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Abstract

This paper raises the question of whether controlling corporations through a monitoring system is a successful way to establish social standards within the supply chain. Since the debate thus far has concentrated strongly on the question of what monitoring systems look like and how they are implemented, this paper broadens the discussion by pointing out possible interrelations between the role of social capital and the diffusion of social standards. Therefore, an alternative concept of social capital is developed. It is shown that the right "composition" of social capital is a necessary "ingredient" for spreading social standards in the supply chain and into developing countries. These considerations are illustrated with a practical example of a public-private partnership project in the German retail sector.