The Role of NGOs and other Stake holders:
The above example of UK supermarket retailers and their treatment of their suppliers is indicative of a violation of labour standards and workers' rights. These host country producers face intense global competition in global markets and therefore workers have limited powers to resist these violations. The growing exploitative business practices of large retailers and some of the transnational corporations, have been actively pursued by NGOs, student activist organisations, and trade unions. They are challenging the policies adopted by large retailers that encourage poor employment practices, lack of trade union recognition, and which create gender and wage discrimination.
Recently, NGOs have been in the forefront for raising concerns regarding labour practice by engaging in campaign called Clean Clothes Campaign (CCC) established in response to the poor working conditions of Filipino garment factories producing for a Dutch clothing company. They have also been successful making MNCs adopt corporate social responsibility as essential code of conduct for MNCs' after Levis Strauss, and Nike sweatshops in the host countries, such as Pakistan and Indonesia.
Conclusion:
In conclusion, Global big business are the main instrumental force in improving labour standards in developing countries, however, their influence to improve labour standards is limited to the area of their operation, such as the countries and sectors in which they invest. Therefore MNCs are not able to influence labour standards equally in all the developing countries. It was also observed in the preceding analysis that MNCs invest in selective countries that have certain level of infrastructure. Thus, countries need to invest in good national economic and social policies that will attract MNCs to these countries. This will build infrastructure and human capital. It is also evident from the argument presented here, that MNCs invest in the countries with relatively high labor standards, thus, they are not only seeking lower wages but optimal benefit.
However, MNCs are not the only stakeholders to improve standards. The other stakeholders and their codes of conduct, such as host governments, NGOs, ILO, Trade Unions have the power to influence labour standards. All these stakeholders are tied a complex socio-economic and political relationship which makes them all the more powerful. Thus, the global business revolution has provided opportunities of livelihood to people in the host countries, but has at the same time expanded the informal economy which eventually leads to poverty and social marignalisation. Therefore MNCs and other stake holders should establish a mechanism to introduce labour standards in the informal sector. This globalization has also created competition amongst the developing countries which creates far more challenges for labour standards.
In the context of the global production system and value chains, MNCs have the power to improve standards through monitoring their supplier's practices and taking care of their workers' conditions. Additionally it is crucial for consumers to be made aware of these conditions to exert pressure on MNCs to address these issues, as they may be unlikely to do so voluntarily.
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