Fraunhofer Institute for Systems and Innovation Research ISITransition in Global Value Chains: Advancing Social Sustainability (SoNa-WSK)
Global value chains (GVCs) often begin in developing countries. In many of these, the working conditions are precarious at best and at times downright inhumane, stretching from issues of health and occupational safety to the use of child and forced labor. From a long-term perspective, this model of production is problematic not only with regards to the social, but also the economic dimension of sustainability. The implementation of greater social sustainability in GVCs and production networks can be a significant challenge for companies. Due to their transnational nature, GVCs cannot be fully regulated on a national or even supranational (i.e. EU) basis, since the laws of any given state or organization always touch on only a small portion of the entire chain. Moreover, the complexity of most GVCs leads to a lack of transparency regarding its members, so that final product manufacturers often do not know who participates in their value chain beyond the first or second tier, much less who upholds certain envi-ronmental or social standards. While a few approaches exist to create more socially sustainable GVCs, an extensive focus on social sustainability in global production chains is still rare.