Case Analysis: Mattel and Toy Safety
Mattel Corporation is the largest toy company in the world, a publicly traded organization with a market capitalization of over $6.5 billion, employing approximately 36,000 people worldwide in 42 countries. Their products are sold in 150 nations (mattel.com).
In the summer of 2007, Mattel suffered a major product recall incident. The first recall was the result of vendor failure in China where traces of lead paint were discovered on 83 different products. This led to a recall of 1.5 million items worldwide. The products contained levels of lead paint that failed the products’ specification.
Mattel even announced that a significant portion of the toys were recalled because of a design flaw and not substandard manufacturing. During this crisis, Mattel contacted their chief suppliers and asked them to pull the recalled products from the shelf.
One of Mattel’s contract manufacturers in China bankrupted because of the recall issue, and the plant owner committed suicide. In contrast, Mattel restricted the damage to its reputation to a bare minimum with effective public relations methods. Mattel also established a new corporate responsibility organization, and its crisis management methods gave the company maximum protection from the crisis.
Do you believe that Mattel acted in a socially responsible and ethical manner with regard to the safety of its toys? Why or why not? What should or could Mattel have done differently, if anything?
I believe that Mattel acted in a socially responsible and ethical manner regarding the safety issue in 2007. According to the case study and given factors, Mattel has always held a reputation of being a good corporate citizen. By that, we should understand that Mattel has always been recognized as a corporation with strong social, cultural and environmental responsibilities to the community. In fact, Mattel has proved to be concerned about safety issues and USA standard regulations for its products. As described in the case study, after learning about the problem, Mattel Inc. made some improvements to their Global Manufacturing Principle (a detailed code of conduct made to cover both Mattel’s factories and those of its contractors and suppliers) to ensure product quality and safety in accordance with the regulations and standards criteria in the USA. To the society, the company is not using any child labor or forced labor. The company stated that it does not tolerate discrimination. The employees should be hired according to their ability to complete the job, not their beliefs or characteristics. The company also began a special investigation, and two weeks later called the first of three recalls on different products. In other words, the company acknowledged the issues and corrected those by recalling the harmful products and enhancing society as well as forgoing profits by doing so. Mattel's product safety issue undermines the corporate social responsibility (CSR) issue in three perspectives: quality control, not acting beyond complaints, and disclosure of information. Therefore, I strongly believe that Mattel Corporation has acted in order to preserve the ethical principles where preservation and continuation of organized life is a must.
Who or what do you believe was responsible for the fact that children were exposed to potentially dangerous toys?
In the case of Mattel, the company and its Chinese subcontractors should have simultaneously and corporately examined the product quality. However, people know that toys with extra lead and non-standardized magnetic batteries are under the brand name of Mattel, not that of the small Chinese contractors. However, in the end, in my opinion, both Mattel Corporation and government play a big role in responsibility for the fact that children were exposed to potentially dangerous toys. The primary concern of a corporate citizen,...
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