Do Codes of Conduct Improve Worker Rights in Supply Chains? A Study of Fair Wear Foundation
Key Insights for Managers
Factories improved their compliance with labor codes of conduct after being subjected to multiple Fair Wear Foundation audits, but only in some areas. Authors Niklas Egels-Zandén and Henrik Lindholm studied 229 garment factories subjected to independent audits conducted by the Fair Wear Foundation, and concluded that these audits likely seriously underestimate the prevalence of discrimination against union members, harassment, and gender discrimination.
Examining the 43 factories subjected to multiple Fair Wear Foundation audits, they find that between their first and second audits, factories tended to exhibit significantly fewer code compliance violations in many areas. most frequently in legal employment aspects (where 35% of factories improved, but 12% declined), discrimination (30% improved, 9% declined), health and safety (26% improved, 19% declined), and freedom of association (26% improved, 14% declined). Most of the factories analyzed are in China, Tunisia, Turkey, and Macedonia.