Scenario
Comp Core, Inc. is a long-established, family-owned construction company in the Midwest with a strong philanthropic mission, particularly rebuilding homes after natural disasters. The company employs over 400 people and relies on subcontractors for additional support. To keep housing affordable, Comp Core sources low-cost wood from Vail, Inc., a supplier based in South America.
During a visit to Vail’s operations, an employee named John discovered that the supplier was destroying rainforests, causing environmental damage and flooding that harmed local communities. When John reported this to his supervisor, Susan, he was told to remain silent. Instead, he informed senior executives. The CEO instructed him to stop raising the issue, citing the lack of affordable alternative suppliers and the risk to the company’s reputation, jobs, and charitable work. John now faces disciplinary action and is considering making the information public, while company leadership fears financial loss, reputational damage, and the potential end of its philanthropic efforts.
Stakeholders Analysis
Individual Stakeholders
Based on the case study, the individual stakeholders comprise John and Susan. For the background, John is an employee of Comp Core, which specializes in construction and home building. On the other hand, Susan is John’s boss in the specific branch in Miami.
The situation of interest is the information that John retrieved from his trip to South America. John uncovered the unethical conduct of Comp Core’s wood supplier, Vail Inc. The supplier has been causing major floods in villages near forests where they have been cutting trees. This indicates over-deforestation, which has led to the endangerment of numerous individuals living near the forest region. Upon informing the supervisor, Susan, John is advised to keep the information confidential and not disclose it to higher authorities (Someh et al., 2019).
The first effect was an ethical dilemma in which John made the information available to the company’s CEO. The implication of the action placed Susan at odds with John as he violated a direct order. She could be held accountable for not identifying the issue sooner or notifying the board upon receiving the information.
The CEO of Comp Core and other key personnel may continue to keep Vail’s actions secret to safeguard the business’s income and reputation. Employees and subcontractors of Comp Core may wish to avoid any loss of income and consequent loss of employment. While the residents of the South American towns may wish for an end to the devastation of the rainforests, Vail, Inc. may attempt to negotiate with Comp Core to keep doing business with them. If John believes he did the right thing and thinks the company’s activities are immoral, he may be motivated to publish his findings.
Corporate Stakeholders
John encounters an ethical dilemma in which Comp Core’s wood supplier, Vail Inc., has been contributing to the destruction of rainforests that causes massive flooding in the region. Comp Core is anticipating a significant shift in its operations if it terminates its business relationship with Vail Inc.
The company has been providing affordable housing for its clients by purchasing wood from its supplier at an affordable price. However, the pricing of wood from available suppliers is expensive, leading to the need to increase the price of their services. Comp Core expects to change its operational structure and streamline costs to provide affordable products to its clients.
The company should end its contract with Vail Inc. and partner with an ethical wood supplier. Vail Inc. should cease its activities in the forest that affect the villagers and compensate for the losses incurred. The approach should maintain its contract with Comp Core and build its brand over the years. The company should conduct a stakeholder analysis to help reach amicable resolutions as soon as possible. A key partner, such as a company official, may not see the need to the same extent and may favor diverting assets to other activities if the group does not conduct a stakeholder analysis until months into the venture.
These stakeholders’ responses are probably going to be diverse. Workers emphasizing ethics and CSR may back John’s activities and urge Comp Core to locate a more conscientious supplier. On the other hand, employees prioritizing the company’s financial performance may be more likely to agree with the CEO’s decision to continue collaborating with Vail, Inc., ensuring that they can continue to offer accessible housing alternatives for those in need.
If Comp Core decides not to continue working with Vail, Inc., subcontractors can put pressure on the company to do so out of fear of losing business. Vail, Inc. may be reluctant to alter its procedures, as doing so could harm its financial situation. South American villagers could favor any initiative that safeguards the environment and their way of life.
Rules of Ethical Decision Making
Morals are the rules and customs that teach us how to behave in various situations. Analyzing a moral issue requires considering how the above standards apply. This alone can clarify the issues enough to make the solution obvious. Working through the moral decision-making steps and evaluating which ethical standards are at stake is invaluable in more complex cases (Wittmer, 2019). Effective and ethical decision-making relies on evidence. Gathering all relevant data is critical in achieving this. Such requires specificity and objectivity, where writing can help clarify thoughts.
Referring to the Code of Ethics to see if the issue is resolved is beneficial as a control measure. Following the prescribed course of action should resolve the issue if there are specific and clear benchmarks. One must study moral guidelines and understand their consequences in order to apply them effectively. If the issue is more complex and there is no clear solution, one likely encompasses an ethical issue and must follow the ethical decision-making preparation.
There are numerous ways to examine the issue thoroughly. Ethics encompass independence, non-maleficence, utility, equity, and constancy. One should determine which principles apply and which take precedence (Wittmer, 2019). When two or more principles conflict, prioritization becomes difficult because each principle is considered equally valuable.
Before making a decision, it is advisable to consult the latest professional literature and seek guidance from knowledgeable colleagues and superiors. They may find new issues or perspectives while reviewing the data. They may also spot unobjective aspects of the dilemma. One can also ask state or national professional associations for help.
Creating options is the next stage in conducting an ethical choice of conduct. Most indecisive steps toward a goal can be resolved by considering all potential solutions. This can be accomplished with the assistance of at least one colleague and the use of imagination.
One should assess each option based on the information and priorities. It is also necessary to consider the impacts of each action on the client, others, and the counselor (Wittmer, 2019). Then, one needs to eliminate options that are ineffective or worse. After that, it will be possible to examine the remaining options to determine which best meets the priorities and situation. Ultimately, one can assess the plan and determine whether the chosen action raises any new ethical concerns.
The advice suitable for John at the point of being threatened by Susan is to find a new employer, as the institution is ethically compromised. During the process, John can make the information public with evidence of the claims to avoid legal backlash. Susan should reevaluate her ethical stance regarding corporate management.
The implication of being discovered as unethical while leading a team has negative consequences, including loss of reputation and potential unemployment if the current role is lost (Suh & Shim, 2020). The CEO and CFO should restructure the company’s business plan and ensure securing a more reputable wood supplier. The company needs to provide affordable housing without compromising on ethical decisions, such as the source of raw materials or employment rights, as is evident in the case study.
Meeting with the CEO, John, Susan, representatives from Vail, and all other important stakeholders is necessary to identify the social dilemma. Additionally, consider the effects of Comp Core and Vail’s activities on the environment, the surrounding communities, and the company’s image to have an open and frank discussion about the problem. Then, investigate alternative wood-sourcing solutions that align with the business’s goals and principles, and develop a strategy to address environmental and social issues while maintaining the business’s financial health. To ensure accountability and transparency, the company must implement the strategy and communicate it to all relevant parties.
Value and ROI through Sustainability Efforts
Comp Core must reevaluate its business sustainability and return on investment by applying the corporate theoretical approach to corporate social responsibility (CSR). CSR emphasizes the ethical commitments of organizations to their shareholders, employees, and the general public. Companies that care about their impact on society and the planet are perfecting their corporate social obligations. Corporate social responsibility activities have emerged to promote morale and enhance efficiency in the workplace. Comp Core must agree with Vail Inc. on the best approach to compensating the afflicted individuals of the flooded village, which will positively impact the company’s image while solving the significant hazards caused by over-deforestation.
Comp Core should terminate its contract with Vail Inc. based on the breached contract, after resolving the current issue of compensating individuals affected by flooding. The company needs to secure a new wood supplier that abides by the law and is ethically sound (Suh & Shim, 2020). Additionally, the internal structure of the human resource department should address the issue of employees disobeying their managers. In the case of John and Susan, John ought to be given a chance to present the case of disobeying his superior in a panel of relevant stakeholders. Given that the conduct is based on ethics, John should uphold his contract, while Susan should be investigated and reprimanded for gross misconduct.
Comp Core must consider how its activities may affect the environment and its reputation in the long run. To demonstrate their commitment to these values, they should consider alternative suppliers that promote sustainability and ethical standards, even if they are slightly more expensive. The first step in managing disobedient workers is for supervisors to examine the circumstances and decide if John’s actions were appropriate. Comp Core should communicate its values and expectations to staff, provide training and materials to help staff understand how to make ethical decisions at work, and participate in charitable endeavors and community outreach initiatives to foster a culture of ethical business practices. These public deeds may strengthen a company’s reputation and brand image while helping people and communities.
Civic Reflection and Corporate Social Responsibility
As members of the communities they serve, organizations must become involved in issues of social responsibility and public concern. I learned that businesses that are dedicated to acting ethically and responsibly benefit in the long run because their consumers and workers are more inclined to trust and support them. Moreover, I realized that ethical behavior fosters a sense of belonging, mutual respect, and trust among participants, ultimately benefiting society. While John’s efforts demonstrate his dedication to morality and social responsibility, they also put him at odds with his bosses, who prioritize the company’s reputation and financial health over his personal values. By addressing the problem with Vail, Comp Core can show its dedication to moral conduct and social responsibility.
Executives’ ethical goals and corporate social responsibility are equally important. B.F. Skinner’s operant conditioning suggests that organizations should not reward bad behavior. Fair on-screen characters should be paid, while unethical ones should face real-world consequences. After a brief trial period, leading representatives who make one moral mistake may be given a chance to change and continue working for the company.
In response, businesses must offer more positive reinforcement, such as rewards and open acknowledgment. Rewards and recognition must be well-planned and executed to avoid unintended consequences. Sustainability requires ethical conduct and consideration of relationships with others, the environment, and the future. Human rights and environmental concerns are important, as well as protecting the common zones we have now and ensuring the common regions we will have for future generations. Non-human aspects, such as clean water, biodiversity, and species health, may be overlooked during development.
Feasible means lasting without harming the ordinary world, while supportability in business means reducing or eliminating an organization’s adverse societal effects. Sustainable businesses prioritize people, the planet, and everything else. Companies are becoming more environmentally friendly by limiting asset use, reducing the use of potentially harmful materials, and establishing eco-friendly practices and supply chains.
Ethics can be used to address sustainability issues, including those involving less self-evident partners, such as plants, animals, and future generations. A rational perspective and frameworks for considering ensure that the collaborative effort will consider all members’ needs when directly relating morals to supportability challenges. Applying ethics to sustainability issues is challenging, but the result will be more relevant and accommodating to multiple parties than a solution based solely on one’s desires and assumptions.
Corporate social responsibility is essential for tackling sustainability’s grand challenges, as it considers many groups’ wants and rights, acknowledges display and future human needs, and ensures everyone’s well-being. Ethical maintainability solutions consider how decisions affect people, the planet, and future generations. Time is necessary because our choices can affect the future. Maintainability-related morality supports a values-based worldview, and sustainability and ethical conduct seek to change long-held beliefs and worldviews. Some people today believe the natural world is for our exclusive use, and it is crucial to preserve it.
Ethical investing is the process of making informed monetary choices to align with a person’s ethical standards. It is often confused with “socially cognizant contributing,” but moral investing produces a more individualized result. Ethical investing may be a way to put your money to work for causes and companies that you accept on an ethical and philosophical level. Natural, philosophical, and political standards support a few solid convictions, and wealthy individuals should allow genuine thought to determine which sorts of ventures they should pursue and which ones they should avoid in the past, making informed decisions.
References
Mahaputra, M. R., & Saputra, F. (2021). Application Of Business Ethics And Business Law On Economic Democracy That Impacts Business Sustainability. Journal of Law, Politic and Humanities, 1(3), 115-125. Web.
Someh, I., Davern, M., Breidbach, C. F., & Shanks, G. (2019). Ethical issues in big data analytics: A stakeholder perspective. Communications of the Association for Information Systems, 44(1), 34. Web.
Suh, J. B., & Shim, H. S. (2020). The effect of ethical corporate culture on anti-fraud strategies in South Korean financial companies: Mediation of whistleblowing and a sectoral comparison approach in depository institutions. International Journal of Law, Crime, and Justice, 60, 100361. Web.
Widyawati, L. (2020). A systematic literature review of socially responsible investment and environmental social governance metrics. Business Strategy and the Environment, 29(2), 619-637. Web.
Wittmer, D. P. (2019). Ethical decision-making. In Handbook of administrative ethics (pp. 481-507). Routledge. Web.