Ikea Case Analysis (Csr)
Corporate Social Responsibility 2012
IKEA Case Analysis
I. Analyze: Identify Issue and its Scope
The primary CSR issue reflected in this case is the use of child labor by one of IKEA’s Indian carpet supplier. The supplier was explicitly made to sign the contract which restricted the use of children below the age of 14 to be used as laborers. The practice of child labor is considered exploitative by many international organizations and is illegal in many countries. The fifth principle of UN Global Compact 's Ten Principles specifies "Businesses should uphold the effective abolition of child labor." In addition to this principle, UN published ‘Convention on the Rights of the Child’ in December of 1989 stating that the right of a child to be protected from economic exploitation and from performing any work that is likely to be hazardous, interfering the child 's education, or harmful to the child 's health or physical, mental, spiritual, moral or social development.
Nevertheless, in 1994, a Swedish television documentary broadcasted a film disclosed IKEA was one of the carpet importers from Pakistan where children worked at weaving looms. As a part of its response, IKEA sent a legal team to Geneva to seek input and advice from the International Labor Organization on how to deal with the problem. Following discussions with the ILO, IKEA added a clause to all its supply contracts – a straightforward “black-and-white” clause stating that if the supplier employed child labor under legal working age, the contract would be terminated immediately. The company also hired external agent to monitor child labor practices at its suppliers in India and Pakistan. After managing the initial response to crisis, in the spring of 1995, IKEA was preparing actions to address this issue but a well-known German documentary maker notified the company that a film was about to be broadcasted showing children working at looms at Rangan Exports, one of IKEA’s major suppliers in
IKEA Case Analysis
I. Analyze: Identify Issue and its Scope
The primary CSR issue reflected in this case is the use of child labor by one of IKEA’s Indian carpet supplier. The supplier was explicitly made to sign the contract which restricted the use of children below the age of 14 to be used as laborers. The practice of child labor is considered exploitative by many international organizations and is illegal in many countries. The fifth principle of UN Global Compact 's Ten Principles specifies "Businesses should uphold the effective abolition of child labor." In addition to this principle, UN published ‘Convention on the Rights of the Child’ in December of 1989 stating that the right of a child to be protected from economic exploitation and from performing any work that is likely to be hazardous, interfering the child 's education, or harmful to the child 's health or physical, mental, spiritual, moral or social development.
Nevertheless, in 1994, a Swedish television documentary broadcasted a film disclosed IKEA was one of the carpet importers from Pakistan where children worked at weaving looms. As a part of its response, IKEA sent a legal team to Geneva to seek input and advice from the International Labor Organization on how to deal with the problem. Following discussions with the ILO, IKEA added a clause to all its supply contracts – a straightforward “black-and-white” clause stating that if the supplier employed child labor under legal working age, the contract would be terminated immediately. The company also hired external agent to monitor child labor practices at its suppliers in India and Pakistan. After managing the initial response to crisis, in the spring of 1995, IKEA was preparing actions to address this issue but a well-known German documentary maker notified the company that a film was about to be broadcasted showing children working at looms at Rangan Exports, one of IKEA’s major suppliers in
References: Bhukuth, Augendra. “Defining child labor: a controversial debate”. Development in Practice (2008) 18, 385–394. UNICEF. 2008. India-The Big Picture. http://www.unicef.org/infobycountry/india_background.html Retrieved February 21, 2012. Office of the United Nations High Commissioner for Human Rights. Convention on the Rights of the Child. http://www2.ohchr.org/english/law/crc.htm.Retrieved February 21, 2012 (originally published on November 20, 1989). United Nations Global Compact, The Ten Principles. http://www.unglobalcompact.org/AboutTheGC/TheTenPrinciples/index.html. Retrieved February 18, 2012. Child Labor (2008). http://www.childlabor.in/causes-of-child-labour.htm. Retrieved February 22, 2012. AZAD India Foundation. Child Labor in India. http://www.azadindia.org/social-issues/child-labour-in-india.html. Retrieved February 22, 2012. Child Rights and You. Ensuring Lasting Chang for Children. http://www.cry.org/whoweare/whowearelp.html. Retrieved February 22, 2012.