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Chiquita In Colombia Case Summary

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Case Study:
Chiquita in Colombia: Funding Paramilitary Groups to Protect Business and Employees

Presented by: Valerie Reese

Case Summary:

United Fruit Company, a company that grows bananas in Central America and exports them to North America and Europe, became Chiquita Brands International in 1984 through a series of mergers and control changes (Maurer, 2012, p. 485). Chiquita Brands relocated its headquarters to Cincinnati, Ohio, and began to expand its holdings in land and shipping (Maurer, 2012, p. 485).
Chiquita Banadex planation, located in Colombia, seemed to operate as a model facility by subscribing to international standards set by international non-governmental organizations (NGOs) on worker …show more content…

488). According to Maurer, criminal charges were filed against Chiquita under the U.S. antiterrorist law in March, 2007 (Maurer, 2012, p. 488). Chiquita plead guilty and paid a $25 million fine (Maurer, 2012, p. 488).
Link to Course: Chiquita suffered both legal costs and reputation costs. The company unintentionally acted unethically by working with AUC, not realizing that it had been placed on the FTO list. However, Chiquita acted intentionally unethical by continuing with the payments to AUC after they did realize that AUC was on the FTO list and that it was illegal to continue to make the payments. Chiquita had a Code of Conduct that emphasized employee health and safety, among other things, yet they allowed their employees to be brutally killed by the same groups they were paying to protect them. …show more content…

The company could have closed down and sold its banana plantation in Colombia, but Chiquita let the atrocities continue for years. Perhaps Chiquita was following the analytical framework of utilitarianism. Chiquita may have thought that making these payments to paramilitary groups was protecting more workers than it was harming; therefore, it was the right thing to do.
Knowing that paramilitary groups had murdered Chiquita workers, one would assume continuing to make payments to these groups would be wrong. When Chiquita continued making payments and workers were still being massacred, one should consider stopping the payments and selling the farmland. Perhaps Chiquita could even relocate the banana plantation and help relocate the workers to a more secure area.
Chiquita faced legal challenges by doing business in a politically unstable foreign environment. A lesson learned from this case is to keep up with and always abide by the laws set in the foreign country, as well as one’s own country. Following the laws and making sure one knows the laws is good advice for any firm starting a business in a similarly volatile

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