Ethics and Business Success: A Case Study of Sackler Family

This report discusses the case study of Sackler family who followed unethical business practices and how it influenced the success of the organization. It also provides recommendations on how organizations can protect against unethical behavior.

Museums and galleries
supported by the Sacklers
family

EXECUTIVE SUMMARY
Ethics are known as the principles which guides organisations or individuals about right
or wrong code of conduct. The unethical practices can make business affected greatly and
negatively. The report has discussed the case study of Sackler family who followed unethical
business practices. It has discussed that how unethical business practices can influence the
success of the organisation. It has been determined from the analysis of the study that the
negligence of ethics is not good for long term success and for retaining customer loyalty and
good brand value organisations must follow the ethical behaviour.

Table of Contents
EXECUTIVE SUMMARY ............................................................................................................2
INTRODUCTION ..........................................................................................................................4
ANALYSIS .....................................................................................................................................4
Success evaluation and measurement for unethical organisations .............................................4
Strategies recommended for organisation to protect against unethical behaviour .....................7
CONCLUSION ...............................................................................................................................8
RECOMMENDATIONS ................................................................................................................8
REFERENCES ...............................................................................................................................9
REFERENCES..............................................................................................................................10

INTRODUCTION
Success is define as the creation of business which empowers employees, community and
service users in equal measurement (Khan and Rasheed, 2015). The ethical principles guide
organisation to follow practices which assist in balancing all these aspects. However negligence
to ethics can result in huge imbalance between monetary gain as well as in other success
parameters of business. Sustainability of the organisational success can be questioned if it does
not follow the ethical practices. Unethical behaviour or practices not only affect the organisation
practising them but it can also influence the success of other organisations who supports or
neglect such practices.
The report will analyse the role of ethics in business success and how organisations can
make efforts to deal against the consequences of unethical behaviour. It will discuss the case
study of Sackler pharmaceutical company which enjoyed huge success form several years.
However the organisation neglected the ethical considerations in order to make profits from
addictive drug OxyContin which was responsible for causing addictions and deaths. The success
of organisation become so much questionable that even donations of organisation to cultural
institutions such as Tate art group, Serpentine gallery, National portrait gallery and Metropolitan
museum is also facing huge criticism and opposition from people. The study will also provide
recommendations that how organisation can address conflicting situations from unethical
behaviour. Further the report will describe the various implications of unethical practices and the
way in which organisations can avoid the unethical practices.
ANALYSIS
Success evaluation and measurement for unethical organisations
The organisation which does not follow ethics cannot be described as successful.
Organisations such as Sackler family which receives huge financial gains on the basis of their
good corporate strategies can also fail if their ethical foundation is not strong. For example
Sackler family earned huge profit but their negligence towards ethical behaviour resulted in
deaths of number of customers. As a consequence of it despite having financial success
organisation cannot be considered as successful in terms of brand value, service quality and
public perspective (Rashid and Mahmood, 2018). The association of museums and galleries with
Sackler family by accepting their donations also influenced their success. Thus it is vital that

apart from profitability organisations must also emphasis upon other success parameters which
are important and depends upon ethical practices.
Success in terms of reputation:
The unethical practices can influence the reputation greatly. Museums and galleries did
not consider any ethical code of conduct and accepted the donations from Sackler family. As a
result of this service users of these organisation started assuming that these cultural institutions
are supporting Sackler family and they does not have any sympathy with the victims. The
integration with Sackler's caused serious damage to the organisational reputation (Fatima, 2016).
People are being used to consider museums as promoter of reputation laundry. There were not
ethical practices followed in accepting charities and thus if created a negative reputation of the
organisation.
It is very important for the organisations to develop and maintain a good public
reputation. If organisations fail to do so then in future it may become challenging to attract new
customers or service users. The organisational engagement in unethical practices prevents people
to build any kind of association with the organisation which is not beneficial from growth and
competitive point of view. The same was observed with galleries and museums. After receiving
donations from Sackler these institutions were highly criticised by the people. They were blamed
that these organisations priorities only donations and charities and they does not have any value
for community. Many people also questioned the operations, reliability and other social purpose
of the existence of such institutions who are supporting Sackler family by giving them respect
and authority.
Impact of public perspective on success:
Another important success attribute which is affected by unethical behaviour is
perspective of people towards organisation. After knowing that museums were conducting
exhibitions from the funds donated by Sackler family many people have shown disappointment.
It is strongly believed by communities that organisations which value only profit irrespective of
life of people are not worthy to get support. However when national importance organisations
such as art galleries and museums are funded by them then it create doubt regarding their social
contribution (Schweigert, 2016). As a result of this people used to consider that by attending
such exhibitions they will also indirectly support the money and reputation laundering. It makes
them distant from participating or encouraging such events.

Thus unethical practices can quickly change the perspective of public towards the
services and organisational brand. Unethical behaviour can be considered as key driving force
which minimises the community engagement (Becker, 2018). The active participation of the
public is an integral part of the organisational success. However unethical behaviour can make
people develop negative perception regarding organisation and its services.
Service perspective towards success:
The involvement of Sackler family also influenced the service quality and range of
services provided by organisation. Though in short term it can benefit the organisation but it
cannot be considered as suitable for the long term success of organisation. For instance with
huge amount of donations UK and New York galleries were able to hold more number of
exhibitions resulting in greater benefits. However now when most of the people are opposed to
involvement of Sackler family within cultural institutions people are considering those services
unacceptable and unethical. It has been also promoted by the communities that such quality and
wide range of services were provided only for promoting the Sackler's and they were not meant
for the public welfare or organisational benefits. Thus if organisations does not follow ethics in
their professional code of conduct as done by museums then people may began to consider the
services as unethical (Tehseen and Ramayah, 2015). With increasing disappointment among
people it is also possible that they may began to boycott services which is not desirable from
success point of view.
Regulatory perspective towards success:
Charity council in England regulates the flow of charity and assures that charities are
ethical and does not provide any means of illegal activities. The compliance to regulations is one
of the aspect which assure people that their practices are ethical and trustworthy. However
museums and galleries neglected the important regulations and principles of charity which made
their actions unethical from regulatory perspective. In case of Sackler family donations,
museums and galleries were completely failed from regulatory perspective.
The charity act has clear guidelines which states that organisations must verify the source
of donations before accepting. However despite knowing the controversy of Sackler family
museums readily accepted their charity (Ferrell and Fraedrich, 2015). The failure to this
legislative perspective affected the success and and response of people. Many people started
demanding that cultural institutions are not following any regulations and their involvement must

also be checked and determined in supporting Sackler family and similar unethical practices.
Thus for preventing such negative offences it is the responsibility and necessity of the
organisations to have suitable guidelines and regulations for ethical code of conduct (Burns and
Gupta, 2015). It will assure that regulations does not encourage unethical practices and success
of organisation is not affected on basis of regulations because in long term it can also cause
serious legal implications on organisation receiving donations.
Strategies recommended for organisation to protect against unethical behaviour
Metropolitan museums and other art galleries who received donations from Sackler
family can adopt various strategies to avoid unethical behaviour. The first step is to create and
follow an appropriate code of conduct. These organisations must outline a proper guideline to
ensure that ethics are followed at various stages of operations (Diallo and Lambey-Checchin,
2017). For instance at present there are not clear guideline is followed by these organisation in
accepting donations or charity.
Thus it is recommended that these organisations must follow a suitable procedure to
accept the donations only after proper background check. The funds must be accepted only when
their source is clearly defined and referenced so that the reputation of these organisations is not
used for reputation laundry. It is also suggested that organisations must lead by example and
must reinforce the consequences of unethical behaviour. For example prior to accepting
donations from Sackler family museums were well aware of their involvement in unethical
practices and public and legal criticism.
Despite this knowledge museums accepted their donations without analysing that this
action could have negative impact on their reputation. Thus organisations must emphasis on
ethical decision making and prior reaching to any conclusion they must assess its possible
consequences. The regular check and balance among employees, procedures and operational
activities can give valuable guidance on the discrepancies and irregularities. Thus all employees
must also be held accountable for their unethical behaviour and strict actions must be taken
against them (Peus and et.al., 2015). If museums and galleries were also had such check and
balance policies then donations were Sackler family were not accepted by them. It could have
save these organisations from unnecessary criticism by the public. The organisation must also
take strict legal actions against individuals who are involved in unethical practices. These

strategies will help organisation to avoid incidences of unethical behaviour and practices which
can affect the success (Yulinda, Situmorang and Salim, 2018) .
CONCLUSION
It can be concluded from the study that ethical practices help organisation to balance the
community welfare and financial gains. In short term unethical behaviour may help organisation
to increase profits but it significantly affect the reputation of organisation and perspective of
communities towards the service providers. It has been also analysed that unethical practices
may influence the brand loyalty and value of the organisation.
Thus for the long term organisations may not be able to retain competitive advantage as
unethical practices and cause huge damage to the organisation reputation. It can also be
concluded from the above analysis that it is the responsibility of the organisation to assure that
there is regular check and monitoring of their practices to ensure that they are ethical or not. For
the long term success organisations are required to follow the ethical behaviour so that their
service quality and brand perspectives are not affected.
RECOMMENDATIONS
The success of organisation depends upon ethics and thus it is recommended that service
providers must follow the ethical behaviour at all stages of business and operations. The ethical
consideration must not only be included in operational activities but also in promotion,
monitoring and other corporate social events organised by the organisation. In the above case
study it has been analysed that after knowing the fact that the OxyContin drug was having
addictive nature and huge number of people were influencing from its ill effect, Sackler family
did not show concern about its reputation.
Thus it is recommended that organisations must understand the significant role of ethics
in terms of reputation and brand name of business. Thus if any of the practices results in huge
criticism among public then it must not be neglected. For instance in the Sackler family case
study also museums and galleries who receive donations neglected the fact that Sackler family is
under criticism due to their ethical misconduct. It resulted in massive opposition of people
towards the services of cultural institutions who received donations from the museum.
Another recommendation which can affect the service quality and brand success of the
organisation is that most of the service providers conduct audit for only their operational
activities. However no such efforts are provided for ethical values. Thus it is recommended that

there must be regular audit which assure that all practices either direct or indirect are ethical. For
example the museums and galleries must encourage the background check of all donations they
receive. It is also recommended that the organisations receiving donations must also have proper
guidelines and control policies which limits and clearly describe the involvement and
interference of charity donors. It will help service users to assure that the services provided to
them are ethically appropriate and does not violate any kind of regulations.

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