Ethical Responsibilities at Woolworths: A Case Study

This essay evaluates a recent ethical conflict in Woolworths in relation to breach in customer trust. The researcher has also enumerated a set of recommendations to establish integrity in the present issue.

ETHICAL RESPONSIBILITIES

Table of Contents
Introduction......................................................................................................................................3
Ethical issues at Woolworths...........................................................................................................3
Recommendation.............................................................................................................................5
Conclusion.......................................................................................................................................5
Reference List..................................................................................................................................6
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Introduction
Corporate sustainability initiates in the presence of an organisational value system as well as a
principle-driven strategy to implement business. This strategy encompasses operation in manners
that can meet the basic responsibilities in contexts of labour, human rights, anti-corruption and
environment. The thesis statement of this essay is to evaluate sustainable principles and values of
ethics in a company in regards to a recent ethical dilemma. The essay evaluates a recent ethical
conflict in Woolworths in relation to breach in customer trust. This evaluation is done in
consideration of United Nations Principles. The researcher has also enumerated a set of
recommendations to establish integrity in the present issue.
Ethical issues at Woolworths
A recent investigation in Woolworths has shed light on the issue of widespread misconduct that
has been taking place in the pubs owned by Woolworths. The alleged incidents of the
aforementioned ethical issue have been further highlighted by the help of a whistleblower. This
whistleblower claims that the company often targets the venue that can prove to be vulnerable to
the gamblers (Toscano and O'Malley, 2018). This in turn can lead to maximisation of losses of
the clients. One of the anonymous employees who worked as a bar staff in one of the hotels
owned by Woolworths have provided details of staff meetings. As stated by Louche and
Lydenberg (2017), an organisation has to be collaborative in their approach to commit
fraudulence against their customers. This can be determined with the help of an incident that has
occurred in one of the pubs owned by Woolworths. It has been alleged that staffs have
encouraged a grieving lady, which lead her to gamble away her entire inheritance on one of the
poker machines in the pub.
The UN Global Compact enunciates a set of principles that must be followed by each business in
order to conduct their transactions in a sustainable and ethical manner. As asserted by Haw
(2017), failure to comply with these principles can give rise to liabilities and penalisation. This,
in turn, can reduce the scope of organisational progress for a company. Incorporation of UN
Principles into strategic procedures can help to establishing organisational integrity and ethics.
This can also motivate organisations to uphold their responsibilities to their stakeholders. The
principles are retrieved from Universal Human Rights Declaration, Rio Declaration on
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Environmental Development, United Nations Anti-Corruption Convention and fundamental
workplace rights and principles formulated by International Labour Organisation (ILO). The first
two principles encompass human rights that mandate businesses to respect and support
protection of human rights and prevent their abuse. Chóliz (2018) states the next four principles
relate to labour protection. This involves enumerating the duties of businesses to uphold
freedom of recognition and association to collective bargains.
These principles abolish compulsory and forced labour as well as child labour, thereby
eliminating discrimination of occupation and employment. Principles 7, 8 and 9 state businesses
must encourage precautionary approaches to act in the best interest of the environment (United
Nations Global Compact, 2018). As stated by Thayer (2015), this involves undertaking
initiatives that can promote larger responsibility towards the environment and encourage
incorporation of environment-friendly approaches. Szczyrba et al. (2015) assert the last principle
enumerates the need for practising anti-corruptive transactions in a business, such as extortion,
bribery and fraudulence. As seen in this case, Woolworths have been motivating its staff to
influence potential gamblers in a way that the clients lose large sums of money in the poker
machines. The present issue of ethical conflict has revealed that Australian Leisure and
Hospitality Group (ALH) staff in these venues aggressively target individual customers or pokie
players to enhance their fiscal losses.
This issue is a direct violation of customer trust and sheds a negative light on customer handling
methods of Woolworths. According to the investigative reports of Liquor and Gaming
Regulation, responsible gambling approaches in ALH venues of Woolworths are being subjected
to continuous investigations after the rise of recent ethical concerns. Australian Leisure and
Hospitality Group is a collaborative venture of Woolworths and Mathieson. As reported by Kim,
Dobson and Hodgins (2016), the aforementioned chain of hospitality business is considered as
one of country's largest pokie providers. The ventures host approximately 12,000 poker
machines in a serviceable condition (Toscano and O'Malley, 2018). As opined by Smith (2015),
this is a violation of Principle 10 of the United Nations Global Compact. These principles
mandate a business to protect and uphold customer trust by implementing anti-corruption
practices in their transactions. In the present issue, it is seen that Woolworth’s employees are
cheating the clients by influencing their decisions for the personal gain of the company.
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Recommendation
Based on the present ethical scandal, the researcher has enumerated a set of recommendations
that can be implemented in this scenario. The recommendations regarding this event are
enumerated below.
Collaboration: The management authorities of Woolworths and Mathieson must collaborate to
resolve this issue in a methodical manner. The code of conduct of these companies must be made
stringent enough to prevent further abuse of human resource. The companies should address the
press and try to uplift their public relations. According to the findings of Miller, Thomas and
Robinson (2018), this can be done by the help of reinforcing a positive brand image and bringing
changes in hierarchical staff members.
Technological installation: Companies should install cameras on the venues and small speakers
to record the conversations that take place near the poker machines (influenced by Bestman et al.
2017). This can be helpful to locate any influential conversation that may give rise to the
aforementioned scenario. This can also help to increase the awareness of customers and motivate
them to act in a responsible manner while gambling.
Conclusion
Based on the given information, it can be stated the organisations must be careful and ethical
while implementing their transactions. In the present breach of UN principles, Woolworths is
seen to have violated the principle of anti-corruption. This has been done by influencing clients
to gamble in precarious positions which maximises their chances of losing money. This, in turn,
increases profit margins of the company. The researcher recommends an active collaboration of
the parent organisational bodies to address the issues in this case and build a positive brand
image for ALH group. A limitation of this study is its time and budget bound nature. This has
limited the literature search to only freely accessible news articles relating to ethical scandals
committed by Australian companies. Overall, it can be deduced that ethical breaches in
companies can bring an adverse impact on its progress scope. In addition, it can also hinder the
welfare of the organisation as well as its stakeholders.
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Reference List
Books
Louche, C. and Lydenberg, S., 2017. Dilemmas in responsible investment. Abingdon: Routledge.
Thayer, L., 2015. Communication: Ethical and moral issues. Abingdon: Routledge.
Journals
Haw, J., 2017. Impulsivity predictors of problem gambling and impaired control. International
Journal of Mental Health and Addiction, 15(1), pp.154-165.
Kim, H.S., Dobson, K.S. and Hodgins, D.C., 2016. Funding of gambling research: Ethical issues,
potential benefit and guidelines. Journal of Gambling Issues, 1(32), pp.111-132.
Miller, H.E., Thomas, S.L. and Robinson, P., 2018. From problem people to addictive products:
a qualitative study on rethinking gambling policy from the perspective of lived experience. Harm
reduction journal, 15(1), p.16.
Smith, A.A., 2015. Office-based sports gambling and pooling: Ethical dilemmas and worker
productivity issues from fan and gender perspectives. Doctoral dissertation, Texas Woman's
University, 2(2), pp.59-96.
Online articles
Bestman, A., Thomas, S., Randle, M. and Pitt, H., 2017. Children’s attitudes towards Electronic
Gambling Machines: an exploratory qualitative study of children who attend community
clubs. Harm reduction journal, 14(1), p.20. Available from:
https://harmreductionjournal.biomedcentral.com/articles/10.1186/s12954-017-0148-z [Accessed
on 12 August 2018]
Chóliz, M., 2018. Ethical Gambling: A necessary new point of View of Gambling in public
Health policies. Frontiers in public health, 6, p.12. Available from:
https://www.frontiersin.org/articles/10.3389/fpubh.2018.00012/full [Accessed on 12 August
2018]
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Szczyrba, Z., Mravčík, V., Fiedor, D., Černý, J. and Smolová, I., 2015. gambling in the Czech
Republic. Addiction, 110(7), pp.1076-1081. Available from: https://doi.org/10.1111/add.12884
[Accessed on 12 August 2018]
Website
United Nations Global Compact (2018) The Ten Principles of the UN Global Compact, Viewed
on 12 August 2018, <https://www.unglobalcompact.org/what-is-gc/mission/principles>
Toscano, N. and O'Malley, N. (2018) Gaming watchdog widens Woolworths pokies probe,
Viewed on 12 August 2018, <https://www.smh.com.au/business/companies/gaming-watchdog-
widens-woolworths-pokies-probe-20180327-p4z6jz.html>
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