“They get breakfast and transportation. What else could they need?” : An explorative study of how to improve ethical labour standards in Sri Lankan companies

Abstract: Abstract Bachelor’s thesis, Enterprising and Business Development, Linnaeus University School of Business and Economics, 2EB00E, VT 2015 Authors: Jesper Gunnarsson and Mathias Holst Tutor: Maria Persdotter Isaksson Title: ”They get breakfast and transportation. What else could they need?”. An exploratory study of how to improve ethical labour standards in Sri Lankan companies. Background: The globalization has led to an increase in movement of goods and capital across national borders. This has contributed to an increase in overseas manufacturing in low-wage countries, meaning a decrease in costs and improved profits for western companies. Since the ethical standards generally are lower in developing countries numerous NGOs have launched awareness campaigns for CSR. In Sri Lanka there are issues regarding ethical labour. There is a concern that the government are not committing enough towards the improvement of these standards. The improvement of ethical standards has the potential to improve the quality of life and the entire economy which makes it interesting to see how the government in cooperation with other stakeholders can improve the situation. Purpose: The purpose of the thesis is to explore how ethical labour standards can be improved in Sri Lankan companies. Method: The study uses a general inductive approach where two main themes are extracted from seven interviews with representatives from the Sri Lankan government, Labour Department, ILO and employers. The study is of a qualitative character and its hermeneutic approach allows the subjective opinions of the respondents to affect the direction of the study. Conclusions: Through this study it has been explored that ethical labour standards in Sri Lankan companies can be improved through two categories: 1) The role of the government and through 2) communication and cooperation. The most prominent conclusions are that the Sri Lankan government have to increase their commitment in the ethical labour discussion and the social dialogue, that promotes the interests of all the stakeholders within the debate, is required. Through a stronger ethical labour legislation further social initiatives can have better conditions through out the Sri Lankan society and through ICT-implementations the monitoring of ethical labour can increase in efficiency, hence increase the ethical labour standards in Sri Lankan companies.