Global Supply Chain Auditing

doi:10.1017/9781108759458.067

67 - Global Supply Chain Auditing

from Part IX - Analysis of Particular Fields

Published online by Cambridge University Press: 07 May 2021

Galit A. Sarfaty

Edited by

Benjamin van Rooij and

D. Daniel Sokol

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Benjamin van Rooij: Affiliation:
School of Law, University of Amsterdam
D. Daniel Sokol: Affiliation:
University of Florida

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Summary

Abstract: The governance of global supply chains is a ripe area of study for legal scholars. As part of an analysis of the governance of multi-tiered global supply chains and the implementation of recent supply chain transparency laws, this chapter analyzes the central role of supply chain auditors. These actors conduct human rights due diligence and implement supply chain policies on behalf of companies, which are in effect outsourcing their compliance obligations. In this chapter, I first discuss the emergence of a supply chain-audit regime in response to recent legislation, industry standards, and reputational pressure on companies to enhance their social and environmental performance. Next, I analyze concerns over the efficacy of supply chain auditors in incentivizing improvements in corporate compliance and behavior. Among the critiques are that audits advance the interests of downstream buyers; auditors are reluctant to report fraud; audits do not move beyond first-tier suppliers; audits are of limited duration; auditors fail to engage with workers; audit results are not released to the public; and suppliers have an incentive to cheat. Finally, I briefly offer remedies that have been proposed to address some of the major critiques and thereby enhance the effectiveness of the supply chain-auditing regime.

Type: Chapter
Information: The Cambridge Handbook of Compliance , pp. 977 - 988

DOI: https://doi.org/10.1017/9781108759458.067 [Opens in a new window]

Publisher: Cambridge University Press

Print publication year: 2021

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