Rana Plaza, Loblaw, and the Disconnect Between Legal Formality and Corporate Social Responsibility

47 Pages Posted: 9 Dec 2018

Date Written: September 13, 2018

Abstract

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

Suggested Citation

Doorey, David J., Rana Plaza, Loblaw, and the Disconnect Between Legal Formality and Corporate Social Responsibility (September 13, 2018). Available at SSRN: https://ssrn.com/abstract=3265826 or http://dx.doi.org/10.2139/ssrn.3265826

David J. Doorey (Contact Author)

York University ( email )

4700 Keele Street
Toronto, Ontario M3J 1P3
Canada

HOME PAGE: http://www.yorku.ca/ddoorey/lawblog/

Register to save articles to
your library

Register

Paper statistics

Downloads
89
rank
273,857
Abstract Views
528
PlumX Metrics