03 Final AC402 Assignment

Primark

Ethical Assessment

AC402 – Business and Professional Ethics

Clare Cummins1/1/2015

“This is a group assignment. Groups are required to prepare a report on a company for an ethical investment fund to determine if they should invest in this company. The focus of the assignment will be to provide a balanced assessment of the company from an ethical perspective.”

Group 9 AC402 Ethical Assessment: Primark 3rd April 2015

TABLE OF CONTENTS

Introduction..................................................................................................................................... 3

1 Primark business model and the associated ethical risk..............................................4

1.1 Primark business model...................................................................................................................4

1.2 Primark supply chain.......................................................................................................................5

1.3 Perceived risk assessment of business model and supply chain......................................................5

2 stakeholder analysis.................................................................................................................. 7

2.1 Categorisation of stakeholders........................................................................................................7

2.2 Potential remedial actions to unethical perceived risks..................................................................8

3 Analysis of the 2008 scandal of child labour in refugee camps...................................9

3.1 Background......................................................................................................................................9

3.2 Most relevant stakeholders of the situation..................................................................................10

3.3 Ethical theory behind actions and possible alternatives................................................................10

3.4 Argumentation supporting both options.......................................................................................11

3.5 Decision and recommendation......................................................................................................12

4 Primark’s corporate social responsibility (CSR) initiatives......................................13

4.1 Code of conduct.............................................................................................................................13

4.2 Ecology..........................................................................................................................................14

4.3 Transparency.................................................................................................................................15

4.4 Charity...........................................................................................................................................15

5 Analysis of Primark’s corporate ethics considering past issues..............................16

5.1 UK Sweatshops 2009 - Illegal workers at UK supplier TNS Knitwear & Fashion Waves.................16

5.2 Rana Plaza 2013 - Collapse of garment factory..............................................................................17

5.3 Cry for help 2014 - Sewn in labels in Primark products................................................................18

6 Exposure to potential future issues with ethical consequences...............................19

6.1 Consequences of past scandals.....................................................................................................19

6.2 Development of Primark’s ethics...................................................................................................19

6.3 Exposure in future.........................................................................................................................20

7 Conclusion and recommendation....................................................................................... 21

8 Bibliography and references................................................................................................ 23

Cummins,Whelan, Meier, De La Tour and Hyland 2


EXECUTIVE SUMMARY

The purpose of this essay as commissioned by Prf. John Nolan is to prepare a report for an

ethical investment fund to determine if an investment in the company Primark is advisable.

The investigations that have been undertaken lead us to the recommendation to not invest in

the company Primark for several reasons:

Assessing the extremely cost focussed business model and the complex international

supplier network we conclude that Primark tends to be prone to unethical activities such

as child labour, wages below living standard and unhuman working conditions.

The Shareholder analysis has revealed that there is a conflict between the employees,

which are subject to unethical treatment but have low power and the shareholders that are

only indirectly affected by unethical behavior but have high power. Customers play an

important role through their influence on profits.

The analysis of the past scandal of the 2008 BBC report on child labour came to the

conclusion that the Primark reaction to abandon the relevant suppliers was one measure

but that alternative ways of resolution could have been more ethically sustainable

Partly driven by the 2008 incident, Primark over time introduced broad CSR activities

ranging from an exhaustive code of conduct, several ecological efforts, charitable

initiatives to providing transparency about the business.

Scandals of a UK sweatshop (2008), the Rana Plaza garment factory collapse (2013) and

“Cry for help” sewed in labels (2014) were managed intelligently. Compensation for

Rana Plaza victims and intense post-scandal investigations helped Primark’s image but

leave doubts about the capability but also ethical mindset of Primark to ensure ethical

behavior throughout the entire supply chain.



INTRODUCTION

The aim of this report is to provide, analyse and draw a conclusion as to whether the ethical

investment fund should invest in Primark, based on their business ethics. Primark is a low

cost garment company and has been subject to several scandals in the past years. By

analysing their business model and supply chain, potential ethical risks are derived. Through

an adaption of a classic approach to stakeholder analysis, the most important stakeholders are

classified. A 2008 scandal revealed by the BBC and Primark’s reaction to it is examined and

Primark’s decision in this specific case and alternatives further examined, applying

theoretical approaches. The CSR initiatives, also driven from the negative effect of the 2008

issue, are analysed. Through evaluation of recent scandals, the CSR communication and it’s

credibility are assessed. From the analysis, the exposure of the company to future ethical

issues is derived. Finally, a summary of the situation and recommendations are given in order

to understand whether an investment is advisable.



1 PRIMARK BUSINESS MODEL AND THE ASSOCIATED ETHICAL RISK

1.1 PRIMARK BUSINESS MODEL

Primark, was first established in 1969 as Penney’s in Dublin, Ireland. The objective of the

business was to set up a “discount clothing chain” (Christina Finn 2015). Primark is a

contributory company for Associated British Foods (ABF). In 2000 Primark had over 100

stores in Ireland and Britain but expanded in mainland Europe to over 238 stores in 2012

(Business Case Studies 2015b). Currently, Primark sticks to its original business model of

being a discount clothing chain and holds a strong position in the High Street market. The

principal factors that contribute to the low prices are:

Illustration 1 – Factors contributing to low prices of Primark (own illustration)

High efficiency in the supply chain and the large sales volumes allowing high economies of

scale allow Primark to maintain their competitive advantage of extremely low prices and a

stronghold in the market of discount clothing (Ziskind, Villanueva and Nueno 2011).



1.2 PRIMARK SUPPLY CHAIN

Primark has around 600 different supplier in 16 countries. Roughly 95% of these suppliers

also supply to other High Street fashion retailers. This extensive and sometimes intransparent

production network represents one major challenge when trying to ensure ethical behavior

along the entire supply chain suppliers (Business Case Studies 2015b). Primark has standards

layed out in their code of conduct (see chapter 4) which are to be upheld and maintained by

Primark operates with a certain focus on lean supply chain management. This strategy seeks

to eliminate all unnecessary costs throughout the supply chain. The goods in Primark’s retail

outlets are made with little or no customisation, which allows mass production in low cost

countries which leads to economies of scale. At the same time, the efficient supply chain

allows Primark to quickly adapt to new market demands. Stock management is a major part

of Primark’s supply chain strategy. The company’s high level of inventory turnover allows

new garments arrive and leave the shops weekly. Primark heavily relies on market demand to

shift the stock of products that are less sought after off the sales floor, as opposed to

overstocking inventory (Ziskind, Villanueva and Nueno 2011). For instance, winter based

garments are rapidly transferred out of stock to make way for lighter, summer clothing. The

company closely observes market trends and quickly introduces cheaper versions of garments

that are in-fashion and in-demand.

1.3 PERCEIVED RISK ASSESSMENT OF BUSINESS MODEL AND SUPPLY CHAIN

Despite the fact that products are produced cheaply, margins for Primark are still relatively

low (Ziskind, Villanueava and Nueno 2011). The extremely high sales volume through



minimal prices drives revenue. According to Fisher (1997), this business model, leads

companies to be very ruthless in their approach to a lean supply chain.

At several stages in the supply chain, various ethical issues arise:

Illustration 2 – Supply chain characteristics and potential issues (own illustration)

The step in the supply chain which seems most critical in terms of the emergence of ethical

issues is the production through numerous suppliers.

Labour conditions are one major ethical matter as well. Working conditions in many

clothing production facilities are sub-par for the employees, and often extremely poor.

Primark sources, to a large extent, from Asian suppliers and the company is found to have

been using suppliers guilty of labour law violations in the past. (McDougall 2009).

Child labour is another very sensitive ethical topic in the garment industry. As per

McDougall (2009), Primark has previously used suppliers who have in fact incorporated

child labour in production facilities. Sairamnath (2014) argues that a strong focus within

supply chain management on cutting costs is associated with increased emergence of ethical

issues.



2 STAKEHOLDER ANALYSIS

2.1 CATEGORISATION OF STAKEHOLDERS

The classical stakeholder analysis plots key stakeholders of the company based on two

dimensions: Power and Interest (Scholes and Johnson 2001). In illustration 3, the horizontal

axis has been adapted to the level of vulnerability to unethical practices. As noted by the

diagram, the stakeholder that is on the low end of the spectrum, meaning that they value

ethical practices rather than activities deemed unethical that could harm the image of the

company.

Illustration 3 – Classification of stakeholders (framework adapted from Scholes and Johnson 2001)

The conflict that can be seen here is that the employees (employees of the suppliers) rank

rather low regarding power but are the main victims of unethical behaviour. In contrast to



that, the shareholders are the most influential but have a rather indirect interest in ethical

behaviour. This results from the fact that unethical approaches, such as implementing cheap

labour, can increase profit and thereby the fiscal return to shareholders.

The most powerful stakeholders of Primark in influencing the business, and at the same time

highly interested, groups are the customers. Through refusing to purchase goods due to

unethical practices of the company, customers can reduce profits. As revealed in the analysis

of Primark’s ethical scandals (see chapter 3 and 6), the customers are the group of

stakeholders who are given a large importance in the corporate context. Primark’s reactions

to the market are generally aimed at moderating customers and maintaining a good brand

image.

2.2 POTENTIAL REMEDIAL ACTIONS TO UNETHICAL PERCEIVED RISKS

Customers: Primark claims to proactively ensure no unethical practices in the production of

clothing. Customers are buying the products under the assumption that this is factual

information.

Workers: Primark has been found to be using suppliers that are not engaging in ethical

practices several times in the past (see section 5 Analysis of Primark’s corporate ethics

considering past issues). Child labour, the mistreatment of workers, depravation of worker

rights and subpar working conditions are the issues that occured in the past. The company has

taken responsibility for these workers in some cases (e.g. the Rana Plaza scandal, see chapter

5) and completely shifted responsibility to suppliers in others (e.g 2008 BBC scandal, see

chapter 3).

Suppliers: Primark has to proactively engage with the various players throughout its supply

chain to eliminate any unethical practices.



3 ANALYSIS OF THE 2008 SCANDAL OF CHILD LABOUR IN REFUGEE CAMPS

Over the past years, many issues concerning Primark’s supply chain have arisen (McDougall

2008, Russell 2009, BBC 2011). One in particular was put to light in 2008 by BBC and The

Observer. In 2008, Primark was found to use suppliers employing child labour from refugee

camps in India producing some of the garments for the UK market (McDougall 2008).

3.1 BACKGROUND

Primark surpassed all competition with the philosophy: “High on style, low on price”

(McDougall 2008). However in 2008, the Observer published an article and the BBC filmed a

documentary about the working conditions for Primark in India (Dearden 2014). The

investigation found children from refugee camps in South India working on embroideries for

long hours under critical working conditions. Testimonials from workers provided evidence

of subpar conditions. The testimony of Mantheesh, an eleven-year-old girl found working on

a waist high pile of clothes, is only one among many reports by the Guardian.

A young Tamil orphan named Mantheesh, was trafficked in Sri Lanka and later found in very

poor physical condition, left for dead, on a sandbank. When she woke up, she found her way

to the textile industry in Southern India where odd jobs are available for those too desperate

to do anything else. In an industry where brands look for cheap labour, where suppliers are

put under extremely high pressure to finish orders on time and where embroidery and

stitching demands small and agile fingers, Mantheesh was the perfect employee in terms of

costs. These undercover children are hidden in sacks or in concealed mezzanine floors

(McDougall 2008).



3.2 MOST RELEVANT STAKEHOLDERS OF THE SITUATION

Primark management

The supplier

The customer (informed through the media)

Primark is the organisation contracting the supplier employing child labour, which means that

Primark is responsible for having children producing some of its garments. Primark holds the

power within their supply chain and can monitor the legitimacy of the stakeholders’ actions

(Matten & Crane 2005). The supplier itself comitted the unethical activity of employing

children from refugee camps and making them work in deplorable conditions. The informed

customers are the third stakeholder considered from Primark in this situation.

3.3 ETHICAL THEORY BEHIND ACTIONS AND POSSIBLE ALTERNATIVES

Primark decided to let go of three suppliers after the scandal came out. Primark did not offer

help or compensation. This is a non-consequentialist way of applying Ethics of Right and

Justice (Ferrell, Fraedrich and Ferrell 2005).

Primark could have decided to keep the supplier and help better the working conditions in

factories, finding alternatives to child labour for children in refugee camps. This would have

been a consequentialist way of applying Utilitarism (Ferrell, Fraedrich and Ferrell 2005).

Suppliers decided not to say anything and to let the poorly regulated system continue . This is

consequentialist Egoism. Suppliers benefit from the possibility of imosing extremely low

wages through maximising their own profit and underprice competitors while human rights



are disregarded. On the short term people suffer yet and on the long term the supplier benefits

from the situation (Ferrell, Fraedrich and Ferrell 2005).

Suppliers could have mentioned to Primark the high pressure they were under which forced

them to conduct illegal actions. This would have been in agreement with Ethics of duties as it

does not bare in mind the consequence it might have on the the future of the work with

Primark or the children (Ferrell, Fraedrich and Ferrell 2005).

3.4 ARGUMENTATION SUPPORTING BOTH OPTIONS

Non-Consequentialist theory- Ethics of Right and Justice

When the scandal broke, Primark decided to fire three of its suppliers which were using child

labour and more particularly child labour from refugee camps as a means of cheap

employment (McDougall 2008). By doing so, Primark showed that any action taken that

would breach fundamental rights such as life, justice, education, or fair wages are not

supported by the company. Primark was able to avoid the wave of bad publicity, which

would have hit the company very violently. Today, profits are still increasing for Primark and

bad publicity is not present enough for Primark to change its positioning. Indeed, Primark is

even opening new stores. (Scally 2014).

Consequentialist theory- Utlilitarism

Primark could have decided to make initial working conditions more favourable by investing

time and money with their suppliers to ensure suitable working conditions from the

beginning. According to Utlitarism, Primark should have ensured that inspections were

carefully conducted and a higher frequency of inspections could prevent scandals from

reoccurring.



3.5 DECISION AND RECOMMENDATION

The best reaction for this particular scandal, according to our perception, considering the

three main decision stakeholders, could have been for the following actions. Instead of

staying silent, the suppliers could have told Primark about the stress level they were under to

supply garment on time. Primark could have acted on the stress level and taken some decision

in order to continue producing in good condition. Unfortunately, letting go of the three

suppliers and not meeting the ethical standards did not improve the situation for the

employees affected by the bad conditions. As a result the decision Primark took was good

and convenient on the short term and helped its image but does not show a very active role to

change profoundly the issue of child labour in the textile industry.



4 PRIMARK’S CORPORATE SOCIAL RESPONSIBILITY (CSR) INITIATIVES

Primark’s claim is that “sustainability is at the heart of what they do”. When looking at the

CSR initiatives on Primarks website, four majour topics can be identified (Primark 2015a).

Illustration 4 – Primark CSR activities overview (own illustration)

Primark’s has clear objectives in areas such as; worker empowerment, sustainable energy

consumption, and educational resources, as well as various philanthropic initiatives in

developing nations.

4.1 CODE OF CONDUCT



Primark’s code of conduct outlines how their workers and the workers of their suppliers

should be treated. Their code of conduct is freely available online and translated into 28

languages. The key elements of the code are as follows:

Workers should not be forced to work, and should be allowed to join trade unions.

Workers are entitled to safe and hygienic working conditions, as well as regular health

and safety training for newly assigned work.

Full-time workers are also entitled to what is called a ‘living wage’ which aims to

cover the workers basic needs and some discretionary spending at a minimum. While

at the same time, workers should not have to work exhaustive hours or irregular

hours, as much as possible.

In hiring their workers Primark does not employ anyone under 14 years of age in

accordance with ILO Convention No. 138 and does not discriminate on the grounds of

race, faith, sexual orientation, age etc.

Primark also have a strict policy which outlaws any form of physical or sexual

harassment as well as verbal abuse between its employees (Primark 2015b).

4.2 ECOLOGY

Green Stores - 80% of all Primark scores use operate off an energy management system, to

control consumption and monitor heating and lighting levels. Primark attempted to

consolidate logistical operations and claims to thereby reducing its road use by 160,525

miles.

Recycling - Primark started a recycling programme and claims that since the start they have:

Reused 23,000,000 hangers

Used 100% recycled bags

Saved 238,000 trees (Primark 2015c).



4.3 TRANSPARENCY

Educational Resources – Primark makes case studies available on their website, for

educational purposes claiming to be an ethical producer. They conducted three case studies in

conjunction with Times 100, the educational resource provider, on topics such as providing

consumers with ethically sourced garments, going beyond social responsibility, and how

companies can better engage with its stakeholders. Here they also have published articles on

the controversial BBC Panorama documentary, on Primark’s supposed use of child labour

(Primark, 2015 d). On their website Primark outline how they have cleared their name of any

wrongdoing in this instance. Primark have also commented on the “cry for help” incident (see

chapter 5).

Primark also perform routine checks on the factories of their suppliers. In 2013, they

performed 2,058 factory inspections. They claim to check every single factory hygeny, safety

and fair treatment (Primark 2015).

4.4 CHARITY

Rana Plaza Compensation - Primark has attempted to support its workers and the victims of

the the Rena Plaza factory, which collapsed in 2013 (see chapter 5 for more information).

Worker Empowerment - Primark has worked with charitable organizations in creating

training programmes in developing nations. Since 2009 Primark has managed to train over

3,900 people, as well as conducting research with the workers to get a better understanding of

the challenges that workers face and their cultural backgrounds (Primark, 2015e).



Angora and animal welfare - Primark claims that they have ceased ordering products

containing angora, due to concerns about animal welfare (Instyle UK 2013).



5 ANALYSIS OF PRIMARK’S CORPORATE ETHICS CONSIDERING PAST ISSUES

Primark has been subject to several scandals (see illustration 5) which questions how future

issues will emerge, will be treated and how they will affect the business.

Illustration 5 – Timeline of ethical scandals from 2008 to today (own illustration)

5.1 UK SWEATSHOPS 2009 - ILLEGAL WORKERS AT UK SUPPLIER TNS KNITWEAR & FASHION WAVES

Incident

In 2009, BBC conducted investigations in the Manchester factory of the Primark supplier

TNS Knitwear. An undercover video reveals that TNS Knitwear employed illegal immigrants

making them work up to twelve hours a day for only GPB 3.50 per hour (minimum wage

UK: GBP 5.73). Additionally, poor working conditions characterised by a lack of heating,

unrepaired toilets and other dangerous conditions were uncovered. Furthermore, firms

subcontracted by TNS Knitwear were found to have even worse conditions (Dhariwal 2009).



As a major supplier of Primark, delivering 20,000 items per week, this breach of employment

and immigration law led to extensive negative publicity (Russel 2009).

Primark reaction

Primark, claiming on its website to deliver fashion without breaking its ethical code or

exploiting workers, reacted immediately and commented that “it works hard to ensure its

many suppliers conform to the highest standards” (Dhariwal 2009). At the same time,

Primark conducted independent audits, supporting investigations of the UK Border Agency

followed by a “timed remediation programme” to identify breaches of its code of conduct

(McDougall 2009). Against the poor conditions at the subcontracted firm Fashion Wave,

Primark argued that suppliers were not entitled to subcontract work. In this way, Primark

endeavored to defend its ethical statement which said: “clothes should be made in safe and

hygienic conditions” (Dhariwal 2009). Although clearly trying to shift responsibility on the

supplier, Primark reacted to the accusations with apologies to the employees of TNS and it’s

supplier.

5.2 RANA PLAZA 2013 - COLLAPSE OF GARMENT FACTORY

Incident

In 2013 the eight-story commercial building “Rana Plaza” in Bangladesh collapsed leading to

the death of 1,129 people and approximately 2,515 persons injured. The building was used by

three clothing factories producing for various brands such as Primark, Mango, C&A, Mango

oder KiK and is considered one of the biggest industrial catastrophes in modern history

(Faigle and Pauly 2014). Primark had started to make goods produce in Rana Plaza two years

before the event. According to a report of The Guardian (Butler 2013), Primark recognised

problems six months before the tragedy took place but failed to address them.



Primark reaction

As one of the brands sourcing goods, Primark introduced a programme for short and long

term compensation. The Management of Primark began to provide financial support to all

workers and families that had been affected by the disaster, including the ones that worked

for firms that supplied competitors (Siegle 2013). Additionally, short-term payments

equivalent to wage payments were paid out to all Rana Plaza workers (3600), regardless of

the companies they supplied (Barry 2014). Through its proactive behaviour and by donating a

large contribution of $12m as support for victims, Primark managed to keep up its image as

one of the better clothing businesses who produce in Bangladesh (Butler 2015). Today

Primark officially promotes it’s actions for the Rana Plaza victims on its website.

5.3 CRY FOR HELP 2014 - SEWN IN LABELS IN PRIMARK PRODUCTS

Incident

The most recent public scandal emerged when two women independently found labels with

messages saying “forced to work exhausting hours” and “degrading sweatshop conditions” in

a dress and trousers. They reported to Amnesty International in 2014 and consequently, new

protests emerged. Primark reported that the dress and top were made in different

countries,but did not specify which (Dearden 2014).

Primark reaction

The immediate reaction from Primark was a claim that the respective factory had been

checked nine times by an “ethical standards team” in the last five years without finding any

evidence for forced labour, followed by again starting broad investigations into the topic

(Dearden 2014). The investigations revealed that the labels were a hoax and could not be real

(Primark 2014).



6 EXPOSURE TO POTENTIAL FUTURE ISSUES WITH ETHICAL CONSEQUENCES

6.1 CONSEQUENCES OF PAST SCANDALS

Primark has been subject to heavy criticism from the press, NGOs, charitable organisations

but most importantly from their customers. Ethical scandals had a significant impact on

Primarks overall reputation. It was negatively affected and assimilated with disregarding

business ethics which led customers to boycott the company and switch to rival firms (Hwa

Lee 2011). Since the BBC report of 2008, Primarks sensitivity for ethical topics increased

and various measures have been taken in order to promote the image of being an ethical

company (see chapter 4).

6.2 DEVELOPMENT OF PRIMARK’S ETHICS

Primark frequently states to strictly follow a code of conduct, prescribing that living wages

will be paid, child labour not be used, environmental aspects considered and no inhumane

treatment allowed. Though Primark regularly emphasises the large amount of efforts they

take on to conduct ethical tests, still multiple new scandals arose. Primarks prompt reactions

to all incidents, again emphasising their frequent tests and high standards support the image

of Primark acting ethical. As per Dearden (2014), Primark states to have carried out 10,000

factory audits since 2009. Former managing director of the magazine “Ethical Corporation”

metaphorically stated: “Primark is working overtime to stitch its reputation back together”

(Russel 2009). Through this metaphorical statement, Russel (2009) points out the issue that

Primark often reacts to scandals but does not prevent them to happen. Forbes (2009) argued

that the scandals will put the ABF stock under pressure. Although after the 2009 UK

sweatshop scandal, the stock did not directly got under pressure. This can also be seen when



looking at the more recent data during the time period of the two later scandals (see

illustration 6). Stephen Taylor, analyst at Dolmen Securities in Ireland believes in an more

secondary effect which cannot directly been observed: “some funds or investors […] won’t

invest in unethical companies” (Forbes 2009).

Illustration 6 – ABF share price (Yahoo Finance 2015)

6.3 EXPOSURE IN FUTURE

The emphasis since 2008 to act responsibly and ethically will support Primark’s brand image

and help keep customers. According to Hwa Lee (2011), the increase in reputation will

reduce risks and have a positive effect on the stakeholders. The introduction of a Ethical

Trade Director and the various audits that take place in factories of new and existing

suppliers should reduce the amount of issues. Increased transparency within the corporate

context and the overall investment in CSR should lead to more ethical behaviour in the

company (Hwa Lee 2011).

Cummins,Whelan, Meier, De La Tour and Hyland

Rana Plaza

2013

Cry for help

22


7 CONCLUSION AND RECOMMENDATION

The analysis of Primark has revealed a business model which focuses on reducing cost in

order to provide extremely low prices to customers. This approach requires a very efficient

and cheap supply chain. Looking closely at the different elements of the supply chain, the

production of the goods through suppliers is the most critical element in the supply chain

regarding ethical issues. Characterized by the need for low costs, ethical issues such as child

labour, poor working conditions and low payment arise.

The major issue in 2008 when BBC published a documentary about Primark’s involvement in

child labour revealed how vulnerable the company is to such subjects. Driven by the loss of

reputation, Primark significantly invested in it’s ethical image by defining a code of conduct

and enforcing it through audits on suppliers. The efforts in ethics are clearly displayed on the

website and comments of Primark frequently refer to those. Nevertheless more issues after

2008 emerged. By often shifting responsibility to suppliers, Primark tried to gain distance.

Primark in recent years achieved to successfully manage the effects of the scandals through

immediate actions once they occurred. On the other side, the amount of scandals with

Primark’s involvement it is worrying and questions the ability of Primark to guarantee ethical

behavior along the supply chain. The large amount of international suppliers, who again

source from different suppliers creates a non transparent business environment. Monitoring

all aspects of the overseas supply chain is only possible to a limited extent. Firstly, only a

limited level of certainty can be reached and secondly, limitations of resources (Ethical Trade

Directors) will result in holes in the system. Due to their highly interconnected and complex

supply chain, one can never be certain that Primark maintains the high level of ethical

behaviour that they claim to.



There has not been any information found on the quality of the investigations and audits

Primark’s ethical team conducts but considering the recent events, we must assume that there

might still be a lack of transparency or worse - a lack of ethical decision making - that will

lead to further scandals in the near future. This is to a large extent also an issue that concerns

the overall clothing industry but especially producers of low price- high volume goods. For

this reason, at this point of time we strongly recommend not to invest in Primark.



8 BIBLIOGRAPHY AND REFERENCES

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Dearden, L. 2014. Primark denies forced labour allegations as more 'cry for help' labels emerge. The Independant: UK [Online], 25 June. Available from: http://www.independent.co.uk/news/uk/home-news/primark-denies-forced-labour-allegations-as-more-cry-for-help-labels-emerge-9563575.html [Accessed on 12 March 2015].

Dhariwal, N. 2009. Primark linked to UK sweatshops. BBC News: UK [Online], 12 January. Available from: http://news.bbc.co.uk/2/hi/uk/7824291.stm [Accessed on 19 March 2015].

Faigle, P. and Pauly, M. 2014. Die Schande von Rana Plaza. Zeit Online: Germany [Online], 22 April. Available from: http://www.zeit.de/wirtschaft/2014-04/rana-plaza-jahrestag-hilfsfonds [Accessed on 12 March 2015].



Ferrell, O.C., Fraedrich, J. and Ferrell, L., 2005. Business Ethics – Ethical Decision Making & Cases. 4th ed. Boston : Houghton Mifflin Co . p93-107.

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