Ethics which can be defined as “the rules
of conduct recognized in respect to a particular class of human actions or a
particular group, culture, etc.” can play a very important role in businesses
today. Some mischievous actions may be perfectly legal but still considered
unethical and can have negative consequences for the people/business(es)
involved. Companies that demonstrate ethical behaviour often reap rewards while
companies that operate unethically can receive bad press, lose customers, and
even face law suits. Below are a few examples of ethical and unethical
businesses.
Mountain Equipment Coop (MEC), is a
cooperative that started in B.C. in 1971. MEC sells a variety of outdoor
equipment from camping gear to running shoes. They now have over 3.3 million
members. Their mission is: “Mountain Equipment Co-op provides quality products
and services for self-propelled wilderness-oriented recreation, such as hiking
and mountaineering, at the lowest reasonable price in an informative,
respectful manner. We are a member-owned co-operative striving for social and
environmental leadership.”
This company is probably one of the best
examples of ethical business we have in Canada. It is entirely devoted to
society and environment. MEC donates 1%
of its gross revenue to environmental groups as part of an initiative called 1%
for the planet. MEC is also a founding member of CPAWS an online initiative
that works on protecting 50% of Canada’s wild spaces. MEC also operates green
buildings that conserve energy and heat. As for their social engagement, MEC is
a member of Fair Labor Association. MEC is also a member of Bluesign, a
sustainable textile production system that ensures environmentally friendly
production and eliminates harmful substances from production. MEC so concerned
about their members that they were the first Canadian retailer to stop selling
water and food containers that could contain traces of cancer causing
chemicals.
PepsiCo is one of the largest multinational snack food and
beverage companies in the world. Created in 1898 in Bern, North Carolina the
company has since grown to distribute products to more than 200 countries
worldwide. With a company this size, it is extremely important for it to be
aware of the environmental factors, as well as social aspects and treatment of
workers. PepsiCo has made a conscious effort to commit themselves to being an
ethically responsible company. PepsiCo is a company that commits itself to
ensuring that efforts are made on their part to help the environment, but also
helping others around the world in need.
PepsiCo made a huge effort in limiting the amount of water
consumption in their manufacturing plants. These efforts have changed the way
the company uses water for manufacturing and in some cases, has eliminated the
use of water for some parts of manufacturing altogether. For example, the
Colombia manufacturing plants recycle about 75% of the water used, and certain
bottles are now purified by air instead of water. This has lead to 14 billion
litre decrease in water usage in Columbia. Here in Canada PepsiCo has also cut
water usage by 40%. Not only has PepsiCo reduced the water usage for
manufacturing, they have also have partnered with the NGO to give water to
those in need and have delivered clean and safe water to over three million
people worldwide.
PepsiCo has also limited the environmental and social damage
caused by the manufacturing of their products. In 2014, PepsiCo stated that the
palm oil being purchased by the company will not contribute to the
deforestation and mistreatment of workers in Asia. PepsiCo also contributes
money to charities and non-profit organizations to help fund education and
nutrition (among other projects) around the world. These are only a few
examples of PepsiCo and what it does as a multinational enterprise to help
around the world, it is a great example of a company that takes pride in being
ethical and treating their employees and the environment with respect.
Unethical business behaviour is when companies and CEOs make
decisions to better their income at the expense of others. These decisions are
morally wrong, and when exposed by the media, could ultimately destroy a
company entirely. It is often a very big risk to follow through with unethical
business tactics. That didn’t stop the tobacco giant Philip Morris (the company
behind Marlboro cigarettes), from targeting the younger generation as their
primary buyers. Philip Morris has attempted to convince young teenagers that
smoking is ‘cool’ and ‘hip’ and that if they buy the product, they will be
popular. Very cruel to be preying on such a young and innocent generation,
almost as if the company is capitalizing on the children’s vulnerability and
desires. This unethical marketing
campaign would have been carried out by the marketing department but would have
had the support of senior officers within the company. Philip Morris even went
out of its way to try and convince the government to dismiss the ten-year-old
law lawsuit against the tobacco industry for attempting to conceal the dangers
of smoking. Despite stricter regulations, Philip Morris still prominently
places ads and products in magazines, convenience stores, and delis. They have
however, been sued by the governments of several countries and now have
information about the dangers of smoking prominently featured on their website.
Toyota is an extremely successful car dealership which sells
a wide variety of vehicles. It was
Canada’s fourth largest selling brand in 2012. When Toyota designs and sells
vehicles, their number one priority should always be the safety of their
customers. However, back in 2010 this was definitely not the case. Toyota began
to receive many claims outlining customer’s safety concerns with Toyota
vehicles. More particularly, there were problems with the acceleration which
was caused by a sticky gas pedal. Toyota created a publicity nightmare when
they unethically delayed telling their customers about the claims they were
receiving about the vehicles. Toyota deferred recall investigations just to cut
back on some expenses and make more money, at the expense of their customer’s
safety. The president of Toyota just sat back and did nothing when innocent
customers went around driving their unsafe vehicles for a long period of time. As
a result, the company was forced to pay $1.2 billion in order to avoid
prosecution for the scandal.
One way unethical behaviour becomes public knowledge is
through whistleblowers. A Whistleblower is a person who makes an ethical
decision to expose illegal, incorrect or dishonest information or action within
private or public organization. Information can be shared internally within the
organization or externally, outside of the company by going through a third
party, contacting the media or the government. Consequences of whistleblowing
could result in jail or federal and civil charges for the person or business
that has been acting unethically or illegally.
Jim Wetta was a Pharmaceutical Sales Representative for two
large manufactures Eli Lilly and Astra Zeneca. He discovered unethical and
illegal actions and filed lawsuits against both companies. In 2000, as an
employee of Eli Lilly, Jim Wetta along with few other sales representatives were
trained to promote a medication named Zyprexa. They discovered that drug
intended for treating schizophrenia was being marketed as multipurpose for
different ailments, which were not approved by Food and Drug Administration as
off-label use. The second case was very similar, Jim Wetta was hired as Sales
Representative for AstraZeneca. In 2004 the company required him to promote the
anti-psychotic drug Seroquel. This medication was approved by FDA for
schizophrenia and bipolar depression. Wetta proved that company was marketing Seroquel
for a variety of different disorders like dementia and depression. Both cases
totaled over $2 Billion in settlements against the pharmaceutical
manufacturers.
What is a Whistleblower?
- A whistleblower is an employee or previous employee that reports an employer’s “dirty laundry” or misconduct. A whistleblower doesn’t necessarily have to be an employee; it could be a contractor, a client, or a supplier.
- A whistleblower cannot be fired or mistreated for reporting any misconduct. They are protected under the “whistleblower protection act”
- They can blow the whistle on any ongoing, previous or in the works projects.
- Internal vs External Whistleblowing: Internal – happens when someone inside the company hands the “dirty laundry” out to another person inside the company. External – is when they air the “dirty laundry” out for the media, public or law enforcement.
Companies who behave ethically often
see the benefits. They may not be making as much money as their unethical
counterparts who tend to sweep problems under the rug however, consumers are
more likely to spend their hard earned money on a company whose actions they
respect. Also companies that act unethically in order to save money often end
up losing more in the long run whether it be through lost business or lost law
suits. It is also clear that unethical corruption often comes from the top of
the company and works it's way down, which can deter lower-level employees from
becoming whistleblowers.
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Written by: Collin Baggio, Jenna Gillan, Emily Hammond, Holly Lalande, Gabrielle Lalonde, Laura Reinhardt, and Karolina Staszak
