April’s factory collapse in Bangladesh, which killed more than 1,000 people, has renewed public debate over working conditions in the developing world: How can dangerous and debilitating factory work be improved?
For more than a decade, MIT political scientist Richard Locke has studied that question. Locke has made hundreds of visits to factories around the world, heading a team of researchers who have been collecting an unprecedented amount of information from companies. For years, Locke thought that the answer might lie in private policing: multinational firms auditing the factories where their suppliers produce goods, noting safety violations, and threatening to withhold business from those suppliers.
But in recent years Locke has changed his view. Private oversight, he thinks, is not enough to eliminate workplace dangers, excessive hours, child labor and poor wages. Governments, he says, must set and uphold better factory standards as well.
“The dominant approach to trying to fix these issues, the private-compliance approach, didn’t work, systematically,” says Locke, who is head of MIT’s Department of Political Science and deputy dean of the MIT Sloan School of Management. “It’s better than nothing, but it wasn’t leading to a significant and sustained improvement in working conditions or enforcement of labor rights in any of the supply chains that we studied.”
Now in a new book, “The Promise and Limits of Private Power,” published this month by Cambridge University Press, Locke expands on this perspective, detailing ways in which both the private sector and governments can work — and sometimes work together — to make factory life more tolerable for workers.
“The private sector can only do so much, and certain issues are issues of citizenship rights, such as the freedom of association, and the freedom to bargain collectively,” Locke says. “You can’t enforce those rights one factory at a time or one supply chain at a time, or even one brand at a time. Those are territorially enforced rights, and only the sovereign states can do that.”
The supply and demand chain
To better understand factory conditions, Locke emphasizes in the book, we need to regard each factory as a link in a bigger global-supply chain. Poor working conditions are not just a consequence of poor local management, Locke asserts, but a result of demands by multinational firms.
Suppose that a multinational garment firm expects a new order with an 11-week turnaround time between the purchase order and the delivery, but takes longer designing an item, so that the factories just have nine weeks to process the order. The consequence for factory workers, Locke says, is that “the only way the factory makes up for that is overtime. And a major problem is excess hours.”
The same dynamic of hurried production comes into play when industries have an overproliferation of products, few of which will make money — or when consumer-electronics firms, whose products now have an average life cycle of nine months, place large orders because they do not want to hold inventory. In all cases, a heavy burden is placed on workers to work more, and more quickly, in difficult conditions.
“The things the brands and large retailers are doing might seem like small changes, but they have enormous, cascading, negative effects on the factories,” Locke says. And, he notes, “We’ve actually been able to document wild fluctuations of orders, which have led to wild fluctuations of hours, as well as wild fluctuations of the hiring and firing of temporary migrant workers.”
That documentation started with Nike, whose reliance on factories using unfair labor practices in Asia led to public protest in the 1990s. Locke began working with Nike to study the problems, and says the company quickly added a compliance staff that was serious about improving working standards. In turn, Nike provided Locke and his research team with every company audit on labor practices from 1998 through 2011.
Locke’s engagement with Nike led him to assess other firms, including Coca-Cola, Hewlett-Packard, and Van Heusen. In all, his book draws upon data on thousands of suppliers in more than 50 countries, as well as at least 120 factory visits in 10 countries in Asia, Latin America and Europe.
Precisely because management decisions influence working conditions thousands of miles away, improvements must take place in the executive suite and not just on the factory floor, Locke believes. “We need changes in the behavior of some managers, who have headquarters in the United States and other advanced industrial nations,” he says.
Locke had hoped that private enforcement would provide a kind of win-win mechanism for factories: In the process of installing better operations, factories might empower workers and become safer, too.
“It seemed to me that in an age of globalization, where each individual state was limited in its reach, this would be an alternative approach,” Locke says. “And I am still optimistic about capability-building [in factories].” But the data, and his visits, convinced him that too many factories still tolerated the conditions that caused protests in the first place.
“If you’re only introducing new techniques into the factories, then whoever is powerful in the supply chain captures the benefits, whether it’s the buyer or the supplier,” Locke says. “It will really hit against limits, and we saw lots of cases where people were introducing lean manufacturing but not empowering workers, or increasing wages. … That was an interesting finding we only could have gotten by doing all this work in all these different countries and these different programs.”
When it comes to assessing factories themselves, what Locke argues for instead is active collaboration between states, nongovernmental organizations and the private sector to set and maintain acceptable working conditions — although, as the tragedy in Bangladesh makes clear, the political will to make changes does not necessarily exist until disaster strikes.
But Locke is adamant that these kinds of changes can happen anywhere — and cites Cambodia as an unlikely success story. There, the International Labour Organization, a U.N. agency, worked with the government and private firms to make across-the-board improvements in working conditions, and to develop monitoring systems as well.
“Cambodia has come through this terrible period [of war], and there are very few [official] records, and yet one sees that brands have invested to develop the capabilities of these factories, and of the government at the same time to enforce its own laws,” Locke says. “If it can happen there, it should be able to happen in parts of China, India or anywhere.”
Aseem Prakash, a political scientist at the University of Washington, has called Locke’s new book “outstanding” and says its “key strength is the level and quality of access Richard Locke has to company-level data. This type and level of access is quite unprecedented in political science.”
That work will continue with an examination of Apple, among other companies with whom Locke will be working in the future.
“We know that there are problems,” Locke says. “But there are enough examples of positive change in places that have limited resources, that it’s possible. It’s not automatic but with the right political will, knowledge and investments, it can happen.”