Fair Wages

‘In his book Fair Wages, Daniel Vaughan-Whitehead provides a compelling view into how to strengthen CSR by incorporating a wage dimension and a monitoring process in this area. This book is unique in that it thoroughly explores the different wage indicators that have been used to capture a general wage concept, and after noting the main focal points and deficiencies present in each approach, provides us a new holistic fair wage framework of analysis and monitoring tool. . . Fair Wages is grounded in research and is written in a style that makes it accessible to multiple audiences.’
– Ilyana Albarran, Public Organization Review

‘While many economists, policy-makers and commentators often point at negative effects of globalisation on wage inequality and income distribution, few specific proposals have emerged so far. Daniel Vaughan-Whitehead’s book should be commended for proposing a concrete approach for addressing the wage-related dimension of the social issues raised by globalisation.’
– Pascal Lamy, World Trade Organization, Geneva, Switzerland

‘Remedies should be brought to the global worrying wage trends so well documented in this book, not only by governments but by employers themselves, out of enlightened self-interest rather than generous benefaction, in the pursuit of the long-term profitability of their companies, through the positive impact that greater fairness exercises have on labour productivity and social peace. This is the line taken by Daniel Vaughan-Whitehead in his book on fair wages. Daniel shows that there is still considerable room for tapping the resources of corporate social responsibility: this potential simply must be exploited to the full before anything else, and therefore it must be investigated and publicized the way he does.’
– D. Mario Nuti, University of Rome ‘La Sapienza’ and formerly of London Business School, UK

‘This is an exceptionally important and timely piece of work for the simple reason that it brings to our attention a global crisis – that of unfair wages. In this volume, Daniel provides an excellent analytical framework and tool that can be applied at firm level. I fully expect that the different dimensions of the fair wage proposed in this book will become standard features of company annual wage reviews and of social audits.’
– Auret Van Heerden, President and CEO, Fair Labour Association

Over the last decade the emergence of corporate social responsibility (CSR) has contributed towards better corporate governance by tackling such burning issues as child labour and basic human rights violations. However, as the author argues in this important new book, the time has now come to incorporate wage issues into CSR. Daniel Vaughan-Whitehead proposes a new methodology, the ‘Fair Wage’ approach, which should allow all CSR actors to make progress in this field through a coherent and comprehensive set of fair wage dimensions and indicators.

The implementation of this new approach through a large-scale auditing exercise on wages in Asia and a number of qualitative cases studies in China provide unique, first-hand information on wage practices among suppliers. The results confirm the need to address wage issues using a broad spectrum of different wage dimensions, including living wages, minimum wages, prevailing wages, social dialogue, the payment of working hours and the evolution of wages in accordance with prices, enterprise performance and changes in technology and human capital. This approach also makes it possible to identify the impacts and pressures on wages, which are increasingly being used as the adjustment variable at the end of the supply chain.

Adverse wage developments clearly highlight the limitations of government action in regulating this aspect of the global economy. The ‘Fair Wage’ approach advocated in this book is a first, serious and concerted effort to address this critical issue. It will be required reading for practitioners and scholars of labour economics, development studies and CSR.