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Tuesday, 7 June 2011

Even Primark Drops Companies that Don't Have CSR Standards

Check out this case from the Daily Telegraph:

http://www.telegraph.co.uk/news/uknews/2176170/Primark-drops-three-suppliers-over-child-labour-revelations.html

Summary: One of the businesses in India that Primark uses as a supplier was found to be using child labour in its production process.  When Primark found out about this, they dropped them as a supplier and pulled from the store all the clothes supplied by that supplier.

Why do we care?

This links to Bullet Point 1.  An advantage of being socially responsible means that you will have good relationships with your customers, your suppliers, and your stakeholders.  So if a company is found to be irresponsible, as the Indian supplier was, even customers like Primark are going to put you at distance.  And it's not like we're even talking about the most high-minded of companies making their distance: it's Primark.  Even Primark is not going to be associated with a factory that uses 11 year olds.

Perhaps we could extend this research to other bullet points.  When Primark made this decision, was it because of a moral stance or because of their need to not tarnish their image any further?  Clearly, this decision was in their self-interest.

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