Aaron Feuerstein: Bankrupt and Wealthy
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Aaron Feuerstein: Bankrupt and  Wealthy

Aaron Feuerstein: Bankrupt and Wealthy

Mr. Feuerstein is a legend in the corporate world. His company is now bankrupt and he doesn't regret a thing.

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Earlier this year, Malden Mills filed for bankruptcy.

Malden Mills, of course, is the New England manufacturer of fabrics like Polartec and Polarfleece, "climate control" materials used by companies like Lands End and L.L. Bean in their winter clothing.

Malden's CEO and owner, Aaron Feuerstein, became the focus of broad press attention seven years ago, when a fire ravaged much of his factory and he decided to shun the idea of resuming his operations overseas, and rebuilt the mill in the same Massachusetts community where it had stood. What was more, and even more remarkable, he continued to pay his thousands of idled workers -- whose families were dependent on his factory -- for the months that passed until it was operative again.

"Maybe on paper our company is worthless to Wall Street, but I can tell you it's worth more."

"I have a responsibility to the worker," he told Parade Magazine in 1996, "both blue-collar and white-collar. I have an equal responsibility to the community. It would have been unconscionable to put 3000 people on the streets and deliver a deathblow 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."

A religious Jew, Feuerstein went on to explain that the ideals of his religious heritage had played the major role in his decision, quoting the famous first century Talmudic scholar Hillel twice:

"In a situation where there is no righteous person, try to be a righteous person."

And: "Not all who increase their wealth are wise."

In an era of widespread corporate downsizing, Feuerstein's actions were roundly hailed as a model of both corporate sensitivity and deep menshlichkeit.

Unfortunately, subsequent years brought mounting debt and, while the company may well rebound and thrive again, questions inevitably arose about whether Feuerstein's benevolence may have helped bring his company to bankruptcy.

To Feuerstein, though, the point is moot. In March, when asked by the CBS program "60 Minutes" if, knowing how things played out, he would do the same thing he had done, he responded, "Yes, it was the right thing to do."

We are charged with acting not for the moment but rather for the larger goal.

It was a simple but powerful sentence, reflecting a simple but powerful -- and wholly Jewish -- idea: We are charged with acting not for the moment but rather for the Moment, for the larger goal, for what is right. It is a profoundly subversive thought in a society saturated with unlimited expectations and trained in instant gratification.

One of the very bases of the Torah is that there is an ultimate reward for the just, and punishment for evil. But from our limited vantage point as mortals, we cannot see that, and so are anguished at the "bad things" that seem to happen to "good people" and vice versa. But being a believing Jew means trusting that God knows, even if we don't, just what He is doing. A time will come when clarity will replace confusion, when understanding will supplant puzzlement.

At times, one encounters a word or phrase that may seem unremarkable but becomes considerably more poignant, even striking, when savored slowly and thoughtfully.

Barbara Lee Toffler is an adjunct professor at Columbia University's Graduate School of Business and an expert on corporate responsibility. When asked by The New York Times last November about Mr. Feuerstein's actions in the wake of the Malden Mills fire, and about the company's newly precarious economic prospects, she suggested that "it may have been that the desire to take principled action somehow blinded him to thinking long term."

She had it exactly wrong, of course. Long term was precisely what he was thinking.

 

 

Published: June 29, 2002


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Visitor Comments: 30

(30) Lance, November 17, 2011 12:06 AM

Admirable actions

Adults, as well as children, need role models. They need to see that an ethical action with a steep price can have widespread benefits that business decisions seldom take into account. Mr. Feuerstein is such a role model. And he is blessed, in this life and the next.

(29) Paul-Gerhard Knöppel, December 22, 2009 8:39 PM

Thankful

I am a German. While studying in the US I saw Aaron Feuerstein on TV explaining to his workers why they should not be afraid, that he would not lay them of, an that he wanted them to work with him, to get started again. Later I found out, why he acted that way: he did so based on the Thorah and the Talmud. I still cherish this memory of a very responsible factory-owner, a beautful human being. As long as we do have people like him living on this Earth there is hope, because there is an example to follow.

(28) Anonymous, January 15, 2009 9:20 AM

Response to Contrary Thought

The fire was an accident. It was unexpected and devastating. In most cases, the owners would have taken the insurance money, closed their doors for good and told the world that they were "cutting their losses" and moving on. Had Aaron Feuerstein done that, he would have destroyed the community AND the businesses who were his suppliers. There was no "win/win" situation. That building had to be rebuilt and it was going to take time. Sure, he could have paid off his suppliers but the companies who went under needed his daily production to stay afloat. Had he found another supplier, would these Mom and Pop companies have stayed afloat? Not if what you're saying is true. They were too dependent upon Malden Mills. Perhaps some of them should not have been in business to begin with. There should be no separation between good business practice and good ethics, but sadly there is. Sure, Mr. Feuerstein could have let his workers go on unemployment. The State could have paid for his workers. And the small Mom and Pop businesses who were supported by his workers would have gone out of business instead. There was no win/win situation. And in my opinion, the actions Mr Feuerstein took were admirable, respectable and commendable.

(27) Anonymous, November 29, 2008 5:20 PM

My uncle

i find it great ahving him as my great uncle he does so much nice stuff for my and my family like taking my family and i on a 5000 vacation for 5 days

(26) Janis, December 10, 2007 11:44 AM

Mr. Feuerstein, you are remembered

Every year at this time, I remember you and I shall for as long as I live.

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