Business Ethics at Gap Inc. Essay

2170 Words Oct 24th, 2013 9 Pages
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Company Report: Gap Inc. and Business Ethics

Depestel Caroline Milijana Zlatic s0101027 s0100470

Professor S. Hughes
Year: 2012-2013
3th Bachelor Applied Economics

1. Executive Summary

The topic of this paper is business ethics within Gap Inc., a multinational retail – clothing company. The foundation of its corporate ethical approach is summarized in the Code of Conduct . This paper outlines the ethical problems Gap Inc. faced in the last years and more important, the solutions they found in order to remain a successful company. It shows how large companies deal with common issues like child labour and sweatshops.
In the first place,
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This allegation, however, is thoroughly denied by Gap who states that with their Code of Conduct, they show their commitment to Social Responsibility (Gap Inc., 2013b). 4.1. Saipan Lawsuit (1999)

In 1999 Gap Inc., together with 25 other well-known companies like Nike, Levi Strauss and Ralph Lauren, was accused of sweatshop conditions in different factories on the island of Saipan (Bas, 2004). Allegations like 12-hour working days without paying overtime and abuse of the employees were included in the complaint (Clean Clothes Campaign, 2004). Gap Inc. first resisted in settling the lawsuit, but in 2003 all the different defendants, except Levi Strauss who won their lawsuit, made a settlement for $20 million dollar, although Gap never admitted liability (Collier et al, 2002). 4.2. Western Factory (2006)

A second incident was made publicly in May 2006 when Gap was accused of child labour and employee abuse in the Western factory in Jordan. The abuse included working more than 109 hours a week, not receiving a wage for more than 6 months and the rape of different employees (Greenhouse et al, 2006). Although these allegations were mostly directed towards Wal-Mart, Gap was also named in the complaint. However, Wal-Mart ignored the problem, whereas Gap reacted quickly on how to address this situation (Min Wha Lee, 2011). 4.3. BBC documentary (2007)

On 28th October

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