Implementation of SA8000 in the Chinese mainland with a special focus onthe toys industry

Pao Yue-kong Library Electronic Theses Database

Implementation of SA8000 in the Chinese mainland with a special focus onthe toys industry

 

Author: Ng, Wan-hung Kelvin
Title: Implementation of SA8000 in the Chinese mainland with a special focus onthe toys industry
Year: 2004
Subject: Hong Kong Polytechnic University -- Dissertations
Toy industry -- China
Toys -- Standards -- China
Department: Graduate School of Business
Pages: xii, 93 leaves : ill. ; 30 cm
Language: English
InnoPac Record: http://library.polyu.edu.hk/record=b1772722
URI: http://theses.lib.polyu.edu.hk/handle/200/1456
Abstract: Since 1980s, the Hong Kong toys manufacturers have relocated their manufacturing facilities to the Chinese Mainland due to the low labor cost. Nowadays, toys manufacturers in China's Guangzhou province supply almost 70 percent of the world's toys, including products for major corporations such as Mattel, Hasbro, Disney, and McDonald's. The export trade is estimated to exceed US$7.5 billion per annum in 2002. However, toys manufacturers do not share the benefits of the growth of toys industry. Owing to the high bargaining power of the dominating corporations, they are facing many operating challenges in the past decade, such as price depression, order seasonality, short delivery time and increasing labor and production costs. In recent years, many corporations have created their codes of conduct in response to the criticism heightened by non-governmental organizations (NGOs) that they are exploiting the workers in the developing countries. For example, Mattel has established its Global Manufacturing Principles (GMP) and McDonald's has launched its Code of Conduct (COC) for Suppliers since 1997. Toys manufacturers find diversity of standard as one major problem in compliance. Different toys companies have different standards and interpretation of standards and they might be contradictory with each other. Moreover, toys manufacturers are subject to multiple COC audits from different toys companies. The time and resources spent by the factories in multiple audits are a burden to them. The objective of this research is to study the feasibility of implementing an independent social accountability standard, Social Accountability 8000 (SA8000), to replace the various codes of conduct created by different corporations. Questionnaires were designed and distributed to the employees of the toys manufacturers to investigate the capability of their factories in SA8000 compliance, it was the quantitative part of this research and descriptive statistics was used to present the collected data. Qualitative study in the form of interviews with the factory managers was used to gather their comments on the questionnaire results and the implementation of SA8000 standard. Both quantitative and qualitative studies showed that the toys manufacturers have difficulty to comply with the requirements on working hours according to SA8000 standard. This is because of the long overtime in the peak seasons. The corporations have accepted the use of the Comprehensive Working Hour System to control the overtime in the peak seasons, but not SA8000 standard. It was also found that the corporations have not recognized SA8000 standard and still insist on their own factory audits according to their individual codes of conduct. These are the major reasons why SA8000 standard failed to prevail in toys industry. It is suggested that the Social Accountability International (SAI), the founder of SA8000 standard, should modify its standard to allow flexibility to adapt to the operating environment of toys industry. Besides, SAI should discuss with corporations about the recognition of SA8000 standard and explain the benefits to the corporations. On the other hand, the corporations should realize that this is the trend to adopt credible external system to avoid human rights abuse. Toys manufacturers should also view the SA8000 standard as a motive to improve their productivity and generating the competitive advantage over their competitors.

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