Business Ethics and Responsible Management: A Case Study of EA Games

This report provides a comprehensive analysis of the ethical challenges faced by EA Games, specifically focusing on the controversial use of loot boxes within their games. The report delves into the ethical perspective of these practices, examining their impact on the company's public image and the various stakeholders involved, including customers, investors, and the government. It explores alternative business models to mitigate ethical concerns and analyzes examples of both responsible and irresponsible business conduct within the industry. Furthermore, the report applies ethical business theories, such as utilitarianism and deontological theory, to evaluate the company's actions and proposes recommendations for improved ethical practices. The report concludes by emphasizing the importance of ethical leadership and organizational practices in fostering a responsible business environment.

Business ethics and
responsible management

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
PART 1............................................................................................................................................1
Company should have to look at this issue from an ethical perspective of ethics......................1
The way this issue influence public image of the company........................................................1
Alternatives ways to think about business role in society...........................................................2
Who are the stakeholders that are impacted and how they are impacted....................................2
Where are there examples of business that act responsibly and ones that do not.......................3
Recommendation for what company should do..........................................................................4
Ethical business theories and it application................................................................................4
PART B............................................................................................................................................6
Ethical leaders and conditions that brings about unethical organisations and practices.............6
CONCLUSION................................................................................................................................8
REFERENCES................................................................................................................................9

INTRODUCTION
It is very important for the business to have ethical practices in order to overcome the
negative impact on the organisation(Crane and et.al., 2019). Present study is based on the
organisation that is EA games that is an America video game company. Report will include
different ethical issues faced by the company and different theories that can help in overcoming
these issues. Report will also include the impact of ethical manager on higher ethical standard of
business.
PART 1
Company should have to look at this issue from an ethical perspective of ethics
It is important for EA games to look at this issue of loot boxes in an effective manner as
these issues may affect the reputation of the organisation and may not bring sustainability in the
business environment(Kim and Werbach, 2016). Loot boxes are generally items in video games
that contain randomised contents and these items can be purchased by the player with the help of
real world money. It is better for an EA games to regulate the gambling related to loot boxes as it
is increasing over the years. These loot boxes are acting as a gateway to different problems as
people have started spending more on these loot boxes as have trust on the organisations. There
is good reason for the organisation to have its focus on regulating loot boxes. These loot boxes
are also not having good impact on the society. Organisation is having high profitability from
these loot boxes but the players who are purchasing these loot boxes are not having any idea,
what they actually will receive in return. If organisation will start following the business ethics it
usually results in increase in productivity and it also boosts up the morale of working employees.
For better decisions and bringing honesty and integrity in the EA games, it is important for the
organisation to look out its business with ethical perspective and work on transparency of these
loot boxes.
The way this issue influence public image of the company
The issues related to Loot boxes influence public image of the company and may also
affect the productivity of the EA games. The customers that use these games on daily bases have
trust on the company, although they are not clear what weapon case's contents are as they pay to
unlock the same. There may be some rare or may be valuable items that players get as they pay
to unlock the content. If they get rare items, they may have thought that company is cheating on
them and they may not use these games again. However, there are many rewards that players get
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and it results in an effective image of the organisation(Gunawan, 2015). It is therefore very
important for EA games to work ethically and provide customers what they actually require from
these video games. Many times, a weapon case may be ugly for the players that gives a negative
image of games and customers may not look back or take risk to play the game again. Players are
risking there money for having a valuable reward and chance and if they do not get satisfied they
may have bad perception of organisation in their mind. By sharing their experience to other
friends and family, Public image of company may get affected.
Alternatives ways to think about business role in society
The business of gaming do not lead to any sort of gambling if EA games are working
ethically with respect to the loot boxes. However, In order to have an effective role of business in
society, it is very important to either replace these loot boxes with some other alternatives or
have some ethical consideration with these loot boxes. The alternative ways of these loot boxes
for the business in order have effective role in society is as following:-
 Ads:- Giving advertisements between the games in not a new thing for people and video
ads have been a well established part of mobile gaming as it pops out between for giving
various ads with the help of business earn revenue(Wesley and Barczak, 2016). It is an
easy alternative for these loot boxes and also an effective ethical mobile developer where
people are allow playing the respective games without ads by paying for ad-free versions.
 Paying extra for a game:- If EA games want to have there respective business ethically
by having an effective role in society, the best alternative for loot boxes is to make the
customers pay extra money for the games. Raising the price of games is ethical and it can
be possible by adding some extra features or models that can attract the respective
players.
 Subscription based progression:- Most valuable alternative among all the respective
game strategy is to offer subscription based progression to the customers so that it can
play an effective role in society and also can help in increasing the profitability of EA
games. Here, players have to pay either on daily or weekly or monthly bases in order to
have accelerated progression(Gros, 2017).
Who are the stakeholders that are impacted and how they are impacted
There are different stakeholders that are involved and impacted by the use of loot boxes
in gaming in both positive and negative ways:-
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 Customers:- Video game industry is all set up due to its customers that is the players
who play there games and show interest with respect to purchase of these loot boxes.
These stakeholders play an important role for the profitability of video game industry.
However, These stakeholders get affected by these loot boxes due to lack of transparency
with respect to the information related to these loot boxes. People loose there money in
huge amount which they can invest for better purposes(Kim And et.al., 2017).
 Investors:- There are many investors who invest for this business in huge amount in
order to earn huge revenues. This industry is having huge scope for them as it is having
vast scope in market. However, it impacts these stakeholders if EA games is not working
ethically. Due to lack of transparency in these loot boxes leads to different gambling and
may stop the users to use it further. Due to these unethical practices, investors may bear
different losses.
 Government:- Government is also investing or helping this industry as this industry is
the biggest entertainment industry which is in need to be supported. Not only this,
government is also involved to protect the people as well as small children who are
getting involved with respect to these loot boxes. They work to have transparency and
ethical consideration of companies so that players and investors are not affected
negatively(Lee, Kim and Kim, 2018).
Where are there examples of business that act responsibly and ones that do not
There are different examples that clearly indicates that business act responsibly and are as
following:-
 EA games is getting a huge revenues out of these loot boxes in video games and that
leads to huge profitability of the business.
 These loot boxes are creating new content and cosmetics for the players in form of a
reward system that attract huge numbers of players.
There are some bad choices that negatively impacts EA games and are as following:-
 There are digital grab bags for which players have to spend real or in-game currency.
 The players are not aware, what is actually inside these loot boxes.
 There is no transparency in these games and its related ads.
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Recommendation for what company should do
EA games is earning a huge revenue out of these games and loot boxes. However,
company have to work effectively in order to bring ethical practices in the business. It is very
important to have transparency in these video games as it leads to development of trust of
different stakeholders as well as players. There are many countries that are banning these loot
boxes in order save the children and also different players to get out these gambling and get their
money protected(Becker And et.al., 2016).
Ethical business theories and it application
There are different ethical business theories that can be applied with respect to the case of
the impact of loot boxes on society as well as organisation. The implementation of these theories
is as following:-
Utilitarianism theory:-
It is a normative ethical theory having its focus over the right and wrong with respect to
different consequences in choosing a action over other action. Basically, this ethical theory is
having its major focus over others interest instead of own interest. According to this theory, EA
games have to focus on the right and wrong on the respective consequences of its actions with
respect to implementation of loot boxes in the video games(Fryer, 2016). Organisation have to
firstly recognise the fundamental role of the loot boxes in the games that is whether it is positive
or negative. After that, approve the respective actions by understanding its consequences.
Organisation then have to equate the good and bad of these consequences and finally, measure
the same in order to have changes. EA games, in order to have ethical practices in the business,
have to think effectively while implementing different loot boxes so that any negative impact is
not seen on the business. This theory generally use an objective process in order to decide
whether the actions taken by the organisation is going in right or wrong direction. EA games
have to use this theory in order to keep balance of good over harms with respect to these loot
boxes in there respective game offerings. It is very important for the organisation to have logical
approach with respect to decision that they take for loot boxes so that they can make their
respective customers loyal with different ethical practices.
Deontological theory:-
The another ethical theory that is Deontological theory, helps in brining morality of an
action by having a clear understanding that these actions are right and wrong with respect to set
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rules and consequences of the actions are not focused here. This theory is generally termed as
formalistic as it is having its central principle on actions that are taken into consideration with
respect to different laws(Thorpe and Roper, 2019). Following this theory help EA games to
create higher level of personal responsibility in order to follow the respective legislations that are
set by government to avoid gambling due to these loot boxes in video games of EA games. These
ethics helps the organisations to look at the situation from a different direction and take an
appropriate action for following ethical practices in the organisation. In order to sale these loot
boxes to different children of respective age group, it is very important for EA games to look
upon the respective actions that they can take in accordance with the set rules and regulations by
the government. The Gambling commission have issued the statement that sale of loot boxes in
most of the video games is not having any way to monetize and that is the reason it is becoming
part of gambling. It is therefore important for EA games to take actions with respect to these loot
boxes in order to make them transparent so that they are ethical in eyes of government and also
audience. Having such ethical consideration in business helps the organisation to grow in right
direction and make an effective impression in eyes of the customers as it results in loyal
customers with respective to their offerings. By applying this theory in the business environment
helps in promoting the organisations interests and this theory helps the organisation to have
understanding with respect to actual behaviour of customers and also organisation. This theory
helps the business to have clear understanding about the actual needs of their business and the
customers.
This theory is helpful to avoid the various possible conflicts. If organisation is interested
to work effectively for brining huge profit for their firm, they can use this theory and can work
effectively without having any pressure with respect to the consequences of these actions. Here
organisation have to be well prepared with the consequence so that there is no negative impact of
these actions on their business environment. However, organisation have to work effectively by
making better decision and have to take actions that can lead to business profitability by having
all the ethical considerations in mind(Klemm and Pieters, 2017). This helps EA games to
overcome the respective conflicts that may arise while implementing loot boxes in there video
games and taking ethical practices into consideration in order to run the business smoothly. It is
not unethical to implement loot boxes in EA games unless these products create trouble for the
respective customers. Transparency have to be there with respect to advertisements and also
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offerings that these loot boxes are providing to the players. The reason is that, there are many ads
that do not clearly convey to the players what they are offering in the games. It creates bad
impression of the organisation and may also leads to gambling in eyes of the government.
PART B
Ethical leaders and conditions that brings about unethical organisations and practices
An Ethical leader is one having following key traits:-
 Have two way conversations:- It is very important to have two way communication in
the organisation in order to make the people engage in the organisation for sharing their
ideas that can lead to effective working environment in the organisation. As a manager of
EA games, it is very important that I never take any action for the organisational benefits
without getting input. It is very important for me as a manager of this organisation to
have quality relationship with the employees and customers as it leads to trust, fairness,
integrity and openness in the organisation(Eller, Gerber and Robinson, 2018).
 Leading by example:- For being an ethical leader in the organisation, it is very
important for me to have such actions in the organisation that speak louder than words. I
have to follow best practices in the organisation and have to demonstrate the use to the
respective ethical practices and honestly in the organisation to all the subordinates. This
not only brings effective working culture, but also leads to respect for the leaders and
creates integrity in the business.
 Champion the importance of ethics:- It is also very important for me to have focus on
overall importance of ethics and work of different ethical issues that EA games is facing.
I also need to consider the way these factors are influencing the society as a whole and
teach the respective peers about these ethics.
There are different ways to set high ethical standard in the organisation and are as following:-
 As a manager I have to be a role model for them as employees follow the top managers.
 It is also very important for the organisation to communicate ethical expectations so that
employees and work accordingly.
 In order to set high ethical standards for the organisation, it is very important for me to
give effective training to my respective employees with respect to ethical practices.
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Personal ethics is basically the ethics that a person identifies with respect to the situation
and then deal with it and following are reasons of the unethical practices in the organisation:-
 No codes of Ethics:- Many times the employees are not actually aware about the facts
that what is right and what is not right. There is a requirement that organisation use
proactive approach in order to address the unethical behaviour. This not only establish
organisational values, but also set respective boundaries in order to adhere those values.
 Fear of Reprisal:- Many times there is situation in the organisation that one witness the
unethical practices going in the firm but they do not complaint for the same. The reason
is that these employees are having fear that they may lose there job or will result in any
sort of damage to their career. It is therefore important for me as a manager to make my
employees fearless and give them confidence to share view points if they feel some
things is goings unethical in the organisation.
 Impact of peer influence:- As new employees join the organisation they do not have
idea who is right and who is guiding them wrongly. They listen to there subordinates and
set a perception accordingly. They follow the subordinates and become part of the
unethical practices going in the organisation. It is responsibility of Manager to train the
new employees and provide them work culture where they can work effectively without
following ant unethical practices. In this way, employees can share ideas about the
different ways to set ethical practices in business in order to have transparency that attract
most of the customers towards the offerings.
 Not Talking about harm done by unethical practices:- It is very important for the
reputation of the organisation to have ethical practices in the business. Some time
unethical practices ruin the reputation of the organisation in such a way that it can not be
repaired out. As a manager of the organisation it is very important part for me, it talk to
the employees and other department leaders to think effectively and implement the
ethical practices that can lead to an effective image of organisation in eyes of the
audience. This helps the business to set an effective reputation where all the players that
are using these video games have trust and they are loyal towards the offering that EA
games is offering to them. The major goal of the organisation must be to ensure that
transparency is there in the business and people are working effectively by taking ethical
consideration at serious note.
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CONCLUSION
From the above study it is been concluded that EA games have to look at ethical issues
from an ethical perspective. Report also concluded that these issues influence public image of the
company and there are different alternatives of these loot boxes for the business in order have
effective role in society. Report further concluded that there are different stakeholders that are
involved and impacted by the use of loot boxes in gaming in both positive and negative ways.
Further report concludes that company have to work effectively in order to bring ethical practices
in the business and there are different ethical business theories that can be applied for having
positive impact of loot boxes on society as well as organisation. Report at last concludes that an
ethical leader or manager can help the business to bring ethical practices in the organisation.
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REFERENCES
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the age of globalization. Oxford University Press.
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motivation. Social Responsibility Journal. 11(3). pp.535-552.
Kim, J.S. And et.al., 2017. The impact of four CSR dimensions on a gaming company’s image
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Kim, T.W. and Werbach, K., 2016. More than just a game: ethical issues in gamification. Ethics
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Thorpe, A.S. and Roper, S., 2019. The ethics of gamification in a marketing context. Journal of
business ethics. 155(2). pp.597-609.
Wesley, D. and Barczak, G., 2016. Innovation and marketing in the video game industry:
avoiding the performance trap. Routledge.
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