Aaron Feurstein’s Malden Mills

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Write the original question (200-250 words) and reply two other’s postings (100-150 words)

Do you consider Feurstein’s actions laudable or not? Why?

Do Feurstein’s actions demonstrate Peter Drucker’s idea that a company should be socially responsible?

  1. Please respond to the question with a minimum of 200-250 words.
  2. Please reply to two of your classmates postings with a minimum of 150 words. Make sure your reply is substantial. Don’t just say, “I like what you said and I agree with you.” If you do agree, explain why…


Do you consider Feurstein’s actions laudable or not? Why?

It appears to be positive that Feurstein was acting ethically by ensuring that his employees receive full salary for six months while his factory was burnt down and in the process of being rebuilt. It was very kind of him being more than generous and supporting his employees during the most difficult time of his company. He put their well-being as his priority instead of his profitability and solvency as a business owner. His employees can certainly feel that they are highly valued and cared for.

As the business owner, Feurstein might not meet significant opposition because of his ownership in the company. He demonstrated the idea that profitability and social awareness are not antagonistic but depend on each other (Bennett, 1999).

However, I would consider that his actions may not be completely laudable in the long term. The solvency and going concern of the company matters significantly for his employees as well since many of them invested their time and old-age life savings through their pension plan. There were better alternatives that can support his employees and not draining his company’s future at the same time.

For instance, he could have used the insurance proceeds as advanced salaries for his employees or paying half salaries instead of full for the 6 months. By offering the full salary, the company did not financially prepare itself in response to market volatility, and the company carried substantially increased debt because of the high costs of re-building a state-of-the-art facility. The volatility of the textile industry hurt the company.

Due to its underfunding situation, it had to file a second bankruptcy and ended production subsequently, which led to the abandonment of the company’s pension plan because of the sale of corporate assets.

Do Feurstein’s actions demonstrate Peter Drucker’s idea that a company should be socially responsible?

Yes, his actions surely demonstrate Peter Drucker’s idea regarding social responsibilities. Peter Drucker believes that a company is also responsible for the community as a whole, which illustrates his value on this aspect. It is clear that Feurstein placed the interests of his employees before his and spent almost all of his efforts to rebuild the factory so that they could continue to be financially capable of supporting their respective families.

Having to experience such a huge loss and using the insurance pay-out on the rebuilt, he acted very responsible for the society as a whole by avoiding unemployment, ensuring the quality of life, and keeping the company operating.



Do you consider Feuerstein’s actions laudable or not? Why?

Personally, I consider Feuerstein’s actions very laudable as even though the factory was burnt to the ground, he still paid his employees in full amount and he did not make the decision of relocating his factory to other parts of the country or overseas because he didn’t want his people to lose their job. At that time, when the plant was destroyed by the fire, it not difficult to imagine how bad was the loss. Ulrich (2006) states that “he could have simply liquidated the assets, banked the money, and retired.”

But he didn’t. Instead, as reported by Parade Magazine, “he immediately proclaimed that he would keep all employees on the payroll, with health benefits, for a month while he started rebuilding the business.” His actions are so laudable because he promised to pay all his people in full when the plant was shut down. This is what he did three months in a row after the fire. Furthermore, Malden Mills was rebuilt at where it was located before the fire, and the employees were able to return to work without facing the devastating effects of a community without employment.

Do Feuerstein’s actions demonstrate Peter Drucker’s idea that a company should be socially responsible?

There is no doubt that Feuerstein’s actions perfectly demonstrate Peter Drucker’s idea that a company should be socially responsible. He once said, “I have a responsibility to the worker… I have an equal responsibility to the community. It would have been unconscionable to put 3,000 people on the streets and deliver a death blow to the cities of Lawrence and Methuen.

Maybe on paper, our company is worthless to Wall Street, but I can tell you it’s worth more (Boulay, 1996, para. 3).” Feuerstein took his share of social responsibility since he didn’t put his own interests first when faced with an organizational crisis. He acted “with moral intelligence” by contributing to the community and also the people in the community.


Last Updated on July 23, 2019 by EssayPro