Helping Child Workers: How should multinational corporations accommodate child workers in Southeast Asian countries to which they outsource?
Abstract
Outsourcing is one of the major supply chain strategies adopted by many multinational corporations in order to respond to market demand by lowering the cost. As the emphasis on social responsibility and sustainability has been increasing, there has been a lot of pressure on firms to control many problems caused by different living conditions or cultures. One of the most significant humanitarian issues is ongoing child labor practices. This paper describes how corporations, such as Nike, Reebok, Wal-Mart and the Pentland Group, have been addressing this issue. Many of them have been eliminating child labor among their suppliers; however, that policy is not a true meaning of social responsibility because child workers will search for alternative jobs that might provide worse working conditions. To address the child labor problems in developing countries in order to ultimately eradicate child labor, extensive research was conducted to find the most viable business model solution. The solution is directly focused on two countries in Southeast Asia, which are Bangladesh and Cambodia. Recommendations are made for multinational corporations to cooperate with non-governmental organizations as well as the national governments in depth, in order to acquire critical insights and experience to implement the solution. The core element of the business model is building a private school right next to the factory where child workers could acquire both education and household income. Instead of eliminating all child workers from the factories, by accommodating them, child labor will be eliminated gradually because their household income will rise. At the end, there will be no child workers to even employ for multinational corporations in Cambodia and Bangladesh.
