The Roof Is on Fire: The Ethical Minefield of the Textile Industry in Bangladesh

CASE DESCRIPTION This case is motivated by a recent fire in a textile factory in Bangladesh in which scores of workers lost their lives while producing garments for multinational firms. The case focuses on a multitude of issues involving a multinational corporation's global ethical sourcing program. This case describes a hypothetical assignment facing a public relations and operations manager of Wal-Mart. The assignment revolves around the dilemma of trying to maintain low costs of production while simultaneously trying to ensure tragedies like this one will not happen again. The case provides detailed background information on the social, economic, and political climate in Bangladesh, the current situation of the textile industry in Bangladesh, applicable laws, ethical frameworks, and competitive market considerations. At the end of the narrative the reader is asked to formulate ethically, legally, and financially sound recommendations. The suggested audiences for this case study are upper level undergraduate students and graduate students. CASE SYNOPSIS In light of several tragic garment factory fires, including one in which 112 people were killed, this case details the harsh economic realities of the Bangladesh garment industry. Throughout this case our hypothetical manager, Matt Lelander must confront and resolve a multitude of strategic, ethical, and legal dilemmas. Mr. Lelander is presented with a career changing and prodigious task of developing and presenting to his corporation's board of directors a long term strategy to keep the company out of tragedies while maintaining a competitive cost structure. Simultaneously, Mr. Lelander must lay out a plan to repair his company's global image as an ethically responsible organization. Matt has been asked to travel to Dhaka, Bangladesh, to take care of these issues. Additionally, Matt has been presented with several ethical and legal issues, some personal, he must confront. This case provides a detailed background on the Bangladeshi business climate, discussion of applicable domestic and international laws, as well as analysis of appropriate ethical frameworks and decision making. INTRODUCTION Matt throws his leased Mercedes into reverse and squeals out of his court mandated drug and alcohol class. It has been a long week for Mr. Lelander, but after finishing his last alcohol class it's time to meet a coworker for a few cool beverages and talk about the events of the past week. Matt enters the bar and immediately orders a gin and tonic. He then settles into the booth to wait for Samuel. Matt and Samuel work together at Wal-Mart, a major textile distributor with offices in Atlanta. Mr. Lelander manages the local operations and public relations arm of the firm in Atlanta. Sammy (Samuel's preferred name) works in the office of the treasury. After twenty minutes, Samuel enters the bar and by the dark circles under Samuel's eyes Matt can see that it's been several days since his buddy has had a proper night's sleep. "So you are all done with your education now? " jokes Samuel. Sammy is one of Matt's closest confidants and the only Wal-Mart employee who knows of Matt's struggle with alcohol. Laughing, Matt raises his glass and wishes Sammy a happy Friday. "So how are things up stairs in treasury? " inquires Matt. "I am glad you ask" replies Sammy. "As you know, we are getting squeezed from the big box retail stores and our numbers are not looking good. The CFO is putting pressure on the purchasing team to reduce purchasing costs to compete. " "That's why we outsourced production of textiles to Bangladesh three years ago, if I recall correctly" chirps Matt. "We can produce textiles at a third of the price and without the risk associated with operating a production facility. " "You're correct" responds Matt's colleague, "but this is why I have invited you out for drinks this evening, there was a major incident at one of our Bangladeshi producer's facilities last weekend. …