IKEA’s Global Sourcing Challenges: Indian Rugs and Child Labor (B)
ISSUES
IKEA is facing environmental and social issues. These are listed below:
The first issue was based on environmental concern, occurred due to stopping the use of water treatment plants which was harmful to the environment. The child labor issue confronted by the company was the second ongoing issue of IKEA. The working with children in companies used by IKEA was first shown on a television program in 1995, showing the proof of child labor in Rangan Export, a major supplier of rugs to IKEA.
RECOMMENDATIONS
IKEA should participate in environmentally sustainability programs effectively. Second, since the child labor issue was raised, it had seen that certain important information had been gained by the company from the International Labor Organization (ILO), and UNICEF. Therefore, it is recommended that the company must show the attitude of eliminating the social issue of child labor to emphasize the company does not accept child labor. It is recommended to the company develop a long-term strategy for dealing with the issue of child labor through strict implementation of the code of conduct. The senior staff like Burnet should have a visit to Rangan Exports to investigate the issue of child labor. In case of finding child labor issue, it is recommended to the company to develop a budget to help those children who are working in Rangan Exports. This budget for children’s support can be used efficiently with the help of UNICEF.
It is recommended that experts need to be hired by the company who must have an understanding and extensive knowledge of investigating the child labor issue at the suppliers’ level. Because the company has no manufacturer, it is recommended that IDEA should work with Rugmark Consortium after eliminating child labor. It is recommended to manage all such types of issues proactively to prove that the company is fulfilling its social responsibilities. These proactive measures will enhance the brand image of IKEA.
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