Pet Food Scandal in 2007,

Pet Food Scandal

In 2007, Purina was among many pet food companies hit with a major scandal. The company had used a supplier, Menu Pet Foods to produce its some of its lines. In turn, Menu had received tainted supplies of wheat gluten from a Chinese supplier. This tainted wheat gluten led to deaths among pets, a massive product recall and legal actions taken against the companies in question (Gillis & Kingston, 2007).

The management decisions that applied to the crisis were twofold. The first decision was the decision to order a recall of Purina's Menu-sourced brands. The recall was announced on March 30, 2007, the same day the FDA informed the company of the source of the contaminated Pet Foods. This decision could have been made earlier based on the recall initiated by Menu on March 16th. The decision to delay the Purina recall failed to adequately mitigate damages to the Purina brand.

The basis of the issue was deliberate criminal action on the part of the Chinese supplier of wheat gluten. Both U.S. And Chinese sources found the Chinese company culpable in deliberately poisoning their products (Barboza, 2007; Akre, 2009). There were concerns that the U.S. importer and Menu Foods also knew about the tainted wheat gluten in advance of the recall order. There is no evidence or suggestion that Purina executives were aware of the tainted wheat gluten prior to the Menu Foods recall order.

The ethical deficiency that led to the problem was not sourced at Ralston Purina. It was sourced at the Chinese supplier, who had used a chemical agent to give its wheat gluten the appearance of having a higher protein value than it actually had. The chemical agent was toxic to animals and led to widespread renal failure.

Organizational leadership at Purina contributed somewhat to the problem because it did not issue a recall order until two weeks after the initial Menu Foods recall order. It acted when the FDA confirmed the source of the tainted food. The company could have acted pre-emptively to help prevent pet illness and death, but did not. Only when the FDA compelled Purina to issue the recall did the organization's leadership do so.

The delay in issuing the recall order illustrates questionable ethics with respect to decision-making. While the extra two weeks allowed Purina to capture additional sales at a time when competitors were announcing recalls, it also put more pets at risk. The stakeholder analysis that appears to have been conducted put the shareholders as the highest stakeholder. Purina management evidently viewed the health of its end consumers (the pets) as less important.

To improve the decision-making process, Purina should place additional emphasis on other stakeholders, in particular the end users and the people that purchase Purina products for them. In the long run, the pet food scandal has had limited impact on Purina sales, in particular because the fault was found to be based in China.

With respect to communication standards, Purina needs to be more up-front and proactive in dealing with such scandals. The company looked like a laggard with respect to this issue, and if it had not been for the fact that dozens of pet food brands were affected, this incident would have left a stain on the firm's reputation. In future incidents, Purina may not be so fortunate as to have a Chinese scapegoat and the problem may not be industry-wide. Thus, decision-making in future need to put other stakeholders higher than the shareholders, and communications need to be more up-front and proactive, rather than the defensive stance taken by the Purina leadership team.