Walmart faces ethical dilemmas after fire deaths in Bangladesh factory

Michael Duke WalmartThere are serious problems facing Walmart and Apple corporations over supply chain control and corporate social responsibilities

 

 

Last year saw Apple forced to address the ugly consequences of working practices down its supply chain at Foxconn manufacturing sites in China which had led to worker suicides. Now Walmart faces criticisms over its lack of controls over a supplier in The Tazreen fashions plant in Bangladesh whose factory fire at resulted in the death of over a hundred employees. The plant had failed safety inspections in 2011 and earlier in 2012. According to the New York Times, Walmart faces the dilemma of seeking the lowest prices from suppliers globally to deliver low price products while projecting a corporate image of high ethical standards and corporate social responsibility. In December [2012], Walmart’s CEO Michael T. Duke faced angry protesters in New York, at a Council on Foreign Relations meeting According to the New York Times:

Mr. Duke’s reassurances that Walmart enforces high standards in the global clothing industry appear to be contradicted by inspection reports it requested and some of Walmart’s own internal communications. Just two weeks before, a top Walmart executive acknowledged in an e-mail to a group of retailers that the industry’s safety monitoring system was seriously flawed. “Fire and electrical safety aspects are not currently adequately covered in ethical sourcing audits,” Rajan Kamalanathan, the executive, wrote to other board members of the Global Social Compliance Program, a business-led group focused on improving the supply chain. But even as the deadly Nov. 24 fire at the Tazreen factory has stirred soul-searching inside and outside the apparel industry about the effectiveness of its global factory monitoring system, some nonprofit groups say Walmart has shown little interest in changing the existing practice of demanding that the factories, often operating at razor-thin margins, meet fire safety standards at their own cost.

The evils of globalization?

 

The tragic fire in Tazreen, and the suicides at Foxconn factories, are seen by some as evidence of the evils of the globalization and the workings of supply chains. Others argue that the examples are flaws that can be put right in a system that is helping in the development and economic health of emerging nations. Neither argument is adequate of itself. The rhetoric of corporate social responsibility too often appears to speak more of espoused beliefs than of leadership actions.

If I ruled the [Walmart] world

“What if I were leader of the Walmart world?” One answer: I would become head of the great modern day church that provideth food to all its followers. And the followers find that the food is always good. Nor is the tithe too high a change. Should I listen to those who say that the good food and low tithes are through the labours of slaves who are not welcome in the churches of Walmark? Such a leader would need a new vision.

 

Updates Updates are planned for this post. Sign up for notifications

 

Monday 3rd November 2014

Walmart rethinks its global strategy. Cuts back its Japanese operations

 

Tuesday 27th January 2015

Taming third party risks.  Walmart compliance officer considers that assessing third party risks is nearly uncharted territory.
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