Ethics and Corporate Responsibility 

Subject: Law
Type: Problem Solution Essay
Pages: 6
Word count: 1631
Topics: Human Rights, Business Ethics, Ethics, Job, Management, Work Ethic

There are various definitions for the term “stakeholders”. These are individuals, organizations or bodies that are likely to be affected or otherwise have an effect on the company’s performance (Jones, et al 2007).  Another way to define a stakeholder is by establishing who is a stakeholder through analyzing their characteristics. Stakeholders are characterized by their position to gain or lose in the success or failure of the company. If an individual is likely to gain if the company succeeds or suffer loss, then they can be termed as stakeholders (Roloff, 2008). Another characteristic is that they provide capital for a company’s project. Individuals may provide funding for the company with an aim to acquire interest in the company. In addition, they may have invested resources in the company which therefore characterizes them as stakeholders. 

Stakeholders can directly or indirectly take part in the running of the company or the works involved. These may include the employees and the directors in the company. In other words, they provide human resource for the company. Stakeholders are also characterized in reference to the company’s productions. Individuals become stakeholders if they are affected by the company’s outputs which may be either positively or negatively depending on the outcome of the company. Another trait is that they form part of the accountability chain. Individuals who are accountable to the activities and outcomes of a company may be referred to as stakeholders. Stakeholders can be categorized into primary stakeholders (this include the beneficiaries), secondary stakeholders (those that are responsible for the beneficiaries and those whose lives are affected by the company’s performance) or key stakeholders (the government, those capable of influencing others and those who have an interest in the productiveness of the company) (Roloff, 2008). For purposes of PharmaCare, the stakeholders include the shareholders and owners, the managing board, the company employees the consumers of their products, the healers, the general community, human rights activists and the government of both Colberia and America.

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The Human Rights Issues

Several human rights issues are presented in this scenario. A contrast is displayed between the treatment of the indigenous population and that of the company’s executives. The indigenous people of Colberia are deprived of their social and economic rights. The services offered by the people of Colberia do not commensurate the remuneration given to them by the company. They are required to travel long distances in an effort to harvest plants for the company. They are paid only one dollar per day whereas they walk long distances carrying heavy baskets weighing up to 50 pounds. Several statutory provisions and international laws provide for social, economic and political rights to humans. Some of these rights are absolute and undivided to every human being. For instance, the people of Colberia have a right to equal pay for equal services offered. However, they have been deprived of these rights as they offer so much work for less pay. Several other rights have also been deprived, for instance, the right to a safe and healthy environment. The company’s extensive involvement in the nation has resulted to a degraded habitat and this has endangered the very existence of the native people. The company executives on the other hand are subjected to a life of luxury, which to some extent is at the cost of the indigenous people. 

Recommended changes 

The company’s performance is crucial to its stakeholders. However, it also has a duty to the residents of the native state. The company enjoys a caring, well-run and ethical reputation and manufacture high quality goods with an aim to save millions and improve the quality of millions of other individuals. In addition to that, it further provides discounted and free products to consumers with low income, provides a program sponsoring healthcare learning programs and scholarships. Nonetheless, the consequences of the company seem to cause more harm to the indigenous people than the benefits it gives to them. There are however several ways through which the company may change to make it more ethical going forward.

One change is by offering the indigenous people of colberia better payments and working conditions. This is done by increasing their payment to the people as per the services rendered. For instance, the company may result to payment of harvested plants as per the weight of the plants given rather than carrying heavy bags for long distances for little remuneration. The company may further provide transportation to the harvesters who walk long distances to harvest the raw materials. This protects the rights of the workers, which are well provided for by many legal instruments. By virtue of this resolution, the company becomes more ethical going forward. 

Another change is through observing and securing the habitat of the indigenous population in Colberia rather than destroying it. The activities conducted by the company should be friendly to their habitat thus protecting the existence of the native species. The company may also result to the improvement of the lives of the natives through community projects to provide electricity and water to the natives (Jones, et al 2007). It may do so by reducing their extensive activities conducted. The company may also adhere to the environmental laws and regulations that it once defeated for the benefit of the environment and the existence of the native species in its manufacturing facility. 

The company recently launched its new initiative, “we CARE about YOUR world” where it highlighted its obligation towards the environmental care via proposed activities such as changing their packaging, recycling and other green creativities. These initiatives prove to be in the support of the environment and the habitat of the people. This not only benefits the company but the people as well for instance, recycling and changes in packages may cut costs to the company expenditure and also promote a clean healthy environment to the native population. 

On the other hand, the company’s extensive activities have brought forward negative consequences to the environment and threatened the existence of the natives. In addition, the company has successfully defeated the laws and regulations governing the environment. Therefore, the company is seen to cause more harm than healing to the environment and the domestic populations (Valentine & Fleischman, 2008). Regardless of the benefits it seeks to provide, the harm done is more and thus making it hard for sustainability of the environment and the lives of the natives. The company should re-evaluate its activities to safeguard the habitat of the native population.

Ethical theories in relation to the company’s activities

Utilitarianism is an ethical theory, which like any other form of consequentialism establishes whether actions done by the company are either morally right or morally wrong depending on their effects (Valentine & Fleischman, 2008). The effects of actions that are significant are the positive or negative outcomes that they create. The ideology argues that the function of morality is to improve the quality of life by increasing positive things and decreasing negative things. Therefore, in this scenario, the theory weighs the positive and negative effects to define good ethics in a company. This ideology would define the actions of the company to be un-ethical. Virtue Ethics on the other hand emphasizes on individuals personality or character as a key principle of ethical reasoning instead of the rules and regulations about the acts or their expected consequences. On this note, the company displays a moral and ethical character but ignores the actions and consequences of its activities. Hence, according to the Virtual Ethics theory, the company may be said to be ethical (Jones, et al 2007). 

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Ethical of care theory assume that circumstances can occasionally override justice and the general code of conduct. It emphasizes on human interconnections and puts a moral importance on human relationships as care receivers and givers (Valentine & Fleischman, 2008). Therefore, question arises as to the caring nature of the company. The company does not seem to care for the indigenous population since its activities lead to the destruction of their habitat and further subjects the healers to underpayments. This can therefore be described as un-ethical behavior in accordance to this theory. Finally, in my own opinion, the company lacks an ethical compass since it seeks to achieve maximum productivity at the expense of the native people. It not only pays them low wages but also seen to destroy their environment. This is regardless of the new initiative pledging its commitment to the environment. 

Several other companies are similar to PharmaCare’s activities that questioned their ethical, environmental and workplace safety issues. For instance, Allegheny Energy Company has been ranked as one of the worst companies in polluting the environment. The company is an electricity utility company with its headquarters in Greensburg, Pennsylvania. The company was once sued for causing massive air pollution at its ferry plant in Hatfield, Greene County. These two companies share some similarities, for instance, they both put in efforts to combat the issue of degrading the environment. Allegheny Energy took several steps in protecting the environment such as using a considerable amount of money on clean air technology. In addition, it is measuring its emissions of carbon dioxide. Another similarity is as to the adherence to environmental laws and regulations. Similar to PharmaCare, Allegheny has been seen to violate the federal and states environmental laws and therefore have both failed in their corporate social responsibility which would ensure that the environment is conserved for future generations. 

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  1. Jones, T., M., Felps, W., & Bigley, G. A (2007). Ethical theory of stakeholders-related decisions: The role of stakeholder culture. Academy of Management Review, 32(1), 137-155
  2. Roloff, J. (2008) Learning from multi-stakeholder networks: Issue-focused stakeholder management. Journal of business ethics 82(1), 233-250
  3. Valentine, S., & Fleischman, G. (2008) Ethics programs, perceived corporate social responsibility and job satisfaction. Journal of business ethics, 77(2), 159-172
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