Unethical Behaviour of Volkswagen - Report

Added on - 22 Jul 2020

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BUSINESS ETHICS
TABLE OF CONTENTSINTRODUCTION...........................................................................................................................1TASK 1............................................................................................................................................11.1 Theories of ethical approaches..............................................................................................11.2 Comparison of absolute and relative theories.......................................................................21.3 Ethical issues affecting the operations of Volkswagen.........................................................2TASK 2............................................................................................................................................32.1 Ethical consideration affecting the objectives of Volkswagen.............................................32.2 Implications of ethical practices for Volkswagen and stakeholders....................................4TASK 3............................................................................................................................................53.1 Primark acting as a moral agent............................................................................................53.2 Mechanism of achieving employee involvement and empowerment...................................6TASK 4............................................................................................................................................74.1 Investigation of current ethical issues of Primark.................................................................74.2 Improvement in the ethics of Primark...................................................................................74.3 New ethical code of Primark.................................................................................................8CONCLUSION................................................................................................................................9REFERENCES..............................................................................................................................10
INTRODUCTIONEthical behaviour is the principle element of success for every organization. Ethics meansdoing what is morally right. It is the social responsibility of every company to follow an ethicalcode of conduct in order to satisfy the needs of society and stakeholder. The report discussesabout the unethical behaviour of Volkswagen, where the company got involved in dieseldeception hoax. Further, it discusses various problems faced by the company in terms of brandimage, losses and court cases. In the second part of the report Primark has been chosen as aregistered company. It discusses about the ethical behaviour the company follows. Moreover,new ethical code has been designed for Primark. Also, various mechanism of achievingemployee involvement and empowerment has also been discussed in the report.TASK 11.1 Theories of ethical approachesEthical theories plays an important role in decision making process of an organization.Each theory emphasizes on different decision making rules. However, the four major principlesthatevery decision maker should follow are:they should do what is right and good, least harm topeople, respect for autonomy and justice to people. There are various theories of ethicalapproaches which are given as below:Deontological Theory:According to this theory, the organization should follow all theduties when a company is going to take any decision. The decision should also follow theduties of other individual and this is what we call as ethically correct. Volkswagenmanipulated the data of emission which caused various respiratory diseases andaggravated heart diseases among people (Ma’Ayan and Carmeli, 2016). It shows that thecompany could not take care of its consumers while fulfilling its own objective.Volkswagen was not able to take rational decision which lead to unethical practice. Thedecision of data manipulation of emission may have been beneficial for Volkswagen inshort run, but it misleads the publiccausing various health issues to them.It also affectedthe business in long run where company lost its revenue, brand image and lost its loyalcustomers.Utilitarian:It is a teleological theory,according to Utilitarian, the morality andimmorality of an act lies in its consequences. Before taking any action it is important todecide the pros and cons of act. If the activity leads to good results, then there are no1
problems in manipulation with the ethics. However, if the action may cause harm toanybody, the malpractice should not be performed by the organization. The action can beright only if the end result of the action is right (Forlizzi and et.al., 2016). Volkswagenmanipulated the data of emission without considering the fact that it can cause harm tothe health of people. The end result led to increase various diseases which made theaction unethical and unacceptable.1.2 Comparison of absolute and relative theoriesAbsolute theories is universal code followed by all, equally the changes in the situationdo not make any change in the absolute moral code. However, relative theories tend to changethe moral standard based on a different circumstance. It may be ethically correct to do somethingin a certain situation (Hickman, Powell, Piquero and Greene, 2016). However, it may beunethical in any other circumstances. Based on the two theories discussed above, deontologicaltheory is an absolute theory where a universal code of conduct is designed and that cannot bechanged in different circumstances. Utilitarian theory is a relative theory where changes in thecode of conduct can be made based on the prevailing circumstances.According to the case of Volkswagen relative theory was applied by the company wheredata of emission was manipulated in order to generate higher revenues. Hampering the moralconduct lead to affect the brand image of Volkswagen. According to United StatesEnvironmental Protection Agency (US EPA), the emission from the diesel engine should not bemore that 40%. This practice need to be performed by every auto mobile company. Volkswagenshould use this moral act as an absolute theory. If discrepancy is found in this data, it may lead toconduct of unethical behaviour which is further punishable by law. It is the corporate socialresponsibility of every company to work in an ethical code of conduct to protect the people orresources attached to it.1.3 Ethical issues affecting the operations of VolkswagenThere are various restrictions made by various departments of the country in order tomaintain ethical code of conduct (Kraft-Todd and Rand, 2016). In case of auto mobile industryvarious restriction. A company's license can be cancelled if the written rules are not followed. Acompany needs to take care of pollution and maintain the carbon emission from the vehicle up toa certain limit. It also needs to make use of the technological devices that help to reducepollution, which can affect the health of stakeholders.2
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