Assessing the Social Impact of Corporations: Evidence from Management Control Interventions in the Supply Chain to Increase Worker Wages | WIP seminar with Greg Distelhorst and Jee-Eun Shin

Join Zoom Meeting
Meeting ID: 868 1964 1821
Passcode: 286086

Do "corporate social responsibility" programs in global supply chains produce measurable social impacts? This study examines an attempt by a large multinational garment retailer to increase wages at its suppliers’ factories by implementing both bottom-up (promoting worker participation) and top-down (changing pay systems) interventions. Difference-in-differences estimates based on eight years of data from over 1,800 factories in nine developing countries show that the interventions were associated with an average wage increase of approximately 5 percent over the three years following their implementation. The intervention-associated wage increase was many times greater than if the invested financial resources were instead paid directly to the affected workers.  Further analyses shed light on contextual factors associated with the effectiveness of the wage interventions, including the presence of trade unions and assessments of supplier quality. These findings have implications for the design of management control interventions for social impact in global supply chains.