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Case studies in business ethics and corporate governance
Ford pinto sale ethical issues
Business ethics case study 3 pages
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A Brief Introduction on the Ford Case
When a decision is made in a business organization, the internal stakeholders, the organization, and the external stakeholders are either affected positively and negatively. In "a who-why situation", two important questions are asked. The first question is who does the decision affect? The second question raised is how can the decision made, made to be ethical. In this case, Ford decided not to repair the defective fuel tank that posed a great danger to the people driving or riding in the Pinto (Leggett, 1999). In this analysis, if the fuel tank was not repaired and an explosion occurred in case the Pinto was involved in a collision, the organization would have observed losses and the shareholders. Other people who would be affected if the fuel explodes will be the customers who ride the Ford Pinto vehicles. The
The first step that Ford would have undertaken was to ask the cars back and redesign the faulty fuel tanks and ensure that the new fuel tanks did not pose any danger to the customers or other people (Hartley, 2012). The second action was to make the matter publicly so as to ensure that the drivers could be aware of the danger posed to them and take action to prevent the danger from occurring.
References
Hartley, C. (2012). Ford pinto: An ethical analysis. Retrieved February 17, 2017, from http://the-business-scholar.blogspot.com/2014/06/ford-pinto-ethical-analysis.html
Leggett, C. (1999). The Ford Pinto Case: The Valuation of Life As It Applies To the Negligence-Efficiency Argument. Retrieved February 17, 2017, from http://users.wfu.edu/palmitar/Law%26Valuation/Papers/1999/Leggett-pinto.html
Svensson, G., & Wood, G. (2003). The dynamics of business ethics: a function of time and culture-cases and models. Management Decision, 41(4),
Trevino, L. K., & Nelson, K. A. (2011). Managing business ethics: Straight talk about how to do it right. New York: John Wiley.
Stead, W. E., Worrell, D. L., & Stead, J. G. (1990). An integrative model for understanding and managing ethical behavior in business organizations. Journal of Business Ethics, 9(3), 233-242. Doi: 10.1007/BF00382649
Greed is the root to evil or at least the motivation behind some corporations making a good, ethical decision. The Ford Motor Company fell into a trap of greed that would cost many human lives. Before the disaster of the Pinto Fires, Ford had a reputation as being the safety pioneer in the automobile industry with additions such as the seat belts. However, as the invention of small cars began to take emerge Ford began to loose market shares to the foreign market. Ford had to do something and quick.
The estimated risk to consumers, along with the potential financial cost of loss of life is deemed lower than the financial burden of making the modification to the cars in question. If Ford were to add the extra part to the Pinto, there would have been an added cost in production, which would then have been passed on to the consumers by way of the purchase price for the vehicle; nevertheless, the risk would have been greatly diminished or eliminated. Using this approach, Ford did the right thing. The company was happy because they saved money on production, consumers could purchase what they considered to be a quality vehicle at a reasonable price. This course of action led to a greater yield of happiness than the alternative. Adding the extra part would have resulted in
Trevino, L., & Nelson, K. (2011). Managing business ethics - straight talk about how to
alternatives were considered and the decision to insert CS gas was a reasonable one. I
Verschoor, C. C. (2012). New survey of workplace ethics shows surprising results. Strategic Finance, 93(10), 13-15. Retrieved from http://eds.a.ebscohost.com/eds/pdfviewer/pdfviewer?vid=12&sid=dac69b8f-b6d7-4136-8b8f-5d852423bdf6%40sessionmgr4005&hid=4103
For this paper Washington Mutual has been selected to show how the ethical decision making process can be achieve. When it comes to business ethics in the workplace Washington Mutual has designed what can be considered a well balanced workplace with behaviors that are aligned with their moral values and business ethics. Business ethics are sometimes depicted as resolving conflicts where one option can appear to be the correct choice. There are many different ethical dilemmas that are faced by managers and leaders everyday that are highly complex and have no clear choice or guidelines to assist in making the choices for resolution. There are times when an employee has to decide whether or not to cheat, lie, steal, or break their contract. These ethical decisions are real-life situations where they are forced to make on a daily basis. This is why it is ultimately important that all employee know the six steps to ethical decision making that the company uses.
... corrective action plan for the oversight. This will show their constituents that they are being proactive and taking full responsibility in their social responsibility duties in correcting the error. In Union Carbide’s case, the company stepped up and addressed various oversights that needed corrected. In addition, they implemented an action plan to ensure that this incident does not happen again and provided relief aid to all of those affected by the incident. For example, they continue to provide medical equipment and supplies, and offer $5 million dollars to the Indian Red Cross.
This Coca Cola malfunction incident demonstrates that if attention is not paid to the ethical operation or the company it could challenge and threaten a company’s short and long term performance. This could have long lasting affects on the companies operations and requires strategic decisions to restore company’s image in the eyes of the customers. Gaining the trust of customers takes long time but it is broken with one small incident.
...he firm foresaw the significant probability of harm to firefighters using the training facility and acted to communicate the discovered risks to the government organization awarding them the contract. Communication was essential in persuading the government to address the safety issues because the site met the requirements set forth by law, reducing the perception of risk, and the design choice of replacing jet fuel with liquid propane created the unintended consequence of an increased risk that otherwise may have gone unnoticed if not for the actions of Giffels’ consulting firm. Giffels’ strategy to remain persistent in refusing to complete the contract and highlighting the significant risk his firm discovered proved successful when dealing with a client that at first appeared to have taken a minimalist approach by staying with the minimum requirements of the law.
Treviño, L. K., & Nelson, K. A. (2007). Managing business ethics: Straight talk about how to do it right Fourth ed., Retrieved on July 30, 2010 from www.ecampus.phoenix.edu
In today’s fast paced business world many managers face tough decisions when walking the thin line between what’s legal and what’s socially unacceptable. It is becoming more and more important for organisations to consider many more factors, especially ethically, other than maximising profits in order to be more competitive or even survive in today’s business arena. The first part of this essay will discuss managerial ethics[1] and the relevant concepts and theories that affect ethical decision making, such as the Utilitarian, Individualism, Moral rights approach theories, the social responsibility of organisations to stakeholders and their responses to social demands, with specific reference to a case study presenting an ethical dilemma[2], where Mobil halts product sales to a garage, forcing the garage owner to stop selling solvents to young people. The second section of this essay will focus on advice that should be given to any manager in a similar position to the garage owner with relevance to the organisational strategic management, the corporate objective and the evaluation of corporate social performance by measuring economic, legal, ethical and discretionary responsibilities. It will address whom to think of as stakeholders and why the different aspect could cost more than a manager or an organisation could have imagined.
It seems obvious that large corporations have a tendency to ignore the negative effects of their actions in favor of profit. This example, although sensationalized, still says to me that with power comes responsibility. It affirmed my belief that a corporation’s goal cannot be just to provide profit to shareholders, but there must also be an element of social responsibility.