Unethical Practices in Johnson and Johnson: A Case Study

This report discusses the unethical practices followed by Johnson and Johnson, a multinational corporation, and the impact on stakeholders. It explores the role of business in society and provides examples of good and bad ethics. The report also discusses two ethical theories and provides recommendations for improvement.

Johnson and Johnson
Taking the Pain Away

Table of Contents
Introduction......................................................................................................................................3
Part- 1...............................................................................................................................................3
A) Report.........................................................................................................................................3
Ethical issues faced in company.................................................................................................3
Role of business in society..........................................................................................................4
Stakeholders affected by unethical practices and how................................................................5
Examples of good and bad ethics................................................................................................5
Recommendations.......................................................................................................................6
References........................................................................................................................................6
B) Discussion on two ethical theories..............................................................................................7
References........................................................................................................................................9
Part-2..............................................................................................................................................10
Reflective essay.........................................................................................................................10
Conclusion.....................................................................................................................................11
References......................................................................................................................................11

Introduction
For an organisation to survive sustainably over a long period of time in the market it is
important that ethical practices and code of conduct are followed in the operations and functions
of business. Business ethics are the written or unwritten codes of morals, values and principles
which governs the decisions of company so that they can produce goods and services which can
help in maximising the interests of all the stakeholders (Edens, Petrila and Kelley, 2018). Ethical
practices in business ensure increased productivity and profitability along with enhanced trust of
its stakeholders so that it can continue to survive in the market in an efficient manner. In this
report the unethical practices which are followed in Johnson and Johnson which is an American
multinational corporation established in 1886 and deals in medical devices, pharmaceuticals,
consumer goods etc. will be discussed. The various types of issues faced by the company
because of its unethical practices will be discussed along with certain recommendations so that
ethical practices can increase. Further ethical ethical theories will also be discussed which can be
applied in company. In the second part of report a reflection will be produced so that ethical
practices that can be applied in business will be discussed.
Part- 1
A) Report
It is important that ethical code of conduct is followed by businesses so that they can
make ethical decisions which can help in making better decisions so that interest of all its
stakeholders can be maximised which also help in increasing its profitability in market. Ethics
are also important as it help in preventing the business from legal issues, increasing the trust of
its customers, improving its brand image in market etc. so that its productivity can increase.
Ethical issues faced in company
Johnson and Johnson is an American multinational corporation which is headquartered in
New Jersey, US and deals in a variety of products like pharmaceuticals, medical devices,
healthcare equipments etc. The company was founded in 1886 and is one of the world's most
valuable companies with over 132,200 employees and revenue of over $82.059 billion in the
year 2019. The company is facing an ethical issue regarding its false and dangerous sales
campaign that caused addition and death of many people in America thereby leading to opioid
crisis. An estimate of 1.7 million people in US suffered from substance use disorders related to

prescription of opioid pain relievers. The company faced a fine of $572 million to the state of
Oklahoma so as to mitigate the losses faced by the state. As the opioids are very profitable drugs
for Johnson and Johnson which lead to increasing its marketing campaigns related with increased
sales of this drug as a better pain killer along with not being addictive. The company also
manipulated the scientific findings related with drugs and persuaded doctors in increasing the
prescription of opioids. This lead to increased addiction among people leading to their deaths
thereby causing an opioid epidemic (Williams, 2017).
Role of business in society
The main role of a business is to produce and make available goods and services to the
customers which can help in satisfying their needs along with increasing the profitability of
business. It is also important that businesses follow ethical code of conduct and bring
innovations in their products and services so that they can fulfil the changing demands of
customers. The ethical issue which has been identified in Johnson and Johnson is regarding its
false claims regarding their opioid drugs which lead to opioid crisis and also a large number of
deaths in US. It is important that the ethical challenges faced during marketing drugs are
identified so that effective actions can be taken and accurate information is made available to
customers. Some of the the challenges identified are drug safety, pricing, data disclosure, clinical
study design etc. which were manipulated by the company leading to adverse effects on its
customers. Leading to the opioid crisis which has claimed more than 400,000 lives the company
has faced many legal actions with about $572 million claimed by the Oklahoma government. It
has also affected the public image of company leading to a decrease in trust of stakeholders in
the decisions of company. It is therefore important that ethical decisions are made in company
which can help in achieving customer satisfaction along with increasing profits of company
(Johnson, Finlayson, and Woodruff, 2017).
It is important that the company find alternatives so that it can improve its image in
market and regain trust of its stakeholders like finding alternatives of opioid which can be used
in painkillers along with improving its marketing campaigns so that true facts can be made
available to customers. The company can also take help of research trails so as to prove the
accuracy of drugs being used by customers so that they can be provided with medicines which
can help in improving the ailments of patients rather than deteriorating their conditions. Also the

company must ensure that apart from making profits improving the health of customers must
also be their aim which can help in increasing the profitability of company.
Stakeholders affected by unethical practices and how
Stakeholders are the people who support in the success of company and also can affect
and be affected by the activities of business like suppliers, customers, investors, government etc.
It is important that businesses make decisions which can help in increasing the interests of all its
stakeholders so that its profitability can increase. Following are the ways in which the unethical
practices of Johnson and Johnson have affected its stakeholders: Customers: The opioid crisis has lead to increased addiction towards company's drugs
along with increased death of customers. Thus the false claims of company regarding its
drugs have affected the health of its customers severely (Israel, Schulz and Lichtenstein,
2017). Shareholders: The Company had to pay a huge fine of $572 million along with about
1500 lawsuits against the company. Also it suffered decrease in sales because of legal
issues faced by the company which lead to a decrease in the profits of its shareholders
(Oklahoma judge finds Johnson & Johnson fuelled opioid crisis .2019). Government: The investment and trust of government in the company also decreased
along with facing increased agitations from the citizens of the country (Despair in opioid
crisis .2017).
 Suppliers: The business of suppliers who provided opioid to be used by drugs by the
company also got affected.
Examples of good and bad ethics
Depending on the effectiveness of decisions in increasing the interest of stakeholders of
company it can be divided into good or bad ethics which also affect the brand image of company.
There are various companies which are focused on increasing the interest of their stakeholders by
following ethical actions like CSR policies, making effective decisions etc. which help them in
improving their brand image in market along with increasing their profitability (Johnson and
Kriz, 2019). Tesco is an ethical business as it follow ethical practices along with applying CSR
policies which help it in maximising the interest of its stakeholders by taking ethical decisions.
The company focus on improving the quality of life of its customers by providing them with
goods and services at reasonable prices along with high quality so that the interest of its

customers can be increased. Johnson and Johnson on the other hand is unethical as it has
misguided its customers leading to their addiction to opioid drugs and also causing death of
various customers.
Recommendations
In order to improve the brand image of Johnson and Johnson in market along with
enhancing the ethnicity of their marketing decisions the company can do the following things:
 Increasing the participation of employees in making decisions which can help in
increasing the ethnicity of decisions made in company.
 Taking the help of scientific data in producing drugs can also help in improving the
quality of its drugs (Jilla, Johnson and Danhauer, 2018).
 Taking government approvals while preparing drugs so that the trust of customers in
drugs of company can increase.
 The company also need to implement CSR policies so that it can execute more
responsible behaviour towards the society and take ethical decisions.
 It is important to conduct a stakeholder analysis before launching drugs so that the
interests of stakeholders can be maximised and negative impacts can be reduced.
References
Books and Journals
Edens, J.F., Petrila, J. and Kelley, S.E., 2018. Legal and ethical issues in the assessment and
treatment of psychopathy.
Williams, C.H., 2017. Francis M. Hult, David Cassels Johnson (eds.): Research Methods in
Language Policy and Planning: A Practical Guide.
Johnson, E.K., Finlayson, C. and Woodruff, T.K., 2017. Fertility preservation for pediatric
patients: current state and future possibilities. The Journal of Urology.198(1). pp.186-
194.
Israel, B.A., Schulz and Lichtenstein, R., 2017. Critical issues in developing and following
CBPR principles. Community-based participatory research for health: Advancing social
and health equity, pp.31-46.
Johnson, C.L. and Kriz, K.A. Eds., 2019. Tax increment financing and economic development:
Uses, structures, and impact. SUNY Press.
Jilla, A.M., Johnson, C.E. and Danhauer, J.L., 2018, May. Disruptive hearing technologies and
mild sensorineural hearing loss I: accessibility and affordability issues. In Seminars in
hearing (Vol. 39, No. 02, pp. 135-145). Thieme Medical Publishers.
Online

Oklahoma judge finds Johnson & Johnson fuelled opioid crisis .2019. [Online] Available
through :<https://www.statnews.com/2019/08/26/oklahoma-judge-finds-johnson-
johnson-fueled-opioid-crisis/>
Despair in opioid crisis .2017. [Online] Available
through :<https://www.brookings.edu/policy2020/votervital/how-can-policy-address-
the-opioid-crisis-and-despair-in-america/>

B) Discussion on two ethical theories
Ethical theories can be explained as the process which discusses that how any of the
decision must be taken by the entity to perform their business activity. Ethical theories certainly
helps entity to identify that what are those decisions which are favourable for the entity at the
time of accomplishing the goals. It is necessary to understand that any of the entity should
consider ethical theories at the time of making any of the decision because failure in this
particular department may create negative impact for the entity (Pritchard and Englehardt, 2016).
Similarly, organisation like Johnson and Johnson are having the similar issue because they are
unable to work according to the ethical terms and condition which has been creating higher
issues for the entity. Below, different ethical theories has been discussed in detail which can help
to explain that whether entity is able to perform as per the requirement or not.
Utilitarian Ethical Theory: It is explained as the ethical theory which discusses that
how any of the entity needs to perform any of the work in a systematic manner. It is the theory
where primary focus is upon the consequences on any of the action which has been taken by the
business entity. There are very minimum chances as per this particular theory that organisation
will take any of those decision due to people connect with it has to suffer. This is among the
theory which takes their decision of their own which sometimes create issue for the entity
because only those decision are taken which can be beneficial for large number of people at a
time. In context of the case study, it was seen that organisation didn't consider their stakeholder
but they only consider some of the stakeholder such as directors of the company, shareholders
and the members. If company would have performed according to this particular theory they
would have identified about the benefit of using any of the opioid pain relievers and all of the
negative impact of this particular medicine (de Sousa, Rasmussen and Pierroux, 2018). Also, if
still company would have continued to sell the product then they would have added the
description about the negative impact which may occur because it is one of the reason that
organisation is suffering from number of issues and different types of penalty has been imposed
upon them.
Some of the advantage and disadvantage of Utilitarian Ethical theory are discussed
below:
Pros

 It is one of the theory which forces the entity to take those decision through which
qualitative services can be provided.
 Any of the decision under this particular theory is taken by considering the positive and
negative impact upon any of the stakeholder which is the positive side of this particular
theory.
Cons
 Here, decision makers are always forced to guess the outcomes which are of their own
choice.
 The decision which are being taken is not possible to predict on a regular basis which is
one of the major disadvantage in it.
According to this particular theory, it can be easily recommended to Johnson and Johnson
that they must be able to analyse all of the factor because earning profit is not only just the main
motive of any organisation. Considering this particular factor will certainly allow the
organisation to take positive decision. Also, they will not take any of those decision due to which
direct effect can be seen upon the health level of any person within the premisses of UK
(Paradice, Freeman and Hall, 2018).
Deontological Ethical Theory: It is among the theory which has a huge importance as it
discusses that any of the business decision must be taken in the manner so that other person can
be treated with full of dignity and respect. It is equally important to understand that if any of the
entity fails in this particular department then it can be simply said that they are unable to perform
their part of work as per the requirement. Here, it is majorly focused by the organisation that
what are their duties and what are those decision upon which they are mainly focusing. In
context of Johnson & Johnson, it can be said that organisation is unable to perform as per the
requirement because they are not considering any of their duties which they must have
considered before making any of the decision. Although, company is trying to cure the pain with
minimum amount but still they do not want any of the person to known about the facts behind
the medicine which they manufactures i.e., side-effect of medicine upon patient (Kalajtzidi,
2019).
There are some of the positive as well as negative side of the theory which has been
discussed below in detail:
Pros:

 Here, any of the person or entity tries to identify about their duty and responsibility
before making any of the decision which is the positive side of the theory.
 It ensure that people are working according to their duty which means to follow the laws
and regulation to respect other people and treat them accordingly.
Cons:
 There is a high possibilities that positive decision can be taken with negative
consequences in future.
 It can be seen that conflict among the duties may raise due to which person may have to
suffer as well (DeMarco and Fox, 2020).
It is recommanded to the company that if they are planning to use this particular ethical
theory then they must be able to understand that they must be aware about their own duty. It
means Johnson & Johnson will not take any of the those decision due to which people who
consumes medicine will not have to suffer. Also, if they will sell the product of a company then
in that respective condition company will tell to their customers about its side effect.
References
Books and Journals
Pritchard, M.S. and Englehardt, E.E., 2016. Ethical theories and teaching engineering ethics. In
Leadership and Personnel Management: Concepts, Methodologies, Tools, and
Applications (pp. 1915-1924). IGI Global.
de Sousa, F., Rasmussen, I. and Pierroux, P., 2018. Zombies and ethical theories: Exploring
transformational play as a framework for teaching with videogames. Learning, culture
and social interaction .19. pp.40-50.
Paradice, D., Freeman, D. and Hall, D., 2018. A Review of Ethical Issue Considerations in the
Information Systems Research Literature. Foundations and Trends® in Information
Systems .2(2), pp.117-236.
Kalajtzidis, J., 2019. Ethics of Social Consequences as a Hybrid Form of Ethical Theory?.
Philosophia .47(3). pp.705-722.
DeMarco, J.P. and Fox, R.M. Eds., 2020. New Directions in Ethics: The Challenges in Applied
Ethics. Routledge.

Part-2
Reflective essay
The leaders of a company play an important role in making decisions related with
operations and functions of an organisation and so it is important that they behave ethically in the
company so that effective decisions can be made. It is important to consider ethical beliefs and
values while making decisions so that an environment can be created in organisation wherein all
the members follow ethical practices and code of conduct in performing their work so that
overall ethnicity of an organisation can be increased. As an ethical leader it is important that I
focus on the dignity and rights of others which can help me in making decisions which are fair so
that high interest can be generated for all its stakeholders thereby increasing their trust in
company. It is also important that I can maintain integrity and compliance in the business
environment which can help in increasing the trust of employees in my decisions so that they can
work together in team and help in achieving the goal sand objectives of company. While working
as a leader in the company it is important that I follow participative leadership which can help in
increasing the participation of employees in decision making which will ensure that ethical
decisions are made in company.
Ethical practices can also help in increasing the trust of all the stakeholders in the
company so that profits of company can increase along with enhancing the morale of workers. It
is important that an integrated and coordinated working environment is created which can help in
increasing the efficiency and effectiveness of the work and also the monitoring of work can also
be done effectively. This ensures that highly ethical practices are adopted in the company by
monitoring the work of each worker which increasing the productivity and profitability of
organisation. Being a leader I can improve effective communication in the organisation so that
coordination among workers can be improved which can also help in increasing the efficiency
with which objectives are achieved. As a leader it is also important that I motivate the workers
by following various strategies which can help in increasing the efficiency with which
employees work in company along with their moral development so that they can become
committed towards company thereby increasing their retention in company. Also while
allocating work among team members it is important that I consider the skills and abilities of
employees so that they can perform their work in an efficient manner. It is also important that

CSR policies are effectively implemented in the company which can help in increasing the
ethnicity of the company activities and also help in ensuring that maximum benefits is provided
to the stakeholders. Further it is important that I try to boost the morale of the team members
through various strategies like performance appraisals, flexible working hours, employee
engagement etc. so that they can work responsibly and ethically for the company. Thus I can
become an ethical leader and help in increasing the ethical behaviour among all the employees so
that a friendly working environment can be created along with increasing the responsible
behaviour among all the workers.
Conclusion
From the above report it can be concluded that in order to make a business successful
over a long run it is important that ethical practices are followed in company which can help it in
following legal framework of the country so that legal issues can be decreased. It can also help in
increasing the profits of its stakeholders which is important in enhancing their trust in
organisation so that their support can help in the continuous development of business. Ethical
theories can also be applied in organisations which can help in increasing morale of all the
workers along with ensuring that ethical code of conduct is followed by them at each process in
the business. The leaders of company can also implement ethical leadership so that they can help
in improving the ethical actions among workers so that better decisions can be made and
ethnicity of company can be increased.

References
Books and Journals
Graham, E. and Walton, H., 2018. Theological reflection: methods. scm Press.
Park, J., Kang, J.H., Kim, S.J., Liu, X. and Brongersma, M.L., 2017. Dynamic reflection phase
and polarization control in metasurfaces Nano letters 17(1), pp.407-413.
Stige, B., 2017. Where music helps: Community music therapy in action and reflection.
Routledge.
Körkkö, M., Kyrö-Ämmälä, O. and Turunen, T., 2016. Professional development through
reflection in teacher education. Teaching and Teacher Education .55. pp.198-206.