Corporate Codes in the Varieties of Capitalism: How Their Enforcement Depends on the Differences Among Production Regimes

Globalization has reinforced the conflicts among the varieties of capitalism. The colliding units are not just nation states, but transnational production regimes, which cut through national boundaries. The conflicts lead global corporate codes, which are developed by international organizations, to take different directions when they are concretized on the enterprise level. They will be differently enforced according to whether they are located in Liberal Market Economies (LME), adapted to the New Sovereignty of enterprises, or in Coordinated Market Economies (CME) with greater components of social welfare state and economic democracy.

Different patterns of enforcement emerge particularly when the courts have to decide whether corporate codes are legally binding. Multinational corporations seek by any means to keep the courts out. For them, interpretation, application, and enforcement of the codes are exclusively a matter of private ordering. Thus, they insist that their "voluntary" codes are legally non-binding.

Accordingly, American courts are very reluctant when public interest litigation pushes them to implement the codes as legally binding rules. The chances of enforcement appear to be different in continental Europe. If they are adapted into thoroughly regulated neo-corporate arrangements, then the codes will be confronted with stronger legislative activities and stronger enforcements by the courts. In the European Union, the codes of conduct will have to adapt to the principles of the welfare state and economic democracy.