A Trend towards Relational Governance Configurations? Governance of labor standards in the Swedish garment industry

Abstract: Abstract Problem Scholars argue that governance studies often fail to incorporate issues related to labor standards within in global value chains (GVCs) and global production networks (GPNs). While studies addressing labor related issues have begun to emerge, many such studies have focused on labor agency and under what conditions labor may shape GPNs, but there is a relatively scarce body of research approaching labor standards from the home country context of lead firms. Thus, a gap in research exists regarding the understanding of value chain configurations and external factors and its influence on how lead firms work with labor standards. Purpose The purpose of this study has been to gain deeper understanding of how governance configurations of lead firms within the Swedish garment industry are structured and how it, along with external factors, influence the work these firms conduct in regards to labor standards in global value chains. Research Questions (1) How are global value chain governance configurations within Swedish lead firms structured and how does this influence these firms’ work with labor standards? (2) How do the external factors of a focusing event and various actors influence lead firms’ activities in relation to labor standards? Research Design The research is based upon a qualitative case study of lead firms within the Swedish garment industry. The findings have been analyzed on the basis of literature of GPNs and GVCs in relation to labor standards and of literature concerning focusing events. Findings We contribute to the existing literature by providing six main findings. First, we have identified a clear dominance of the relational governance configuration. Second, we find that lead firms governance configurations appear to be strongly related to a certain type of market economy. Third, it is found that the cooperative paradigm is of great relevance among the Swedish lead firms. Fourth, we suggest that the cooperative paradigm, in combination with governance theory, offers enhanced understanding how lead firms work with labor standards. Fifth, we argue that focusing events have little influence on Swedish lead firms and sixth, that local actors have had limited effect on how Swedish lead firms work with labor standards. Suggested Future Research Agenda As this study has been limited to specific segments and contexts within the garment industry, future research should focus on other segments and contexts as well. Moreover, future research including institutional theory is needed, since our findings suggest a strong correlation between governance configurations and home country contexts. Furthermore, research combining the cooperative paradigm with governance theory should be conducted as this allows for enhanced understanding of this research field.