Essay About Subsidiary Company Of H.B. Fuller And H.B Fuller Controversy

H.B. Fuller Glue Case Study
Johnny ArenasCase Study Response PaperCase Study 1: H.B Fuller Controversy        In 1985, there was a widespread use of inhalant abuse by young children in Honduras. The country was plagued with high rates of poverty which led kids to begin working to help support the family. Typically, if a mother became sick or died, the child would then be left homeless and forced to live on the street. Police in Honduras began arresting children, often referred to as “Resistoleros”, for being drugged by sniffing glue. This phenomenon was then picked up by news articles which ended up catching the attention of Kativo Chemical Industries, a subsidiary company of H.B. Fuller. Since their product, Resistol, was being branded in a negative fashion, Kativo’s advertising agency informed newspapers that Resistol was not largely at fault and to halt the use of their product name in relation to a drug addict. To further push the blame and negative press away from the company, they attempted to state that the issue was more a problem with the society of Honduras, rather than their product itself. Later, the opportunity to fix the problem appeared. By adding mustard oil as an ingredient to the glue, some believed that due to the harsh negative side-effects, abuse of resistol would be reduced. The company however, resisted the idea by stating that due to a toxicology report from the Aldrich Chemical Company, adding mustard oil would increase the dangers of working with the glue for the workers and the children who abuse the glue. Humberto Larach “Beto”, the vice president of Kativo, attempted to push for education of drugs to the government. The idea seemed to begin taking traction, however in the end, went nowhere. In 1986, a shareholder of the company wrote a letter directly to Elmer Anderson, a chairman of the board of H.B. Fuller, concerning the issues which were occurring in Honduras with their subsidiary’s product. This shareholder was questioning whether H.B. Fuller was truly following their ethical guidelines they once promised. As more shareholders took issue with the company’s actions, H.B. Fuller then decided to visit the country to see the issues themselves. In the end, the company decided to consider a community relations strategy to help fix the problem. The issue however was never resolved and has seemed to have been forgotten by everyone today (Donaldson and Werhane 21-33).        Was H.B. Fuller ethically responsible as a company to resolve this problem since it affected the community of Hondurans or was their obligation to focus only on keeping shareholders satisfied regarding company profits? Should H.B. Fuller have pulled their product out of the market due to the abuse of their subsidiary’s product, or hope that the social issue would somehow solve itself while they continued as normal while gaining profits off drug abusing children? There are two conflicting schools of thought that should be mentioned before discussing what I believe is the correct response.