In an organization I am involved with called SIFE, one of the projects called “Spend It Right” aims to teach students about a variety of topics in commerce, including ethics. Good ethics leads to good businesses because consumers know that everyone who participated in the production of the product is being treated fairly and compensated well for their work. With value-based management, companies can find ways to provide value for stakeholders, shareholders, and the company itself. Unfortunately, some companies still use debt bondage to increase the amount of profit made because they either pay very little wages or do not need to pay at all. Consumers from other countries may not know about the process in which products are made and may be indirectly supporting the trade because of lower prices. However, this is not an ethical business model because of the poor treatment of the workers and the absence of human rights for the employees, who practically act as slaves for the owners.
What are some methods to stop or reduce the number of business practicing debt bondage? Microfinance can be one method of prevention to ensure that debt bondage does not continue to persist in our society, provided that the organizations are maintaing responsible business ethics themselves. If rural villagers do not have to borrow money from the owners of those businesses, then they will not be succumbed to a life of financial trouble.
On a side note, this article reminded me of a novel I read in elementary school (a long time ago I know) called Iqbal, which discussed child labour in a carpet factory and the dismal conditions of working in one of those factories without adequate payment. The unfortunate part is that the story was based on a real-life event, and the protagonist (Iqbal), although freed from his owner, was murdered because he took a stance against child slavery in Pakistan.
Sources:
http://www.economist.com/news/asia/21565685-where-slavery-persists-all-name-toil-and-trouble
http://www.globalresearch.ca/wp-content/uploads/2012/02/129532.jpg
http://worldschildrensprize.org/images/I000738_-1.jpeg