Lind green, …………………. In the quest to deliver the lowest possible prices to the consumer, IKEA has contracted with manufactures and Ikea rangan exports in developing nations where labor costs are very low.
Addressing the issue honestly, rapidly, and seriously will help mitigate the potential harm to the company.
However, if IKEA withdraws from India market, it will restrain itself from a big opportunity of cheap labor and put the company at disadvantage position as other competitors like Wal-Mart is accessing the same opportunities to compete for lower product prices. The company should not sign-up for Rugmark.
In fact, done well; IKEA could be seen as a leader in developing new corporate child labor practices. The fact that India, Pakistan, and Nepal were not signatories to the convention implies it is unreasonable to accuse IKEA of violating the law of child labor.
The way out First we take a look at how the company responded to environmental and social issues when they first emerged. A free telephone number and website address for reporting violations should be posted within the factory.
Barner must be very prepared for the broadcast. IKEA will act more inline with core values by staying in India and trying to improve working conditions at its Ikea rangan exports factories.
IKEA might even want to consider changing her job function for a year to that of a global child labor advocate on behalf of the company. The children found in the Rangan Exports plant should be taken to their homes where IKEA representatives will meet with the families to see what their needs are.
There are several organizations that are actively involved in eliminating child labor.
Rangan Exports should be investigated by independent auditors from one of the Big 4 accounting firms under rush Ikea rangan exports before the broadcast. Up to that point, the company had gained some positive achievements to the child labor issue since the problem was first raised by Swedish television.
This is just a sample partial work. Its key feature of providing self-assembled furniture starting from significantly cut transport and storage costs. The company was founded in by Ingvar Kamprad and kept growing tremendously from 2 stores in to stores in to stores in in 24 countries welcoming a total of million visitors.
If IKEA follows the steps described above, it will advance itself to the proactive level of social responsibility. IKEA should utilize its own compliance monitoring group and independent auditors to oversee its operations in India.
The third step was to appoint a third-party agent to monitor child labor practices at its suppliers in India and Pakistan. Working with Rugmark is another good option if IKEA can make sure the child labor problem is under control.
Its corporate strategy style partly exacerbates, instead of helps the situation. This image can be tarnished quickly if child labor is allowed to continue. Some people may argue that if the company is actively involved with the issue, it may undergo a drop in profit compared to its competitors.
IKEA does not own any of its manufacturing; instead it has developed close relationships with suppliers. Since checking the procedures of the suppliers on occasionalbasis by the company may be effective asthereare chances that thesupplier may stop such activities in order to save the contractand continue to so do while the checking team leaves.
This option should be passed on. At the initial period, the way that IKEA dealt with Formaldehyde and forestry issues showed its engagement in social responsibility still remained at the reactive step but not yet at the proactive step or interactive step.
Afterward, the company worked directly with glue companies and reduced the formaldehyde off-gassing in its products. There must be a penalty to Rangan Exports for employing children.
These events urged the company to consider environmental and social issues more seriously.The Alternative Responses Acts Ethical Dilemma Purpose Principle People Accept the invitation Rule-Based Thinking Terminate Rangan Exports contract End-Based Thinking Exit India Rugmark Solo Monitorship Care-Based Thinking End-Based Thinking 24 Source: the heart of Leadership, PLCEthics-Oklahoma State University-Student Union Ikea.
IKEA 4 Introduction The dilemma that faced IKEA’s business manager for carpets Marianne Barner was significantly in terms of how a decision left up to her to cease business alliances or not based upon a breach of promise made by one of the of the company’s Indian rug manufactures (Rangan Exports) would affect the company’s.
Rangan Exports. Since the German filmmaker has targeted the Ikea activity (Use of Childlabor) in Rangan Export, which is ahuge supplier of the Ikea business unit, it is better to develop certaincontrol and monitoringbody in India that cross checks and verifies the supplier’s activity while fulfilling the Ikea’s mi-centre.comn bedone by.
Issue #2: How should IKEA deal with Rangan Exports’ violation of the contract?
In order to address this question, it is important to identify the implications of IKEA’s relationship with Rangan Exports. Firstly, Ragan Exports is a large and well-regarded company that is also one of IKEA’s major suppliers of Indian rugs.
IKEA can remove Rangan Exports as one of IKEA supplier by using the violation of child labor and look for another supplier that manufactured the same products as Rangan Exports with a reasonable price%(6). In the spring ofanother film is threaten to be shown on German television about children working at looms at Rangan Exports, an Indian company used by IKEA, and the producer then invited IKEA to send someone to take.Download