Big brands/retailers send a lot of social auditors to the factories working for them. It is usually ineffective (or worse), but there are a few bright spots too.

Now, how about smaller companies that want to live and breathe ethical practices? They are not guided by the risk of bad press. So should they go at it the same way as large corporations?

I don’t think so. They are free to do what they think is right. They should ask social auditors to focus on the worst practices that are common in China. In my view, international standards can be a source of inspiration, but they are a bit out of touch with Chinese realities.

First, Chinese workers have the choice of where they work.

If the dorms are crappy or the canteen is terrible, they can easily go to another place. If they stay, it is their choice. Maybe it allows them to save more, to get back to their hometown earlier, and to buy a property / open a small business there.

If that’s their purpose in life, what is wrong with it? My point is that dorms, canteens, and other living areas should not be the main focus of a social audit.

Second, child labor and really bad cases of forced labor are not widespread. 

I would advise not to worry about these issues — with the notable exception of prisoners’ work.

What you need to know is the reality of the supply chain (what is subcontracted where). Do not force each manufacturer to get audited and approved, because in process you are forcing your suppliers to hide the fact that they subcontract to unapproved factories. The Walmart precedent shows that it is not realistic.

The same goes for home workers. Entire villages depend on this type of work in rural areas, and I don’t see what is fundamentally wrong with this setup. Don’t restrict it, as long as proper quality control processes are in place at the central location.

Third, most workers are not aware of the dangers to their health.

Most Chinese manufacturers are really at the level of European and American factories one century ago in that respect, and that’s frightening. Now THAT’s something you probably want to check.

The main questions are:

• Are workers wearing appropriate PPE (personal protective equipment)?
• Are there fire hazards? Is fire prevention taken seriously? (Several tragedies were reported in Bangladesh over the past few years, and I am surprised there are not more accidents of that nature in China.)
• Has factory management done something about the major sources of danger to employees?

Fourth, Chinese bosses don’t care about the environment.

Yes, they really, really don’t care at all. And that’s something you can change if you, as their customer, apply enough pressure (and if your business is sufficiently attractive).

In some cases, a bit of pedagogy might go a long way. If they don’t use energy-efficient equipment, you might want to explain to them how much they would save on their electricity bill.

In other cases, adopting more environmentally-friendly practices will require some arm-twisting. They will always see treating waste water (rather than dumping it behind their factory) as an extra cost.

Fifth, Chinese law is protective of employees’ rights.

Did you know that an employer isn’t allowed to charge fines to its staff, for example?

Naturally, there are many ways to circumvent these rules (e.g. reducing the bonus instead of giving a fine). So checking if the labor law is respected can’t be a bad thing. But I don’t see this as a priority.

What you might want to spend time on, instead, is looking for practices that demonstrate an adversarial relationship between labor and management. And the easiest thing to ask is… When is the last time training was provided to production operators?

Sixth, working hours are not a social issue, they are a quality and a productivity issue. 

I am not sure how to write this in a politically correct manner, but “the law” doesn’t have exactly the same meaning in China and in the US/Europe. It is a fact that both the workers and the factory owners are happy about long working hours. So why care about the legal limit?

The real culprit is the widespread belief that paying workers by the piece makes them more productive. As a result, workers are allowed to work 6 to 7 days a week, up to 12 hours a day.

And what is the problem with that? Low attention levels, behaviors based on individual interests, and excessive strain on equipment and machines. In the end, quality and productivity suffer.

So you might want to give extra points to those manufacturers that base workers’ pay on the team’s output and/or on working time (at least partially).

And, of course, you need to penalize those factories that push their staff to do all-nighters or that give them no resting days for up to an entire month (yes it is common…).

What do you think?