Ethics and Corporate Responsibility in the Workplace and the World 1

Ethics and Corporate Responsibility in the Workplace and the World

Cecilia Maposa

Strayer University
Ethics and Corporate Responsibility in the Workplace and the World 2

Ethics and Corporate Responsibility in the Workplace and the Workplace

Introduction

This paper provides a summary of the key characteristics of a stakeholder. Stakeholders

are individuals who can affect or be affected by the organization's actions, objectives and or

policies. This paper will explore the common issues that a lot of companies face when dealing

with employee relations and human rights issues in sweatshops using the United Nations

Framework and will include recommendations on how Pharma Care can be more ethical going

forward. The paper also provides an assessment on the whether the laws of America apply to

Colberia. A decision on whether Pharma Cares actions are following ethical theories. Lastly, a

comparison Pharma Cares' actions and Apple actions will be analyzed looking at the

environmental, workplace safety and monetary loss.

Stakeholder definition

According to McCarthy (2016) by way of definition, a stakeholder is a party that

has vested interest in a firm and can either affect or be affected by the operations,

policies, and objectives of business. Internal stakeholders are individuals whose interest

in a company comes through a direct relationship, such as through employment,

ownership or investment who engage in economic transactions with the organization.

External stakeholders are those individuals who do not directly work with an organization

but are affected in some way by the actions of said business. Suppliers, public groups and

creditors are all considered external stakeholders. Present theories of the idea go beyond

this original notion to include additional stakeholders such as a community, or trade

association, competitors, the government and political groups (Cornforth, 2007).

Ethics and Corporate Responsibility in the Workplace and the World 3

Key features of a Stakeholder

Key Characteristics of a stakeholder include that the individual stands to gain or lose

through the success or failure of the business, provides funding for the firm. Has invested

resources in the enterprise, participates in or works at the company, is affected by the outputs of

the company and is in the "chain of accountability." The stakeholders in Pharma CARE scenario

are the employees of Pharma Care in New Jersey and Colberia, the firms' low-income

consumers, the Colberian government, the company's investors, the foundation, the CEO and the

state of New Jersey (Garriga and Mele,2004).

Human Rights Definition

According to the United Nations Article 1 and 2 of the Universal Declaration of Human

Rights, Human rights are rights which are inborn to all people, whatever the nationality, place of

residence, sex, national or ethnic origin, religion, language, color or any other status. Every

individual is equally entitled to human rights without discrimination. All people are equal and

born free in dignity and rights.

These rights are all interrelated, indivisible and independent. Universal human rights are

often expressed and guaranteed by law, in the forms of treaties, general principles, customary

laws and other sources of international law. International human rights law lays down obligations

of Governments to act or refrain from certain actions, to encourage and protect human rights and

freedoms of individuals or groups. Campion, human rights activists, are Eleanor Roosevelt,

Martin Luther King, Jr, Nelson Mandela, Desmond Tutu, Malcolm X among others (Universal

Declaration of Human Rights,1948).

Ethics and Corporate Responsibility in the Workplace and the World 4

Human rights issues presented by Pharma CARE's treatment of the Colberia's indigenous

population versus that of its executives

According to Universal Declaration of Human Rights (1948), Pharma Care is violating

human right of Colberians in accordance with Article 7 (a)(i)(ii) to enjoy just and favorable

conditions of work which ensures fair wages and equal remuneration for work of equal value

without distinction of any kind and a decent living for themselves and their families .By failing

to provide a better pay and benefits for its employees forcing them to settle for $1.00 a day

harvesting plants and walking 5 miles in and out of the forest carrying heavy baskets containing

these plants, weighing up to fifty (50) pounds.

Under Article 25, Pharma Care is violating Colberians basic human right that "every

individual has the right to a standard of living adequate for the health and well-being of himself

and of his family, including food, housing clothing and medical care and necessary social

services, including the right to security in the event of unemployment, disability, widowhood,

sickness, old age or other lack of livelihood in circumstances beyond his control. Motherhood

and childhood have right to care and assistance. All children, whether born in or out of wedlock,

shall enjoy the same social protection". (Universal Declaration of Human Rights,1948).

Recommendations for changes Pharma CARE can make to be more ethical going forward.

The first recommendation would be for providing basic essential needs such as shelter,

clean water, electricity for Colberians. If they are unwilling to pay them more than a day they

should at least provide them with basic needs. Also, provide them with carriers like wagons they

can use to carry the plants in and out of the jungle instead of doing it themselves
Ethics and Corporate Responsibility in the Workplace and the World 5

Another recommendation is for the that the company should not only pledge its

commitment to environmental issues but lead by example to show their position to initiatives of

being environmentally friendly. As well as developing and improving practices within Pharma

Care regarding industry-related standards, various ISO standards, the UN Global Compact

among others (Epstien,1987

The last recommendation would be to create an ethical and socially responsible culture

within the firm; formulating strategies that would lead to the sustainability of socially and

ecologically practices. These may have highly short-term expenses but may have overall long-

term benefits in both monetary and non-monetary terms, for instance, those practices that would

lead to an improvement in the image as a sound firm, high integrity, and image of impeccable

ethics in all business and employee dealings (Bartkowiak,2006).

Pharma CARE's environmental initiative against the backdrop of its anti-environmental

lobbying efforts and Colberian activities

Laws of Colberia

Colberia is a native country, and there are no stated environmental laws that can prevent

Pharma Care from engaging in serious environmental issues such as endangered species. If they

are any environmental issues in Colberia, it might be difficult for the country to enforce them on

Pharma Care because they consider Pharma Care their primary source of income and

employment and they might fear retaliation from the firm.

Do laws of America apply to Colberia

Pharma Care's laws are only limited for enforcement in the USA but do not extend to the

people of Colberia unless they are universal laws that are applicable worldwide.
Ethics and Corporate Responsibility in the Workplace and the World 6

International Environmental Laws

Pharma Care should conform to International Environmental Laws worldwide who are a

network of treaties, statutes, regulations, shared and customary laws addressing the effects of

human activity on the environment. Current issues of international concern covered by the

environmental law include ozone layer depletion and global warming issues, desertification,

destruction of tropical rainforests, marine plastics pollution from ships, international trade in

endangered species (i.e. ivory trade (International Environmental Law,2015)

Clean Water Act

In America, environmental legislation that would be enforceable by Pharma Care would

be the Clean Water Act, which is a primary federal law that protects the health of the countries

waters, including lakes, rivers, and coastal areas. It provides a comprehensive framework of

standards and financial aid to address the many causes of pollution industrial wastewater

discharges, and poor water quality, including municipal and , polluted runoff from urban and

rural areas, and habitat destruction (Clean Water Act,1998).

Clean Air Act

Another act that would tie Pharma Care in America is The Clean Air Act which is

required to regulate the emission of pollutants that put the public health and welfare of people in

danger. It has helped cut ground-level ozone, a dangerous component of smog, by more than 25

percent, reduce mercury emissions by 45 percent, reduce the principal pollutants that result in

acid rain, sulfur dioxide, and nitrogen dioxide, by 71 percent and 46 percent.(Clear Air

Act,1990).

Ethical Theories
Ethics and Corporate Responsibility in the Workplace and the World 7

Utilitarianism

According to Garriga and Mele (2004), what makes anything good or bad, right or

wrong, is that it produces the most amount of pleasure for the largest number of people. It bases

on the "Greatest Happiness Principle." Maximize positive outcomes for the most number of

individuals, adverse results for the lowest number of individuals. The chosen action should lead

to the greatest happiness overall (Jensen 2002).

Utilitarianism will say the company is ethical because it produces high-quality products

that save many lives and enhance the quality of life for millions of people thus providing the

greatest overall good.

Deontology

Kant & Ross (1877) states that deontology is what makes something good or bad, right or wrong,

is that it conforms to some (rational) duty. The fundamental principle is fulfilling duties towards

self or other persons. One should choose the action which best fits one's recognized functions.

According to this theory there are certain universal rights, and they do not change according to

time and circumstances.

About this theory, Pharma Care would not be ethical because they violate the human rights of the

people of Colberia by not addressing their basic needs of proper housing, electricity and running

water.

Virtue ethics

Famous Proponent of this theory Slote (2007) focus on what the individual should choose for

his/her personal inward behavior rather than the individual relying on the external customs and
Ethics and Corporate Responsibility in the Workplace and the World 8

laws of the person's culture, and if a person's character is right then so ought the person's choices

and actions be good.

In this scenario, Pharma Care is ethical as this is solely bases on their inward character, the

company doesn't seem to think it's doing anything wrong as they are living large while the people

of Colberia suffer.

Ethics of care

According to Slote (2007), ethics of care emphasizes that the development of morals

cause by learning moral principles.People should learn norms and values in specific contexts. It

supports, maintains, or furthers existing relationships. It involves caring for or nurturing another

and is reflective of empathy, particularly towards those who are vulnerable.

Ethics of care would say the company is not ethical as it does not show care for the people of

Colberia as they live large while Colberians cannot afford basic needs and is not providing

adequate resources for them to perform their duties.

Own moral compass

My moral compass would say the company is unethical as fundamental human rights are being

violated a Colberians treated like slaves with nothing to show for it.In as much as Pharma Care

has made its contribution to the society, l believe charity begins at home, if Pharma Care cannot

take care of its own then their motives are not right. As much as a sole aim of a company is to

make profits Pharma Care should not neglect to recognize the same people who work long hours

to make it happen
Ethics and Corporate Responsibility in the Workplace and the World 9

Compare Pharma CARE's actions with those of at least one (1) real-world company whose

corporate activities led to ethical, workplace safety and financial loss.

Issues raised

One of the biggest suppliers and manufacturers of Apple Inc's (Apple) products recently

has been involved a scandal concerning working conditions of its factory workers. Issues were

raised in 2010 when 14 workers killed themselves at Apple's biggest supplier, Foxconn, China.

According to Pratap, Radha Krishnan and Dutta (2012), Foxconn is "the world's largest contract

electronics manufacturer, taking in over electronics' manufacturing and service industry revenue

globally.

Apple overworks its employees with average overtime of between 100 and 130 hours

monthly normally and between 150- 180 hours during peak production. Their normal workdays

are 11-16 hours long, including weekends and holidays during peak production, with a day off

allowed a month.

Employees exposed to dangerous working conditions, including exposure to metal dust,

are common, and in cases of injury, factories fail to pay mandated costs to cover health insurance

or the Chinese equivalence of workers' compensation. On-premises cafeterias are "unsanitary"

and dirty.Many of the workers have limited ability to push for better conditions and are

unfamiliar with labor unions (Hodglet,2009).

How has Apple scandal affected them?

Lee (2011) points out that although it is convenient for Apple to continue its business

with Foxconn as it can profit from this relationship and not suffer losses. The decision to stay in

business with Foxconn is profitable for the company, but the cost of these profits come at the
Ethics and Corporate Responsibility in the Workplace and the World 10

expense of maltreatment of workers, who are working hard on developing products that bring

such benefits to Apple is too high.This has affected their reputation.

Apple seems to encourage this poor treatment of Foxconn's workers. Apple continues

working with Foxconn even after these issues which have become more publicized and has

caught a lot of media's attention. Consumers are paying more attention to the way companies

operate and how they act socially, not only what their profits are (Sterlin,2002).

As these issues come up, it has become harder to cover it up from media. Consumers are

starting to realize that while they overcharge for their new Apple devices, those who made these

devices with their hands are paying much higher price for it which is the price of their well-

being, and even the cost of their lives. Apple's decision is not further sustainable development

has caused them to start losing its valuable clients because of the questionable conditions under

which its products are made (Meister,2012).

Similarities between Pharma Care and Apple

Mission Statements

Both companies mission statement indicate that these companies sole purpose is to be game

changers and these companies are leading, successful companies.

Pharma Care mission is (We CARE about YOUR health®) is one of the world's most

successful pharmaceutical companies, enjoying a reputation as a caring, ethical and well-run

company that produces high-quality products that save millions of lives and enhance the quality

of life for millions of others.Similarly, Apple mission is to be committed to bringing the best

personal computing experience to students, creative professionals and consumers around the

world through its hardware, software and Internet offerings.

Ethics and Corporate Responsibility in the Workplace and the World 11

Both companies are corporately responsible businesses and have foundations that

offer programs and scholarships.

Pharma Care offers free and discounted drugs to low-income consumers, has a foundation that

sponsors health care educational programs and scholarships.Similarly, Apple also provides Apple

Scholarship Programs which recognize the academic and creative abilities of outstanding high

school seniors by giving them tuition grants, free Apple Nano iPods, and laptop computers to

take to college. These scholarships are competitive among tech-minded high school students,

who use Apple inspiration to create innovative technology ‘concept' pieces.

Another similarity is that Pharma Care executives are living large and staying in luxury

compounds, complete with a swimming pool, tennis courts, and a golf course. PharmaCARE's

extensive activities in Colberia have destroyed and endangered native species.Apple executives

are reported to be staying in well-equipped houses, complete with swimming pools, tennis

courts, computers, TVs and interest clubs (Moore, 2010).

Differences

Pharma Care does not seem to be proactive in conducting some investigations on the

environmental issues as the company's lobbying efforts, and PAC has successfully defeated

environmental laws and regulations whereas Apple has been far more proactive in investigating

working conditions at Foxconn and making some demands of its largest production partner.

In Pharma Care situation, there has not been a note on any reported deaths that have

occurred due to the harsh working conditions in Colberia, whereas in Apples' case 14 workers

killed themselves at Apple's biggest supplier, Foxconn, China from the harsh working conditions

at the factories.
Ethics and Corporate Responsibility in the Workplace and the World 12

References

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Arnold, D., & Hartman, L. (2006). Worker rights and low-wage industrialization: How to avoid

sweatshops. Human Rights Quarterly, 283, 676–700.

Bartkowiak, G. (2006). A Practical aspect of social responsibility in business. Dialogue and

Universalism, 5(6), 133-140.

Carthy McCathy Source: Boundless. "Types of Stakeholders." Organizational Communications

Boundless, 26 May. 2016

Clean Water Act." Compton's Interactive Encyclopedia. 1998 Edition. Compton's Home Library.

TLC Properties Inc., 1997.

Endangered Species Protection Program. (n.d.). EPA. Retrieved May 25, 2014.

Garriga, L, and Mele, F. (2004). Competitiveness, Social Responsibility, and Economic

Growth.Pg 60-68.

Hall, J., & Leeson, P. (2007). Good for the goose, bad for the gander: International labor

standards and comparative development. Journal of Labor Research, 28(4), 658–676

International Environmental Law (2015) J.W. Smith, The World's Wasted Wealth 2, (Institute for

Economic Democracy, 1994), pp. 127, 139.

Jensen, M. C. (2002). "Value maximization, stakeholder theory, and the corporate objective
Ethics and Corporate Responsibility in the Workplace and the World 13

function." Business Ethics Quarterly: 235-256

Lee, A. (2011) "Apple Manufacturer Foxconn Makes Employees Sign "No Suicide" Pact", The

Huffington Post

Michael Slote (2007), The Ethics of Care and Empathy, Routledge.