Business Ethics and the Volkswagen Diesel Deception Case Study

This report examines the Volkswagen diesel deception scandal through the lens of business ethics. It begins by defining business ethics and exploring various theoretical approaches, including teleological and deontological ethics, and comparing absolute and relative ethical frameworks. The report then delves into the ethical issues that affected Volkswagen's operational activities, such as misleading customers, using technology to deceive, and neglecting environmental concerns. Furthermore, it analyzes how ethical considerations impact business objectives and the implications of operating ethically for a business and its stakeholders, including customers, shareholders, and employees. The analysis covers the importance of ethical codes, stakeholder engagement, and the benefits of ethical practices for business success and sustainability. The report concludes by highlighting the importance of ethical decision-making in the business environment.

Business Ethics

INTRODUCTION
Business ethics might be characterized as type of applied or professional morals that
analyses ethical standards as well as morale issues which emerge in a business environment. It
applies to all parts of business conduct and is applicable to lead people and whole associations.
These ethics begin from individuals, authoritative explanations or from lawful system."The
Volkswagen diesel deception" case has been explained in this assignment. In this examination
readers will able to determine all hypotheses which will assist them in creating different
theoretical methodologies that are being made with end goal of breaking down various parts of
development and advancement (De George, 2011). Alongside it, various approaches of absolute
as well as relative nature are being mentioned together. At last through its end perusers will able
to distinguish each and every moral problems which are helpful for producing code of conduct
which are appropriate for success as well as growth of association.
LO 1
1.1 Background and development of theoretical ethical approaches.
Idea of Business morals is not much unique for people of entire world, as they are using it
from very long time. There are various researcher, who provided theories related to moral and
which can influence business, persons, society as well as surroundings. Generally, every
approach has their own pros and cons and covered these points:
 People's rights and their responsibilities.
 It is essential to take moral decision while evaluating their affects.
 Follow values properly, so that people can live their life in good way.
 It is necessary to understand each and everything in a right way (Fassin, Van Rossem,
and Buelens, 2011).
Morals can concerned with different elements, which can affect people's decision making
capabilities. Thus, it is necessary for them to recognised everything and use things correctly, so
that they can take right decision. There are some theories which can used by organisation are
mentioned as below:
Teleological ethics: This methodology was given by Aristotle. It is a hypothesis which is
worried about keeping all activities at standard with ethical esteems that acquire more bliss and
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improves final outcome. It is a consequentialist moral hypothesis which is associated to absolute
nature. Three sorts of teleological moral speculations, which are mentioned as below:
 Ethical egoism: This is a methodology which expresses that, an activity is thought to be
great in event that it develops constructive as well as better outcome, for example,
expanding an individual self enthusiasm according to his goals, regardless of possibility
that it impacts others (Audi, 2012).
 Utilitarianism: This theory was proposed by John Stewart Mills. It expresses that an
exercise is thought to be great if it can fulfil enormous public who will get affected by
action.
 Eudalmonism: It is an approach which expresses that an activity is great in event that it
can satisfy all objectives while additionally increasing happiness of people.
These methodologies were developed after some time and in this way considered as
significant for all with exception of utilitarianism methodologies which is of relative nature and
along with this consequentialist.
Deontology theory: It was given by Emanuel Kant, he was a social researcher. It describes a
position which is generally associated with responsibilities as well as duty. It is based on various
rules and likewise judge action with ethical values (Bageac, Furrer and Reynaud, 2011). It is
totally distinctive from teleological hupothesis because it focus on action's morality and
inappropriateness but not consequences.
These all hypotheses is used for making ethical code in business today. In which, some of
theories are used in only specific conditions but mostly applied to all.
1.2 Compare and contrast Absolute and relative ethics.
Ethical theories are absolute in nature but there are some which is specific:
Theory Absolute or Relative
(Subjective)
Examination of
theories
Contrast of these
theories
Teleological ethical
theory
It signifies 'applies to
everybody', at that
point on off chance
that you make a flat
It is hypothesis
which is applicable
for each as well as it
is centered around
This approach is
generally based on
consequences.
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out run it would need
to apply to everyone
(Rutherford and et.
al., 2012).
final products and not
activities rightness or
misleading quality.
Deontological or
Duty
Absolute This method control
teleological morality,
as it is centered
around morality and
along with this
unsoundness of
action itself and not
the final result.
This is a hypothesis
which depends on
activity itself and moral
esteems took after while
taking these choice.
Utilitarian theory Relative - Relativist
and personal:
Bentham and Mill’s
Utilitarianism
This is a concept
which explicit that
any act that acquire
more outstanding
level of satisfaction
for any person is
great (Giacalone and
Promislo, 2013).
It considers welfare for
bigger segment of social
group.
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Ethical Egoism Relative hypothesis It is centered around
own intrigue while
likewise promotes
different great here
and there.
Then again it states self
intrigue while
conformity others
advantages up just in a
few conditions.
These methodologies are go about as a reason for different situational decision making
today. They get an institutionalize yield and assist administrators in taking right choice which is
advantageous for business, workers, clients as well as surroundings. Volkswagen use Deontology
theory in their business, because it is action based (Bardy, Drew and Kennedy, 2012).
1.3 Ethical issues which can affect operational activities of business.
Moral problems in transactional exercises – from ancient records of organisation it can be
broke down that it has conferred different activities which made moral issues for general public.
Along with this, its image got affected in spite of fact that administrations given by business
substance were exceptionally viable. A portion of problems are talked about underneath in detail
which assist in getting a reasonable thought regarding how Volkswagen is included in making
morally non adequate actions:
Lied to customers: It was consumed that firm failed in accomplishing what it really guaranteed
to its buyers. Merchandise given to clients neglected to fulfil them, as it doesn't coordinate with
guidelines which were ensured by company (Calabretta, Durisin and Ogliengo, 2011). This
expanded disappointment among customers and built up quantity of grievances.
Use technology to deceive people: keeping in mind the end goal to build aggregate sales,
organisation embraced system of dishonest purchasers by furnishing them with untrue
informations. Clients were confounded and got pulled in to incorrect communication and took
their purchasing choice.
Lack of concern for surrounding: Other moral trouble in which a similar association is
included in is that it doesn't deal with environment. Transactions of Volkswagen developed harm
to regular environment, which is a noteworthy concern. It influenced goodwill of firm.
Several other problems are:
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 In the event that the organization is following such a valuing procedure, to the point that
endeavours its clients by giving underweight items charging higher value then the
organization would free the trust of its clients and this would influence antagonistically
the operational exercises of the company.
 If organization utilizes negative limited time procedures that transmits a negative
message which could influence the soundness of clients or impacts the attitude of kids
particularly , then such special systems could negatively affect the operational exercises
of the organization and along these lines influencing the overall revenue also its picture in
the general public.
 If firm makes utilization of fixings that are damaging to the soundness of open, at that
point the cost done after generation and dissemination exercises would come about
nothing. Customers are exceedingly mindful of the economic situations so they can't be
duped or fooled.
 In addition enterprise needs to deliver an extensive variety of items for its clients
contemplating the distinctive age bunches so they are furnished with enough space to
pick the item from those of the organization said. This would guarantee that the client
would not change over to the next organization's items and consequently the operational
exercises would deal with easily. On the off chance that the organization does not
consider this part, at that point it would to a great extent influence each of the operational
action.
LO 2
2.1 Business objectives are affected by ethical considerations.
Moral contemplations can be tended to at individual as well as social group levels. How
people are being influenced by direct of others merits ethical considerations. These are standards
and guidelines by which organisation works and as indicated by references of business (Hunton,
Hoitash and Thibodeau, 2011). They are best exhibited through demonstration of fairness,
compassion as well as obligation. Key for entrepreneurs and officials is guaranteeing that all
workers must attempt these morals. One of most ideal approach to convey morals is to produce
preparation programmes which will help staff members in rendering training which is essential
for association as they want to develop their standards.
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To become most successful auto mobile manufacturer Volkswagen sues administration
morals. This is on account of in this moral perspective labours may affect team spirit as well as
trueness of employees. The pioneers utilize moral codes to identify discipline systems and
worthy conduct of employees inside an association. At the point when leaders have high ethical
benchmarks then it urges staff members to work more adequately and proficiently so that, they
can become more successful in creating such sorts of items and administrations which are gainful
for substantial number of buyers (Ciulla, 2011).
Fascination is a critical advantage of an enterprise that encourages them in creating positive and
sound corporate morals which are useful in enhancing spirit as well as ethics of people.
Accordingly, it aids in giving profitability and budgetary administrations which are beneficial for
increasing proficiency of an individual workers who are working there. Alongside it certain
different angles should be broke down like increment in labour retention. This will help in
diminishing expense of labours substitution.
Sustainable auto mobile manufacturing unit assists in creating powerful deals and developing
business goods, that endeavours to fulfil necessities of people. In any case, it is tom be done in
an appropriate way with end goal that characteristic assets and condition helpful for future era
ought to be kept up. As indicated by Volkswagen it is useful for its employees to create such sort
of products and administrations which will aid new clients to get pulled in by quality, cost as
well as elements of auto mobile which will improve its development and advancement of
marketing condition gainful for buyers and employees from business venture (Ford and
Richardson, 2013).
There are some other business objectives, which are mentioned as beneath:
 It assists to improve goodwill of company at marketplace.
 Company can decrease their labour turnover ratio.
 They can easily attract numerous investors towards them.
 Manager of organisation can enhance their sales and productivity. Along with this, it
assist them to take advantages from their rivals at commercial centre.
2.2 Implications for a business and its stakeholders to operate ethically.
There are many people who can affect business of Volkswagen, either directly or
indirectly. These are mentioned as below:
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Customers: For survival of an organisation, there is a need of clients. They are always as a
priority for company. Manager of firm has to determine their demands, thus, they can
accomplish it timely. They are an essential stakeholder because they spend their money on
enterprise's products and services. If they have lots of buyers, then they can compete their
competitors in marketplace as well as enhance their revenues.
Shareholder: They are an important element for every form of association. It may comprises an
individual, organisation, group and so on. They are those people who purchase shares of
company as well as firm issue share certificate to them. Along with this, they assist firm to
expand their business and products (Ma and et. al., 2012). Additionally, they can increase their
profits and take advantages from their competitors.
Employees: It is essential for manager of enterprise to provide good working environment to
their workers. Thus, they can retain in business as well as do their work more effectively and
efficiently. Along with this, they always want job security from their employers. It is necessary
for them to do their work ethically. It is main duty of management, treat equally their labours,
there must be no discrimination among them. Additionally, every staff member has a right to get
minimum wages from their employer, thus, they can fulfil their basic requirements.
Government: They are an important stakeholder of company and make certain policies which
every organisation has to follow. If Volkswagen is doing their activities very well, then they will
help nation to enhance employment in country. But if firm is doing any unethical practices, then
it may affect regulatory body in a negative manner. There is a reason behind it, that government
is responsible for their nation's association. Along with this, if Volkswagen doing any wrong
work then it may affect their goodwill.
Competitors: Main rival of Volkswagen in marketplace is Toyota. Similarities among them, is
they both develop small cars for their buyers (Wright and Bennett, 2011). Basically, Volkswagen
focus on china market but Toyota are most customer oriented as well as maintain quality of their
products and services.
LO 3
3.1 The role of Toyota acting as a moral agent
Toyota is an organization which has kept up high state of moral esteems and treating its
workers and other bondholders at standard with principles. It is an impeccable ethical operator
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who is capable for taking choice while recognizing what is good and bad. The directors in firm
can take more judgements which depend on idea of right as well as wrong. Toyota takes after
approaches which provide high regard to human rights and has possessed capacity to set an
appropriate condition in provider's industrial plants.
It has embraced different approaches and procedures which go about as a premise in
making a situation where moral esteems are followed at every single stride. Toyota has been at
the bleeding edge when it came to show as marketplace pioneer in keeping up nature as well as
morals while efficiency dependably stayed high (Ferrero and Sison, 2014). They have created
and set up framework, for example, six sigma and lean generation which aid them in following
every single environmental law and different ethics while boosting its transactional capacities. It
is considered as a good example for all other car producer in nation. There are various way
which will assist in understanding advantages and disadvantages:
Toyota Pros Cons
Deal with suppliers Organization can keep up its
relations with provider and
acquire subjective items.
A few providers utilize moral
concerns as a shortcoming and
adventure it by charging
advanced costs.
Public picture General population considers
Toyota to be a trade name
which presents quality as
well as morals.
Enterprise needs to guarantee
merchandise and administration
which are ethical and enhances
cost (Belak and Milfelner,
2011).
Treating employees right
way
It assists to provide
motivation and additionally
boost work performance of
staff members.
It is costly as well as more time
consuming.
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3.2 Development of mechanism for achieving employee involvement and empowerment.
There are various plans which is utilized by Toyota, so that they can increase interest of
employees as well as their performance. Employers of organisation very well understand about
staff member's value. Along with this, they know that if they want to gain their commitment,
they have to give them incentives and motivation, thus, they can improve their skills and
knowledge. Additionally, they can modify their mental structure. There are various
methodologies, which are used by Toyota, are mentioned as below:
Job expansion: It is like a horizontal enlargement and manager of firm can easily add new task
to job (De George, 2011). As result to, they can make work more challenging. With help of this,
workers can learn more as well as perform their duty in an effective manner.
Training and development: Employer of Toyota can arrange training programmes for their
employees, it will aid them to increase their skills and abilities. Along with this, they do their
work more appropriately and their involvement level also enhance.
Information flow: It is essential for leader to provide essential data and information to their
labours, thus, they can do their work timely. Additionally, manager will take decision more
appropriately.
Team building and working: It is top most strategy which is used by employer. If workers of
firm do their work in groups then they can accomplish their work effectively as well as
efficiently. Because, if people do their work in teams then they can perform their task more
adequately.
Equal opportunities and rewards: Management of Toyota ensures that, in organisation every
people have equal chances or not. Employees get reward according to their performance as well
as skills (Fassin, Van Rossem, and Buelens, 2011).
LO 4
4.1 A current ethical issues affecting Toyota.
There are various moral problems which can affect Toyota as well as their transactional
susceptibility, are discussed as below:
Globalisation: There are some issues which is related with manufacturing facilities of an
association and located in various parts of nation. There are lots of competition in it, it may be
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