Price fixing of detergents by manufacturers seeking green solutions

A New York Times article (April 13, 2011) describes fines levied on Proctor & Gamble ($ 306 million) and Unilever ($ 104 million euros) for price-fixing to maintain market shares as they worked together in an industry association to implement green initiatives. These included reducing the weight of powdered detergents and reducing waste from the containers – boxes of bags.  The companies were accused of agreements not to decrease prices when the package sizes decreased and agreements to increase prices thereafter.  These details were revealed by Henkel, another competitor in the industry, that reported it to the authorities when they discovered the cartel.  Given this report, should governments more carefully monitor industry efforts to implement green initiatives ? Should any lack of price decreases following packaging reductions be assumed to be the result of illegal coordination or would that be too drastic an assumption ?

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About aviyer2010

Professor
This entry was posted in Collaboration, Global Contexts, Operations Management, Supply Chain Issues, Sustainability and tagged , , , , . Bookmark the permalink.

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