within their supply chain, this “created a new discourse of corporate accountability” (Quan, 2008), emphasising the complicity of Northern brands in the exploitation of workers, including Nike, Wal-Mart and Gap (Bartley & Child, 2011).

In response to the movement, corporations swiftly introduced corporate social responsibility (CSR) methods, which spread across the apparel industry (Bartley & Child, 2011). CSR refers to policies and programmes corporations adopt in order to better the conditions of workers in their supply chains (Bair & Palpacuer, 2012). It includes various means of ensuring ethical behaviour, including audits, codes of conduct, programmes, and guidelines on ethical behaviour (Blowfield, 2005). These methods aim to acknowledge that: companies are responsible for the impact they have on society and the environment; companies are responsible for those they conduct business with; companies must regulate their relationships with society (Blowfield & Frynas, 2005). For example, in response to the bad publicity they received during the anti-sweatshop movement, Levi Strauss introduced their ‘Terms of Engagement’ (Jenkins, 2005), with stated requirements for their factories, covering issues such as child labour and discipline (Levi Strauss & Co, 2017).  As CSR spread, international organisations began to adopt them. For example, development institutions such as the World Bank now promote ‘corporate responsibility’ as a means of poverty reduction (World Bank, 2016), while the UN has created the Global Compact, encouraging sustainable and responsible business, and requires enterprises to incorporate their ten principles into their business, in order to “establish a culture of integrity…upholding their basic responsibilities to people and planet, but also setting the stage for long-term success.”  (UN Global Compact, 2018).

However, despite the widespread adoption of CSR, the exploitation of workers continues to prevail. A recent report from Oxfam earlier this year interviewed women working long hours in garment factories for six days a week, for less than $1 an hour, with excessive daily targets and few breaks or granted leave (Oxfam, 2018). This questions the usefulness of CSR in ensuring workers’ rights, and thus, the extent to which it meets the aims of the anti-sweatshop movement. In this essay, I will evaluate arguments suggesting that CSR is ineffective, by covering three prominent arguments that CSR: maintains unequal power relations that perpetuate the exploitation of those at the bottom and ignores workers; continues neoliberal policies that transfer regulation of workers’ rights to multinational corporations (MNCs) and civil society groups; allows businesses to continue their race to the bottom through ‘moralising’ capitalism. I argue that, while CSR may have been useful in helping to improve the lives of some workers, it is a mere distraction utilised by corporations to prevent activists from exposing and addressing the mechanisms of exploitation they depend on to continue competing against each other in the race to the bottom. Furthermore, I argue that all the arguments against CSR stem from one central issue: it refuses to acknowledge the root issues of exploitation.

Consolidating unequal power relations

One focal argument against CSR suggests that CSR maintains and strengthens “gendered neo-colonial power relations” between the Global North and South; a relation that subordinates developing countries to the North, so countries in the South become dependent on the North for economic growth. This dependency means the North is able to intervene in the South, under the guise of promoting development and empowerment via CSR, while in reality, allowing the exploitation of populations in the South by MNCs to continue (Ozkazanc, 2018). Ozkazanc further argues that by enabling continued involvement in the South under the façade of worker empowerment, in particular female empowerment, this allows them to continue exploiting the pre-existing oppression of women in these countries for profit, allowing them to maintain low wages and keep them working under exploitative conditions, while using female empowerment in their CSR programmes to convince consumers they are doing otherwise. This could be used to evaluate ‘The Girl Effect’ from Nike; a CSR programme aimed at educating young girls as a solution to ending poverty in the South, clearly a strong message of female empowerment. However, simultaneously, their female workforce are forced to work long hours in poor conditions, compelling masses to faint simultaneously in factories in Cambodia. This supports the theory that ‘female empowerment’ via CSR is allowing the veiled exploitation of its female workers in the South, which prevails as a result of a dependency relationship between the North and South, under neocolonialism.

Moreover, DeNeve (2009) argues that CSR is utilised by corporations to exert control over suppliers in the South, by presenting the North as benevolent, caring, disciplined and knowledgeable actors required to discipline the backward, uncaring, out of control suppliers of the South via CSR. He found that suppliers in Tiruppur were forced to comply with Western values and codes, with Northern MNCs threatening to withdraw orders if they refused, and the subsequent fear of losing out in the competition for buyers among suppliers, if they did not conform to expectations. To add further pressure to suppliers, these brands did little to support suppliers in adopting their codes, e.g. continuing to set extremely high targets which would not be possible in the maximum hours their codes of conducts would permit workers to work. This demonstrates how these power relations permitted through the continuation of the perceived moral superiority of the North, perpetuated by CSR, justifies brands’ use of intimidation to pressure brands to conform to their stringent rules in order to please their consumers, while simultaneously imposing impossible demands on suppliers.

This was similarly demonstrated in China, where brands are described as implementing a “top-down regulatory process”; imposing an authoritarian regime in which they, as “paternalistic” actors safeguarding workers, are able to dictate and impose their own codes on workers (Pun, 2005). This is highlighted by the ability of brands to demand when factories should and should not comply to their regulations, demanding factories to disregard workers’ rights in times of rushed production, in order to ensure their targets are met. In doing so, this completely invalidates the purpose of CSR in protecting workers, with corporations demonstrating concern for their workers only when it is convenient to them. This further illustrates the lack of agency workers have in regards to their own rights, which are instead imposed on them when it suits MNCs, via this relationship of dominance. According to Ruwanpura (2013), reporting from a Sri Lankan factory, these power relations are maintained by the implicit knowledge of corporations that workers face socio-economic vulnerabilities, thus making them easily manipulated to follow orders regardless of the codes of conduct implemented, as they are more inclined to accept poor working conditions.

However, CSR does not only maintain hierarchical power relations between the North and the South, but it also creates power differentiation between suppliers. For example, according to Kabeer (2004), first-tier factories in Bangladesh with formal wage work are typically covered by CSR, excluding informal workers. This creates class differentiation between informal and formal workers, as MNCs are more willing to work with factories that have been monitored than those that have not, resulting in those higher tier suppliers being perceived as dominant and the ‘right enforcer’ of CSR norms (Mezzadri, 2014). Taylor (2011) argues that these power relations form the basis of competition between suppliers that results in uneven development, as higher tier suppliers subcontract and shift production to those lower down, with fewer orders, who are therefore willing to compete for contracts through the advertisement of lower labour costs i.e. poorer working conditions that will increase the likelihood of targets being met. This results in workers at the bottom enduring poor, unregulated working conditions, and adopting various means of falsifying data presented to their subcontractor and brands to ensure further orders, highlighting their dependency on these brands financially. Taylor further highlights that within CSR codes give little importance to the rights of workers to organise, instead focusing on those regulations that can maintain the established power relations and mechanisms of control businesses that ensure profits.

The research presented here therefore suggests that CSR is not a useful tool for the anti-sweatshop movement, as it perpetuates and continues power relations that result in the very exploitation CSR is supposedly fighting against.

On the other hand, there have been examples where CSR implemented by brands have been utilised by worker-led movements and have subsequently achieved justice for workers. For example, in a garment factory in Sri Lanka, workers were denied their New Year bonus, which they depended on to supplement their income. In response, workers went on strike and decided to form their own union, a branch of the Free Trade Zone Workers’ Union (FTZWU). Management refused to engage with the union, harassing members, as well as those who indicated support for the trade union. The FTZWU went on to request a referendum for recognition of the union in the factory, resulting in further harassment. In response, FTZWU decided to request international support, with various solidarity alliances showing support for the trade union. Campaigns targeted brands that were sourcing from the factory, including Nike and Vanity Fair, who conducted audits in the factory and eventually organised a meeting between management and the FTZU, as well as stakeholders including a local non-governmental organisation (NGO), the International Labour Organisation (ILO) and brands sourcing from the factory. This led to an agreement that recognised the FTZWU, and the campaign was subsequently called off (Gunawardana, 2008).

This example indicates that CSR and corporate involvement in ensuring justice for workers can be effective, however, it must be done in solidarity with workers who lead the way, as opposed to workers simply having CSR codes and programmes imposed on them. Indeed, having evaluated various worker movements worldwide, Wells (2009) argues that rights for workers are most effectively achieved when international social movement unionism is built upon local worker mobilisation, as opposed to the standard rhetoric that it is Northern activism that has helped achieve successes in the movement for better working conditions. He emphasises this by describing the factory as the “base of the pyramid upon which any campaign stands”, where the prominent events preceding success take place.

 

Business needs prevail over workers

Another argument suggesting CSR is not useful to the anti-sweatshop movement comes from those who argue that CSR is just a means to allow business to expand “beyond original boundaries”, using it as a means to increase profits (Blowfield, 2005). CSR is perceived as a pro-capitalist way for brands to compete with one another, demonstrating how ‘ethical’ they are, as ““ethical acts” are bought and sold” (Mezzadri, 2014). For example, after the backlash Nike received when poor working conditions in their factories were exposed, Reebok benefited from being deemed as the ethical alternative with a code of conduct (Yu, 2007).

Similarly, Pun (2005) explains that CSR is a “public relations ploy”, made evident by his findings that brands will disregard their codes of conduct if it jeopardises the suppliers’ ability to meet their targets, thus putting their profits are at risk. Had CSR been a genuine concern to brands as something more than an attempt to improve their image while maintaining their drive for profits under capitalism, they would have most likely ensured their codes of conduct were being followed. However, through CSR, whether followed or not, brands can present themselves as ‘moral agents’ in support of workers, with the reassurance that their wealth and power is not affected (Jenkins, 2005), and in a way that resonates best with investors, than workers themselves, who become a “marketing opportunity” via CSR (Blowfield, 2005). By presenting business interests as social interests, this leads to a downgraded expectation of what social interests should be addressed, reducing the likelihood that important issues will be tackled by corporates via CSR, with little resistance from consumers, who are presented with the business form of CSR.

This is particularly highlighted by the issues that CSR addresses and fails to address. For example, according to Blowfield, while CSR will address certain issues, it fails to regulate problems such as tax evasion, as well as the sudden closure of factories and subsequent lay off of workers without providing compensation. This was shown in 2015, when a factory in Indonesia UNIQLO had sourced from went bankrupt, as orders declined, resulting in 2000 workers unemployed and owed four months of wages as well as severance pay (pay when a factory closes down). While their wages were paid, they are still owed their severance pay to this day. Despite the difficulties workers face after closures, with families being left with nothing, there is no mention in the UNIQLO code of conduct of any measures to be taken to address this issue (Fast Retailing, 2018), which is now a regular occurrence in the garment industry, nor has UNIQLO responded to compensate their workers (Villadiego, 2018). Moreover, in an OECD survey, it was found that out of 246 codes of conduct, only one mentioned taxation (OECD, 2000). Jenkins (2005) argues that regulation over this is crucial to reducing poverty, significantly impacting the very people CSR should protect, i.e. the poor and marginalised. Instead, corporations are given impunity over such crimes, which further signifies the ability of corporates to define what justice for workers is; anything that can be dealt with in a way that maintains profits (Blowfield, 2005). Another example is provided by Nike, who, to avoid public concern over their workers enduring exploitative conditions and child labour, stopped employing homeworkers, instead focusing on supplying from larger suppliers, which are easier to monitor. However, this denied employment to many homeworkers, who consist of poor, marginalised individuals (Brill, 2002). These examples indicate brands’ willingness to implement CSR on the grounds that it maintains their image and profits, regardless of whether it contradicts their ‘moral’ rhetoric or not.

This therefore suggests that CSR may not be useful to the anti-sweatshop movement, as it continues to be utilised as a means to ensure corporations’ competitiveness in the market, as opposed to a means by which they can protect workers’ rights.

On the other hand, Kao, Chen, Wu and Yang (2004) have found an example of a corporation making profit while also using CSR to support poor and marginalised workers in rural communities by not only helping them to attain employment work, but ensuring they escape poverty. Indeed, the case study involves a private rabbit-breeding factory in China providing fur for the fashion industry. This factory adopted a poverty-reduction model of CSR, which involved personal empowerment practices including providing vocational education and training, and social empowerment practices such as increasing employment opportunities for poor and marginalised individuals. Through this model, it is argued that factories can help reduce poverty, by promoting accumulation and preventing a return to poverty. In this case, the factory provided free training as well as distance-learning, to ensure the spread of their services to the rural community. Books and journals were also provided to the rural community free of charge, while support was provided to those who wanted to excel within the industry. It was found that among those trained by the factory, 90% were no longer impoverished, while 65% reached millionaire-status. While this does not go in depth into the working conditions of the workers, it demonstrates the effectiveness of the factory’s investment in taking workers out of poverty, as opposed to keeping workers impoverished to take advantage of and thrive off their ‘socio-economic vulnerabilities’ as mentioned earlier.

This indicates the potential of CSR as an effective means of supporting workers, on the grounds that the factory is able to implement CSR practices they know will be able to help those in the community, as opposed to having CSR being imposed by Western brands.

Encourages reduction of state regulation

In addition, CSR is also suggested to be implemented by corporations “to justify the imposition of neoliberal prescriptions” (O’Laughlin, 2008). One way this is done is by reducing the state’s regulation of working conditions, which is displaced by CSR (Esbenshade, 2004), as the monitoring of working conditions transitions from state regulation to a situation where citizens, and civil society groups take responsibility for corporations’ behaviour as well as the protection of the poor (O’Laughlin, 2008). This has led to the privatisation of regulation and monitoring, and the subsequent “co-opting” of groups such as NGOs by corporations to regulate their working conditions, who become main stakeholders, transforming them into “clients” of MNCs, less likely to criticise their actions (O’Laughlin, 2008). Moreover, as a result of civil society groups replacing the government in state regulation, this could also result in the beneficiaries of CSR being limited to individuals whose issues are prioritised by NGOs or other civil society organisations. For example, Blowfield (2005) explains that homeworkers are often neglected from CSR, as rights abuses among this largely hidden population pose less of a threat to the reputation of organisations, and thus they are likely to be ignored.

Shamir (2004) refers to these NGOs as MaNGOs (Market-oriented Non-Governmental Organisations), which he argues ‘deradicalise’ CSR, as they “disseminate and actualize corporate-inspired versions of ‘social responsibility’”. He found that among MaNGOs, most were inclined towards community programmes surrounding education and training when working with corporates, creating an “a-political” meaning for CSR, avoiding concerns such as political empowerment, that may create tension between corporates and social issues. This is also in line with neo-liberal policies of replacing the government in providing public services.

This suggests that CSR is a tool that enables brands to regulate themselves, ensuring there is little government regulation of working conditions and, as a result, allowing brands to get away with adopting poor working conditions that enable maximum profit at the expense of their workers.

On the other hand, it is argued that voluntary CSR converges with the law and can pave the way for new legislation regulating working conditions (Blowfield & Frynas, 2005). Indeed, a recent form of CSR that has converged with law is the Accord; a legally binding agreement introduced in 2013 between brands and trade unions in Bangladesh, to safeguard the factories of the garment industry in Bangladesh (The Accord, 2017). Due to the legally binding aspect, corporations that sign up to the agreement are required to fund inspections and repairs in their factories, and are held accountable to any factories they supply from (Leibson, 2015).  This new legal approach to CSR, has shown significant effects. For example, as a result of the implementation of the Accord, it has reported 749 factories in Bangladesh currently at 90% remediation, with 138 completely remediated, and over 1600 at 85% remediation (The Accord, 2018). Furthermore, it has been shown to have a significantly greater impact on workers than a voluntary, corporate-led CSR programme implemented around the same time, called the Alliance, which also aimed to protect the health and safety of workers in factories supplying brands. For example, a report conducted by various transnational activist organisations found that among 175 factories covered by the Accord and the Alliance, while the Accord reported half of the factories as inadequate, providing details describing each situation, the Alliance had written them off as ‘on track’, with little on what changes were being made. This ambiguity allows corporations under this programme to falsely present themselves as ensuring the health and safety of their workers to consumers, thus allowing them to relax their actual investment in remediating their factories. This indicates the potential of CSR tied to legal agreements, which are created alongside workers, in improving the lives of workers without state regulation.

 

Conclusion

The research indicates that, while CSR may improve the lives of some workers, it clearly does not have the wellbeing of workers in mind. Indeed, by concealing the core issues of neoliberal policies, capitalism, and unequal power relations between the North and the South, it allows corporations to continue profiting off worker exploitation, behind cleverly curated marketing presenting corporations as benevolent and moral. By hiding behind this false philanthropy, corporations justify their imposition of oppressive codes of conduct, resulting in the continuation of exploitation to meet the needs of brands, contradicting the very existence of CSR.

Research also suggests that good CSR is possible, on the grounds that it involves significant engagement with workers and practices that work to elevate workers beyond poverty, as well as legally binding, transparent measures that oblige corporations to comply to rules.

However, until the core issues of neoliberalism and capitalism are addressed, CSR will remain a publicity ploy for brands to continue to profit off the subjugation of workers in the South, thus failing to provide a useful tool for the anti-sweatshop movement.

 

 

 

References

 

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