Ethical exits: French food group Danone shows how companies can close down production plants without damaging the social fabric of the region

Between 1965-1995, Danone operated a manufacturing plant specializing in the production of fresh dairy products in the town of Iraitzoz in the Ultzama Valley, 26km from Pamplona. Danone's management team took the decision to close the plant in Sep 1994 in order to concentrate its production facilities. This article describes the closure of the plant and the steps taken by Danone to mitigate the impact of the closure and assist in the regeneration of the region. In the light of this situation, Danone set three objectives: to maintain leadership; to recover lost market share; and to ensure the brand's long-term future. Despite the initial skepticism, Danone achieved all its objectives in the plant closure, including the important aim of not leaving anyone alone with their problems. In that sense, this story provides not so much an agenda for best practice, but material for reflection for companies that might find themselves in similar situations.