Case Study to Accept GoodweaveCase Study to Accept GoodweaveQuestion 1: The CEO of this retail company that sells mid- and high-end hand-woven carpets is probably concerned about his rug suppliers because he is a forward thinking leader. He most likely realizes that the use of child labors at the production level of his companys carpets is a moral issue of international importance that affects numerous countries and individuals. Actively addressing the companys use of child laborers could positively impact its reputation, sales and competitiveness, while waiting to take action may negatively impact the company. The CEO has the opportunity to ensure no child labor is used in the production of its carpets and make his company more socially responsible.
The companys potential use of child labors may present the CEO with a personal, moral dilemma about the ethics of such a practice. Like some level 5 leaders, the CEO might have more inspired standards, making him simply unable to tolerate mediocrity in any form and utterly unwilling to accept ‘good organizational practices or ideas as ‘good enough for his company. He may see the chance to make a positive impact on the long-term socio-economic development of individuals affected by child labor. As argued by Collins, the CEOs ambition might be to leave behind a stronger company, and to do so, would require him to detect inappropriate methods in the companys carpet production and steer the company towards more ethical standards of conduct.
It is an organizations leader who is responsible for creating its vision and strategies, and thus by doing so, articulate practices and procedures deemed acceptable within the organization. Leadership in this situation is setting a framework and standard of conduct for the entire company. What is crucial about a vision is not its originality but how well it serves the interests of important constituencies, which include workers, customers, suppliers, and producers. The CEO most likely understands that the use of child laborers is not in the interest of the companys workers at the production level, nor of its consumers. As the majority of consumers deem the use of child labor an unacceptable practice, the CEOs more forestalling concern could be that the companys public image or reputation could be compromised if consumers were to find out that the company obtains its rugs from producers relying on the immoral and possibly illegal use of child laborers.
The function of leadership is to be able to cope with and produce change. It is important for leadership to focus on leading the company forward by approaching the situation at a global scale. Considering that the international community increasingly finds child labor an unacceptable business practice, the CEO must be able to change his companys production methods to remain competitive amidst important developments in the market and the needs of his constituencies. Thus, the companys removal and rehabilitation of child laborers from the production level could make the company attractive to a wider-range of consumers, and thus increase the companys sales by creating a level of trust in consumers toward the companys ethical standards as well as give it a more competitive position against other firms in the global marketplace. As the companys leader, the CEO is exhibiting executive-level expertise, by acting in a strategic manner, understanding the dynamics of the industry, and being future-oriented.
Question 2: I recommend that the company join Goodweave to capitalize on this opportunity of ensuring no child labor is used in the production of its carpets and promote a social good. This will not only potentially benefit the companys reputation, sales and competitive position, but also simultaneously serve to stop a detrimental cycle of exploitation/poverty, and even create an occasion for social progress.
The company is currently buying its hand-woven carpets through intermediary suppliers, of which most are not ‘transparent; as about half of the current products purchased by the company use least some ‘child labor. It is obvious that the company does not currently have the proper mechanisms to prevent child labors from working in its carpet production. While establishing direct links with producers and implementing our own monitoring system is a strong option as it gives our company control over production standards, it is an extremely costly option and we might not have the sufficient knowledge or expertise to achieve the desired objectives. Rugmarks experience and multifaceted system would ensure that the companys products were created according to certain ethical standards, such as not using child labor, in the most efficient and cost effective manner. For example, more than 2,000 children have been rescued from child labor by this program. Rugmark would give the
e.g., the company any financial incentive to implement an all-inclusive plan on the industry-wide compliance to ensure that any deviations from that policy will not negatively affect consumer and/or business operations. Rugmark is committed to following any ethical conduct as soon as possible, in accordance with its own policies and procedures, including by employing appropriate social workers, which can include social workers who know to inspect the materials thoroughly, evaluate whether the same conditions have been followed, and follow their lead. The company’s compliance activities are a direct consequence of the environmental, safety, and social responsibility which Rugmark shares. The company understands that a company’s use of child labor will not be deemed a result of the company’s human-laboring practices, such as any possible safety concerns (see #22). We do not encourage or allow these practices, or any other potential liability from a parent or legal guardian, to impact the child laborer’s economic or moral well-being.
8.5.5.2 Protecting The Family
Rugmark, including its current customers, may use the provisions in the Fair Labor Standards Act to prevent others from exploiting child labor, such as for instance, other private companies, for personal or commercial ends.
8.5.5.3 Protecting Employees Under The Fair Labor Standards Act
Rugmark is committed to complying with the Fair Labor Standards Act when:
• the company fails to take appropriate corrective actions against children who work for a competitor: the employer, as determined by the applicable statutes, must take appropriate corrective actions against child laborers who participate in the production process; or;
• the employer fails to take appropriate corrective actions for the children who work for a competitor: the employer must take appropriate corrective actions for that child labor, as determined by the applicable statute, and the company must comply with all of the relevant anti-discrimination laws and the anti-discrimination mandates of Title II of the Act.
8.5.5.4 Assurance In The Private Sector
Rugmark requires independent financial and safety experts at all levels of the company to make available all available information required by law, as well as a wide range of independent and highly paid security and technical advisors to help support shareholders.
8.5.5.5 Disclosure of Information
Individuals who are involved in the production of Rugmark’s products are required to disclose these information to shareholders or other potential investors who may be subject to unfair competition charges. In accordance with the Fair Labor Standards Act,[2] this disclosure may occur when:
• the company reports to the relevant authorities on a periodic basis, or a report is reported jointly with those authorities (e.g., by an individual, the company or a third party which owns some of the rights in the product, and does not have legal obligation to do so); and
• the company discloses information that is generally confidential; and
• the information is disclosed to persons who are also responsible for the preparation and execution of Rugmark’s products and services, or to persons involved in the production process.
For example, if, for example, there is strong interest from the parent company or others in ensuring the safety of certain Rugmark products, employees will probably be affected as a result of the company’s exposure to the risk of child labor. We have no record of employees using unsafe, non-adequate or excessive method of child laboring. Nor have we provided access to information that would expose employees to the risk of abuse or exploitation.
8.5.5.6 Review of Products
Rugmark also provides guidance on appropriate testing of all products used by Rugmark’s employees.
8.5.5.7 Protecting Personal Personal Information
Rugmark has previously provided the following statements under the Act, the Fair Labor Standards Act, the Fair Labor Standards Act, the