University and overseas labor focus of panel discussion
BY LISA TREI
Professor Hayagreeva Rao offered his take on the issue of sweatshop labor overseas during a Nov. 27 panel discussion, “Responsible Competitiveness: Economics, Ethics and the Global Labor Force,” on campus.
In contrast to Adam Smith's notion that an "invisible hand" guides markets, Professor Hayagreeva Rao said last week that it is the "visible joint hands of activists that shape markets and can exert a profound effect" on them.
Rao, an expert on the social and cultural causes of organizational change, asserted that the demand side of the apparel industry—that is, consumers—can wield greater influence over the working conditions in which their goods are manufactured than expecting the supply side—overseas subcontractors—to treat their employees according to U.S. and E.U. labor standards.
"You've got to influence consumers so they're willing to pay more," Rao said. The Gap clothing firm has achieved this through its popular Gap (PRODUCT) RED collection, he said, through which purchasers know that half of the profits earned go to support women and children in Africa affected by HIV/AIDS. "By educating, by moralizing consumers, [movements] can create natural incentives for firms to differentiate themselves," he said.
Rao, the Atholl McBean Professor in the Graduate School of Business, offered his take on the issue of sweatshop labor overseas during a Nov. 27 panel discussion, "Responsible Competitiveness: Economics, Ethics and the Global Labor Force," in Bishop Auditorium. The event was held to discuss the role of Stanford, the garment industry and social movements as they relate to working conditions overseas for the men and women who make gear emblazoned with Stanford's logo.
Professor Joshua Cohen, director of the Program on Global Justice, moderated the 90-minute discussion, which featured political science Professor David Brady; philosophy Professor Debra Satz; Scott Nova, executive director of the Worker Rights Consortium; and Auret van Heerden, president of the Fair Labor Association. President John Hennessy opened the event by addressing Stanford's responsibility as a global citizen.
"We've always exercised great care in how the Stanford name is used," he said. "That should apply not only to the name of the university around the world with respect to research and education, but also in the way it's used with apparel products."
During the past year, Hennessy said, he has looked closely at issues surrounding the production of university-licensed merchandise. The subject came to the forefront last May when 11 students occupied Hennessy's office demanding that the university not use sweatshop labor to produce Stanford gear. About 50 more protesters marched from White Plaza to rally outside the president's office. A week later, Hennessy published an editorial in the Stanford Daily noting that he had been meeting for several months with members of the student-led Stanford Sweat-Free Coalition and had decided before the sit-in that the university would join the Worker Rights Consortium and Fair Labor Association, two groups that aim to improve working conditions overseas.
"What I've learned is that the issue is a lot more complicated that it appears and that there are no simple solutions," Hennessy told the audience last week. "But, just as Stanford has adopted standards on its own core campus talking about having a healthy, safe, secure working environment, we should expect the same thing for the products we use and the products that carry our name."
Although Stanford permits its name to be used on licensed merchandise, Hennessy said, it is many steps removed from its manufacture. Although the university could simply remove itself from the sweatshop controversy by forgoing the licensing income it derives from such goods—which, in the big picture, does not bring in a lot of money—such an approach would be irresponsible, the president said.
"The long-term solution in my mind … will be better local laws and enforcement of labor standards," he said. "But that goal is still a long way from reality. Some believe in limiting production to a small number of certified factories. Others believe it's possible to create an environment where factory owners are incentivized to treat their workers better and develop better business processes. But I think, in the end, the collaborative approach [is best]—an approach that works with all the stakeholders and tries to find an alignment of interests that works for the university, for consumers, for manufacturers, for product suppliers and, of course, for the employees that are manufacturing apparel."
