PepsiCo Burma connection
Executive summary: The case mentions about how PepsiCo had to withdraw all its assets from Burma despite the fact that they were doing very well in this country.
In July 1988, decline in economic conditions led to large-scale and bloody rioting in cities in Burma. In Sept 1988, the army under General U.Saw Maung replaced the Government with the State Law and Order Restoration Council (SLORC), a group of military officers. In 1990, SLORC proposed a new government and allowed free elections with the confidence that it would win, but 80% of the seats were won by the civilian opposition party led by Suu Kyi. But it refused to turn over the power to the civilian government. It outlawed …show more content…
4).Even in the end also they have taken this step very smartly by hiding the information with the stakeholders whether they’ll still continue to sell its syrup to bottlers in Burma.
Their approach is virtue approach. They acted not by themselves but by the force of their stake holders and with other American companies withdrawing their business activities from Burma. Big Company like PepsiCo did not take this step earlier which they should have done.
2. In your judgment does PepsiCo have a moral obligation to now pull its product and brand name out of Burma? Explain your answer.
Answer: In our judgement PepsiCo has a moral obligation to now pull its product and brand name out of Burma because
a. By doing business in Burma they were actually supporting the military rule to strengthen their dominance through taxes and other means. As a result they were supporting more illegal practices in Burma which was ruining the country.
b. PepsiCo being involved in counter trade was promoting forced labour throughout the agriculture sector.
c. Being morally right in their conduct they could not do their business at the sacrifice of human rights and getting opposition from their stake holders..
d. Their respect was being questioned. Their brand image was getting