CRITICAL THINKING EXERCISE 4-1
Ethical Dilemmas
Below are several situations that present ethical questions in a business. Discuss each
situation: (a) from the strictly legal viewpoint, (b) from a moral and ethical viewpoint, and (c)
from the point of view of what is best in the long run for the company. Be sure to consider both
short- and long-range consequences. Also look at each situation from the perspective of all
groups concerned: customers, stockholders, employees, government, and community.
1.
A disgruntled employee of your major competitor mails top-secret information or new
product samples to you. Do you begin to do a dance on your desktop or do you
immediately mail the information back to your competitor? What would you do?
a.
Throw the plans or secrets away.
b.
Send them to your research department for analysis.
c.
Notify your competitor about what is going on.
d.
Call the FBI.
2.
You are the general manager of a regional chemical company. In the course of producing
your bulk chemicals, large amounts of particles and smoke are emitted through your
plant’s smokestack. The level of pollutants is below current EPA regulations, and you are
violating no laws, but neighborhood groups are complaining about minor health problems
caused by the smoke. After investigating numerous alternatives, you find the most
effective solution would be to install a “scrubber” system, which will remove 90% of the
pollutants and ash. Cost: $1 million. Do you install the system?
3.
You are a general manager in a cosmetics firm. The results of a study show that your
major brand could cause skin cancer. What do you do?
4.
You have the opportunity to offer a job to a friend who really needs it. Although you
believe that the friend could perform adequately, there are more qualified applicants.
What would you do?
5.
You are the vice president of a beer company in a state which sets the legal drinking age
at twenty-one. Your boss asks you to organize a lobbying effort to have the drinking age
reduced to eighteen. What would you do?
6.
Because of a loophole in federal laws you find that you could legally pay your workers
less than the minimum wage. The cost savings you recommend may mean your getting a
choice promotion. What would you do?
7.
You are an accountant in a large firm. Your boss tells you to use a controversial
accounting practice, which will make the company’s profits seem higher. She tells you it
is only to impress stockholders and will not be used in statements submitted to the IRS.
What would you do?
CRITICAL THINKING EXERCISE 4-1 (continued)
8.
You are required to fire a worker for persistent absenteeism, but you know that her
absence is because she is caring for her father who is in the advanced stage of
Alzheimer’s disease. You feel that the organization is being inhumane in its attitude, but
your boss remains insistent. What would you do?
9.
A worker is repeatedly late for work. You know she has family problems and is going
through a difficult period with an alcoholic husband. Her work is inconsistent—
sometimes average, often excellent. She has been with the company for nine years. On
Monday she was two hours late for work. What would you do?
10.
You believe that your (male) boss is overly friendly with a (female) member of your staff
and that she is taking advantage of the situation. What would you do?
NOTES FOR CRITICAL THINKING EXERCISE 4-1
Each of these situations may have several possible solutions. The best solution from the
company’s point of view may be quite different from one’s own philosophical point of view.
Below are some discussion points.
1.
This actual situation is at the heart of a dispute between rivals 3M Corporation and
Johnson & Johnson. It seems a 3M employee named Philip Stegora mailed samples he
stole of a new casting tape to J&J and three other competitors. He offered to meet and
explain the technology for a fee of $20,000.
Here’s what happened in the 3M and J&J case: None of the contacted companies reported
his scheme to 3M. Instead, an outside source contacted 3M, who then turned the case
over to the FBI. The case could have ended there, but in patent-infringement proceedings,
3M found that J&J had done chemical tests on the sample Stegora had sent. 3M sued and
was awarded $116.3 million from J&J for infringing on its patent and misappropriating
trade secrets. Sounds like someone should have sent the tape back to J&J in the first
place.
2.
In considering whether to install the scrubber, both the short and long-term consequences
should be addressed. While the level of pollution is legal today, is it likely to be regulated
tomorrow? What would be the public relations impact for the company if it installed the
system? If it did not? Should the company publicize the scrubber installation or avoid
discussing pollution at all?
3.
The key word in this question is “could.” The evidence is inconclusive. How would the
company be affected if the product were pulled prematurely? How would it be affected if
the product causes dozens of cancers and results in huge lawsuits?
4.
This is a grey area. Hiring a friend may smack of favoritism. However, with a friend you
already know about his or her background, reputation, experience, and work ethic. The
friend may be the best one for the job if you value his or her abilities. The downside is
that you may have to fire your friend, losing an employee and a friendship.
5.
Eighteen to 21-year-olds represent a huge market for liquor. But, again, the public
reaction should be considered.
6.
Many smaller companies are exempt from minimum wage laws but still pay the
prevailing wage. The supply and demand for workers is a more important price factor. A
company that pays less than minimum wage will not be able to attract as many qualified
workers as one that does.
7.
This is the only black and white dilemma. To use dual accounting practices to deceive
investors is illegal.
8.
This is a direct order from your superior. You might take a meeting with the supervisor to
explain the extenuating circumstances, but if there’s no change in his or her position, you
will have to fire the employee or be ready to leave your job.
9.
This worker is going through a difficult time. Her work is, however, “often excellent.”
The costs of training a replacement worker must be weighed against her possibly
temporary reduction in productivity.
10.
Your boss is guilty of sexual harassment. The female member of your staff may be taking
advantage of it, but that does not change the reality. The boss’s actions may open your
company up to a sexual harassment suit. Fighting it will be costly and generate bad
publicity. The boss needs to be warned, although you might not be the one to do it. If you
have a mentor in the firm or a sympathetic friend in upper management, you might
approach them, confidentially, about the situation. If you decide to talk to the boss
yourself, how would you handle the encounter? What could your first sentence possibly
be?