Will the Bangladesh Factory Tragedy Kill Voluntary Corporate Codes?

Probably not. The tragedy in Bangladesh — more than 400 dead — on the heels of a fire there in November, is no doubt casting a negative light on non-governmental certification schemes.

But there’s no clear alternative. Voluntary codes of conduct are now routinely subject to institutionalized third party supply-chain monitoring (evidenced by the fact that a number of monitoring firms are themselves publicly traded companies). Obviously, the system is coming up short, as critics vigorously note (see, for instance, this labor-funded study released last month). Many are pushing for something that looks more like public regulation. In that view, the recent Bangladesh episodes look like the global equivalent of the Triangle Shirtwaist fire in 1911, which ushered in the modern era of workplace safety regulation in the United States.

That’s not the the way it’s going to play out, at least not for now. The capacity just isn’t there, either nationally or globally, to fully legalize labor rights. But there are new approaches mixing private-public components that are gaining traction. The most notable example, at the global level, is the UN Guiding Principles on Business and Human Rights. That may set a long-term baseline from which to refine labor rights and other norms into workable practices on the ground. In an interesting (and well-timed) essay in the Boston Review, MIT’s Richard Locke sees promise in regulation by host governments, even in the developing world. Public regulators can overcome capacity deficits by taking a more measured, strategic approach, using carrots to create conditions (e.g., transparency) that improve the effectiveness of private schemes. In the end, only the state can create the level playing field necessary to their success.

The result is some form of polycentric governance, for what that’s worth. The Bangladesh tragedy is training unprecedented attention on the question of how better to hold corporations to human rights norms, defining it as one of the major issues of globalization. It may be, as John Ruggie says of the Guiding Principles, the end of the beginning.  But even the basic outlines of a durable solution still seem over the horizon, and a lot of institutional mapping and empirical study remains to be done.