This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

So What if Samsung Violates Labor Laws in China?: Opinion

Samsung (005930.KS) shares traded in Seoul also hit an all-time high last month and appear to be unfazed by reports about factories in China. ADR shares of the South Korean firm -- so large that it makes up more than a third of the MSCI Korea index -- also trade in the United States.

In Foxconn's case, the glare of labor issues may even put a shine on new Apple products. China Labor Watch itself says the October strike was due to "strict quality demands on workers" including some related to scratches on phone frames.

"With such demands, employees could not even turn out iPhones that met the standard," the labor group said in a statement on Oct. 5. "This led to a tremendous amount of pressure on workers."

The idea is to stir consumer anger against the firms behind these labor issues and steer them to other products, pressuring the factories under fire to make changes. Shoppers in Western countries are into fair trade. But probably more are keen on buying phones without scratches on the frames.

Share prices of Foxconn's parent company Hon Hai (2317.TW) have bounced around since the suicides at its China factories in 2010, but drops appear pegged to dips in the global economy that would affect consumer demand for electronic devices.

Bounce-backs among MNCs questioned for labor practices don't run in just the tech sector. In December 2011 China Labor Watch reported that cuts in year-end bonuses had set off a strike at the Guangzhou Alei Siti Auto Parts Corp., a factory complex with 1,500 employees who make stuff for Honda (HMC), Toyota (TM), Suzuki (7269.T, SUK.F) and Nissan (NSANY).

Incidentally, China Labor Watch is just one of three well publicized NGOs that follow workplace issues in China. They also don't target only foreign companies.

Japanese automakers took a hit during the anti-Japan demonstrations around China in September following a diplomatic row between Beijing and Tokyo over the control of several small islets.

Share prices of the companies that buy from Alei Siti did slide in December of last year, but so did those of unrelated American automakers. That means something in the world economy, maybe a knock-on from the euro zone-driven fall in financial markets earlier that year, probably affected the whole industry at once.

2 of 3

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 17,106.70 +29.83 0.17%
S&P 500 2,000.02 +2.10 0.11%
NASDAQ 4,570.6370 +13.29 0.29%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs