CISM4000: Business Intelligence and Ethics - Gucci Case Study Analysis

This report examines the breach of business ethics by Gucci, focusing on labor mistreatment and violations of the code of conduct. It details the policies and guidelines designed to maintain ethical balance within a company, emphasizing the role of the human resources department. The report analyzes the specific case of Gucci in China, highlighting issues such as labor mistreatment and manipulation of working hours. It explores the consequences of these violations, including reputational damage and disruption of business processes. Furthermore, the report outlines mitigation procedures adopted by companies, including strict policies, assessments, and workplace monitoring. Gucci's response to the case, involving improvements to working conditions, employee incentives, and local ties, is also discussed. Finally, the report references relevant literature on business ethics, corporate social responsibility, and workplace behavior.

Running head: BUSINESS INTELLIGENCE AND ETHICS
BUSINESS INTELLIGENCE AND ETHICS
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Table of Contents
Violation of Code of Conduct or Business Ethics...........................................................................2
Breaching code of conduct – Case Study of Gucci.....................................................................2
Violation of Code of Conduct by Gucci:.....................................................................................3
Mitigation procedures for violation of Code of Conduct by Gucci:............................................3
References:......................................................................................................................................5

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Violation of Code of Conduct or Business Ethics
A code of conduct or that is regarded as business ethics is a set of policies or guidelines
that a company develops for all of the employees, starting from lower class staffs to higher
officials (Leipziger 2017). The company expects all of the employees to abide by the policies
and the guidelines that has been set up. These are the policies and the guidelines that are
formulated to maintain a balance between all of the employees working together in the same site.
It is obvious that due to certain professional or personal issues there could be a misunderstanding
that can take place between the employees. In simple words, all these guidelines and policies
have been set up for the balance in ethical aspect among not only the company officials but also
between the company personnel and the clients they will be handling. A breach in the code of
conduct simply means the violation of such policies by the company personnel (Melé and
Fontrodona 2017). These policies are being set up by the human resources department of a
company and before anyone is provided with the offer letter, these documents are given to the
would-be-employee for confirming that he/she is fine with the give set of policies and thereafter
has to sign the document in order to show the consent (Trevino and Nelson 2016).
Breaching code of conduct – Case Study of Gucci
While considering the case of breaching the code of conduct one of the major cases is the
Gucci in China where they have breached the code of conduct or the business ethics. From the
case of 2011 it has been assessed that Gucci was looking to accelerate their process of store
opening in which they have just violated the business ethics. This case became public after the
announcement of its five former employees regarding labor mistreatment and inhuman
conditions of working. By not providing a proper workplace and by mistreating the labors Gucci

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have just breached the business ethics (Ferrel et al. 2019). Also, it has been assessed that Gucci
done some manipulation with the working hours of their labors also so that they do have to pay
the labors for their overtime which is a serious issue of breaching the business ethics.
Violation of Code of Conduct by Gucci:
The issues that are probable with the breaching the code of conducts are always harmful
for the Gucci. Any abuse of the resources including the labors cause the company to bear an
extra effort to rebuild that reputation of theirs. Often it is found that the organization abuses the
labors that are provided to them. This instance lead to improper working condition for other
employees as well (Pund et al. 2017). Moreover, the behavioral issues do have an impact over
the reputation of the company. Any misbehavior done with any labor will directly reflect in the
business of the company in case if it is published to the public. The misunderstandings between
the labors and the Gucci can seriously affect the processes of the company. Any issue among the
labors of the company will put the processes that takes place with the coordination of the
involved labors will be interrupted unnecessarily and that would certainly affect the overall
functionalities of the company. In simple words, ethical behavior is expected to maintain in the
workplace for the betterment of the business itself. Besides, any unethical actions from any
employee can put the business into risks.
Mitigation procedures for violation of Code of Conduct by Gucci:
Different companies are adopting different measures in order to mitigate the risks that are
caused by the violation of the code of conduct. Strict policies are being introduced where no
mercy would be shown in case of an unethical action and the penalty would be considered
depending upon the severity of the action. Assessments are being done by the companies in order
to assess the knowledge of the employees of the policies and guidelines. Proper monitoring of

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the workplace are done by the companies with a separate team. To solve this breach of business
ethics case Gucci used their leadership strategy through which they improved the working
condition of their Chinese factories (Xu, Loi and Ngo 2016). To mitigate this Gucci created a
new type of working environment where the employees were able to grow within the
organization. This opportunity lead to oversupply if the labors which provided them the option to
choose best and most skilled employee. Additionally, Gucci also stared incentivizing the
employees to make them more motivated to their work and to pay their hard work. Gucci also
ensured that well being of the workers is put in the hands of the local ties. In this way, Gucci
improved the workplace conditions for their labors in China and mitigated their own breach of
the code of conduct.

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References:
Ferrell, O.C., Harrison, D.E., Ferrell, L. and Hair, J.F., 2019. Business ethics, corporate social
responsibility, and brand attitudes: An exploratory study. Journal of Business Research, 95,
pp.491-501.
Leipziger, D., 2017. The corporate responsibility code book. Routledge.
Melé, D. and Fontrodona, J., 2017. Christian ethics and spirituality in leading business
organizations: Editorial introduction. Journal of business ethics, 145(4), pp.671-679.
Pund, S.B., Kuril, B.M., Doibale, M.K., Ankushe, R.T., Kumar, P. and Siddiqui, N., 2017. Study
of workplace violence, its risk factors and perceptions about workplace security in doctors of
Paithan. International Journal Of Community Medicine And Public Health, 4(6), pp.1987-1992.
Riggins, F.J. and Klamm, B.K., 2017. Data governance case at KrauseMcMahon LLP in an era
of self-service BI and Big Data. Journal of Accounting Education, 38, pp.23-36.
Stevens, H., 2018. Hans Peter Luhn and the birth of the hashing algorithm. IEEE Spectrum,
55(2), pp.44-49.
Xu, A.J., Loi, R. and Ngo, H.Y., 2016. Ethical leadership behavior and employee justice
perceptions: The mediating role of trust in organization. Journal of Business Ethics, 134(3),
pp.493-504.