Decent Work in Global Supply Chains

Unit 2, Lecture 1: Introduction to the Regulatory Framework

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A. Introduction to the Regulatory Framework

Beginning of industrialization – had to have charter to form corporation. Charter could be revoked if didn’t perform to the wishes of the public.

Now corporations can sue states in public and private courts. Corporations gained legal status. Can sue on their own grounds and it does not touch the owners. There is now a separation between management and owners. If a corporation violates the law management not owners will be brought to court even fines are paid by the corporations.

Today the key issue is intellectual property rights, patents and trademarks. Great national difference in terms of regulation.

No effective and consistent web of laws and standards has emerged at the international level to hold TNCs accountable to citizens in all of the countries where they operate. Global rules set by voluntary self-regulation or co-regulation.

Types of Regulation:
Public Regulation: set by parliament / government authorities
Co-Regulation: arrangements between business and 1 or more other parties. Only govt’s can link co-regulatory guidelines to legally binding enforcement
Self-Regulation: businesses set their own rules and pledge to abide by them

Ways that TNCs try to control their influence:
- Disseminating industry versions of codes
- Lobbying for legislation which is weather than codes
- Threaten trade retaliation
- Lobbying for ‘freedom of commercial speech’
- Enlisting health professionals
- Challenging legislation in the courts
- Lobbying to draft legislation and monitor compliance


about 2 years ago

the fact that a lacuna exist in terms of legal provisions at the international level to force corporations to be accountable to the workers in the area of their operation is quite a challenge. this goes to show how far the corporations themselves have taken charge of the global best practices setting. is this corruption or not?

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