Global Value Chains (CGVs) formed by the geographical dispersion of productive activities across firms and countries have become dominant patterns of organisation in the global economy.

According to the United Nations Conference on Trade and Development, GVCs could account for as much as 80% of global trade, organised in complex webs of intra-firm and inter-firm trade under the governance of large transnational corporations (UNCTAD, 2013).

These chains are being actively promoted by leading international institutions, as promising ways of staying competitive in the global economy (OECD, 2007), offering “tremendous opportunities, in particular for developing and least-developed countries” (Lamy, 2012). GVCs are expected to deliver economic benefits by offering possibilities for local firms to plug into globally-dispersed but tightly coordinated production networks, and to perform increasingly sophisticated services for global buyers, so as to increase the value captured from their productive contribution.

The number of people employed in GVCs has increased from 296 to 453 millions between 1995 and 2013, providing one in five jobs in the global economy (ILO, 2015).

While GVCs grew at a fast pace in many industries, new social movements have also emerged in the form of transnational resistance networks aiming to make visible the social and environmental conditions under which productive activities were being performed in GVCs. Tight productivity pressures, low wages and erosion of social benefits, frequent repression of workers’ organizing efforts, and the continuous threat of job losses through production relocation, are making social gains both scarce and precarious in the most vulnerable segments of GVCs.

The spectacular collapse of the Rana Plaza building in Dhaka, the capital of Bangladesh, in April 2013, causing the death of over 1,100 workers and injuring twice as many, has attracted major public attention to the hazardous health and safety conditions to which workers, mostly women, were being exposed in global systems of subcontracted production.

Environmental issues are likewise paramount, in relation to the exponential growth of world transportation, accelerated rates of waste generation, depletion of national resources and weak environmental regulation in many places of production. Claiming that brands and retailers that outsource production should take responsibility for the social and environmental conditions under which their products are being manufactured, social movements have stirred the adoption by global buyers of dedicated management tools in the forms of codes of conduct, auditing and monitoring procedures, aiming to guarantee respect for core international labour and environmental standards in global supply chains. The proliferation of such initiatives, either private, public, or of varied forms of public-private partnerships, has greatly complexified the landscape of GVCs. If some local improvements can be observed, these organisational devices have proved inadequate to address systemic issues of labour violation or environmental degradation in GVCs.

The Rana Plaza accident also highlighted the lack of effectiveness of codes of conduct and monitoring systems by which global buyers were to ensure human rights protection for workers who manufactured their products in the collapsed building.

These social and environmental concerns are gaining momentum in international and national debates on Global Value Chains. They were prominently addressed at the ILO 2016 International Labour Conference, in the European guidelines for trade and investment policy (EC, 2015), and stirred the on-going discussions of the intergovernmental working group on « transnational corporations and other business enterprises with respect to human rights » of the United Nations’ Human Rights Council. Likewise, a series of national laws have been passed or are being discussed to address corporate accountability for these issues in novel ways, such as the French Law on the Duty of Vigilance of Multinationals (2017), or the UK Law on Modern Slavery (2015). The need for greater consideration of the impact on social and environmental life of economic decisions made in GVCs, and the search for new ways of addressing and redressing these impacts at both local and broader systemic levels, call for multi-disciplinary research and teaching initiatives, as well as enhanced cross-fertilization between varied forms of knowledge produced in academic, NGOs, labor unions, and others circles.


 

European Commission (2015) Trade for All: towards a more responsible trade and investment policy, Brussels: European Union.
http://trade.ec.europa.eu/doclib/docs/2015/october/tradoc_153846.pdf accessed 11/11/15.

Lamy, P. (2012) Speech delivered at the WTO-MOFCOM-OECD-UNCTAD Seminar on Global Value Chains in Beijing on 19 September 2012.
http://www.wto.org/english/news_e/sppl_e/sppl245_e.htm, accessed 15/02/2015.

International Labour Organisation (2015) World Employment Social Outlook: the changing nature of jobs, ILO: Geneva.

Organisation for Economic Cooperation and Development (2007) Staying competitive in the global economy: moving up the value chain, Paris: OECD.

United Nations Conference on Trade and Development (2013) Global Value Chains and Development: Investment and Value Added Trade in the Global Economy, UNCTAD/DIAE/2013/1. Geneva: United Nations.