Massachusetts Institute of Technology
Sign in

Making Globalization Work for All

10/07/2005 9:00 AM Kresge
Richard M. Locke, PhD '89, Alvin J. Siteman Professor of Entrepreneurship and Political Science; Hannah Jones, Vice President, Corporate Responsibility; Nike ; Scott Nova, Executive Director, Workers Rights Consortium

Description: These speakers share a bleak perspective: A decade's-worth of high-profile efforts to change sweatshop conditions in overseas apparel factories hasn't worked. Hannah Jones describes Nike's dismay following in-depth research at its overseas facilities, where the corporation had attempted to implement codes of conduct and compliance monitoring. The corporation made "some stark realizations," acknowledging such systemic issues as excessive overtime, unpaid wages, worker harassment and denial of workers' rights to associate freely. Real remediation of the problem, says Jones, must deal with root causes. "There's no point in Nike having 96 monitors on a factory floor day in and day out monitoring overtime, if overtime is being caused way up the supply chain." So Nike is scrutinizing its own behavior as a buyer. We must "incentivize suppliers to become part of business decision-making," she says, and convince them that creating efficiencies in a volatile market doesn't mean "squeezing labor costs" but "squeezing time to market." The worker "is central to that," and better-trained factory managers may be key.

Scott Nova agrees that major U.S. garment retailers must take corporate responsibility to heart. The pressure on foreign suppliers hasn't succeeded, he says, because "factory managers conclude correctly that if the brands were truly serious about improved working conditions, they would pay enough to make it possible for those conditions to be achieved." Instead, factories compete to pick up cheap contracts, pressure their workers to toil for pennies, and use "fakery and deception when customers send auditors to inspect labor conditions." But there is good news, he says: "The economics of apparel production are such that the problem could be fixed." Since labor costs are a minute percentage of the retail price of apparel, a tiny increase in the cost of a product passed along to a consumer could enable "brands to pay factories to reflect the true costs of compliance living wages for workers."

Host(s): Sloan School of Management, MIT Sloan School of Management

Comments (0)

It looks like no one has posted a comment yet. You can be the first!

You need to log in, in order to post comments.

MIT World — special events and lectures

MIT World — special events and lectures

Category: Events | Updated over 2 years ago

December 12, 2011 20:47
All Rights Reserved (What is this?)
Additional Files

7379 times

More from MIT World — special events and lectures

Race from France to France, Leave Antarctica to Starboard

Race from France to France, Leave A...

Added over 6 years ago | 01:39:00 | 14168 views

Proactive Computing: A Progress Report

Proactive Computing: A Progress Report

Added over 6 years ago | 01:38:00 | 3686 views

30th Anniversary of The Inter-University Committee on International Migration

30th Anniversary of The Inter-Unive...

Added over 6 years ago | 01:29:00 | 4639 views

The Coming Generational Storm: What You Need to Know about America's Economic Future

The Coming Generational Storm: What...

Added over 6 years ago | 01:04:00 | 5261 views

Just Back from Iraq: Observations of a Weapons Inspector

Just Back from Iraq: Observations o...

Added over 6 years ago | 01:02:00 | 4608 views

Minorities in the United States

Minorities in the United States

Added over 6 years ago | 02:04:00 | 23770 views