Coca Cola's Ethical Stance: An Analysis Based on Johnson's Intensity of Ethical Stance

Student’s Last Name 1
Organization Behavior
By (Name)
Course
Professor
University
Date

Student’s Last Name 2
Introduction
Organizations face several ethical issues such as discrimination and harassment,
technology, privacy, as well as health and safety. Many organizations have adopted
Corporate Social Responsibility practices that incorporate sustainable development into
an organization’s business model. CSR has got a positive effect on economic, social,
and environments factors. Coca Cola is one of the companies that has faced several
ethical stances in its operation. In India, the company has failed to consider the welfare
of employees as a result of its mining process which has consumed a lot of groundwater
leading to water shortages. Moreover, the company has engaged in activities that
pollute the environment. Coca Cola’s ethical issues in India have made the Indian
government ban the sale of Coca Cola and Pepsi products in its cafeteria. This essay
will discuss the general ethical stance of coca cola based on Johnson’s Intensity of
Ethical Stance and offer some recommendation for the company.
Ethical Stance of Coca Cola based on Johnson’s Intensity of Ethical Stance
Short-term Shareholder Interest
This ethical stance limits organizations from handling responsibility for short term
interest of the shareholder on the basis that the state alone has the right of imposing
wider limitations on corporate governance. It is a minimal way to respond to the needs
of the law that the organization would undertake to comply with less substantial rules of
conducts. According to Johnson and Scholes, shareholders maximize profits and focus
on short term responsivities of the business (Coca-Cola, 2019). Coca Cola has been
reported to have anti-competitive prices in some nations. For example, this case was

Student’s Last Name 3
reported in Europe and Italy. The company was accused by PepsiCo and Virgin Cola for
intentionally using discounts and rebate strategies to increase its sales. This is ethically
wrong because the company was using unfair competitive means (Bhalla, 2013, pp.46).
Also, the company wanted to acquire Cadbury but the deal was unsuccessful because it
was against the antitrust laws.
Long-term Shareholder Interest
This type of ethical stance improves the organization's image. The cost of
undertaking this kind of responsibilities may be justified as a basic promotional
expenditure. Besides, it prevents the development of political and social pressure for
legal regulation. Although Coca Cola has faced many ethical issues which have
tarnished its name, the company has tried to maintain its ethical stance to prevent more
social and political pressure that may cause more harm (Powell and Gard, 2015,
pp.862). The company opened a recycling plant to reuse all its plastics. In America, the
company has recaptured 20% of plastics which had been released to the market. On
the other hand, the plant has assisted the company prevent around 100 metric tons of
carbon dioxide from being released to the atmosphere. In return, this will help prevent
global warming which may lead to the greenhouse effect (Torres, Bijmolt, Tribó and
Verhoef, 2012, pp.16). Moreover, the controlled emission of harmful gasses will reduce
the health hazards among individuals residing around Coca Cola’s plants.
Shareholders are crucial stakeholders for Coca Cola, with the consumers being
the most essential shareholders since they make profits for the company. Therefore,
their major interest is high-quality products from the company. Coca Cola has had to