American Apparel, Bankruptcy: Which Sort of Tragedy?

business_ethics_highlights_2American Apparel is a company that gets discussed for two very different reasons in ethics / CSR classrooms. Sometimes it gets discussed because of the company’s history of avoiding sweatshop labour. It is generally applauded for this. And sometimes it gets discussed because of its substantial string of sexual misconduct scandals, back when it was under the leadership of Dov Charney. Of course, even the former is open to ethical debate. The company’s refusal to source garments overseas may have been good for American workers, but quite bad for workers in Bangladesh and Vietnam who really, really needed the work. >>>

LINK: What does American Apparel’s bankruptcy mean for responsible business? (from The Crane & Matten Blog)

This week’s announcement of American Apparel’s bankruptcy and subsequent filing for Chapter 11 protection could spell the end of a unique experiment in responsible business.

Although it has been a fixture along with global retailers such as Zara, Gap, and H&M on high streets across the world for the past decade or so, American Apparel is unlike virtually all of its counterparts in the apparel industry when it comes to responsible business. While other global clothing companies outsource their production to suppliers in emerging economies, American Apparel has steadfastly stuck to a made-in-America philosophy, promising that its clothes are ‘sweatshop free’….

What do you think?

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  1. Alta Gracia is the more important test case: .
    Knights Apparel has been sold and now Alta Gracia is an independent entity.

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