NOKIA IN CHINA, A MULTINATIONAL INSPECTION

Nokia is striving for legitimacy by:

·        Creating corporate social responsibility by belonging to the Dow Jones Sustainability Index and FTSE4good index

·         Building a methodology that includes the education of their own people in this topic and the implementation of external ethical audit for one of its suppliers in the aim to know better their businesses

·         Nokia wants to make sure the supplier´s manufacturing process is legal in terms of the working conditions.

Chinese company in Schengen strives for legitimacy by:

·         Being aware of the risk prevention of every activity at every department (for example hearing protection in the copper wire braiding department); having fire extinguishers.
·         Establishing a welfare committee for the workers
·         At least on the paper, determining legal working times of 8 hours
·         Having a good record keeping system
·         The acceptance of the external audit and the openness to audits´ questions and suggestions
·         The willingness to have a contract for every employer in the future

Nokia´s approach to diffusing sustainability is effective because

·         They talk to the top managers in an assertive way (specially Hanna) as she explains why Nokia is doing this and also recognizing Nokia is new at implementing sustainability criteria in their company. She explains they had to start by reeducating their people. Accepting that they do not know enough about their suppliers and therefore cannot simply incrase expectations by only judging them.

•          As she speaks with the top manager, she explains how Nokia is creating a system for being sustainable, therefore indirectly teaching them how to do it themselves. For example determining the ethical requirements expected from suppliers, the communication and monitoring of these.

•          She explains the economic advantages of such audits to Nokia, like incrasing product price and also protecting themselves from any disadvantageous news; in general terms reducing the the risks to damage the company´s good will.

•          The general feedback from the audit starts with a very possitive output, the indication of the aspects to be improved is clear and consistent.

•          They communicate with managers of different levels, allowing them to individually think on what is wrong and how it could be improved. This is a simple way to multiply the message.

How could another coordination mechanism improve on this?

Clearly, the Chinese company has already managed to overcome legal aspects set by the government. So I consider a worker union as a self-governance coordination mechanism that can improve working conditions for the factory. If workers are given a higher voice, where first, they know the law, second, keep track of its compliance in the factory, the conditions would be more ethical not only within the company but in the country and for the European suppliers.