This presentation entails a reflection of the child labor practices applied in the context of the manufacture of goods and services and which are prevalent in China. Many American companies with large scale operations across the globe usually outsource some of their production operations to China due to the favorable cost propositions found there. The goods and services are then manufactured there and shipped to the United States where they are packaged and sold (Basu, 2010). However, a good number of the Chinese factories where these goods are produced are involved in child labor as part of the manpower which they have employed. This creates an ethical dilemma for the US-based companies such as Nike, Samsung, Sony and many more (Herath and Sharma, 2011). Do they continue to procure the services of these Chinese operations involved in child labor or do they disengage from these business arrangements? This reflection will explore this ethical dilemma from three main standpoints and it will conclude by giving a summary of its main findings.
Ethical Branding and Corporate Reputation Relationships
According to Humbert (2009), ethical compliance by the main blue chip companies across the globe has become an integral component of the analysis of these companies` overall success beyond the traditional metric evaluations on the basis of financial performance alone. Companies are increasingly being perceived to be successful if they continually apply ethical practices such as environmental protection and corporate social responsibility programs even though their financial performance may not be as impressive as that of their main competitors (Nanjunda, 2009).
In this regard, companies that are perceived to be ethically-compliant have become ethical ambassadors in their own right and this has directly positively impacted their corporate reputation. Basu (2010) adds that in the current business environment, the more ethically compliant a company is, the more success it is perceived to be by its different stakeholders.
Child labor is a critical ethical issue that has dominated business conversations and operations since time immemorial. From an ethics perspective, this practice directly infringes on the children’s core human rights and it has been criminalized in almost all of the main economies of the world. However, the practice is still relatively prevalent in some parts of China, albeit undertaken secretly. Child labor is one of the main reasons why the labor market in China is cheaper than that of the United States and this has resulted in the outsourcing of many production operations by American companies to China over the last several decades.
Child Labor Legislation
Many countries across the globe have implemented a firm legislative framework that strictly prohibits any form of child labor in the economic activities of their citizens. In the United States for example, child labor is strictly prohibited in the Fair Labor Standards Act (Nesi, Portile and Nogler, 2013). This legislation was formulated and recommended by the National Child Labor Committee, which was formed to investigate and mitigate this practice, especially after the Great Depression of the 1930s (Nesi, Portile and Nogler, 2013).
The legal implications of child labor in the United States are both severe and criminal in nature for those companies found to be engaging in the practice. Although the punishments meted out on such culprits may vary slightly from State to State, such companies are likely to face similar judgments which may vary from large financial fines to the revoking of their operating licenses and even the possibilities of jail sentences for the people in charge of such companies (Chen, 2011).
However, the legislation against child labor is not as strong and as strict in China as it is in the United States. Although companies that are perceived to be cordoning child labor in their foreign production arrangements are liable for prosecution under US laws, the legal framework in China is weak in this regard and it has created numerous loopholes that are exploited by some manufactures there that shamelessly employ child labor. Therefore, it is recommended that the Chinese legal structure should be strengthened so as to ensure that the practice of child labor in the factories there is completely eradicated and the perpetrators of these crimes brought to book accordingly.
Although many companies in the United States that have outsourced some of their production functions to China are strongly opposed to child labor, they enjoy numerous cost benefits that result from the cheap labor available in China which ensures that the overall prices of the companies` products are cheap, once completed. This translates to massive sales due to the favorable prices of these products and ultimately, large profit margins.
However, this cheap labor tends to be greatly influenced by the availability of child labor in some of the factories where the American goods and commodities are produced. This implies that whereas the American companies that outsource these production operations are seen to be opposed to the practice and legally compliant in this regard, the same companies are aware of the dirty tricks that are employed by their Chinese partners in their factories that result in the labor being cheap and easily affordable. The American companies overlook these facts and only take proactive action in situations where the information relating to the child labor practices leaks out to the mass media.
Going forward, the relationship between corporate reputation and ethical branding will continue to grow from the perspective of the main stakeholders of American companies both in their home market and in their global operations as well. The companies that will be perceived to be more ethically-compliant will enjoy greater financial success even though their goods and services will be more expensive due to their increased ethical compliance. Therefore, American companies must actively dissociate themselves from Chinese child labor practices as this will most likely impact on their overall successes either positively or negatively going forward.
This reflection was centered on the global, ethical and moral discussion surrounding the practice of child labor by Chinese manufacturers in the production of their goods and services. A significant portion of such goods and services are destined for American markets as a result of the outsourcing arrangements and agreements between the Chinese companies and their American partners. This implies that by extension, goods and services produced through child labor in China for American companies may be directly perceived to have been produced through the same dubious means in the United States.
In closing, child labor is a grave human abuse that directly infringes on the children’s rights to enjoy their youth and to grow up in conditions that are favorable for their wellbeing. Therefore, it is paramount that global manufactures actively engage in initiatives that will result in the entire elimination of this vice especially in China.
Basu, K., 2010. The Retreat of Democracy and Other Itinerant Essays on Globalization,
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Chen, K., 2011. Labour Law in China. NJ: Kluwer Law International.
Herath, G. and Sharma, K., 2012. Child Labour in South Asia. NJ: Ashgate Publishing.
Humbert, F., 2009. The Challenge of Child Labour in International Law. London: Cambridge
Nanjunda, D. C., 2009. Anthropology and Child Labour. Delhi: Mittal Productions.
Nesi, G. Pertile, M. and Nogler, L., 2013. Child Labour in a Globalized World: A Legal Analysis
of ILO Action. NJ: Ashgate Publishing.