Chapter 5 - Working conditions and corporate social responsibility in Chinese-owned companies

How socially responsible is Chinese investment in Southern Africa? Does it respect worker rights and contribute to society? The common perception is that it does not. Work conditions in Chinese-owned enterprises are perceived to be poor. Workers are said to be forced to labour in harsh conditions inferior to those in other workplaces. In China, it is argued, people are expected to work hard for very modest pay and, predictably, Chinese firms therefore expect African workers to labour under the same conditions as their Chinese counterparts.

Claude Kabemba's picture

Director of the Southern Africa Resource Watch (SARW)

October 10th, 2012

How socially responsible is Chinese investment in Southern Africa? Does it respect worker rights and contribute to society? The common perception is that it does not. Work conditions in Chinese-owned enterprises are perceived to be poor. Workers are said to be forced to labour in harsh conditions inferior to those in other workplaces. In China, it is argued, people are expected to work hard for very modest pay and, predictably, Chinese firms therefore expect African workers to labour under the same conditions as their Chinese counterparts. In this common view, the jobs which these plants provide – or the more general development benefits they bring to African countries – might make China’s presence beneficial to development in Africa. But it is widely assumed that to work in a Chinese-owned plant is to experience considerable hardship and that Chinese-owned enterprises are particularly harsh work environments. The research confirmed that this is a common perception – in several country studies, informants were highly critical of conditions at Chinese-owned plants.

Another common concern is that Chinese firms are, more than those owned by non-Chinese enterprises, likely to ensure that the important jobs are done by Chinese people rather than locals. Chinese investment, it is suggested, does not therefore enhance the skills and capacities of people in the host country.

Given these perceptions that Chinese investment is narrowly focussed on extracting resources, it is assumed that corporate social responsibility programmes play little or no role and that Chinese firms do little to assist development in African countries.

These perceptions do have empirical backing in some cases, but the reality is far more complex. Our country studies did indeed find Chinese-owned workplaces in which workers’ right to dignity and fair treatment was not honoured and in which work conditions were harsh. Some of the companies have been closed down for brief periods by the host government because health and safety laws were violated. In some, workers have reacted to their conditions by striking.

But it also found employers who were at least as concerned to respect the rights of their workers as other companies – in some cases, Chinese owned firms are offering better working conditions than the average. In some firms, Chinese workers were indeed favoured over locals. In others they were not. This suggests that there is no clear pattern in the employment conditions of Chinese firms operating in Southern Africa and that the perception that Chinese investment inevitably means poor working conditions is inaccurate. Further evidence which may suggest that it would be inappropriate to single out Chinese firms is that, where Chinese companies enter into joint ventures with local businesses or those owned by nationals of other countries, Chinese participation does not alter labour standards negatively. In one case, where Chinese investment took over a plant which had been owned by non-Chinese business, conditions significantly improved.

Since there are differences between Chinese firms, it may well be inappropriate to see working conditions at Chinese companies as a problem. The issue is, rather, whether countries in the region can ensure fair labour practices by all employers. The research seemed to suggest that technology transfer to local people is not a feature of most Chinese investment. But, if states wish to address this problem, they would need to look more broadly at measures to ensure that foreign investment ensured technology transfer, rather than relying on special arrangements for China.

About the author(s)

Claude Kabemba is the Director of the Southern Africa Resource Watch (SARW). In 2006, the Open Society Initiative for Southern Africa (OSISA) asked him to spearhead the formation of SARW. He holds a PhD in International Relations (Political economy) at the University of the Witwatersrand (Thesis: Democratisation and the Political Economy of a Dysfunctional State: The Case of the Democratic Republic of Congo). Before joining SARW, he worked at the Human Sciences Research Council and the Electoral institute of Southern Africa as a Chief Research Manager and Research Manager respectively. He has also worked at the Development Bank of Southern Africa and the Centre for Policy Studies as Policy Analyst. Dr. Kabemba’s main areas of research interest include: Political economy of Sub Saharan Africa with focus on Southern and Central Africa looking specifically on issues of democratization and governance, natural resources governance, election politics, citizen participation, conflicts, media, political parties, civil society and social policies. He has consulted for international organizations such Oxfam, UNHCR, The Norwegian People’s Aid, Electoral Commissions and the African Union. He has undertaken various evaluations related to the work of Electoral Commissions and civil society groups interventions in the electoral process in many African countries. He is regularly approached by both local and international media for comments on political and social issues on the continent. His publication record spans from books (as editor), book chapters, journal articles, monographs, research reports, and newspaper articles.

Contacts

  • 1 Hood Avenue/148 Jan Smuts; Rosebank, GP 2196; South Africa
  • T. +27 (0)11 587 5000
  • F. +27 (0)11 587 5099