When Industrial Democracy Meets Corporate Social Responsibility — A Comparison of the Bangladesh Accord and Alliance as Responses to the Rana Plaza Disaster

DOIhttp://doi.org/10.1111/bjir.12242
Publication Date01 March 2018
AuthorJuliane Reinecke,Jimmy Donaghey
Date01 March 2018
British Journal of Industrial Relations doi: 10.1111/bjir.12242
56:1 March 2018 0007–1080 pp. 14–42
When Industrial Democracy Meets
Corporate Social Responsibility — A
Comparison of the Bangladesh Accord
and Alliance as Responses to the Rana
Plaza Disaster
Jimmy Donaghey and Juliane Reinecke
Abstract
Corporate Social Responsibility (CSR) and Industrial Democracy are two
paradigmatic approaches to transnational labour governance. They dier
considerably with regard to the role accorded to the representation of labour.
CSR tends to view workers as passive recipients of corporate-led initiatives,
with little attention paid to the role of unions. Industrial Democracy centres
on labour involvement: those aected by governance need to be part of it.
Examining the Bangladesh Accord and Alliance as governance responses to
the 2013 Rana Plaza disaster, this article oers a comparative perspective of
how Industrial Democracy-oriented and CSR-oriented initiatives translate into
dierences in implementation. The article highlights that while CSR can foster
eective problem-solving in the short run, Industrial Democracy is necessary to
build governance capacities involving workers in the long run.
1. Introduction
On 23 April 2013, large cracks appeared in the eight-storey Rana Plaza
building in the Savardistrict of Dhaka, Bangladesh. A bank, shops and oces
in the lower floors closed the next day. But severalthousand garment workers,
who lacked a strong collective voice, were prompted to enter the building
despite safety concerns. The building collapsed, killing over 1,100 workers,
highlighting the absence of worker voice to refuse unsafe work. The name
‘Rana Plaza’ has become synonymous with the problems of labour rights in
JimmyDonaghey and Juliane Reinecke are atOrganisation and HRM, Warwick Business School,
University of Warwick.
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2017 John Wiley & Sons Ltd.
When Industrial Democracy Meets Corporate Social Responsibility 15
global supply chains, but also with the failure of social auditing adopted by
brands as part of their Corporate Social Responsibility (CSR) commitments:
two of the factories in the complex had been audited shortly before the
disaster. While CSR provides a mechanism to step in where public regulation
is absent, RanaPlaza also highlighted the problem of the lack of worker voice.
CSR is typically seen as a corporation’s voluntary engagement with its
stakeholders, including consumers and civil society actors to work towards
the improvement of social and environmental standards. Yet, organized
labour itself has been conspicuously absent from the definition, design and
governance of CSR. This is surprising given that many CSR initiatives are
aimed at the improvement of labour standards (Fransen and Burgoon 2015;
Locke 2013). An alternativeapproach to the regulation of labourwithin global
supply chains that puts workers at the centre of the design and implementation
of initiatives to improve their conditions is grounded in Industrial Democracy.
These two approaches, as will be outlined below, are built upon dierent
normative assumptions and this article seeks to understand empirically how
dierences in the design of such initiatives play out.
This article compares the implementation of two competing governance
initiatives to improve workplace safety in the Bangladesh ready-made
garment sector post-Rana Plaza: The ‘Accord for Fire and Building Safety
in Bangladesh’ (Accord) and the ‘Alliance for Bangladesh Worker Safety’
(Alliance). The Alliance is built upon a fairlytraditional CSR-based approach,
resulting in collective, transnational industry self-regulation. The Accord is
broadly based on principles of Industrial Democracy, resulting in a form
of transnational co-determination. However, unlike traditional Industrial
Democracy, where collective bargaining rights are underpinned to a lesser or
greater extent by the state, in the Bangladesh case, the consistent failure of
the state to enforce eectively worker rights has meant that brands, rather
than states, have become the ultimate enforcer in employment relations.
Being rooted in significantly dierent logics presents a unique opportunity
to compare the interplay between the Industrial Democracy and CSR
approaches to transnational labour governance. The article investigates these
dierent logics underlying supply chain labourgovernance from a conceptual
approach, followed by the research methods and keyfindings. Finally, insights
are derived on how the interplay between Industrial Democracy and CSR
shapes global labour governance.
2. Transnational labour governance in global supply chains: two approaches
The fragmentation of global supply chains and the outsourcingof production
to countries where labour standards are weak and enforcement even
weaker have severely challenged traditional labour governance mechanisms
of collective bargaining and public regulation. In the absence of such
mechanisms embedded within the national context where production is
carried out, regimes of ‘private labour governance’ (Hassel 2008) and
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2017 John Wiley& Sons Ltd.

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