Please review the Global Sourcing & Child Labor Challenge summary below, which based on based on an Harvard Business Case Study (source: Source Citation only.pdf Download Source Citation only.pdf) featuring the IKEA organization; and post in the discussion board per the below prompt.
Case
Marianne Barner, the global business area manager for carpets at IKEA, the largest furniture manufacturer in the world, was faced with an ethical dilemma. A key carpet supplier based in India was discovered to be using child labor to produce its rugs for IKEA. This was particularly frustrating for Barner because, like all other IKEA suppliers, this large and well-regarded supplier had recently signed an addendum to its contract explicitly forbidding the use of child labor. On one hand, Barner has solid reasons to stick with the supplier and painstakingly explore solutions to the problem since termination of this supplier contract would majorly disrupt supply and global sales. Also, in line with IKEA’s high ethical standards and track record of doing the right thing, Barner had recently signed up commitments with the Swedish Save the Children organization, a coalition of other manufactures and retailers, and other Indian nongovernmental organization (NGOs) to specifically take on the issue of child labor, with a shared goal to do what is “in the best interest of the child” ― whatever that might imply. These aims also align with the longstanding IKEA vision to “create a better life for the many people.” On the other hand, Barner is confronted internal pressure from those who wondered if IKEA should just abandon the situation. Indian rugs account for a tiny portion of IKEA’s overall business, and to these observers, the time, cost, and reputational risk posed does not justify the effort. This pressure of the situation is further compressed due to the fact that a well-known Germany documentary maker known for hard-hitting interviews had uncovered the child labor issue and invited Barner to a filmed interview to be featured in the documentary.
From a corporate social responsibility perspective, what consideration would you offer Marianne Barner in this situation?
What is at stake in this IKEA case?
