MMH733 : IKEA Corporate Social Responsibility
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Deakin University
Added on 2019-10-31
MMH733 : IKEA Corporate Social Responsibility
Deakin University
Added on 2019-10-31
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Ethical Responsibilities for IKEA 1ETHICAL RESPONSIBILITIES FOR IKEANameUnit nameStudent ID no.Professor’s NameUniversityCity (State)Date
Ethical Responsibilities for IKEA 2ABSTRACTThis research is aimed at finding out the ethical practices in IKEA. The study reveals different unethical activities that have happened in the past and how they were resolved. It also finds out how IKEA treats its various stakeholders in relation to the Caroll’s four-part model on CorporateSocial Responsibility. Moreover, it analyzes IKEA's vision, mission, and code of practice to find out how they influence the way it carries out various activities. The research shows that IKEA's primary focus is to its customers to enable them to create a better life at low costs. Finally, there are recommendations on how IKEA can improve its practices to be more ethical.
Ethical Responsibilities for IKEA 3Ethical responsibilities for IKEABusiness ethics refers to moral principles that are followed by a business that control the way it operates. Unethical business practices can be very easily identified. Incidentally, child labor should not be employed in business, bribery should not take place in business, and copyrighted materials should not be unlawfully used in business (Goodstein & Wicks 2014). IKEA is a company that has very many stores across the world. This report has three major objectives;1. To determine if IKEA practices business ethics.2. To find out if IKEA shows corporate social responsibility using Carrol’s CSR model.3. To see how IKEA treats its different stakeholders.Any company that has business ethics also employs corporate social responsibility for its actions. This is to its shareholders and its employees. It should make good returns for its shareholders, and it should also respect its employees and treat them fairly. These businesses additionally take responsibility for the environment and prevent all forms of pollution (Boons & Wagner 2009).Ethical Issues IKEA Has FacedIkea is a company that has a strong reputation due to its sale of high-quality products that are cost effective. The company has a competitive advantage due to its ability to produce highly innovative products. This company is top-rated in the united states as well as Europe. It is a company that is also involved in philanthropy and has had sustainable growth. However, IKEA like many other organizations has faced some ethical problems (Fund & Initiative 2014).There was evidence of the company was spying on its employees. This was reported in France. Upon further investigation into the matter, it was revealed that IKEA had put investigators to follow up on employee misconduct, customer complaints, and job applicants intothe company. There was one senior employee was on sick leave but was later terminated when it was determined that she was not ill through the use of an investigator. Upon learning of the events that transpired, the employee filed charges against IKEA for infringing on her privacy.
Ethical Responsibilities for IKEA 4Some top executives in the company were terminated, and IKEA was required to post a bond of five hundred thousand Euros (Lindgreen 2017).Another ethical scandal that involved IKEA happened during the communist regime. Upon questioning about the incidence, IKEA admitted that to build its furniture, it had used laborfrom political prisoners from East Germany. Moreover, inmates who refused to carry out this task were punished. This revelation by the company showed that it been unethical and violated human rights. However, the fact that the firm admitted to the allegations and put down measures to respect human rights in the future show that it wishes to avoid the semblance of the same(Wadsworth 2007). Some critics have cited IKEA's corporate structure as unethical. This is because the structure of management is seen as highly complex and hierarchical. The company is run by a private company that is then run by a non-profit company in Dutch. There are others who find Kamprad to have excessive power because he is the chairman of the company that oversees the non-profit company. Another claim is that IKEA involves the non-profit company in a bid to dodge taxes. IKEA has however denied these accusations and said that its reason for using a non-profit company is to increase its level of competitiveness. To prove that it is not unethical, IKEA agreed to publicize its financial information (Render 2012). In 2013, there was yet another scandal that involved the quality of IKEA’s products. There were accusations that IKEA was selling meatballs that were made from horse meat. The Czech Republic authorities confirmed that they had tested the meatballs and they tested positive for horse DNA. IKEA investigated the issue, and sure enough, it was true. The investigation revealed that one Swedish supplier had, in fact, supplied the horse meat which was, in turn, traced back to slaughterhouses in Poland (Render 2012). The meatballs were removed from the shelves, and a police report was filed against the supplier. To reassure its customers and ensure such an occurrence does not happen again, IKEA provided DNA testing of the meatballs temporarily. It also informed the people that horse meat was not poisonous (Ben Brik et al. 2011). These are just a few of the ethical challenges that IKEA has faced over the years. It is, however, important to note that IKEA responded to the claims with the immediate investigation
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