TAKING BACK THE DECISION-MAKING POWER OF GLOBAL CONSUMERS
In late 2015 Chinese police arrested four labour rights defenders in Guangdong, namely Zeng Feiyang, Zhu Xiaomei, Tang Huanxing and Meng Han. They were arrested by the police and convicted by the court for “gathering a crowd to disrupt social order” for directing workers at the Lide shoe factory to claim a total of RMB 120 million in compensation for relocation, social security and housing fund, etc. During the same period, at least 15 labour rights defenders were taken away for questioning by the police. This move has left labour rights NGOs in China in a state of flux. In a centralized state like China, the actions of the police and judiciary can basically be seen as the mandate of the Communist Party and the government. This certainly sends a clear signal to the factories that China does not protect workers’ rights and that the Chinese judiciary will adjudicate to the benefit of the factories. Under such circumstances, it is almost impossible to rely on the Chinese government to enforce the Labour Law to protect the rights and interests of toy workers. One can only hope that global consumers will monitor the international toy industry associations to enforce their industry codes and that multinational toy companies will honour their commitments.
The International Council of Toy Industries (ICTI) was founded in 1975 and is made up of toy associations from approximately 20 countries. ICTI and its member associations are committed to promoting, among other things, “ advancing standards that support the rights and well-being of factory workers”. ICTI’s Ethical Toy Initiative certification requires factories to adhere to 12 standards that support the rights and welfare of factory workers. Can these industry self-regulatory standards really improve the rights of workers in Chinese toy factories? This paper uses two Chinese toy factories as ‘critical cases’ in a longitudinal analysis to explore whether industry self-regulation can lead to a positive impact on toy workers’ rights by linking theory and factory practice. It also makes recommendations for NGOs working to advocate for toy workers’ rights.
Industry self-regulation is a common initiative by companies to establish systems and rules that benefit the industry as a whole. The voluntary cooperation of companies within an industry to implement the systems and rules of that industry’s self-regulation is the driving force that enables it to function. It takes the form of a collective line strategy, with industry codes of conduct and norms, and aims to promote responsible business behaviour within one industry. Industry-wide self-regulation requires the implementation of a collective strategies because an individual corporation is sometimes overburdened with fulfilling its social responsibility. Industry self-regulation is a form of collective action whereby behavioral rules and norms that foster responsible business practices within an industry are established, and it can ensure that responsible business behaviour does not result in individual business members being at a competitive disadvantage as a result. But it is not without its critics, such as scholars who argue that industry self-regulation is simply window dressing; for years, China Labour Watch has criticised Mattel’s “responsible supply chain commitment” as a empty “promise”.
While there is debate as to whether industry self-regulation can realistically monitor multinational corporations’ implementation of responsible business practices and can protect the rights of workers in global supply chains; ensuring and expanding the scope of Chinese toy factory workers’ rights must rely on self-regulatory codes in the toy industry. As noted earlier, the Chinese government and judiciary have shown no interest in actively enforcing the Labour Law, and in recent years the Chinese government has continued to suppress and persecute Chinese labour rights defenders and labour organisations. Scholarly research has also shown that many developing country governments lack the capacity to enforce their own labour laws, due to profit maximization, short-termism, market failures, and the complexity of international supply chains. Corruption in the government and judiciary, and inadequate human rights education make it even more difficult to enforce labour laws in China. Therefore, we cannot expect the Chinese Labour Law alone to improve the labour environment for Chinese toy workers.
The following characteristics of the toy industry make it possible for the ICTI to promote self-regulation by its members and thereby enhance the rights of toy workers. 2020 global toy sales were $94.7BN and the international toy industry is a relatively small industry. Within this relatively small industry, the top five leading toy brands (LEGO, Bandai Namco, Hasbro, Mattel, JAKKS Pacific) account for $24.34BN in sales. At the same time, most of the toy factories are concentrated in China.
The adoption of industry self-regulation does not mean that this paper does not take into account corporate responsibility to adhere to China’s Labour Law. Although the Chinese government and judiciary do not require toy factories to strictly enforce labour laws, international toy industry committees and multinational toy companies must still incorporate the relevant laws and regulations of the country in which the factory is located when developing industry codes of conduct and supply chain systems to ensure the legality of their own supply chains.
In addition to the relevant Chinese laws and regulations, this paper will also consider the Chinese culture and system. This is because multinational companies’ industry standards can easily be dismissed as “cultural hegemony” or “capital hegemony” and face resistance. If Chinese culture and systems are not taken into account, not only will it be a mistake in terms of ‘cultural pluralism’, but it will also be detrimental to workers’ understanding and acceptance of the codes’ content. More importantly, for almost 50 years since the Cultural Revolution, China has had a culture of ‘saying one thing but doing another’, or a culture of decoupling theory from practice, which is the opposite of the industry self-regulation concept that requires factories to couple industry codes to factory practice. It can therefore be argued that certain cultures in China are a barrier to the couple of industry self-regulation codes and practices and cannot be ignored.
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