FAIR TRADE, CORPORATE ACCOUNTABILITY AND BEYOND This page has been left blank intentionally Fair Trade, Corporate Accountability and Beyond Experiments in Globalizing Justice Edited by KATE MACDONALD University of Melbourne, Australia SHELLEY MARSHALL Monash University, Australia © Kate Macdonald and Shelley Marshall 2010 All rights reserved. No part of this publication may be reproduced, stored in a retrieval system or transmitted in any form or by any means, electronic, mechanical, photocopying, recording or otherwise without the prior permission of the publisher. Kate Macdonald and Shelley Marshall have asserted their rights under the Copyright, Designs and Patents Act, 1988, to be identied as the editors of this work. Published by Ashgate Publishing Limited Ashgate Publishing Company Wey Court East Suite 420 Union Road 101 Cherry Street Farnham Burlington Surrey, GU9 7PT VT 05401-4405 England USA www.ashgate.com British Library Cataloguing in Publication Data Fair trade, corporate accountability and beyond : experiments in globalizing justice. 1. I nternational trade Social aspects. 2. Commercial policy. 3. Social responsibility of business. I . Macdonald, Kate. II. Marshall, Shelley. 382.3-dc22 Library of Congress Cataloging-in-Publication Data Fair trade, corporate accountability and beyond : experiments in globalizing justice / by Kate Macdonald and Shelley Marshall. p. cm. I ncludes index. ISBN 978-0-7546-7439-9 (hardback) ISBN 978-0-7546-9119-8 (e-book) 1. I nternational trade. 2. Competition, Unfair. 3. Foreign trade regulation Social aspects. I. Macdonald, Kate, 1976- II. Marshall, Shelley. HF1379.F343 2009 382'.3 dc22 2009030156 ISBN 9780754674399 (hbk) ISBN 9780754691198 (ebk.I) Contents List of Figures and Tables ix Notes on Contributors xi Preface xvii List of Acronyms xix INTRODUCTION 1 Social Governance in a Global Economy: Introduction to an Evolving Agenda 3 Kate Macdonald and Shelley Marshall PART I INDIVIDUAL AND CIVIC ACTION THROUGH FAIR TRADE 2 Fair Trade at the Centre of Development 37 Steve Knapp 3 Developing Markets, Building Networks: Promoting Fair Trade in Asia 57 Claribel B. David and Hyun-Seung Anna Kim 4 Mainstreaming Fair Trade: Fair Trade Brands and the Problem of Ownership 75 Anna Hutchens 5 What Gives Fair Trade its Right to Operate? Organizational Legitimacy and Strategic Management 93 Alex Nicholls 6 Voluntarism and Fair Trade 121 Tim Wilson PART II RESPONSIBLE CONSUMERS AND CORPORATIONS 7 Corporations and Global Justice: Rethinking ‘Public’ and ‘Private’ Responsibilities 137 Terry Macdonald 8 Corporate Responsibility and Stakeholder Governance: Relevance to the Australian Garment Sector 149 Emer Diviney and Serena Lillywhite Fair Trade, Corporate Accountability and Beyond vi 9 CSR and Policy Incoherence 169 Peter Utting 10 Fair Consumption? Consumer Action on Labour Standards 187 Gordon Renouf PART III MOBILIZED WORKERS 11 Corporate Accountability and the Potential for Workers’ Representation in China 211 Anita Chan 12 The Threat Posed by ‘Corporate Social Responsibility’ to Trade Union Rights 223 Jeff Ballinger 13 Can CSR Help Workers Organize? An Examination of the Lessons Learnt and an Exploration of a New Way Forward 245 Andrea Maksimovic 14 Corporate Accountability through Community and Unions: Linking Workers and Campaigning to Improving Working Conditions across the Supply Chain 259 Annie Delaney 15 Triangular Solidarity as an Alternative to CSR and Consumer-based Campaigning 277 Apo Leong, Chan Ka-wai and Anna Tucker PART IV A STRENGTHENED AND TRANSFORMED ROLE FOR THE STATE 16 Regional Trade Agreements in the Pacic Islands: Fair Trade for Farmers? 293 Nic Maclellan 17 Crowding Out or Ratcheting Up? Fair Trade Systems, Regulation and New Governance 313 Orly Lobel 18 The Regulatory Impact of Using Public Procurement to Promote Better Labour Standards in Corporate Supply Chains 329 John Howe 19 CSR is Not the Main Game: The Renewed Domestic Response to Labour Abuses in China 349 Sean Cooney Contents vii CONCLUSION 20 Experiments in Globalizing Justice: Emergent Lessons and Future Trajectories 365 Kate Macdonald and Shelley Marshall Index 387 This page has been left blank intentionally List of Figures and Tables Figures 4.1 Typology of trader-participation in fair trade/Fairtrade markets 82 4.2 The evolution of fair trade models: Certication to brand companies 87 5.1 A model of organizational legitimacy 98 5.2 Legitimacy tree nodes 108 11.1 Legal minimum wage per month for a 40-hour work week, Outer Shenzhen, Guangdong Province, 1993–2007 213 Tables 3.1 Bangladeshi fair trade organizations engaged in domestic activities 59 4.1 Fairtrade labelling criteria for Fairtrade certied traders 78 4.2 Standards for fair trade organizations (FTOs) 79 5.1 Legitimating competences 99 5.2 A typology of organizational legitimacy 101 5.3 Legitimating discourses in fair trade public statements 103 5.4 Data summary for legitimacy typology 111 11.1 Ination adjustments to minimum wage, Outer Shenzhen, Guangdong Province, 1993–2007 213 14.1 Summary of homework regulation mechanisms to promote supply-chain regulation and homework protection 268 20.1 Extent of contribution to institutional transformation 380 [...]... as to protect core human and social rights and advance broader principles of justice within a global economy? Fair Trade, Corporate Accountability and Beyond  In order to examine this core question, contributors study the potential role of a range of emerging state and non-state initiatives – broadly termed fair trade’, corporate social responsibility’ (CSR) and corporate accountability initiatives... worked as a union and community organizer and campaigner She has worked for the Textile, Clothing and Footwear Union of Australia and was the founding member and driving force behind the creation of the FairWear campaign, coordinating campaigns and organizing activities with homeworkers in the garment industry She is a participant in the xii Fair Trade, Corporate Accountability and Beyond International... to support and/ or demand responsible corporate action, as well as to promote more far-reaching agendas of justice in the domains of production and trade In short, over the course of the last decade and a half, agendas of ethical trade and consumption, together with associated agendas of corporate responsibility and accountability have been expanding and consolidating across both ‘barricades and boardrooms’... Enterprises and Social Policy and the United Nations Conference on Trade and Development’s proposed codes on Restrictive Business Practices and on the Transfer of Technology (Haufler 2001; Jenkins et al 2002) 12 Fair Trade, Corporate Accountability and Beyond Globalization of Capitalist Market Economies and Evolving Dynamics of Disembedding The dynamics of interaction between capitalist production and trading... related one between ‘Fordism’ and ‘post-Fordism’ (Harvey 2006) 10 Fair Trade, Corporate Accountability and Beyond The Embedding of Capitalism by the State in the Post-war Period During the post-war period, the state was the major underwriter of capitalist productive and social relations Both international law and broader understandings of appropriate political practice reflected and reproduced the assumption... organization OECD Organisation for Economic Cooperation and Development OSHA Occupational Safety and Health Administration PACER Pacific Agreement on Closer Economic Relations PICTA Pacific Island Countries Trade Agreement SME small or medium enterprise TCF textile, clothing and footwear xx Fair Trade, Corporate Accountability and Beyond TCFUA Textile, Clothing and Footwear Union of Australia TNC transnational... Diplomacy and Trade and a Bachelor of Arts from Monash University, studied IP at WIPO, and Global Health Diplomacy and the WTO, International Trade and Development at the Institut de Hautes Études Internationales et du Développment This page has been left blank intentionally Preface It is often lamented that academics, activists and practitioners engaged in corporate accountability and improving labour standards... University of Melbourne and the Centre for Applied Philosophy and Public Ethics at the Australian National University, with the support of the Centre for Governance of Knowledge and Development at the Australian National University and the Fair Trade Association of Australia and New Zealand We are especially grateful to Cameron Neil from the Fair Trade Association of Australia and New Zealand for working with... Filipinas Fair Trade Ventures and the Director for Finance and Advocacy for the Advocate of Philippine Fair Trade She joined the International Fair Trade Association (IFAT) in 2003 as Treasurer and Asian Representative and took on the role of Vice President in May 2007 IFAT is a global network of 350 fair trade and support organizations in 60 countries whose mission is to improve the livelihood and well... of the Fair Trade Movement’, in 2007, Dr Hutchens’ recent research on fair trade will be published by Edward Elgar in her book Changing Big Business: The Globalisation of the Fair Trade Movement in April 2009 Dr Hutchens’ research interests include fair trade value-chains and ‘mainstreaming’, Fair Trade labelling and brand companies; Fair Trade market development in the Asia Pacific region; and gender . FAIR TRADE, CORPORATE ACCOUNTABILITY AND BEYOND This page has been left blank intentionally Fair Trade, Corporate Accountability and Beyond Experiments. participant in the Fair Trade, Corporate Accountability and Beyond xii International Homeworkers Movement organization, and is currently a PhD candidate at Latrobe