BERLIN - IKEA released findings by Ernst & Young that the global furnishings giant sourced low-cost furniture components produced by prison laborers in the former communist Germany Democrative Republic (GDR) and in Cuba.
IKEA says it has been dogged by media reports over the past year that it purchased products from trade companies in the former GDR, suggesting prison laborers, including political prisoners, produced its goods. The wood products purchases in question took place 25 to 30 years ago.
IKEA Group says it took the allegations "very seriously," engaging Ernst & Young in May 2012 to conduct an independent investigation into its buying practices in former GDR and Cuba.
Findings of the study, announced in Berlin, found political and criminal prisoners were involved in parts of the component or furniture production units that supplied to IKEA 25-30 years ago. IKEA Group representatives were aware of the possible use of political prisoners in the former GDR production; teh factories were paid by IKEA, but the prisoners were not paid. While IKEA Group says it took steps to elminate prison labor in production, it failed to do so.
"The use of political prisoners in production has never been acceptable to the IKEA Group," says Jeanette Skjelmose, sustainability manager, IKEA of Sweden. "At the time, we didn’t have today’s well-developed control system and obviously didn’t do enough to prevent such production conditions among our former GDR suppliers.” Skjelmose says, “We deeply regret that this could happen."
Regarding Cuba, IKEA says the report found "a limited amount of test products were purchased but stopped as they did not meet quality standards. There is no evidence that the IKEA Group received any other products from Cuba."
IKEA said the investigation combed through 20,000 pages of documents from the internal archives of the IKEA Group and 80,000 archived objects at German federal and state archives, and interview 90 people - both active and retired IKEA employees and witnesses.