Bryan was recently hired by a large chemical company to oversee the construction

Question

Bryan was recently hired by a large chemical company to oversee the construction of production facilities to produce a new product. X Chemical developed a new industrial lubricant which it felt it could produce at a price close to those of its competitors. The plant to manufacture the lubricant was built on land adjacent to the East River. X Chemical had already applied for and received the necessary permit to dump waste materials from the process in the river. Several other chemical plants in the near vicinity are also releasing waste materials into the river. Bryan is concerned because the government agency which oversees the permit process has granted X Chemical a permit to release more waste in the river than previously anticipated. An additional stage in the production process which would have reduced the waste and recycled some materials became unnecessary due to the regulatory agency's decision. Because the additional process would have added capital and production costs, it was not built as part of the existing plant. Yet, X Chemical has always stated publicly that it would do all that it could to protect the environment from harmful materials. The company has had mediocre performance for several quarters, and everyone is anxious to see the new product do well. Tests have shown it to be a top-quality industrial lubricant which can now be produced at a cost significantly below these of their competitors. Orders have been flowing in, and the plant is selling everything it can produce. Morale in the company has increased significantly because of the success of the new product. Due to the success of the new product, all employees are looking forward to sizable bonuses from the company's profit sharing plan. Bryan is upset that the company failed to build the additional stage on the plant and fears that the excess waste released today will cause problems for the company tomorrow. Bryan approaches Bill Gates, the Plant Supervisor, with his concerns. Bill replies, "It's up to the government agency to protect the river from excess waste, and the company only had to meet the agency's standards. The amount of waste being released poses no threat to the environment, according to the agency. The engineers and chemists who originally designed the production process must have been too conservative in their rtes. Even if the agency made a mistake, the additional recycling and waste reduction process can be added later when it becomes necessary. At this point, building the additional process would require costly interruptions in the production process and might cause customers to switch to our competitors. Heck, environmental groups might become suspicious if Spring 2017-2018 Assessments Page 3 of 3 production was stopped to add the additional process-they might see it as an admission of wrongdoing. No one in the company wants to attract any unwarranted attention from the environmental groups. They give us enough trouble as it is. The best thing we can do is make money while the company can and deal with issues as they come up. Don't go trying to cause trouble without any proof. The company doesn't like troublemakers, so watch your step. You’re new here, and you wouldn't want to have to find a new job." Bryan is frustrated and upset. He can see all the benefits of the new product, but inside he is sure the company is making a short-sighted decision which will hurt them in the long run. The Vice President of Operations will tour the plant next week, and Bryan is considering approaching the officer with his corm. It might also be possible to contact the government agency and request that the permit be reviewed. Bryan is unsure what to do, but he feels he should do something. Answer the Following Questions 1. Describe the ethical issues in this case (Marks 5) 1. Identify the main stakeholders of the business (Marks 5) 2. What are the ethical alternative decisions you would have to adopt as ethical leader to resolve the issues? ( Marks 10)

Explanation / Answer

Describe the ethical issues in this case

“Ethical problem can be understood as difficult issue requiring a moral solution. Moral problem was defined by Van der Arend and Van der Hurk-Remmers “a situation in which a problem or dilemma is experienced between your own values and norms and those of other people: a situation which by your own account is not correct or should not occur.” Ethical problem can be recognized if we asked ourselves „how should I act not „how must I act.

Core ethical challenge for HR managers according to Ulrich (1997) lies between employers and employees and managing interest of both sides. “Resolving this conflict requires that all parties recognize that HR professionals can both represent employee need and implement management agendas, be the voice of employee and the voice of management, act as a partner to both employees and managers.

Sources of ethical challenges in business were characterized by Davis and Frederick (1983). These challenges may appear in various modifications and raise different kinds of ethical dilemmas. Ethical challenges and follow-up dilemmas can raise due to: failure of personal character, conflict of personal values and organizational goals, organizational goals versus social values and hazardous, but popular products

After realizing there is an ethical issue, person must be able to make a judgment about possible direction of action – which one is morally more justifiable. Moral judgment provides a moral labeling of each possible action not involving any personal interest (Rest 1986). After the strategy, how to deal with an ethical issue, is chosen, moral agent must be motivated to place moral values above other values such as job security, social acceptance, career development and wealth

Ethical decision making process, first step in the ethical decision making process in business is to recognize the presence of an ethical issue

Identify the main stakeholders of the business

The word “stakeholder” means any person with an interest in the business -- someone who can contribute to the company’s growth and success or who benefits from its success. The various stakeholders in a business have differing roles and their level of involvement in the enterprise varies from full-time to barely involved at all. The company’s CEO seeks to utilize the skills, experience and knowledge of each stakeholder group to further the organization’s long-term goals

Employees

Top management may set the overall strategic direction for the company, but the employees are responsible for carrying out the tasks specified in the company’s strategic plan in an efficient manner. Employees are the closest to the action. They interact with customers on a daily basis. In a manufacturing environment, they work directly on the company’s products. The company’s success depends in large measure on the skill and dedication of its employees. Without the employees performing their roles proficiently, the company will not reach its revenue and profit potential.

Stockholders

Stockholders’ initial role is to provide the capital a company needs to grow and expand, or in the case of a startup venture, the capital it needs to launch its products or services into the marketplace. In private companies, stockholders may take an active role in setting the strategic direction for the venture. They sometimes provide guidance or advice to the company’s management. In public companies, stockholders can attend an annual meeting and ask questions of the company’s top management, including the CEO, about the decisions they have made and the direction the company is going.

Customers

The reason for a company’s existence is to provide products or services that meet the needs of its target customers and benefit them in a meaningful way. The role of customers is critical to the company’s survival and success. Through the purchase decisions they make each day, they select which companies will prosper and which will fail. They also provide valuable feedback to the company about its products and customer service level. This feedback enables the company to improve what it offers and to come up with entirely new solutions to customer needs based on what its customers asked for. For many businesses, customers also play a vital role in the company’s marketing efforts by recommending the company’s products or services to other potential customers.

Vendors

A company’s ability to fill its customer orders on time -- and bring the highest quality goods to the marketplace -- depends in part on the role its vendors or suppliers play. The company relies upon raw materials or components being available when they are needed and at reasonable prices. If the supply of one key item is interrupted, it can cause a disruption in the company’s entire manufacturing schedule. Vendors also play a role of introducing new applications or solutions to the company so it can become more efficient, more productive and lower its costs -- and increase its margins and profits.

The Community

The community provides the skilled workforce that a company depends upon to maintain its competitive edge. Members of the community, including the news media, often play a watchdog role, ensuring that the company is a good citizen with fair business practices, concern for the environment, and a willingness to contribute to charitable and social causes

What are the ethical alternative decisions you would have to adopt as ethical leader to resolve the issues?

Moral issues greet us each morning in the newspaper, confront us in the memos on our desks, nag us from our children's soccer fields, and bid us good night on the evening news. We are bombarded daily with questions about the justice of our foreign policy, the morality of medical technologies that can prolong our lives, the rights of the homeless, the fairness of our children's teachers to the diverse students in their classrooms.

Dealing with these moral issues is often perplexing. How, exactly, should we think through an ethical issue? What questions should we ask? What factors should we consider?

The first step in analyzing moral issues is obvious but not always easy: Get the facts. Some moral issues create controversies simply because we do not bother to check the facts. This first step, although obvious, is also among the most important and the most frequently overlooked.

But having the facts is not enough. Facts by themselves only tell us what is; they do not tell us what ought to be. In addition to getting the facts, resolving an ethical issue also requires an appeal to values. Philosophers have developed five different approaches to values to deal with moral issues.

The Utilitarian Approach
Utilitarianism was conceived in the 19th century by Jeremy Bentham and John Stuart Mill to help legislators determine which laws were morally best. Both Bentham and Mill suggested that ethical actions are those that provide the greatest balance of good over evil.

To analyze an issue using the utilitarian approach, we first identify the various courses of action available to us. Second, we ask who will be affected by each action and what benefits or harms will be derived from each. And third, we choose the action that will produce the greatest benefits and the least harm. The ethical action is the one that provides the greatest good for the greatest number.

The Rights Approach
The second important approach to ethics has its roots in the philosophy of the 18th-century thinker Immanuel Kant and others like him, who focused on the individual's right to choose for herself or himself. According to these philosophers, what makes human beings different from mere things is that people have dignity based on their ability to choose freely what they will do with their lives, and they have a fundamental moral right to have these choices respected. People are not objects to be manipulated; it is a violation of human dignity to use people in ways they do not freely choose.

Of course, many different, but related, rights exist besides this basic one. These other rights (an incomplete list below) can be thought of as different aspects of the basic right to be treated as we choose.

In deciding whether an action is moral or immoral using this second approach, then, we must ask, Does the action respect the moral rights of everyone? Actions are wrong to the extent that they violate the rights of individuals; the more serious the violation, the more wrongful the action.

The Fairness or Justice Approach
The fairness or justice approach to ethics has its roots in the teachings of the ancient Greek philosopher Aristotle, who said that "equals should be treated equally and unequals unequally." The basic moral question in this approach is: How fair is an action? Does it treat everyone in the same way, or does it show favoritism and discrimination?

Favoritism gives benefits to some people without a justifiable reason for singling them out; discrimination imposes burdens on people who are no different from those on whom burdens are not imposed. Both favoritism and discrimination are unjust and wrong.

The Common-Good Approach
This approach to ethics assumes a society comprising individuals whose own good is inextricably linked to the good of the community. Community members are bound by the pursuit of common values and goals.

The common good is a notion that originated more than 2,000 years ago in the writings of Plato, Aristotle, and Cicero. More recently, contemporary ethicist John Rawls defined the common good as "certain general conditions that are...equally to everyone's advantage."

In this approach, we focus on ensuring that the social policies, social systems, institutions, and environments on which we depend are beneficial to all. Examples of goods common to all include affordable health care, effective public safety, peace among nations, a just legal system, and an unpolluted environment.

Appeals to the common good urge us to view ourselves as members of the same community, reflecting on broad questions concerning the kind of society we want to become and how we are to achieve that society. While respecting and valuing the freedom of individuals to pursue their own goals, the common-good approach challenges us also to recognize and further those goals we share in common.

The Virtue Approach
The virtue approach to ethics assumes that there are certain ideals toward which we should strive, which provide for the full development of our humanity. These ideals are discovered through thoughtful reflection on what kind of people we have the potential to become.

Virtues are attitudes or character traits that enable us to be and to act in ways that develop our highest potential. They enable us to pursue the ideals we have adopted. Honesty, courage, compassion, generosity, fidelity, integrity, fairness, self-control, and prudence are all examples of virtues.

Virtues are like habits; that is, once acquired, they become characteristic of a person. Moreover, a person who has developed virtues will be naturally disposed to act in ways consistent with moral principles. The virtuous person is the ethical person.

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