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of multinational corporations in theUS and Europe such as Avon and Wal-mart ask their suppliers to meet the standards.More and more Chinese firms are told by their European and US clients that theyshould meet these criteria before they can talk business. (Suzuki, 2005)China Daily (2003) had an interview with Xia Yueming, president of Zhejiang-basedMishuai Apparel Co, is basking in an increasing number of international orders sincehis private company passed SA8000 certification, According to Tuesday's China Daily,they can directly supply US clients, instead of resorting to other traders. On the other
hand, some other companies in South China, with its booming export-orientedeconomy, feel the pinch of the SA8000. An increasing number of plants there have lostinternational orders due to demerits in fulfilling the SA8000 requirements.This Mishuai case indicated a fact that in these years, exporters in China did realize the
significance of obtaining SA8000 certification. However in reality, there are not somany companies willing to do it. They do not think they will be as lucky as Xia. It isclear that the increasing costs for working conditions improvement and high costsneeded for passing the certification itself, making the exporters worried about the
SA8000 requirements. They may think such would reduce the benefit of access to annexpensive labour force and affect their exporting advantage, because most of them assuppliers are private and small-scale players seeking quick returns. According tocalculations, a 1,500 employee company will spend 230,000 Yuan (US$27,811) on the
first-time accreditation and following reviews for three years. Chinese producers ofelectronic products, apparels, textiles, toys, sporting equipment and shoes are thoughtto be most vulnerable to the strict requirements (China Daily, 2004).Due to this conflict, the problem will be focused on whether the good side of the issuewill prevail over the negative impact. Waddock and Graves (1997) states a “virtuouscircle” may exist about relation of CSR and financial performance, which suggest thatpositive stakeholder relationships can reduce the likelihood of difficulty when dealingwith groups such as employees, customers, and the community. In addition, good social
performance and good managerial practice may be related, so this in turn may lead tostrong financial performance.
The audience of my paper could be the exporters who may realized the importance oflabour condition improving, but worry about less profits than expect after get SA8000certification or decreasing competitive advantages of “low cost” in global market. Thatmeans my study will be mainly about testing firms’ financial performance changingafter gain SA8000 Certification. I would like to also discuss what other “non-financial”profits the SA8000 certification could bring, because the principle of SA8000 is notdefined as the way help suppliers gain more profits, it is a responsibility we all shouldpay attention to.

In my paper I studied Chinese exporting companies in some industries as example toinvestigate necessity to generalize certifications to SA8000 standard in developingcountries. At the end I discussed whether Chinese exporting companies shouldcertifications to SA8000 standard, because they may be able to benefit from it by betterfinancial performance. Therefore my research question is: Whether the SA8000Certification affects the sample firms’ fina