Importance of Ethicality in Business: After Rana Plaza

Running head: AFTER RANA PLAZA
Business and Society
[After Rana Plaza]
Name of the student:
Name of the university:
Author note:

1
AFTER RANA PLAZA
Executive summary
The main purpose of this study is to understand the importance of ethicality in business. The
purpose is being served by discussing and analysing Rana Plaza after the collapse from various
perspectives. The perspectives being chosen were ‘Stakeholder Analysis’ and ‘CSR and Ethical
Analysis’. The analysis has found the owners of the Rana Plaza, and the international buyers of
‘Fast Fashion’ from Europe and North America as indirectly promoting the unethical business
practice. The owners of the factory were unethical because they forced their workers to work
despite knowing that the building is in an unsafe condition. Moreover, they have not been very
effective in providing compensation benefits to those being affected by the collapse. The
international buyers are unethical as they do not even know the sub-levels existing in the
manufacturing in Bangladesh. The study identifies their incapability to monitor operations as
being intentional. The study also provides a few suggestions, so that, such things are never
repeated back in the future. These suggestions are implementing effective training mechanism in
factories and improving labour policies in Bangladesh.

2
AFTER RANA PLAZA
Table of Contents
Written Case Analysis 1: Stakeholder Analysis..............................................................................4
Task 1: Summary.........................................................................................................................4
Task 2: Issues...............................................................................................................................4
2.1 Key Issues..........................................................................................................................4
Task 3: Stakeholders....................................................................................................................5
3.1 Identify and describe relevant stakeholders and their stakes in case.................................6
Task 4: Stakeholder Power..........................................................................................................7
4.1 The type of power of the relevant stakeholders.................................................................8
Task 5: Responsible Stakeholders...............................................................................................9
5.1 Identify from Task 3 the list of stakeholders who contributed to or were responsible for
the collapse of Rana Plaza.......................................................................................................9
Written Case Analysis 2: CSR and Ethical Analysis.....................................................................14
Task 1: Citizenship of Factory Owners/Managers....................................................................14
1.1 Evaluate the global corporate citizenship of Factory owners/managers.........................15
Task 2: Citizenship of Apparel Retailers...................................................................................16
2.1 Evaluate the global corporate citizenship of apparel retailers and brands in the U.S. and
Europe....................................................................................................................................16
Task 3: Ethics of Owner Sohel Rana.........................................................................................19
3.1 Using a Utilitarian approach............................................................................................19

3
AFTER RANA PLAZA
3.2 Using a rights approach...................................................................................................19
3.3 Using a justice approach..................................................................................................20
Task 4: Ethics of Buyers of "Fast Fashion"...............................................................................20
Task 5: Strategies to Address Worker Abuse............................................................................20
5.1 Strategies that companies may use to prevent abuse of workers by contractors in supply
chains.....................................................................................................................................20
5.2 Under what types of conditions the listed strategies could be effective..........................21
References......................................................................................................................................22

4
AFTER RANA PLAZA
Written Case Analysis 1: Stakeholder Analysis
Task 1: Summary
The collapse as believed by many happened due to structural problems. A deadliest
structural collapse in history happened in 2013 (YouTube.com). Despite a fact that there were
visible cracks in the Rana Plaza the owners ordered workers to come to the work. The owners
even confirmed that the workplace is safe to work. Rana Plaza was never an industrial building.
It was rather designed for commercial purpose. Hence, the building was not fit enough to bear
the work pressure. Surprisingly, four floors were added to the building without having a valid
permit for the proceeding. The International Labour Organization and local development
agency ‘Brac’ are providing support to the victims' families in forms of medical treatments and
in finding new means of survival (YouTube.com). Bangladesh like few other countries is
extremely reliant on a single garment industry. This is perhaps why so many people particularly
women are a part of the garment industry. Global apparel retailers have been slashed from labour
groups and consumers to clean up their 'Act' fast. European retailing brands and retailers have
been found as more reactive to this urgency. North America, on the other hand, have been very
reluctant and is relying just on the assessment of the case. Twenty global retailers and two global
trade unions have signed policies to stop such things from happening in the future
(YouTube.com).
Task 2: Issues
2.1 Key Issues
Key issues raised in the case are structural problems in various Bangladesh garment
factories, extreme pressure on suppliers to support the demand of fast fashion industry, unethical

5
AFTER RANA PLAZA
practices across the garment factories such as child labour, minimum wages and absence of a
training infrastructure.
The case is about the collapse of the Rana Plaza Factory. The accident happened on 24th
April 2013 (Land and Zakaria). The collapse apart from a big monetary and assets lost to the
owners of Rana Plaza, and their local and global clients was also a huge matter of concerns for
those who have lost their lives or are seriously injured. The collapse raised many questions
concerning a variety of issues such as the infrastructural efficiency of garment factories in
Bangladesh, the ethicality of global apparel retailers like Wal-Mart, Asics and Wranglers and the
effectiveness of the Bangladesh government's regulatory framework related to the safety
conditions of workers (Jacobs and Singhal 56).
The collapse has affected many projects for global apparel retailers especially from the
European and the North American part. Apparel retailers from these regions get their orders
manufactured in Bangladesh due to cheap labour wages in the country (Alamgir and Banerjee
281). The owners of the Rana Factory also has the influence of the collapse. The collapse has
caused both reputational and monetary damages to the owners of Rana. Many owners have lost
their factories after the Rana Plaza accident. These owners have lost their entire or partial
business. On top of all these, on a humanitarian background, it was a huge loss for those who all
have been affected by this collapse. Many have lost their lives and those who could somehow
survive are struggling to get their lives back to normal. Some have lost three or four of their
entire family members whereas few have even lost their entire family. The compensation
benefits offered by the Bangladesh government, some local development organisations like
‘Brac’ and the International Labour Organization have been largely ineffective (Haque, Das,
and Rahman).