Business Ethics Dick Grasso Was Research Proposal

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The treatment of the undocumented workers has legal and economic implications, but is only an issue in the political arena.

Companies that hire illegal immigrants are being socially responsible. The argument that illegals suppress wages is not based on sound evidence - the jobs illegals do would otherwise be unfilled. If anything, hiring illegals is socially responsible because it gives those people an opportunity to better themselves, something they otherwise would not have had. The notion is especially absurd given that 99% of Americans received this same opportunity at some point in their own family's history. Furthermore, mankind has an obligation to look out for our fellow man. This duty transcends any sense of duty to a state or that state's rule of law.

The only small issue with regards to illegal immigrants is that with regard to legal immigrants, those who play by the rules, sometimes to their detriment. However, following legal channels may take longer but results in the ability to pursue meaningful employment, which illegals do not usually receive. This means that there are essentially two streams for new immigrants. Companies should continue to hire whoever they choose - it works well for the companies, helps grow the nation's economy and benefits the workers and their families. Moreover, the main duty of the company is to its shareholders, therefore the profit motive trumps all other considerations.

Case 21: Consumer groups are justified in their opposition to Coke on account of their use of sodium cyclamate. There is enough reason to believe that Coke leveraged their contacts to have the sweetener approved. Coke may have had a role in the approval. They have strong connections in government, and if the sweetener had been approved in other countries, it is reasonable to expect that they would have lobbied for it. The consumer groups would be equally justified whether Coke used influence or not, because they should be upset that such chemicals are being marketed as food. Moreover, if the FDA has not approved it, the groups have a right to know what the difference is, given that the FDA is the de facto worldwide standard for food safety.

Coca-Cola should have anticipated the reaction. They are using a substance that was once banned. They could have mitigated the situation, however, by providing knowledge ahead of and in conjunction with the Coke Zero launch. If the product is in fact safe, this should have been communicated openly.

What Coke should do now is to stay the course, and continue to use sodium cyclamate. To switch to another sweetener would be perceived as an admission of guilt, and would likely hurt Coke's image and market share more than continued use of the product. Furthermore, if they believe in the safety of sodium cyclamate enough to use it, they should believe in it enough to continue using it.

Also, if Coke believes that the product would pass an FDA test today, they should pursue that. A successful pass would end the controversy in Mexico almost immediately.

Case 22: There are several ethical issues in this case. One issue is the duty of care owed to workers at subcontracted firms by Nike. Another issue is the concept of living wage in an economic system driven by supply and demand. Yet another issue is the role of organized labor in the antisweatshop movement.

It is ethical for Nike to pay its endorsers millions no matter the wage of the factory workers, because the endorsers are worth more to the company. Endorsers in the athletic shoe business are worth millions of dollars in business every year. Nike's efforts were an economic responsibility, since the bad press had become potentially damaging to sales and share price. There is little Nike could have done to salvage its reputation - their opponents cared little for facts.

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One cannot use truth or reason to mitigate those types of attacks.

The AFL-CIO is using the antisweatshop movement to further its goals. It wants to eliminate competition by erecting trade barriers and lowering the competitive gap between nations. The students are definitely being used by the AFL-CIO, as they have greater moral ground than organized labor, and less obvious profit motive.

Nike's response has been to improve their governance of the factories in which their products are made. The implications of this are that firms can lose revenues if they do not monitor their overseas suppliers. It is critical for firms to avoid becoming the poster child for unethical behavior, which makes the firm a target for irrational and dishonest complainants.

Case 23: The most important issues for Coke and Pepsi in this case are, in order, crisis management, stakeholder management, issues management and global business ethics. The corporate social responsibility in India was predominantly economic - the companies were losing sales. There was no social responsibility because the crisis was manufactured by interest groups, with no scientific basis whatsoever. These companies were not ignoring their responsibilities in India, but were rather the target of interest groups. Those groups fabricated their results, failed to target locally-owned companies and lost interest in Pepsi once they hired an Indian woman to lead the company.

Having the Indian-born CEO definitely helped Pepsi's case. This appears to have been one of the key unspoken grievances of the CSE and IRC. However, there are many explanations for this. One could be that the interest groups were bigoted. Another could be that the Indian CEO knew better how to deal with the situation on a political and cultural level.

Companies can protect themselves from such groups with legal action. Groups such as this should face the full wrath of the law.

Media campaigns should also be engaged - groups like these are not going to go away and must be dealt with in the strongest manner allowable by law. This case presents a valuable lesson, that when dealing in countries where the rule of law does not protect them, they must build protection in other ways, such as community contribution and political alliances. It also pays to hire some locals into the executive team, so that they can avoid whatever social pitfall has befallen Coke in this situation.

Case 25: The CALA report is, in my opinion, correct. The CALA groups do convey an image of a grassroots effort, and it is not always readily apparent where their funding comes from. I find these practices deceptive.

There should be stringent limits on corporate lobbying conducted under these shell organizations. There are major ethical concerns with pretending to be something you are not. In this case, these corporations believe that they will be more effective if they pretend to be grassroots. That degree of deception, however, is clearly unethical, and should be made to be illegal.

My attitude towards the shell lobby groups does not change depending on the product they are promoting. I approach issues like this from a purely deontological perspective, that corporate deception is simply unethical, even if I supported the goal. The legal system is in place to provide fairness. Consumers are already relatively powerless in court compared to corporations, so for corporations to disguise themselves as consumers - underdogs - in order to gain even more power is reprehensible. It undermines the legal system and the political system.

The public policy recommendation I would make it that Astroturf lobbying be banned. Corporate interests should be forced to represent themselves. Any group claiming to be grassroots should be compelled to present auditing financial statements to prove the claim. The legal system requires trust, and that cannot be achieved if this type of lobbying is extant.

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