Sweat Factories in China and Corporate Social Responsibility

Assessment will be based on your topic concerned (whether it is interesting), analytical skills (reasonable, use relevant and appropriate theories, and rigorous), potential contributions to readers (whether readers can learn from the report), and professional presentations.

 ( it is also suggested by one CPA association to do case analysis)

Sweat Factories in China and Corporate Social Responsibility

Content

1. Facts and general situation of sweat factories in China

Sweatshop (or sweat factory) is a negative term for a workplace that has socially unacceptable working conditions. The work may be difficult, dangerous or be paid a wage that is not corresponding with the content of work. Workers in 'sweatshops' are made to work extremely long shifts for very little wages and have their human rights violated. . Sweatshops often have poor working conditions, unfair wages, unreasonable hours, child labor, and a lack of benefits for workers. According to the US Department of Labor, a "sweatshop" is defined as a factory that violates 2 or more labor laws.

Many aspects of the worldwide people’s material lifestyle can be attributed to trade relations between worldwide different countries and Asia. A significant proportion of the clothes we wear, the toys we grew up with, and also the technology we use, was produced somewhere in Asia, especially in China. Products that commonly come from sweatshops are shoes, clothing, rugs, coffee, chocolate, toys, and bananas. The places producing these products are usually developing countries.

1. Ethical issues related to sweat factories

1. Enron Problems – Corporate Governance:  Week 2
   Governance failure at management level, incompetence – awareness / understanding of role, control & report system
2. Ethical Decision Making Considerations (EDM)   Week 4 P.5
   Well-offness or well-being – Consequentialism, utilitarianism, teleology
   Fairness among stakeholders – Kant, Justice as impartiality
   Different behavior in different culture – Relativism, Subjectivism
3. Culture of integrity can help remedy deficiencies – corporate culture – those shares beliefs, values, and other means that guide the actions of a corporation’s employees and agents. A Culture of integrity depends upon the set of beliefs and values that drive norms and actions.   Week 5
4. Universal values – Despite diverse cultures in different societies and organizations, we still commit to design a set of universal values or hyper norms in corporate value systems. → Honesty, Fairness, Compassion, Integrity, Predictability, Responsibility Week 5

1. Create an Ethics Program Week 5

1. Identify important values
2. Build values into culture & decision making
3. Train/Reinforce – leaders must reinforce
4. Monitor Performance
5. Reward/Punish
6. Re-evaluate values & ethics program

1. Create an Ethical Corporate Culture Week 5

1. We need to consider following questions:
2. 1. What are the key values?
3. 2. How would you reinforce them?
4. 3. How would monitor them
5. 4. What rewards or penalties would you use?

1. Ethics Risks - Exist when the ethical expectations of stakeholders are not met:

1. Resulting in loss of reputation and stakeholder support.
2. Preventing full achievement of strategic objectives.

Ethics Red Flags

1. Lack of integrity
2. Little understanding of Ethical Decision Making, or of virtues expected

1. “The Fraud Diamond: Considering the Four Elements of Fraud”, David T. Wolfe and Dana R. Hermanson, The CPA Journal Online, 2004, http://www.nysscpa.org/cpajournal/2004/1204/essentials/p38.htm
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   Corporate Culture 可解決: 1. Incentive; Culture: Be Honest,少d不好的incentive; 2. Rationalization:同大家communicate邊d好/壞culture
   Internal Control可解決: Opportunity (by separation of duty)

1. Structure problems
2. Choose one most important and significant issue
3. Plan and perform your analyses using theories
4. Synthesize the findings
5. Develop recommendations

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