Steering CSR Through Home State Regulation: A Comparison of the Impact of the UK Bribery Act and Modern Slavery Act on Global Supply Chain Governance
| Author | Genevieve LeBaron,Andreas Rühmkorf |
| Date | 01 May 2017 |
| Published date | 01 May 2017 |
| DOI | http://doi.org/10.1111/1758-5899.12398 |
Steering CSR Through Home State Regulation:
A Comparison of the Impact of the UK Bribery
Act and Modern Slavery Act on Global Supply
Chain Governance
Genevieve LeBaron
Department of Politics, University of Sheffield
Andreas R€
uhmkorf
School of Law, University of Sheffield
Abstract
The home states of multinational enterprises have in recent years sought to use public regulation to fill the gaps left by the
absence of a binding labour standards framework in international law. This article examines recent home state initiatives to
address forced labour, human trafficking, and slavery in global supply chains, and their interactions with private governance
initiatives. Focusing on a case study of the 2015 UK Modern Slavery Act and 2010 UK Bribery Act, we analyse two distinct leg-
islative approaches that policy makers have used to promote corporate accountability within global supply chains and explore
the varied impacts that these approaches have on corporate behaviour. Empirically, we analyse codes of conduct, annual CSR
reports, and supplier terms and conditions for 25 FTSE 100 companies to shed light into the impact of the legislation on cor-
porate behaviour. We find that legislation that creates criminal corporate liability appears to spur deeper changes to corporate
strategy, and argue that in the case of the Modern Slavery Act, the triumph of voluntary reporting over more stringent public
labour standards seems to have undermined the effectiveness of recent governance initiatives to address forced labour in glo-
bal supply chains.
After more than two decades of private governance initia-
tives to promote Corporate Social Responsibility (CSR),
reports of gross human rights violations within global supply
chains remain in the public spotlight. Recent examples
include the Rana Plaza building collapse in Bangladesh, the
Tazreen factory fire in Pakistan, oil spills on Ogoniland in
Nigeria, and forced labour in several countries and industries
ranging from Thailand’sfishing boats to West African cocoa
farms. In light of recurrent reports of labour exploitation and
workers’premature death within supply chains, consumers,
non-governmental organizations (NGOs) and others have
raised concerns about the effectiveness of the industry-led
private governance regimes, through which companies pur-
port to address and prevent these types of violations.
Recently, societal coalitions in countries like the United
States, United Kingdom, France, and India have succeeded
in sparking a wave of new public governance designed to
strengthen corporate accountability. This has included legis-
lation passed by the home states of multinational enter-
prises –in other words, the countries in which the large
retail and brand manufacturing companies that lead global
supply chains are incorporated –which is primarily geared
towards changing corporate practices in host states, the
countries in which multinational enterprises operate, either
directly or through subsidiaries. Examples of recent ‘home
state regulation’to spur multinational accountability for
their global supply chains include the California Trans-
parency in Supply Chains Act, the US Dodd-Frank Act (which
regulates conflict minerals), the UK Bribery Act (which estab-
lishes extraterritorial corporate criminal liability for bribery in
global supply chains), and the UK Modern Slavery Act
(which includes a transparency in supply chains clause). To
date, the effectiveness of this wave of legislation and the
questions of how, whether, and when it impacts corporate
behaviour has been under investigated.
In this paper, we explore the accelerating legislative trend
of home state legislation’s use to mandate CSR and stimu-
late changes in corporate behaviour and its consequences
for the governance of labour standards in global supply
chains. In particular, we investigate how the stringency and
institutional design of national legislation shapes private
governance responses and evaluate the effectiveness of dif-
ferent models of home state regulation. Conceptually, we
seek to build on and deepen recent scholarship on CSR pol-
icy (Gond et al., 2011; Steurer, 2010) and the governance of
labour standards in global supply chains (Appelbaum and
Global Policy (2017) 8:Suppl.3 doi: 10.1111/1758-5899.12398 ©2017 University of Durham and John Wiley & Sons, Ltd.
Global Policy Volume 8 . Supplement 3 . May 2017 15
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