Rana Plaza, Loblaw, and the Disconnect Between Legal Formality and Corporate Social Responsibility
47 Pages Posted: 9 Dec 2018
Date Written: September 13, 2018
Canada’s largest retailer was a major buyer from factories in Bangladesh’s Rana Plaza when the building collapsed in 2013 killing 1,130 people. Most of the dead and injured were workers employed in factories that were never approved from garment production in a building not authorized for industrial production. Like other corporations sourcing from Rana Plaza, Loblaw had an impressive sounding corporate social responsibility (CSR) program that utterly failed to protect its supply chain workers from the largest industrial tragedy in history. This paper examines an interesting decision by an Ontario Court in a multi-billion dollar class action negligence lawsuit filed on behalf of Rana Plaza victims. The plaintiffs argued that, through its CSR program, Loblaw had accepted responsibility to take steps to protect workers in its supply chain from foreseeable harm and that it had failed to meet the standard of care required. In a lengthy decision, the Court dismissed the lawsuit on the basis that it was plain and obvious that the case was certain to fail. The paper explores how the Court’s discussion of the concepts of ‘responsibility’ and ‘control’ contrast sharply with the meanings ascribed to those concepts in the logic and discourse of CSR. The Court’s surprising conclusion that Loblaw should be commended for its CSR efforts, despite clear evidence that company ignored violations of its Code of Conduct, is explored and critiqued.
Keywords: Corporate social responsibility, CSR, Rana Plaza, Labour, Labor, tort, Supply Chain, law, class action
JEL Classification: L24, L31, L81, J80, J83, K31, K13
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