Does Corporate Social Responsibility make a difference on labor conditions? A Case Study in Southern China

The corporate social responsibility code of conduct (CSRC) has been the model of corporate governance (CG) used by multinational corporations (MNCs) for their suppliers. Using the transaction cost perspective, this study argues the CSRC system may reduce some transaction costs for MNCs in planning and implementing corporate social responsibility (CSR). However, the CSRC may suffer from opportunism at the supplier level, which may undermine CSRC outcomes. By utilizing a unidimensional item response model with a randomized survey of factory workers of 12 toy manufacturers in Southern China, this study provides a unified measure to evaluate the effects of CSRCs on labor conditions from workers ’ voices. Furthermore, this study offers fresh empirical evidence to show the ways opportunism may undermine CSRC effects on labor relations