Here is another product safety legal settlement from 2007. Here, Mattel agrees to pay a $2.3 million fine.

June 8th, 2009

Fridays post relative to food safety in the pet food arena discussed the potential risks and associated costs of not adhering to product safety standards. The Mattel settlement and fine is from that same time period.

Ultimately not adhering to standards can result in significant fines or if the violation is severe enough can cause a supplier to go out of business. For a business such as Mattel with annual sales of approximately $6B USD based on their 2008 annual report a fine of $2.3M is relatively small. The total cost is probably double based on the length of the litigation and associated legal fees. For other companies violations can cause them to entirely go out of business in a much shorter period of time; as was the case for the Peanut Corporation of America from the peanut butter recall associated with the Salmonella outbreak earlier this year.

Even though two of the examples sighted above are relative to food products, product safety is not just about food borne illnesses. That was actually the title of a recent post that discussed the lack of accountability at the top of organizations relative to Triple Bottom Line (TBL) which measures organizational success based on economic, ecological and social results or more simply put based on people, planet and profit impact.

The question this begs is do any of the companies above meet that level of success based on these legal findings and results. If these things happen once in accompany can they or will they happen again? Will consumers let it? As we enter a heightened time of social consciousness only time will tell.

In recent history we have peanut products, medical devices, toys, produce and ballpark turf etc. all causing serious illnesses or death. It is time for all companies to require active diligence in order to ensure that safety and other standards are adhered to without exception in the sourcing process. Ask your solutions provider how they can help you accomplish this?

We look forward to and appreciate your comments.

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