Cases

Simply Divine

At the beginning of this chapter, you read about fair-trade practices, especially as they apply to the market for cacao beans and the company Divine Chocolate. Using the information presented in this chapter, you should now be able to respond to these questions.

Questions for Discussion

  1. 2-22. While Divine Chocolate has embraced the concept of fair trade, their products are not organic. On their website, they argue that purely organic production methods could result in greater instability in production because cocoa is very disease-prone. Do you think that Divine has an ethical obligation to require farmers to become organic? Why or why not?

  2. 2-23. How would you describe Divine Chocolate’s approach to social responsibility? How do they balance their responsibilities to their stakeholders?

  3. 2-24. Do you pay attention to fair-trade products in your own purchasing behavior? For what kinds of products might you be willing to pay a premium price to help those who produce the ingredients?

  4. 2-25. Under what circumstances might fair trade actually cause harm? To whom? At what point would fair-trade trade-offs no longer be acceptable?

When Mother Nature Storms In

On October 25, 2012, Hurricane Sandy began a devastating path through the Caribbean and eastern United States. The storm roared through Haiti, Jamaica, and Cuba, killing 72 residents and displacing millions. In Haiti, still recovering from a 2010 earthquake, severe flooding compromised the safety of the food supply, exposing at least 1.5 million residents to cholera and other waterborne illnesses.

The massive storm continued up the east coast of the United States, making landfall in New Jersey on October 29. Sandy collided with a winter weather system, creating the “perfect storm.” The storm was so large that its impact was felt as far south as Tennessee and as far west as Lake Michigan. The famous Jersey Shore was devastated by destructive winds, heavy rain, and unprecedented flooding. Power outages lasted for weeks after Sandy passed. Estimates of U.S. losses exceeded $50 billion, making Hurricane Sandy one of the worst natural disasters to hit the country.

The impact on businesses along the Jersey Shore was immediate and profound. Hard-working entrepreneurs saw their businesses leveled and their customer base washed away. Large home improvement stores, such as Lowe’s and Home Depot, were forced to close their doors, just when customers needed them the most.

Just as rapid as the devastation, however, was the response from the business community. Home improvement giant Lowe’s immediately shipped truckloads of batteries, generators, and flashlights to reopened stores in the most highly impacted areas. In addition, the company made a commitment to freeze the price of these emergency goods and others, in spite of the opportunity to reap substantial profits.46

The Home Depot Foundation, the charitable arm of the big box retailer, pledged one million dollars to support Hurricane Sandy relief, recovery, and reconstruction, disbursing money to organizations such as the American Red Cross, Team Rubicon, and Operation Homefront.47

Appliance manufacturer Whirlpool stepped up to the plate, donating 30 household appliances. Volunteers from Discovery Communications and Habitat for Humanity rebuilt homes along the Jersey Shore and installed the donated appliances. The company highlighted their donation in vignette advertisements on Discovery’s TLC.48

Although the recovery effort will take years, if not decades, the contributions of these and other businesses have helped ease the suffering of those affected by this natural disaster and speed the healing and rebuilding process.

Questions for Discussion

  1. 2-26. After Hurricane Sandy hit, Lowe’s committed to maintaining prices on emergency goods. Do you think that other retailers acted similarly? Why, or why not?

  2. 2-27. Do you think that social responsibility is good for business? What would motivate a profit-seeking company like Whirlpool to incur the expense of donating appliances to the rebuilding effort?

  3. 2-28. How would you characterize Home Depot’s approach to social responsibility? Support your conclusion.

  4. 2-29. Do you think that U.S. businesses have a greater responsibility to support rebuilding in New Jersey or Haiti? Defend your answer.

  5. 2-30. What is the appropriate role of government in the event of a natural disaster such as Hurricane Sandy?

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