A clothing firm in UK, Primark, sells a mixture of low prices and accessible fashion for different age groups, and has been very successful in recent years. But recently, Primark has discovered that 3 of their Indian suppliers have been using child labour in their factories. Children were doing embroidery and sequin work was paid unfairly. Primark has taken this very seriously, and responded immediately by firing these suppliers.
As current consumers have more moral and ethics , they are “increasingly demanding companies to produce their products in an ethical manner”. Valuing the working conditions and work wages of workers. And a situation like this would affect Primark’s sales and revenue. But Primark has responded to the public by saying that “under no circumstances would Primark ever knowingly permit such activities”, and as mentioned above, they have fired these firms.
In my opinion, it is hard to control and make sure the suppliers are not exploiting workers, especially when they are in Asia or India. It might even cost a lot more to put in random checks in all their factories. So having an ethical behaviour might be very costly. Not only that, if child labor is prohibited in these factories, the suppliers would maybe even charge more money to account for the cheap labour children can bring. On the other hand, if the company has always implemented ethical behaviours, consumers would give positive support and buy their products, therefore increasing revenue. Moreover, the employees working would also be motivated and excited to work. And there might be new sources of finance, such as ethical investors, or even sponsorships. Ethical behaviour have both positive and negative effects for a company, but it should be implemented for human morals.
http://news.bbc.co.uk/2/hi/business/7456897.stm