The rise in globalization has led to the rapid growth in the integration of societies and national economies further allowing businesses to operate on a global platform. Everest Pashmina is one such company located in Nepal that has dominated the pashmina export business. However, doing business in a diverse economy involves dealing with multiple stakeholders with varying socio-economic, and political values, experiences, and backgrounds which can bring in both opportunities and challenges for a business. Therefore, throughout the paper, I will be discussing a serious moral issue related to the use of child labour in Pashmina factories of Nepal. Further analysis will also be done based on ethical theories and discussing possible paths that could lead to the most optimal solution from an ethical and financial point of view. The solution will be mainly geared towards reducing child labour. This decision is being considered not only on the basis of the company’s reputation but to also devise a proactive response to try to reduce child labour as a global citizen and not just a Pashmina company.
Nepal is a developing South Asian and landlocked country between the largest economy and fastest-growing economy in the world China and India respectively. International trade plays a crucial role in the economic growth of Nepal and represents nearly 50% of the GDP. Pashmina, which is the finest, lightest and warmest wool found in nature, is the nation’s third-largest overseas export product. Almost every winter accessory is made using Pashmina wool. In order to make these final products, the entire process is arduous and time-consuming. The first part of the process involves extracting the wool from the Himalayan sheep which is then collected, dried, cleaned, and finally coiled into a yarn. In the second process, the yarn is washed, dyed (if necessary), and weaved into the product. Finally, the product is tweezed, washed, necessary designs (prints, embroidery) are included, and packaged.
Nepal also has the major problem of political instability and traditional caste system due to which income disparity, economic and gender inequality have always existed and still continues to exist. Pashmina factories are labour intensive and have high demands for workers. So, the demand is fulfilled by supplying people from low-income families into the workforce. According to the Central Bureau of Statistics (CBS), about 21.6% (6 million) of Nepal’s population is still living under the poverty line. Due to high poverty rates, Nepalese children from a very young age are expected to contribute to the income source of the family. According to the United States Department of Labor, 34% of Nepalese children are involved in some type of child labour. So, in many cases, they work alongside their parents in factories. Similarly, because of the lack of education and job opportunities in Nepal, many parents want their children to join them at work. This is because they think providing their children with skills such as embroidery instead of going to school will be helpful in easily getting a job in the same line for them in the future.
The company I am focusing on is a handicraft exporting company known as the Everest Pashmina Knitting & Weaving Industry. It is the number one Pashmina exporting company in Nepal and the award for the highest exporter was received by the company for the 15th consecutive time in 2019. Without a doubt, the company is majorly contributing to Nepal’s GDP being a country that is heavily reliant on trade for economic growth. However, the use of child labour is prevalent in the factories of Everest Pashmina because I have personally witnessed it while walking past their factory which is located about an hour away from my home. I saw young girls sitting down with women making the embroidery patterns on the shawl while boys were in the yard with other men mixing chemicals and dying the Pashmina. It was mind-boggling to see it even though scenes like these are very common in Nepal. I could see it because the doors were open and this supports the whole idea of child labour being socially accepted in Nepal. However, the problem of child labour for an international exporting company goes beyond their profits and directly sheds light on the company’s ethical stance.
Despite child labour being extensively common in Nepal, Everest Pashmina being a well-renowned company faces an ethical dilemma. The company is in a position where two right situations conflict which is discussed below:
Individual vs Community: In this dilemma, there is a struggle between the needs of the individual and that of the community. Here, the individual is the company and the community is the children who work for the company. Being an exporting company their main goal is to maximize their production which will lead to an increase in exports. So, it is right for the company to use child labour as their inclusion in the workforce will help the company achieve its goal of production maximization. However, at the same time, children will be giving up their school time to work in the factory. So, it is also right for the children to get an education, increase their own productivity and broaden their knowledge which will help them get better jobs in the future.
Short term vs Long term: Within this dilemma, the company has the struggle of satisfying their current needs and that of the future. Almost everyone in Nepal is aware that children from low-income families need these jobs to support their families. So, in the short term, it is right for the company to satisfy the demands of the children by hiring them for the job. Accordingly, the company does become a source of income but exposes the company to long term reputational, legal, and financial risk. The export business is very competitive and the information regarding child labour use possible will be divulged unexpectedly. So, it is right for the company not to involve children as satisfying their needs directly puts a risk to the business.
Truth Vs Loyalty: Despite it being known that child labour is common in Nepal, customers mainly located outside of Nepal are unaware about the use of child labour in the manufactruing process of the products they use. As customers, when we are offered good products at an affordable price, we hardly question the low price. However, if the customers are made aware about the use of child labour then without a doubt some customers would not want to buy the product. So, in this case it is right for the company to be truthful to their customers and not use child labour in factories. However, at the same time the children along with their parents and even the Nepalese government is heavily reliant on the company for income. So, it is also right for the company to be loyal to both the government and its employees (children) by providing them opportunities for consistent income flow.
In Nepal, there are laws that prohibit child labour. One of the most important international agreements made was based on the Convention of the Rights of the Child (CRC) in 1990. Article 32 of the CRC deals specifically with child labour: “States Parties recognize the right of the child to be protected from economic exploitation and from performing any work that is likely to be hazardous or to interfere with the child's education, or to be harmful to the child's health or physical, mental, spiritual, moral or social development.” However, the problem in Nepal is that laws are passed and no follow up is done to see if it really is being implemented by businesses. So, because of the leniency and lack of responsibility, everyone disobeys the law.
To further analyze the situation it is important to approach it from an ethical framework. So, the ethical frameworks I will be using for the problem of child labour are:
Utilitarian framework: This framework focuses mainly on the outcome and is concerned with the greatest net good for the greatest number. In this case, the greatest number includes the employees involved. As mentioned above, despite the existence of laws, children are included in the workforce and are hence considered as employees. So, being an employee directly benefits the children as they can now support their families through the pay they receive. In this case, for the Utilitarian the greatest number is being benefited. So, solely focusing on the outcome child labour is not wrong and would suggest the company to involve children. They can further even reverse the situation of child labour by showing the company as doing a good thing and working towards for the best interest of the people and society in which they operate in by improving their economic conditions. Additionally, choosing to remove children from the workforce for the Utilitarian would be unethical especially if the child is contributing largely to the family’s income. So, the right thing to do for the company under this framework is to continue to use child labour as the outcome largely benefits the greatest number.
Deontological Framework: The framework also known as Kantian ethics is based on duty and rights. While using this framework for decision making it is important to consider choosing the course of action you would wish everyone to take in the situation you are in. So, the Kantian would argue that despite operating in a nation where child labour is not only acceptable but is required for economic reasons, including children in the workforce is unacceptable. This is because it violates the child’s right to education further hindering their development and well being as they are exposed to work pressure. The Kantian can further go on to personally connect the top-level executives with the children by suggesting the executives for once to place themselves in the children’s place to consider the difficulties and pain they are going through at such a young age. Accordingly, the right thing to do under this framework would be not to use child labour as it is immoral and violates the fundamental rights of the children.
Overall, the company is in dilemma on how to address the problem of child labour in a society which accepts it and simply choosing to put an end to by removing children from the workforce would further worsen the poverty situation of the people. So, the third option to the ongoing situation would be to solve the problem of child labour in a way that also addresses its root causes: poverty and illiteracy.
By seeing the problem from a first-hand perspective and considering the analysis from the above mentioned ethical frameworks, it can be understood that child labour is a systematic problem that is extremely difficult to solve as its deep-rooted cause — poverty which is yet another unsolvable global issue. While the political system in Nepal does need a huge overhaul, I am a strong believer in the fact that this needs to and can only happen in unison with changes done at the individual level. Every individual commitment is valuable and required. So, while Everest Pashmina cannot entirely change the system it can take the necessary steps to minimize child labour. Before moving on to the solution, some of the important things to be considered that are mentioned above are:
So, the company should move forward by considering these five main factors and implement a realistic solution that has both short and long term benefits for both the business and children.
I am aware that addressing the problem of child labour is complex and challenging. So, with this in mind, the third option I propose is by starting an educational program cooperatively with the government that directly aims at minimizing child labour by providing education which will eventually alleviate poverty. I believe that the government of Nepal will be compelled to work with the company if it explicitly mentions their contributions to the country’s GDP. Apart from government support, investment is required. So, Everest Pashmina can make a collaborative approach of working with external stakeholders (customers and community) by doing the following:
Fundraising/ Social Awareness Events: Child labour is a societal problem which requires collaborative efforts. The public also needs to be both involved and informed of the efforts made by the company and social awareness events can help achieve this goal. While at the event Everest Pashmina can voluntarily ask people for donations with the guarantee of them being regularly updated through progress reports about their impact towards a greater social good. While Nepal is considered a poor nation, some people are exceptionally affluent and they do attend many social events. It is all about trying to make an effort and people in the event recognizing the effort will most likely donate if not for the effort for their own philanthropic choice.
In-store donations: Most customers shop in physical stores where they can actually feel and experience the use of Pashmina products. So, during check out the store can include an option of voluntary donation for the program before they sign their purchase receipt in the card swipe machine.
In order to alleviate poverty, providing education to future generations is a must. In fact, this solution is also in the best interest of the children. So, education should be a priority as it not only reduces the time spent in factories but will provide children with the skills and knowledge which will provide them with better opportunities and for once allow them to dictate their future. The company will essentially be equipping them to take on the world.
According to the Nepal Child Labour report, It is estimated that nearly 40% of working children work up to 14 hours a week, 36% work from 15 to 28 hours and about 15 %work from 29 to 42 hours. This indicates direct harm on the psychological and physical wellbeing of children due to extensive labour work during their development stage. So, the first step to providing education is minimizing work pressure by providing work flexibility which allows children to attend both school and work. Likewise, another important thing to be considered is to make education accessible. In Nepal, public transportation is really bad and unsystematic. Children in many parts of Nepal have to walk through difficult paths during extreme weather events just to go to school. One in ten students in the outskirts of the capital city have to cross a river on a cable to come to class. So, the company should use the funds they earned through the social event and in-store donations to build a school which is in a commutable and safe distance from the factories. This is better for all as it is much more time-efficient allowing the children to get back to work at the appropriate time which will increase production compared to if the children had to walk for a longer distance.
An important factor to realize is that while providing education is a huge step towards addressing child labour, it can only be achieved when the children are encouraged to go to schools. This is because I know that some children work in hopes of helping their parents and siblings, especially when they only have one parent remaining. So, parents play a crucial role in making this program successful by encouraging their children to attend school. In some families it is extremely difficult to encourage parents to do so because of immediate financial needs. So, it is equally important to make parents aware of the importance of education. For this, the company should host an event that focuses on informing people the need of educating their children and the long term benefits it can have on the entire family. To further show that the company is truly invested in the future of their children, I believe setting up a scholarship program (through government aid) where a few exceptional children will be sent to colleges in countries like America would serve as an encouragement to pursue education. This will encourage children to be hardworking students. Furthermore, the company can also provide white-collar jobs within the company once the children complete their education (through the scholarship program or locally). As they get older and educated, they could even become the factory manager or choose a different path of being teachers in their schools and give back to the community.
Along with providing education, it is imperative for the businesses to be responsible for the health and safety of their workers. The working conditions of the factories are considered by customers when making purchasing decisions. With increasing economic inequality, everyone is looking to satisfy their needs at an affordable price but this necessarily won’t stop them from making an ethical choice. Personally, my mother and I both use Pashmina products but we do not buy it from Everest Pashmina. We instead buy it from a company named Moonlight Pashima. As I mentioned before, factories in Nepal are not really concealed as the doors are swung open. So, our decision is based solely by observing the working conditions of the children in the factory of Moonlight Pashmina which is safe. They are provided with masks and glasses which I clearly did not see when the young boys were dying the Pashmina at Everest Pashmina’s factory. So, the company should also be focused on minimizing any harm not only to the children but every employee. So, they need to provide all necessary protection such as masks, gloves and such to prevent the children and their parents from hazardous conditions. Creating this option to work under safe conditions will not only help the families, but it would serve as a split in the road breaking the cycle of poverty.
The problem of child labour has consequences for businesses, but it is also one of the important income sources many families in developing nations depend on for survival which is why it will continue to exist. However, the responsibility to acknowledge and address it must be taken by someone. Thinking in the shoes of the child and attempting to take the collaborative initiative of starting the educational program that addresses the problem of child labour and its root cause - poverty is imperative. So, I strongly believe that as a nationally recognized company, Everest Pashima with its influence has the potential to make a positive impact and motivate other companies also to balance profit and humanitarian efforts.
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