In November 2006, the global sports brand Nike announced that the company would be ceasing orders with its hand-stitched soccer ball supplier, Saga Sports, based in Sialkot, Pakistan, due to the contract factory's failure to ensure that it was not employing child labourers. This outcome left approximately 3,000 – 4,000 female labourers and their 30,000 dependents in Sialkot without an income. Nike’s decision was taken even though a public private partnership between UNICEF, the ILO, NGOs, global brands, and Sialkot sporting goods manufacturers largely succeeded in eliminating child labour from the industry in the late 1990s. While Nike has since partly re-entered Sialkot, most of its soccer balls are now sourced from China and Thailand.

The purpose of this research project is to theorise and empirically investigate whether the insertion of industrial districts into the global economy, and joint attempts at promoting corporate responsibility (CR) within these districts, lead to a race-to-the-top whereby the districts ‘upgrade’ by making better products more efficiently and improving the conditions of labourers in developing countries. Or conversely, whether their insertion into the global economy and joint CR efforts in clusters lead to a race-to-the bottom, because their attempts at upgrading are undermined by fierce price competition as global buyers prefer to source from lower-cost suppliers elsewhere in the developing world that do not engage in collective CR initiatives.

Particular attention is paid to whether joint CR initiatives in Sialkot, Pakistan, and Jalandhar, India, enhance or undermine the competitiveness of local producers and the conditions of workers in these clusters vis-à-vis their Chinese counterparts that have not engaged in similar joint CR initiatives.

The research team is highly interdisciplinary and consists of Peter Lund-Thomsen, CBDS, Khalid Nadvi, University of Manchester, Anita Chan, Australian National University, & Mike Redwood, University of Northampton.

The project is planned for a three year period starting February 2008 and it has been awarded DKK 1.490,000 from the Danish Social Science Research Council.

For further information, please contact: Peter Lund-Thomsen