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Furthermore

Lower-tier suppliers receive little attention and pressure to address issues like harassment or overtime demands. They often lack sustainability expertise and resources, and are unaware of social and environmental practices or regulations. MNCs frequently don't know who their lower-tier suppliers are or where they are located.

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Subhan Ahmad
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33 views

Furthermore

Lower-tier suppliers receive little attention and pressure to address issues like harassment or overtime demands. They often lack sustainability expertise and resources, and are unaware of social and environmental practices or regulations. MNCs frequently don't know who their lower-tier suppliers are or where they are located.

Uploaded by

Subhan Ahmad
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
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Furthermore, most lower-tier suppliers are not well known, so they receive relatively little attention

and pressure from the media, NGOs, and other stakeholders. Even when they do attract attention
(for sexual harassment problems, for example, or chronic overtime demands), we found that they
do not feel the need to address the issues involved. They tend to act only when MNCs intervene.

Lower-tier suppliers are also the least equipped to handle sustainability requirements. They often
do not have sustainability expertise or resources, and they may be unaware of accepted social and
environmental practices and regulations. They are also frequently located in countries where such
regulations are nonexistent, lax, or not enforced at all. And typically they don’t know much about
the sustainability requirements imposed by MNCs—but even if they do, they have no incentive to
comply. This may explain why most of the lower-tier suppliers in our study lacked programs to
dispose of toxic waste and in fact had no environmental management program whatsoever.

MNCs, too, are handicapped by ignorance. They frequently don’t even know who their lower-tier
suppliers are, let alone where they’re located or what capabilities they have (or don’t have). Many
of the 22 lower-tier suppliers in our study are small or medium-size private firms that provide little
information to the public—characteristics that, in effect, make them almost invisible. Several
directors of the three MNCs we studied viewed this as a big problem. “The demon in this place,”
one of them said, “is the [lower-tier] suppliers that I know the least about.” Another said, “I don’t
have control over the ones that pose the highest risks, so I’m losing sleep over them.”

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