The International Labour Organisation (ILO) has called on governments, employers and workers’ groups to adopt a systems-based approach to tackle poor working conditions in global supply chains.
The UN agency warned that micro, small and medium-sized enterprises (MSMEs) risk being left behind without targeted reforms.
In a new policy brief titled From Root Causes to Real Change: Using a Systems Approach to Foster Decent Work Deep in Supply Chains, the ILO observed that while first-tier suppliers often benefit from direct buyer relationships and stronger compliance mechanisms, lower-tier suppliers face systemic barriers that undermine both business growth and workers’ welfare.
The report highlighted persistent challenges such as limited access to finance, weak infrastructure and poor enforcement of labour laws, which continue to trap MSMEs in conditions that make it difficult to meet international standards on wages, safety and sustainability.
Dragan Radic, Chief of the ILO’s MSME Branch, said the systems approach aims to identify and tackle the root causes of these barriers to strengthen competitiveness and promote decent work.
“Through a systems approach, we aim to strengthen MSME competitiveness and promote decent work by first identifying the root causes of key bottlenecks and later working with ILO constituents to address them in a long-lasting way,” Radic said.
Dan Rees, Director of the ILO’s Action Programme on Supply Chains, added that systemic solutions could generate ripple effects across industries, leading to sustainable improvements in wages, productivity and job quality.
“Supply chains can be an entry point for decent work in MSMEs when they are supported within a stronger, more coherent system, achieving real ripple effects,” he said.
The ILO stressed that improving labour conditions in lower-tier supply chains requires coordinated action from governments, employer organisations and workers’ groups. By applying a systems approach, stakeholders can design evidence-based interventions that deliver long-term improvements in business competitiveness and worker welfare.
