Question

Provide an example of an ethical situation faced by a business and discuss your recommendations for the best way for the business to handle the situation.

Answer 1

An ethical condition for a business would be for example tht of a major shoe manufacturing and retail company to find out that its shoes are being manufactured in low income countries in conditions which are very bad for the workers and the workers are being paid very poor wage to keep the costs low. although keeping costs low helps the company to achieve better profits but it is unethical in the sense that it exploits human beings and pays them below the wage commensurate with their labour.

In such a condition, the ethical response would be to shift the manufacturing to a more ethical and trust worthy supplier or put in place stringent supplier audits to ensure that the existing supplier significantly upgrades the workplace conditions and the wage system. Also, the company can communicate this to its customers and ask for a price hike to compensate the supplier and provide better working conditions at its manufacturing locations.

Thus the key would be to immediately rectify the situation and communicate transparently to the consumer and then take necessary commercial measures to preserve profitability and reputation.