How should Marianne Barner respond to the invitation for IKEA to have a representative appear

on the upcoming broadcast of the German video program?

Barner should accept the interview invite as

• This allows them to go public and explain the situation.

• They can showcase that their supplier contract clearly states ‘Use of child labor would result in
abandonment of the contract’and they will fire Rangan Exports.
• Highlight the measures they have taken to suppress child labor such as monitoring the supply-
chain network themselves and also hired a third-party vendor for monitoring the use of child-
labor.
• Formulated supplier contracts post discussions with ILO to inculcate measures to
eradicate/avoid products that are produced using child labor.
What actions should she take regarding the IKEA supply contract with Rangan Exports?

Europe was very stringent on support of child labor laws and being their primary market, it was in their best interest to fire
Rangan Exports as a supplier and resonate corporate ethics and values of the company with their customer base.

As per the formulated contract, use of child-labor in manufacturing of the product would result in abandonment of the contract.

Rangan Exports should be fired as this would set an example amongst other suppliers of the emphasis on Child labor policy
followed by IKEA .
What long-term strategy would you suggest she take regarding IKEA's continued operation in
India? Should the company stay or should it exit?

IKEA should definitely continue doing business in India with below measures

• Find new suppliers that aligns with company’s ethics, values and corporate ethics.
• Take legal measures to ascertain the contract terms are abided and child labor policy
enforcement is implemented correctly.
• Continue monitoring the rest of the suppliers via Random Tests & Situation Anlaysis.
• They should work with Rugmark Foundation and enhance the existing measures/rules
forayed to prevent child labor.
• The company should also investigate the root cause of child labor and undertake projects as
part of CSR initiatives to eradicate it. This could be in the form of
Setting up schools providing free education to children in rural areas.
Empowering women labor to support family income.