Chapter 5: Managing Ethics and Social Responsibility

Tutorial Questions
1. Discuss how and why corporations need to create an ethical culture
2. Discuss factors that lead to ethical and unethical behavior
3. Explain “sustainability” and why organizations are embracing it

CASE STUDY
Should We Go beyond the Law?
Nathan Rosillo stared out his office window at the lazy curves and lush, green, flower-lined banks of the Dutch
Valley River. He’d grown up near here, and he envisioned the day that his children would enjoy the river as he had
as a child. But now his own company might make that a risky proposition.
Nathan is a key product developer at Chem-Tech Corporation, an industry leader. Despite its competitive position,
Chem-Tech experienced several quarters of dismal financial performance. Nathan and his team developed a new
lubricant product that the company sees as the turning point in its declining fortunes. Top executives are thrilled
that they can produce the new product at a significant cost savings because of recent changes in environmental
regulations. Regulatory agencies loosened requirements on reducing and recycling wastes, which means that
Chem-Tech can now release waste directly into the Dutch Valley River.
Nathan is as eager as anyone to see Chem-Tech survive this economic downturn, but he doesn’t think this route is
the way to do it. He expressed his opposition regarding the waste dumping to both the plant manager and his
direct supervisor, Martin Feldman. Martin has always supported Nathan, but this time was different. The plant
manager, too, turned a deaf ear. “We’re meeting government standards,” he’d said. “It’s up to them to protect the
water. It’s up to us to make a profit and stay in business.”
Frustrated and confused, Nathan turned away from the window, his prime office view mocking his inability to
protect the river he loved. He knew that the manufacturing vice president was visiting the plant next week. Maybe
if he talked with her, she would agree that the decision to dump waste materials in the river was ethically and
socially irresponsible. But if she didn’t, he would be skating on thin ice. His supervisor had already accused him of
not being a team player. Maybe he should just be a passive bystander— after all, the company isn’t breaking any
laws.
What Would You Do?
1. Talk to the manufacturing vice president and emphasize the responsibility that Chem-Tech has as an industry
leader to set an example. Present her with a recommendation that Chem-Tech participate in voluntary pollution
reduction as a marketing tool and as a way to position itself as the environmentally friendly choice.
2. Mind your own business and just do your job. The company isn’t breaking any laws, and if Chem-Tech’s
economic situation doesn’t improve, a lot of people will be thrown out of work.
3. Call the local environmental advocacy group and get the group to stage a protest of the company.

Source: Richard L. Daft (2018) Management, 13e, Cengage Learning, pp.163.

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