Country-of-Origin or Host-Country Effects? Code-of-Conduct Effect and Labor-Standards Compliance in Chinese Overseas Garment Factories: The Cases of Cambodia and Myanmar

Abstract

Focusing on the global garment supply chain, this article explores a third effect, apart from the country-of-origin and the host-country effects, that impact the employment relations of overseas Chinese companies. This paper is based on field research and interviews of 42 stakeholders in the Cambodia and Burmese garment industries, and employs thematic qualitative text analysis to examine the data, revealing three main findings: First, the compliance of Chinese overseas factories to labor standards is significantly affected by codes of conduct if these factories supply lead firms in the global garment supply chain. Second, if Chinese overseas factories do not supply lead firms in the global garment supply chain, their compliance to labor standards is significantly influenced by the country-of-origin effect. Third, the strength of regulations in the host country is an important factor that moderates the relationship between code-of-conduct effect and labor-standards compliance as well as the relationship between country-of-origin effect and labor-standards compliance by Chinese overseas factories.