The role of formalization in the insertion of social indicators in the supply chain of the popular garnment sector

Nascimento, Cristiane Mano do; Silva, Minelle E.

doi:10.1590/0104-530X4708-20

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ORIGINAL ARTICLE • Gest. Prod. 27 (4) • 2020 • https://doi.org/10.1590/0104-530X4708-20 copy

The role of formalization in the insertion of social indicators in the supply chain of the popular garnment sector

O papel da formalidade na inserção de indicadores sociais na cadeia de suprimento do setor de confecção popular

Authorship SCIMAGO INSTITUTIONS RANKINGS

Abstract:

Under the supply chain sustainability debates and seeking to reduce the theoretical gap related to the social sustainability dimension, this research aims to analyze the relation between formalization and the insertion of social indicators in the supply chain of the popular garment sector in Fortaleza-CE. Using the case study strategy, 20 interviews were carried out with enterprises, direct suppliers and outsourced suppliers to cover the direct supply chain. Hence, were analyzed three categories - social responsibility, health and safety, and supplier development - and their 15 indicators. The results indicate that the formalization impacts on the insertion of social indicators, mainly in the category of health and safety. In addition, it was identified the possibility of informal work, even in the formalized companies, which demonstrates the need for a new look at this variable. With empirical demonstration, this study contributes to the study of social indicators in the supply chain and draws attention to informal labour relations in the local context.

Keywords:
Social dimension; Supply chain; Formalization; Popular market

Social indicators	Description
Social responsibility
Slavery work	The company should not engage with or support the practice of using forced work
Child work	The company should not engage with or support the practice of using child work
Ethical behaviour	The company must contribute to economic development, aiming to increase the environmental quality and quality of life of society. This indicator is taken as a self-declaration of actions carried out in this sense.
Community work	Refers to philanthropic activities and works with local communities
Unfair wages	The company should not engage with or support, breach rules set by law, paying unfair wages lower than permitted salary.
Minority inclusion	It is the development of populations that are considered as minorities, in terms of population by their religion, race, ethnicity, as well as due to physical disabilities.
Gender	Equal treatment of women and transgender people, taking into account their special needs and the attribution of equal rights in the workplace.
Marginalised people inclusion	Population living below the poverty line is considered marginal.
Health and Safety
Work schedule	It is compliance with applicable laws and industry standard on working hours and breaks
Working conditions	The company shall provide a safe, healthy and enjoyable working environment by taking appropriate measures for the prevention of occupational accidents and diseases associated with the performance of productive activities
Awards	Award practice strategy for employees in the context of other organization recognition practices.
Supplier development
Type of Relationship	Collaborative relationships of external stakeholders such as NGOs, which require companies to better manage social issues and internal stakeholders such as top management, who follow the performance objective, addressing social issues in supply chains.
Trust	The trust relationship between buyers and suppliers determines the degree to which social issues are managed in supply chains. Value is created along the supply chain if the relationship between buyers and suppliers thrives on trust and commitment.
Supplier assessment	It assesses how the supplier deals with social issues in supply chains to meet the demands and concerns of stakeholders and how it creates actions to overcome problems involving the social dimension.
Supplier selection	Refers to the social criteria used by the company in selecting its suppliers.

Companies	Code	Classification formal/informal	Time of operation at José Avelino	Quantity of employees	Interview time
Company 1	E1	Formal	10 years	7	35 min
Company 2	E2	Informal	10 years	0	41 min
Company 3	E3	Formal	10 years	5	50 min
Company 4	E4	Informal	7 years	3	25 min
Company 5	E5	Formal	15 years	1	37 min
Company 6	E6	Formal	17 years	2	26 min
Company 7	E7	Formal	7 years	3	45 min
Company 8	E8	Formal	4 years	4	35 min
Company 9	E9	Formal	18 years	4	36 min
Company 10	E10	Formal	3 years	8	22 min
Company 11	E11	Formal	2,5 years	30	51 min
Company 12	E12	Formal	8 years	10	47 min
Company 13	E13	Formal	4 years	14	38 min
Supplier 1	FORN1	Formal	7 years	6	35 min
Supplier 2	FORN2	Formal	20 years	70	41 min
Facção 1	F1	Informal	15 years	15	25 min
Facção 2	F2	Informal	13 years	2	27 min
Facção 3	F3	Informal	20 years	1	36 min
Facção 4	F4	Informal	1 year	1	25 min
Facção 5	F5	Informal	3 years	2	33 min

Companies	Formal Group
E1	All my employees are formal
E6	I got already twenty employees, but I was firing them, and right now I'm alone with two people. One girl there in the store, one at Beco da Poeira and a person doing the finishing there at home and alone. This all wallet signed.
E7	All formal [referring to your employees]
E9	Yes, everyone is formal
E11	Today in the factory we have around ... I think it's 12. Twelve employees here in the company. Twelve here, inmates. Outside, the saleswomen ... Around a total of thirty employees between: models, stylists ... They are all formal.
E13	Here in the factory we have fourteen direct, fourteen! And indirectly we have over forty people working. They are signed.
Forn 1	All formal [referring to your employees]
Forn2	Yes, everyone is formal

Companies/ Facções	Informal Group
E2	No. No. Because as I told you we are not with the firm yet registered the guy is still registering, the accountant! Then when he gets it I'll sign my wallet with my grandson and my daughter
E3	Only two that is not because them were hired now
E4	No. There is not
E5	No. Today I have one employee with wallet signed. However, I still have my factory and there are some people without wallet signed
E8	No. They are not all formal. Actually, there's a formal one, one is ... By the way, two! One is already registering, the other I will register and the forth I cannot ... I work with him in a different way, as if he were a freelance. That's Bruno.
E10	It's because I do not need ... Yeah. When I need it. It's by production. It's not even a day job, it's production. She has to make me twenty new pieces a month. And I paid individually for these pieces. If she spends all morning here and only makes a piece, I pay for a piece. It is not daily. However, my stylist is already per day.
F1	It's ... It's complicated because I .... If I formalize I have to close the doors. Because lately I'm not taking it to me, and they know it. Because at home I leave everything very comfortable, they know everything from how much I get a piece, how many pieces did we produce, right?
F2	No, I've never been interested in opening ... Not to register.
F3	No. No [referring to non-existence of registered employees]
F4	No [referring to non-existence of registered employees]
F5	No [referring to non-existence of registered employees]

Social Indicators	Quotes
Social Responsibility
Slavery work	I've heard at the news [slavery work] (E1).
Child work	No, I've never heard of child work from manufacturers! (FORN 1)
Ethical behaviour	We did not have it like this... Government incentive and we really rehabbed, a lot here from the factory... They are people: Ex-addicts, ex-drug addicts, it's a good slice of our employees and they even learn in practice, they will... One teaching to the other who is entering and the starting point of all of them was my husband himself (E13).
Community work	I donate to the Cancer Institute! (E9).
Unfair wages	Yes, we are paying the salary above what is required (E13).
Minority inclusion	There is no problem. Even the company is very mixed regarding religion, right? We have here protestants, Catholics, various types. And that's not even in our register to ask, right? (FORN2). No, in reality, I outsource 90% right? So here, I do not think I have conditions to hire these people (E9).
Gender	No way! I work with them here! I have stylists, I have dressmakers who are man and I have no problem at all (E11).
Marginalised people inclusion	Most of the painting and stamping sectors have them. It is precisely because of this social project that they go hand in hand. What is reintegration into society. That's the part. The guys working with Calandro (big machine of stamping fabric), they were prisoners, one was robber, today is not anymore. Today the right arm of her husband, more trustworthy to save money for her husband, in high values, he was a thief, he plucked a house (E13).
Health and safety
Work schedule	From eight to five in the afternoon. And on Saturday from eight to noon. But always leave at eleven. [referring to working schedule] (FORN1)..
Working conditions	The ones I have contact offer working conditions but what I used to relate had problems before. There were some that explored too much (FORN2).
Awards	Awards. If the employee do not miss a workday, we provide it! Person who does not lack, it has an award, the person who has production has a award. Overtime payment... All correct. (E11).
Supplier Development
Type of Relationship	We travel to visit some suppliers, we go to the suppliers ... We often go to do the shopping properly ... From time to time we even do these purchases. You're having this closer relationship with them (E13).
Trust	We trust, distrusting because it has to be with the seamstress ... We need to have close look [referring to outsourced] (E6).
Supplier assessment	No. I visit, but only they are in São Paulo, but they want us to go with them to China to say the product we want to give them a tip and I never went. But for Sao Paulo I always go. To see the market right? It's more about research (FORN1).
Supplier selection	Several suppliers, from whom to bring more differential. Nowadays, we are practically like this, choosing who brings some differentiated because the customer only wants differentiated right? (FORN1)

Social Indicators	Quotes
Social Responsibility
Slavery work	We listen sporadically, but that there at home never had anything (E5)
Child work	No. I've never heard of it; neither. Because so, the facção is always woman, husband and children that so in the house right? The biggest! Because the minors only study (E2).
Ethical behaviour	[We have importance in the market] because you will not get a lot of unemployed family. The way unemployment is, right? (E4)
Community work	Yes. I donate every month to the church. (E10)
Unfair wages	There are things I do not think are fair. It should be better. There are things that I really get into because I think that the person give the piece to me for the price and you really see that it can be a little bit more and I complain a lot. (E3).
Minority inclusion	Yes, I would hire. There would be no problem [however they have no disabled staff] (F1, F2, F3, F4 e F5).
Gender	Not any, I do not have this prejudice (F3).
Marginalised people inclusion	No way, thank God [indicating that he has no problem hiring] (F3). Oh, because I like helping people. I like to give opportunity, sometimes people do the wrong things for lack of opportunity (F1).
Health and safety
Work schedule	Impressively from eight in the morning until six in the afternoon, from Monday to Thursday. And from eight in the morning until five in the afternoon on Friday. All of them! Do not overdo also leave early. Facção is from seven thirty to four thirty. They make their schedules. Because it's like it's a cooperative here. There in the interior of Redenção, I do not know (E8).
Working conditions	I believe they are all well and good, right? My intention is to improve every time. But at the moment I can not, because even today we had a meeting and I was saying to them, “people, we're going to have to improve on productivity, because lately I'm not even taking the light off!” (F1).
Awards	When they are ... Produce more, there I ... I give an award, a little gift (F1).
Supplier Development
Type of Relationship	They ask me, they ask me for a faster way to work. Yeah, they say like this: “Dona Cleide, our piece is from here. But if you think you have to change something in the piece, to get the production lighter, give your opinion!” (F2).
Trust	Because so insecurity, I what I tell you ... I do not know if you have or if they will still be with me [referring to companies] (F1).
Supplier assessment	I never leave the house. Just... Just the Mira Mary, that the boy comes... Because so, they are starting now and are with the same insecurity that... (F1).
Supplier selection	No. Actually, it's that blind thing. But it's always in confidence right? (F1).

Universidade Federal de São Carlos Departamento de Engenharia de Produção , Caixa Postal 676 , 13.565-905 São Carlos SP Brazil, Tel.: +55 16 3351 8471 - São Carlos - SP - Brazil
E-mail: gp@dep.ufscar.br

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