International Corporate Responsibility Series

Volume 2, 2005

Perspectives On International Corporate Responsibility

Corporate Codes of Conduct
On the Virtue of Modesty

What are international codes of conduct for? The broad support for such codes masks fundamental differences about their purpose. Corporations see codes of conduct as regimes for regulating their relations with their suppliers in developing countries and—not least—to counter negative publicity. For labor and human rights activists, on the other hand, codes of conduct are levers for forcing positive change in global labor and environmental standards. Here I consider two areas typically covered by codes of conduct—wages and child labor—and identify some of the dangers of using codes to force change. If low wages or child labor are the result of poverty, and can’t be fixed by enlightened corporate policies, then codes will at best leave the underlying problems untouched and at worst will aggravate them. I conclude that we should be cautious about using codes to force higher standards.