Last Updated 20 May 2021

Globalization, and International Business Ethics

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Many in industrialized nations argue that lax standards in developing nations permit unethical treatment of workers and create unfair trade advantages. Abuse of child labor leads to many reactions of people who are neither social activists social activists to protest such corporate practices nor social community rather they can lead to complexity and can be called either naive or hypocrisy, protectionism, and a sinister form of ethical imperialism. A study by J. Lawrence French and Richard E. Washout examined after reviewing the contentious debates on the ethics of work by children, we focus on their employment In global Industries and ground our discussion in Brazier's export oriented shoe industry, where this practice as received much attention and a variety of global actors work with local entities to abolish it. First, we examine what appear to be the causes of work and conclude that child employment in this industry has more to do with the integration of children and their families Into global production and consumption systems than with their poverty or Immersion In tradition.

Second, we Investigate the nature of work activities, the context within which these occur, and their consequences for the child workers. What is most evident is the marked disagreement regarding the implications of shoe industry employment for children among interested takeovers that include the local community, the U. S. Government, and the children themselves. Third, we examine the campaign by the U. S. Government to end child employment In the shoe Industry and the shoe industry response.

We conclude that this campaign has not been as effective as It might have been In part because some important stakeholders have both the will and the ability to resist U. S. Efforts. The increasingly contentious debates regarding the ethics of child employment pit an array of actors, mainly from the industrialized North, who seek to develop and dif use international standards, against a host of voices, mainly from developing areas of the South, who argue the need for recognizing the diversity of children's lives and the forms that their work takes.

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These debates reflect rather profound differences In notions of children and childhood as well as the functioning of families and labor markets. According to The Olio's Minimum Age Convention, 1973 (No. 138) states "The minimum age. Shall not be less than the age of completion of compulsory schooling, and in any case, shall not be less than 15 years" (ILL, 1973). Labor by children is taken to mean the performance of any productive activities beyond some specified number of hours In exchange for wages In the labor market.

By contrast, unpaid household chores or work for parents In family businesses Is typically Song 1999), and therefore excluded from regulatory efforts. U. S. Senator Tom Harkin, arguing in support of the Child Labor Deterrence Act he sponsored in the U. S. Congress, attempted to clarify this issue: "Keep in mind the distinction between child work and exploitative child labor. The legislation does not bar children from selling swappers, shining shoes, or working on the family farm, but, rather, prohibits work in the hazardous Jobs of mining and industry under abusive conditions. Harkin 1999: 41)" This distinction between child work and child labor is useful in that it focuses directly on tube work itself and its results. However, it is often difficult to make this distinction in practice. Certainly mining and factory work are not the only potentially hazardous sectors of the economy. In fact, farming is a quite hazardous occupation for children (Hen, 2003), and one can even envision oppressive conditions imposed on children selling newspapers or shining shoes.

In addition to this, If the touchstone is children's welfare or interests, then adequate public policies must also consider the diversity of notions of children and childhood as well as the variety of social, economic, political, and cultural contexts in which they live. Anthropologists note that the defining features of a "child" and "childhood" have varied historically and differ across contemporary cultures (Aries 1962; Horn 1994).

In Harvard Business Review article, "Values in Tension: Ethics Away from Home, "Thomas Donaldson (1996) provides a framework for resolving moral dilemmas in international business that attempts to avoid ethical imperialism as well the opposite extreme of ethical relativism (I. E. , uncritically accepting host country moral standards). These arguments are refined and presented in more robust form in his book Ties that Bind, co- authored with Thomas Dundee (1999).

In both of these publications the authors concede that avoiding the twin perils of ethical imperialism and ethical relativism is often very difficult, but they provide guidelines to do so. Donaldson (1996) contends that companies confronting such conflicts will be well served by following three duding principles:

  • Respect for core human values,
  • respect for local traditions,
  • the belief that context matters.

Donaldson and Dundee (1999) frame this in terms of the application of Integrative Social Contract Theory (CIST) that attempts to reconcile locally accepted business practices with more general and overriding macro-social contracts. These macro-social contracts establish hyper norms which constrain micro-social contracts and establish the boundaries of "moral free space" within which social contractors have ethical discretion. Within this moral free space the specific economic, social, cultural, and geographic contexts should inform our ethical decisions about business practices. Brazier's shoe industry provides an excellent context for an empirical examination of child employment and efforts to combat it.

From 1970 to the mid-asses, it expanded rapidly to become one of the world's largest exporters with most production destined for the U. S. Market (Penitentiaries, 1995). Subsequently, China's entrance into world markets eroded Brazier's position and, by 2000, both output and employment had fallen by roughly 30 percent. Efforts to cut costs have led most manufacturers to intensify their subcontracting of labor-intensive operations to small, family-run shops during their non-school hours as well as other unregistered workers.

Although children under the age of 16 (raised from 14 in 1999) cannot work legally, government officials have rarely intervened to charge parent-employers with child labor violations. Given the potentially sensitive nature of the information sought, it is possible that collecting the data from classes within public schools led student respondents to underreported their working activities and exposure to hazardous irking conditions. Most commentators attribute child labor to poverty.

However, this perspective provides only limited help in understanding the prevalence of working children in Franc's shoe industry. Per capita income in this city is considerably above the national average: $6,000 according to Franca City Hall (1999), versus $4,300 in the country as a whole. Most young workers live in families with both parents present and typically both are employed (Liquors, 1995). Data from the survey (according to Table 2) asking about the session of household items suggested that the families of working children have more possessions and thus, presumably, more income than those of non-working children.

For example, the families of 95. 8 percent of the twelve- to fourteen-year- olds employed in the shoe industry have cars; by contrast, the families of only 66. 6 percent of those twelve- to fourteen-year-olds looking for work and 80. 6 percent of twelve- to fourteen-year-olds not working by choice own one. The strategic responses by shoe manufacturers to intensifying global competition and, somewhat later, mommies stagnation provide better explanations for child employment than does family poverty.

In addition to reducing employment levels, employers have responded to competitive pressures to lower costs by modifying their production systems to pen nit more subcontracting of the skilled cutting and sewing operations. Some measure of subcontracting of labor operations has characterized Brazier's shoe industry since its inception, but observers (Liquors 1995) concur that this quite traditional form of production has, ironically, expanded greatly in recent years with global economic integration.

These very labor-intensive segments of production are typically contracted to small, family-run shops, or "Bancs," often established in the backyard, garage, or spare room of the owner's house. The implications of child employment in Franca for the children, their families, adult workers, and the society at large have been hotly debated since the mid-asses when evidence of extensive child employment was widely disseminated.

For many adults in Franca, work by children in the shoe industry is seen as normal, benign, and healthy for their development. They argue that children are rarely forced to work by their parents. Consistent with these claims, our 1998 survey revealed that young workers in the shoe industry did indeed spend long hours at their posts. Reflecting their direct involvement, child workers in the shoe industry appear to hold more complex and nuanced views of their Jobs than do either the local community or the U. S. Government.

All evidence suggests that these children value work very highly for the money it provides to meet their consumer needs, for the independence gained from parents, for the skills they believe they acquire, and for the opportunity to keep busy and out of trouble. Many workers disliked aspects of the work processes. As indicated, some of those working with glue complained of the smell and the commented on minor cuts and other injuries from close work with machines, the dirty environment, and the fatigue from the pace of work and movements required.

Child employment appears to persist throughout these segments of the shoe industry in part because many children and their parents regard this practice as useful and thus resist efforts to eliminate it. Many employers find work by children attractive as well, but recognize the need for defensive programs in the face of U. S. Threats. The implication of Franca case can be- firstly, the forms that child employment take in Brazier's export-oriented shoe industry differ markedly from the images in the popular press of impoverished children forced to leave school to labor for exploitative employers.

Secondly, the study suggests that stakeholders hold very divergent notions regarding the consequences of this newer form of child employment associated with global industries. Thirdly, the case study also illustrates the difficulty of detecting child employment in industries whose production systems extend into the informal sector through subcontracting with family-run, home-based hops. Fourthly, because child employment in Brazier's shoe industry appears rather benign to some stakeholders and has proven very difficult to detect, the U. S. Led campaign to eradicate this practice has proven extremely difficult. Fifthly, this study raises the issue of the ethical implications of the U. S. Government's strategic posture of abolishing child employment in Brazier's shoe industry. Finally, and in broader terms, the study suggests the limits of effective actions by the U. S. Government to deal with children's employment in the exporting industries of developing nations.

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