The disaster happened recently in Bangladesh was overwhelming.

After a garment factory collapsed, dead bodies kept emerging from the ruins. At least 400 workers were killed by it. The building was extremely unsafe. One of the reasons for the poor quality of construction is to decrease the cost. Because of the low cost, many major brands, such as Walmart, Gap and Target, became the main buyers.

After the scandal, all of these companies had to deal with the massive pressure coming from the public. Some of the them signed on an agreement that called for independent inspection of factories and agree to take actions to improve the safety of factories. Despite some flaws in the agreement and public doubts, this performance helped to regain brands’ reputation to some extent.

Therefore, once again business ethics are back into the spotlight. The number and harm of business crisis because of ethic problems are increasing every moment. It is what every manager should consider seriously. The strategies being used to manage ethic crisis are crucial as well. Although acting morally in business usually means relatively high cost and efforts, it helps firms to present a better image.

What happened in Bangladesh has a really horrible impact on retailers like Walmart and Gap. It is very disappointing to see them choosing to ignore people’s safety just for a lower cost. And instead of taking responsibility, they tried to get away from it. Now when people see their brand names, they see “sweatshops” and “irresponsible”. They reject their products or even take actions against them. And so do the investors.

Source link: Bangladesh: cheap clothes lead to danger and tragedy(CNN Money)