Globalisation

The Moral Economy of Capital: Transnational Corporate Codes of Conduct and Labour Rights in China

Pun Ngai
Associate Professor, Division of Social Science
Hong Kong University of Science and Technology
E-mail: sonpun@ust.hk

Abstract

Since the mid 1990s we have witnessed a surge in the practice of producing transnational corporate codes of conduct vis-à-vis labour standards and labour rights in China.

This gives rise to a series of puzzles: Who cares about labour rights in China? Why does transnational capital take the initiative to protect Chinese labour? Who can generate institutional support and ethical standard to safeguard the basic rights of Chinese labour which have rapidly deteriorated in the last two decades? For whose interest? At a time when China has been racing to become a “world workshop”
providing a huge pool of cheap labour for facilitating global production, we see an increasingly concerted attempt by transnational capital to initiate the regulation of labour standards, especially at the company level. In contract to the “race to the bottom” strategy that works adversely against labour rights globally, there is a kind of “moral economy” of capital, as we will call it, initiating and shaping new labour standards and regulations in China’s rapidly changing labour relations.

Deriving insights from James Scott’s concept of the moral economy, we highlight the role of capital in articulating a notion of economic injustice and the principle of reciprocity and forced generosity by capital to rule out labour exploitation through the institutionalization of labour codes. In tandem with, if not replacing, the role of the Chinese state in regulating labour conditions, meeting international labour standards and practices, corporate labour codes have been increasingly advocated by transnational corporations (TNCs), often big
brand-name American and European retailers, for introduction into their Chinese production contractors and subcontractors. This perplexing phenomenon has created a heated contemporary debate on labour rights that deserves deeper investigation.

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