From a weak letter of intent to prevalence: the toy industries' code of conduct

Abstract

In 2003, the global toy industry started a new attempt to implement common standards on working conditions in the notorious ‘sweatshop‐factories’ especially in China, where up to three million people from rural provinces produce toys for Western brand name companies. This article explores, why and how the common industry code of conduct (CoC) of the International Council of the Toy Industries (ICTI) gathered momentum and who will benefit from this dynamic. One reason for this harmonization is the uncontrolled growth of unilateral CoC in the industry, that makes it impossible for suppliers to comply with all the requirements, particularly when they deliver to many different brand name companies. Credibility gaps of‐ and critical reports about the CoC‐record of major brand name companies like Disney, Mattel and Hasbro were continuously issued by Nongovernmental Organisations (NGOs) from Hong Kong (the Hong Kong Christian Industrial Committee, HKCIC), its Northern network partner, the German Catholic Organization Misereor under the umbrella of the ‘fair‐play’ campaign and, by several media reports in reputable newspapers in the USA. Since 2004, even Mattel as a widely acknowledged ambitious company on codes of conduct, supports the less ambitious sector code. Moreover, the ICTI CoC enjoys support from some big retailers like Karstadt‐Quelle, Argos and Woolworth, that give the industry code real authority within the industry. ICTI negotiates with the biggest toy retailers Toys'R'Us and Walmart to accept the code like their own. The coordination between the big retailers and the brand name companies can potentially end current weaknesses of single codes of conduct, that leaves the managerial thesis about ‘first‐mover‐advantages’ or reputation effects for the brand name companies as a myth. In the long run, the major brand companies may benefit of a better reputation of the whole industry, due to the fact that the image of a brand is strongly connected with the image of the whole sector. Copyright © 2006 John Wiley & Sons, Ltd.

Positive Economics and the Normativistic Fallacy: Bridging the Two Sides of CSR

“…At the cross-industry level such engagement includes voluntary international agreements such as the UN Global Compact (Williams, 2004) in which companies commit themselves to certain standards of ethical conduct. At the industry level, for instance, major toy producers jointly established a common industry code of conduct (CoC) to implement common standards on working conditions in developing countries (Biedermann, 2006). In that way, they established functional equivalents to state regulation to ensure the legitimacy of their economic activities.…”

Measuring Corporate Social Performance: A Review

“…Supplier outcomes/impacts. Recent research on supply chain management appeared earlier in this paper as examples of responsive stakeholder management practices (e.g Biedermann 2006;Lindgreen et al 2009;Mamic 2005;Maloni and Brown 2006; . Measuring Corporate Social Performance 73 Pedersen and Andersen 2006).…”