The Makings of a Scandal How CSR Failed to Meet the Labor Rights Expectations of the Chinese and American Presses in the Foxconn Suicide Scandal Aren Sakala LaBianca Master's Thesis in Chinese Society and Politics (KIN4591 – 60 Credits) Department of Culture Studies and Oriental Languages UNIVERSITY OF OSLO Spring 2013 II The Makings of a Scandal How CSR Failed to Meet the Labor Rights Expectations of the Chinese and American Presses in the Foxconn Suicide Scandal Aren Sakala LaBianca III © Aren Sakala LaBianca 2013 The Makings of a Scandal: How CSR Failed to Meet the Labor Rights Expectations of the Chinese and American Presses in the Foxconn Suicide Scandal Aren Sakala LaBianca http://www.duo.uio.no/ Press: Reprosentralen, University of Oslo IV Abstract When a string of suicides strikes at a Foxconn Technology Group (富士康科技集团) factory that assembles the Apple iPhone in China, accusations of worker mistreatment spread quickly in the international press. Even though statistics show that the factory’s suicide rate is lower than the national average and experts and officials both assert that working conditions are legal and better than those of the average Chinese factory, the scandal still continues. Foxconn’s use of Western corporate social responsibility (CSR) codes to compensate for the lax labor policy of the Chinese productivist welfare regime seems to have failed to prevent the growing scandal. Is it possible that the press perceives Western CSR standards as inadequately suited to protect labor rights in a Chinese work environment? This thesis uses the case study of Foxconn’s CSR scandals to explore the perceived efficacy of CSR in protecting the labor rights of workers in transnational corporations (TNCs) in China. The research focuses on the media scandal that occurred following the publication of a series of three reports by Southern Weekend (南方周末) exploring the realities of workers’ lives at a Foxconn factory in Shenzhen. This thesis uses discourse analysis of citations and paraphrases from the original Southern Weekend reports as its primary methodology. It examines how the concept of CSR exceeds and fails to measure up to the labor rights expectations of the Chinese and American presses. The differences between the expectations of the Chinese and American presses with regards to labor rights are also discussed. This thesis argues that both American and Chinese presses find standard CSR codes wanting in their protection of labor rights, though each for different reasons. While the American press is more likely to emphasize the dehumanization of workers and shortcomings with regards to wages and overtime, the Chinese press is more likely to discuss workers’ social isolation and broken dreams. This thesis also discusses possible origins of the discrepancy between the priorities of standard CSR codes and the labor rights priorities expressed in the Chinese and American presses, particularly contrasting the Chinese concept of the danwei (单位) with the Western concept of CSR. V VI Acknowledgements First and foremost I would like to thank my advisor Halvor Eifring for his critical eye, insightful comments, and helpful suggestions during my writing process. He was the one who helped me to find the linking thread between the diverse elements of my thesis, and I truly appreciate that he has always held me to a high standard of research. Other professors also provided me with encouragement and helpful advice at various stages in the process. I am particularly grateful to Cuiming Pang for her assistance in formulating the idea for this project. While I was an exchange student at Fudan University in Shanghai, professors Izabela Wagner and Hong Bing provided advice and assistance in developing my methodology and in doing a sample run of my analysis. I am also very grateful to Professor Wagner for her critical feedback on the first draft of my methods and results chapters. Fudan professors Li Zhang and Kjell Nilsson provided me with resources for improving my understanding of Chinese social policy. Mette Halskov Hansen also provided insightful feedback and direction on more than one occasion. I would like to thank all the staff of the China Program at the Center for Human Rights in Oslo for their comments and advice on my project, and for their generous scholarship funding my masters’ research. I am also very grateful to Cheng Zeng and Joshua Yin for their support and proofreading of my Chinese translations. Asta, Danielle, Johanna, Mary, Vienna and Øystein, thank you so much for your encouragement along the way and for using your valuable time to help me proofread the final draft of this thesis. I take full responsibility for any remaining mistakes. There are many other people who have supported me in this process—my family, my friends. I want to thank all my classmates, especially Lars and Trine, for our stimulating research discussions in and outside of class. Last but not least, I also must thank Margrethe Lia and Kjersti Hetland for writing theses that provided a framework for me to follow, and a point of comparison in writing my own thesis. Oslo, May 10, 2013 Aren Sakala LaBianca VII VIII Table of Contents THE MAKINGS OF A SCANDAL ................................................................................................... III ABSTRACT ........................................................................................................................................... V ACKNOWLEDGEMENTS ............................................................................................................... VII TABLE OF CONTENTS .................................................................................................................... IX CHAPTER I ：INTRODUCTION ....................................................................................................... 1 I.I RESEARCH QUESTIONS ................................................................................................................. 2 I.II THESIS OUTLINE ......................................................................................................................... 2 CHAPTER II : BACKGROUND AND THEORY .............................................................................. 4 II.I CLASSIFYING CHINA WITHIN THE GLOBAL CONTEXT OF WELFARE REGIMES .......................... 4 II.II THE GAPS IN CONTEMPORARY CHINESE SOCIAL POLICY ......................................................... 6 II.III THE FLOATING POPULATION .................................................................................................... 8 II.IV CORPORATE SOCIAL RESPONSIBILITY ..................................................................................... 9 II.V CULTURAL DIMENSIONS THEORY ........................................................................................... 13 II.VI FOXCONN AND CSR SCANDALS ............................................................................................ 15 CHAPTER III : RESEARCH METHODS ........................................................................................ 19 III.I TWO FORMS OF ANALYSIS ...................................................................................................... 21 III.II CLASSIFICATION OF METHODOLOGY ..................................................................................... 22 III.III SELECTION OF CORPUS ......................................................................................................... 24 III.IV DIVISION OF TEXTS FOR FOCUSED ANALYSIS ........................................................................ 28 III.V DISCOURSE ANALYSIS DIFFICULTIES .................................................................................... 30 III.V.I Different Styles of Citation and Paraphrasing ................................................................ 30 III.V.II Other Key Differences between Chinese and American Citations ................................. 31 CHAPTER IV : FOXCONN’S CSR AND THE PRESS .................................................................. 34 IV.I FOXCONN—“SWEATSHOP” ALLEGATIONS ............................................................................. 34 IV.II FOXCONN AND THE FLA ........................................................................................................ 36 IV.III WAGES .................................................................................................................................. 38 IV.IV WORK HOURS ....................................................................................................................... 41 IV.V ADDITIONAL CSR VIOLATIONS ............................................................................................. 46 IV.V.I Insurance ......................................................................................................................... 46 IV.V.II Interns ............................................................................................................................. 46 IV.V.III Unions ........................................................................................................................... 47 IV.V.IV Right to Strike ................................................................................................................ 48 IV.V.V Recruitment, Hiring and Personnel Development .......................................................... 48 IV.V.VI Grievances ....................................................................................................................