Four Part Question Fountain of Youth (FOY) Incorporated is a corporation that re

Question

Four Part Question

Fountain of Youth (FOY) Incorporated is a corporation that recently started selling a new over the counter anti-aging pill, Eternally Yours. Despite brisk sales over the past quarter, sales and management team members have been receiving feedback from customers and retailers that the product has some unanticipated side effects. The product is not lethal, but the typical complaints include allergic reactions, rashes, sever skin peeling, and in very rare instances, blindness.

Technicians at FOY have indicated they could recall and reformulate Eternally Yours, but that would result in significant revenue loss, negatively impact share price for stockholders, and jeopardize your position as chief executive officer (CEO).

The accounting department advises that the likelihood of customers formally filing a complaint is fairly low (under 10% of all purchasers) and that the typical claims can be settled easily, since no one has experienced lethal responses to using Eternally Yours. The legal department states that the product packaging says it is not FDA-approved, and that most people that sustain an injury is mild and are unlikely to file a claim. As CEO of FOY, it is your task to report to the Board of Directors and shareholders at next week’s annual meeting and discuss what steps are being taken in response to this product defect. As you prepare for this meeting, you research and prepare to answer the following questions:

Do you keep Eternally Yours on the shelf or recall the product and reformulate it?

Identify the ethical theory relied upon in making your decision in question 1 and explain why that theory was selected and is best for FOY in this matter.

Based on your reading of the course learning materials, identify the stakeholders (those who are impacted by your decision) and explain whether FOY has a corporate social responsibility (CSR) to those identified or not.

Would you characterize this problem as ethical, legal, or both? Explain.

Explanation / Answer

Answer

1) I will recall the product and reformulate it, because a business should not harm the community and people by providing such harmful products. Though there are less consequences of harm but it has to be removed. every organisation needs to stay ethical and serve the society with good harmless offerings.

2) the ethical theory on which my answer relied upon is UTALITARIAN theory, which states that decision must be based on what is good for largest amount of people and is right and beneficial for largest number of individuals. In this case the UTALITARIAN theory is best for FOY, because, to recall the product and reformulate it will provide greatest good for every one in the society and save them from any harm.

3) stakeholders who gets impacted with my decision will include, the employees, investors, management, suppliers, and prospective customers. FOY has corporate social responsibility to these stakeholders, in terms of keeping the investors satisfied by increasing their share values, keeping employees satisfied and happy with good working conditions and ethical values, customers needs to be provided with products which are safe, and can be utilised to meet their requirements, and management needs to be taken care by providing them with decisions which are beneficial for them as well as for the society, to effectively manage the organisation.

4. I characterise this issue as both ethical and legal, because FOY need to meet societal norms and provide them good and safe products, at the same time they must comply with the legal rules and regulations to meet safety standards and to remain successful in their industry. Because, legal standards need every organisation to produce or manufacture harmless products which are consumable and good for human beings. Ethical compliance is also needed to see that every individual gets benefits and no one is harmed. And FoY must run with righteous actions.

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