assignment 4 video

Social implications of business ethics

Social implications of business ethics.

Hi there, 

thank you for coming back to my blog today. 

In this part of my blog I will investigate into Gap Inc. that I believe acts ethically. I will focus on how their ethical behaviour affect the different stakeholders of the business. I have done research into the CSR policy of Gap. Inc to support my analysis of the following points;

- Finance    

The things that I believe Gap Inc. does financially well, that secures them as an ethical company are their commitment with the community. Gap Inc. has had some problems with their community involvement. The ethical issue of ''not giving back'' was reported by the community. Gap Inc. Having a selfish outlook on business and not caring about the people. They were not happy with this image and so over the past 5 years gap has invested lots of money to engage and educate their community around them. Gap Inc. has introduced a training program called;  P.A.C.E. (Personal Advancement & Career Enhancement) This program offers female garment workers the life skills education and technical training they need to advance at work and in life. This both benefits the garment workers but also the business in the long run. Developing a wide base of skilled workers that can potentiality becoming leader within the industry.  The program evaluation also supported this as 1.5 times as many woman said they felt more confident and believed in their personal and working skills. 50% of woman reported that they felt a higher level of self esteem after the participated in the program. This has a positive impact on the businesses ethical behaviour as they build up the respect of the community in showing that they also give back. 

- Human resources 

Gap. Inc has been nominated as one of the best working places within the retail industry. They look after their staff very well. They offer staff not only good pay and hours, etc. but also a chance to climb further up into the corporate ladder as well as giving them many benefit's including additional education, health assistance and for many younger employees study financing. As talked about in the first part we can see that Gap. Inc is very active in teaching people in order to create a greater empire in the future. Which does not only help Gap Inc. directly but it gives many people the opportunity to get a better job and improve their working & social skills. Gap Inc. hopes that these people will stay loyal to the company which is why they also get a 35% store discount. Gap Inc. is really big on being yourself. This is promoted through their advertising of their clothing but also in the work place of Gap Inc. Their promise as stated on the website is: We inspire every employee to a simple aspiration: to “do more than sell clothes.” This promise continues to guide our commitment to the communities where we live and work, driving our constant efforts to improve our social and environmental performance. This is a statement that shows their commitment in ethics and a working environment where the employees are aware of the company's values. 

The implications these activities have on the company and the brand Gap Inc. I believe links back into the company appreciating and looking for long term, loyal relationships between anyone involved in the company, including, staff, suppliers and customers. With these values Gap Inc. is impacting different stakeholders of the company. This goes for again Staff, suppliers and customers. The staff should enjoy their time at Gap Inc. due to all the benefit's that the company offers. This means they respect the company and hopefully here for stay loyal, which should mean they stay for a long time. Hopefully this then helps the brand image of the company as the employees are dedicated, hard working and have a positive working attitude. This then should have a positive effect with the customers as well, who should enjoy their experience at Gap Inc. more, and furthermore this should then convey into positive effects for the shareholders of the company. 

- Production 

In Gap Inc. 's production line the 1 word that keeps popping up is 'Corporate Compliance' This is the main value that the company keeps very close to. It is their commitment to a responsible, honest and ethical way of doing business. As said on the website: 'A combination of written guidelines, formal processes and management oversight helps us ensure that "strong corporate compliance" aren't just words on paper, but a way of doing business at Gap Inc.' This shows us that they are very serious about compliance and that it is a way of doing business. I believe this is a strong value which helps the company in the long run with stakeholders and shareholders. For those of you that don't know what compliance means I will give you a short definition: it is basically the company's confirmation that the doer of an action (such as the writer of an audit report), or the manufacturer or supplier of the product, meets the requirements of accepted practices, legislation, prescribed rules and regulations, specified standards, or the terms of a contract.'' Which is simpler words means, that the production factories where 
Gap Inc.'s clothing gets made are a 100% compliant to the code of conduct 

and requirements of Gap Inc's standards and rules and regulation when it comes to producing the clothing. This also links into being ethical which is for example not having child labourers and ensuring employees get paid minimum wage and have rights.

The compliance standards of Gap Inc. are very high. This means that most manufactures have to pass a certain inspection before they are able to produce any type of products for Gap Inc. Here for the company has put in a global integrity department to ensure that their code of conduct is followed. The global integrity department works very closely with human resources, global corporate affairs and corporate security. This is to raise code awareness through communication and education. Two very important aspects of Gap Inc.'s working standards.   

The impact this has on all the stakeholders of the business is that they are all constantly reminded that Gap Inc. works under a very strict code of conduct which ensures safety, honestly and an ethical working environment. This I believe impacts all stakeholders very positively because they all stay within the guide lines set by the company which ensures an ethical working base.  

- Sales and marketing

Gap. Inc's sales and marketing I believe is very effective in sharing their core values. Being an ethical company as they are, the customers are actually being reminded off it trough things like advertising and promotional campaign's. A great example of the advertising that Gap Inc. Uses is the 'Dress normal campaign' This campaign focused on the affordable and normal fashion trend that was for anybody and everybody. Gap Inc. wanted to not only attack a certain target market like luxury fashion brands but they wanted to be able to sell their clothes to any human-being. Meaning affordable prices with good quality clothing and a way of fashion where people don't look outrages but are still able to put their own identities with the clothing. This campaign was and is a huge success for Gap Inc. as they were one of the only companies that had not recored a loss in revenue during the recession. They actually had seen a big rise which was thanked off the dress normal campaign. People seemed to appreciate and believe in the brand. Which is a very strong image to have.  

This has many positive implications on the business as customers respect what the company does. Also for suppliers and retailers it is good to know that they support a company who supports a 100% fair, honest and ethical working base which translates to their marketing and sales. A company that does great and works great whilst at the same time stay's great throughout the years is a company that people can stand behind from and stakeholders position. This goes for employees, suppliers, manufactures, customers and even the truck drivers that drive around the world to deliver the 'most ethical products' 

please be sure to check out the rest of my blog and don't be afraid to send me a message. Im more than happy to answer any of your questions :)

Signing off

Sjors

(D1) Impacts of acting ethically

 Impacts of acting ethically 

In this part of my blog I will analyse the 3 recommendation I gave in order for Philip Morris to improve their ethical behaviour. I want to be evaluating the impacts these changes could have on all the stakeholders of the business.

Suggestion 1 : 

I suggested to set up a labour party/union in the counties where this production is done. This allows for the legal workers to form a bond and propose to the company what things need to change in order for a fair and safe working environment. As well ass making it the main priority to eliminate all child labour, simply because it is illegal. The impacts of these changes will be very positive for both the employees and the businesses reputation. firstly the internal stakeholders which are the workers at the farms will be happier to work in a safe environment and get paid a fair wage. This can improve the relationships within the businesses social ladder. It should be right for the business to make this change because it has proven to work. Labour parties/unions are much stronger than individuals and business have to legally listen to what is being proposed to them. This should not be seen as negative feedback but positive feedback to enhance changes in order to have a better production service. Here for the company should be open to this idea and consider these point in the bettering and improving of their brand. As said by Foxbusiness a respected business channel in the USA, ''Thanks to labor unions, wages have improved, the workweek is shorter and the workplace is safer.'' This indicates that labour parties have a postive impact on businesses. They do not only benefit the workers but also the employees, this is because through labour unions it is easier to negotiate. The employee will only have to communicate with 1 person that represents the rest of the workers. Also When a business has a labor union to work with, they can partner together to facilitate change easier. When the employer knows that change is required, it can consider the information given to him and communicate this to the leadership of the union and the union can then pass the information along to the employees. When everyone is on the same page, it improves the chances of the company getting through the change. External stakeholders such as the retailers and customers will know that the cigarettes were produced in a safe and fair environment. Here for they will be happy to represent the brand of Philip Morris. If the product is made with care and transparency the people working for the business will not have to worry about any false accusations. They can work comfortably and have a good view and respect for the business. 

Suggestion 2: 
The second suggestion was an easier achievable one, I believe. Having better lines of communication is always a positive for a business. Since Philip Morris has not been as transparent throughout the company I think they should consider improving their communication. To ensure this happens I believe the company should always have follow ups from meetings and special announcements. These is simply done by adding people into emails and making calls to discuss if the information being shared has reached and is understood by the stakeholder. Whether their internal or external. If suppliers know exactly when and where the product needs to be then they can time and contact this with the retailers to ensure the product is delivered on time and with care. The real winners in this aspect is going to be the leaders of the company. They might think they know it all but if even the employees can share and have put into business information then the company can improve itself. If their is clear communication between all stakeholders no problems should arise. Making sure information is passed on to every line in the production chain is vital for the companies success. If everyone is on the same page mistakes are less likely to be made. miss communication can always happen but this is only if people within the chain are holding things back from others. This can not be done. An improvement in employee morale can result from effective communication. Employees appreciate good communication coming from management. It produces a healthy work environment. When employees are satisfied with their jobs, they are able to efficiently perform their duties with a positive attitude. 

A 2012 Study by Great Place to Work®  based on employee perceptions of around 400 organisations shows a co-relation between good communication (management keeps me informed about important issues and changes) and intent to stay in the organization( I want to work here  for a long time).

( http://www.greatplacetowork.in/publications/blog-posts-articles-and-news/690-communicating-at-great-workplaces-key-principles# )

Also another source from The former CEO of Google, Eric Schmidt,  explained the company’s business strategy at the beginning of the year. They have several quarterly meetings which allow Googlers insight into the company’s broad strategies as well as how they’re progressing against internal goals. The CEO also holds multiple sessions to ensure that Googlers around the world have access to this high-level, strategic information. “One thing that'd strike anybody who has worked in any other company immediately upon joining is the openness at Google. I was thrilled to see the level of details shared by management with all the employees. For example, we are always kept up-to-date with company's strategy for the future and the challenges we are facing. Also, a great deal of transparency is maintained about current/past performance. Everyone is open to discussion on anything and constantly looking for ways to improve.”- Google employee 

From this source we can see that transparency in a business is key for good management. The communication between employees and employers is very important. The employers should always be open-minded to be able to listen to the employees and see what sort of knowledge they can bring to the table. Like the google employee says; ''Everyone is open to discussion on anything and constantly looking for ways to improve.” This shows he as an employee is happy his opinion counts and that he's able to input in ways to make a business better. 

Suggestion 3: 
The final suggestion I proposed is for Philip Morris to have honesty towards the public, government and the media. Once again I believe transparency is something that allows people to see the truth and not have to guess whats wrong or right. If the business is truthful about the production of their product people will know exactly where it is coming from and how it is made. This gives security to stakeholders. People like customers trust that the product their buying will always be of good quality and is made legally. Also the community as a stakeholder needs to be considered in this. the honesty about the treatment of workers is vital in order to keep them happy but also to not get in trouble with the government. They should not have to find out if theirs any illegal practises going on. This will give the business less problems and bad publicity. bad publicity can lead to disappointment and a loss of trust. When an organisation fails to follow through with promises, customers, employees and partners are more likely to question the truthfulness of all the organisation's current and future messages. 

A source from the economist, called bad publicity states that;''Brand association refers to the deep-seeded attitudes and feelings a customer has toward a product or company. When brand association is negative, negative attitudes are more likely to come into a consumer's mind before positive ones. Bad publicity can contribute to negative brand association, which can in turn reduce sales over time.'' From this source we can tell that actually bad brand association can affect sales. Here for Philip Morris should definitely consider having a better reputation with the public and its shareholders. If  let's say the company comes out with all their non ethical behaviour and apologises formally while also showing the public, government and shareholders what changes they have made in order to be more ethical we can hopefully see a change for the better of the company. Not only will there be no loss of sales but stakeholders will be happy to represent the company which means they can be investing. This is an even better impact for Philip Morris as a company. 

 I have made 3 suggestions of which I think the business should consider, however I believe suggestion 2 is the most achievable one. I think if the company takes on this suggestion the rest of the problems can be solved. good communication is key and here for I think this is the best solution. 

please be sure to check out the rest of my blog and don't be afraid to send me a message. Im more than happy to answer any of your questions :)

Signing off

Sjors

5 Ethical Solutions (M1)

Ethical solutions. 

In my last Blog I talked about Philip Morris and their unethical behaviour. I described how their mistakes impacted the business and its stakeholders. Large companies like Philip Morris need to deal with many people and stakeholders daily. It is difficult to ensure 100% transparency throughout the large operation, however Philip Morris did not handle it well. 

In this Blog I will give suggestions for how the business can improve their ethics within their operations. Often small and simple changes can start up a businesses morals and improve communications throughout. 

Suggestion 1 : 

Philip Morris's first issue was the fact that the production of the Tobacco was done by child labour and in horrid conditions. This also went for legal workers that were working in dangerous working environments and not getting paid the minimum wages.  Setting up a labour party/union in the counties where this production is done is the 1st change that the business should introduce. This allows for the legal workers to form a bond and propose to the company what things need to change in order for a fair and safe working environment. The main bosses of the company will have never been at these factory sites which means they have no idea how things are actually run. I think it is a very good idea to get these men and woman down to the heart and grind of the company to see for them selves that things need to change. The main priority will be to eliminate all child labour, simply because it is illegal. The second priority will be to set up the labour party which means their rights are fair and considered by the company. this includes paying every worker a fair wage. This will make them happier and so have a respect for the business. This can positively impact the business ethics and their production because workers will work hard for their fair money their being paid. On the other hand, external stakeholders such as the retailers and customers will know that the cigarettes were produced in a safe and fair environment. Here for they will be happy to represent the brand of Philip Morris. If the product is made with care and transparency the people working for the business will not have to worry about any false accusations. They can work comfortably and have a good view and respect for the business. 

Suggestion 2 :

In order for Philip Morris to be transparent and fair, the business needs to ensure their communications with both internal and external stakeholders is perfect. Making sure information is passed on to every line in the production chain is vital for the companies success. If everyone is on the same page mistakes are less likely to be made. miss communication can always happen but this is only if people within the chain are holding things back from others. This can not be done. If 1 person passes on the correct information but the 2nd person only passes 3/4 of it though then you have created problems and distrust. To ensure this does not happen I believe the company should always have follow ups from meetings and special announcements. These is simply done by adding people into emails and making calls to discuss if the information being shared has reached and is understood by the stakeholder. Whether their internal or external. If suppliers know exactly when and where the product needs to be then they can time and contact this with the retailers to ensure the product is delivered on time and with care. 

Suggestion 3 : 

The final suggestion I want to propose is for Philip Morris to have honesty towards the public, government and the media. Once again I believe transparency is something that allows people to see the truth and not have to guess whats wrong or right. If the business is truthful about the production of their product people will know exactly where it is coming from and how it is made. This gives security and will have people trust that the product their buying will always be of good quality. This also goes for the honesty about the treatment of workers, the government will not have to find out if theirs any illegal practises going on. This will give the business less problems and bad publicity. The media has a big impact in the businesses reputation. They can exploit any non ethical operation and show them to the public and government. If the business ensures they have no non ethical issues then this wont be a threat to Philip Morris the company. Stakeholders can respect a business for its legal and ethical operations and often this will also positively impact a business sales and marketing. 

please be sure to check out the rest of my blog and don't be afraid to send me a message. Im more than happy to answer any of your questions :)

Signing off

Sjors

4 Acting unethically (P2)

Acting unethically. 

Phillip Morris International is the leading non-government international tobacco company. It owns seven of the world’s top fifteen international brands, including Marlboro, the world’s best-selling cigarette brand. The company has always had doubt from the government and consumer but has been leading in the tobacco industry. What I wanted to know is what is it exactly that this business does to be so 'unethical'. It is still the leading tobacco company so their is something not being told to the public I suspect. 

So the first thing I tracked back to was Before 2009, where the Phillip Morris International website allegedly contained information stating that the company was against the use of children for labor practices. This was before an extensive report, compiled by the Human Rights Watch. According to the report, migrant workers contracted by farms in Kazakhstan that supply tobacco to the Philip Morris Company were subjected to conditions that often amounted to forced labor. These workers usually had their passports confiscated and were often forced to do additional work for no pay. (Independent). This is very suspicious because you could say this is a lead to child labour, the evidence of no pay and stolen passports indicates that the workers were most likely under the legal age. With knowing this the company has done 2 unethical practises within 1 issue. The first of which is telling false information on their website and the second is the unethical actions taken towards their workers and the law. Clearly doing illegal practices. 

From this research I understood that Philip morris had more incidents with the government and its law and not following them. The company has been acting unethically. This does not look good on the stakeholders of the company. The business actions can affect or be affected by those in government and the regulatory sector. 

The other stakeholders such as retailers, growers and  suppliers want to have a very transparent communication line with the company. If certain issues are not discussed it can mean people are left out and communication has not passed everyone before making decisions. To ensure a smooth running of the business and an effective production all these stakeholders have to work together and be on the same page. Am I right? But unfortunately Philip Morris the company has not done this. Meaning bad publicity and relationships created with the media and its stakeholders. 

On the other hand external stakeholders like customers want to have good quality products. It is easy for Philip Morris to keep selling cigarettes because people that smoke are addicted. Here for the company acting unethically has less of an impact on the customer. They will still want to buy the product if the quality is still good. 

Internal stake holders such as the employees might be concerned with their position in the business since it is under fire by the government. It can appose a threat of them loosing their job and also going away with bad reference. Some employees might not agree with what the business does and this can create problems within the production and management of the business. Now this goes for the people that are working in the headquarters or factory lines.. The people or children that are being forced to work in horrible condition with a minimum pay are going to want recognition and help. They are hoping for someone to step up and show the world that the business is handling illegal practices and unethical behaviour. 

Philip Morris has tried to cover up many of their unethical actions. However for a large company like them, it is very difficult to try and keep everyone happy. Customers will want good quality cigarets for a cheap price, this means the company needs to find good but cheap production lines/workers. However they have done this in an unethical way and this impacts those people that have to work under these bad conditions. Then at the same time retailers will want a large supply of cigarets to be able to sell but they cant do this when the company has a bad name. This means Philip Morris needs to retain its name and a constant supply of good quality cigarettes. With out getting any bad publicity. 

Conflicts between stakeholders can now easily be created if Philip Morris has not covered up their unethical behaviour and gotten a bad reputation trough media for example. Retailers will not want to sell their cigarets if they know that people would rather buy a different brand. social concerns are that the quality of their cigarets might have gone down due to the cheap production. Here for the other internal stakeholders of the business might experience changes in pay or certain rules. This can get them to disagree with the company and raise awareness to the employee's rights. If this happens Philip Morris has to deal with both internal and external stakeholders, basically having everyone unhappy.


The benefits of the business in the way it operates is that they are able to produce their products very cheaply. Using unethical behaviour yes! but it does allow them to make or catch more money. Philip Morris had gotten away with it for a while and even when threatened by the government, the company still tried to cover up their tracks. What the actual reason was for the unethical behaviour we don't seem to know. Thinking logically would be saying that just like any other big company Philip Morris is looking for good deals and cheap prices to produce their product. Going to less economically developed counties and employing cheap labour their is what most do. However Philip Morris decided to go 1 step further which was employing child labour. This is illegal and so in the end of the day the company was exposed by the media and put in front of the government facing major law suits. Another major drawback that came from the bad publicity was that customers were actually considering not to buy the cigarets from Philip Morris anymore. Even though most customers are addicted they still have the option to go for different cigarets that are produced under a better environment. This would take away sales from the company and so a possible loss in profit. 

To conclude, at the end of the day the companies unethical behaviour got them a bad image with their internal and external stakeholders. Then again Philip Morris tried to cover up their unethical behaviour with more unethical behaviour, which obviestly does not work.. Very stupid I would say. There is a fine line between what is accepted and what goes to far. Phillip Morris has pushed these boundaries to the limit. Here for their law suits and major public disgrace. 

please be sure to check out the rest of my blog and don't be afraid to send me a message. Im more than happy to answer any of your questions :)

Signing off

Sjors

  

2 Introduction (P1)Task2

Introduction:

Hi there, I'm sjors laurijsen and I have a great interest in business ethics. Ive always felt like Customer is King! Am i right? here for I have decided to make this blog to tell you all about what I believe is right and wrong in some businesses. Because not everything is as pretty as it seems..

I will cover different points of view and headings in a line of Posts. Here for you can click on each one and hopefully be able to navigate yourself easily through my blog :)

Business Ethics:

So online it says this: ''Business ethics are The study of proper business policies and practices regarding potentially controversial issues, such as corporate governance, insider trading, bribery, discrimination, corporate social responsibility and fiduciary responsibilities. Business ethics are often guided by law, while other times provide a basic framework that businesses may choose to follow in order to gain public acceptance.''taken from (http://www.investopedia.com/terms/b/business-ethics.asp)  
Now these are all very BIG words and so I will try to break this down a little bit. Basically it is about the moral and social responsibility a business has when making certain decisions. They are always supposed to tell the truth and ''follow the rules''. However some companies try to get around this and often get a very bad reputation with the general public. When people find out a well known corporation is doing something unethical, they can often be very fast to judge and hold a grudge against them. I mean we have al had it right? for example when they all said Mcdonalds chicken Mcnuggets weren't even chicken!! People went nuts! '' Oh I will never eat those little crappy things again..'' said almost everyone who ever ate them. And guess what a few months later people forgot about it and starting chowing down on them again. Anyways the Point I'm trying to make is that the choices that businesses make can impact them either positively or negatively.

Ethical VS Unethical 

An example of a business being unethical was The leading tobacco producer Philip Morris International Inc. In 2014 they tried to persuade the government to abandon its 10 year old law-suit against the tobacco industry allegedly concealing the dangers of cigarettes. Now a days everybody knows that cigarets are bad for you but when the company first started they prompted their product to be ''healthy'' and not a danger for anyone's health. This is an Unethical thing to do because the corporation knew they were not telling the truth. Here for they could be sued by anyone who had gotten a life threatening health problem due to smoking cigarets. It is legally stated that every product must tell the truth about it's ingredients and production. This is why the scandal of Philip Morris became so public and had given the company a very bad name. The other fact was that they tried to persuade the government to abandon their law-suit which is also illegal. Hiding or concealing the dangers of cigarets is a fault and companies shall pay the price for that. 

On the other hand Gap Inc. Was announced to be high in the rankings of the most ethical companies of 2014. Gap has always had a good reputation with their customers and shareholders. As stated by GapInc.com : Wilma Wallace, Vice President, Gap Inc. said: “We view this recognition from the Ethisphere Institute as another example that we are living up to our company’s promise—‘to do more than sell clothes.’” 

I really like this, A simple promise that shouldn't be to hard to follow right? I also shop at Gap and as a customer I have always felt like I've been treated well and gotten whats worth my money. As I did more research into Gap's actual policies and promises I found that they have dedicated a whole page on their commitments to:

- environment

- employees

- community

- human rights

In this page Gap. Inc has given a Fact for each commitment and an impact. This impact is how Gap. Inc tries to do the most ethical thing. For example;

Human Rights

Fact:
Consistent and comprehensive monitoring practices across the retail industry will help create long-term solutions to improve compliance with labor standards and laws.

Impact:
Gap Inc. is engaged in several broad initiatives where we work with governments, workers and other stakeholders to improve working conditions across our supply chain. For example, our 2004 partnership with the International Labour Organization led to the development of the global Better Work program.

From this you can see that Gap. Inc is active with their improvements and communication with governments, workers and stakeholders. They have stated that a global better work program has been developed which indicates that actual work has gone into the human rights section. I appreciate how Gap. Inc has put in the effort and actually explain what they are trying to do in order to be the most ethical company. You can question if all the things Gap. Inc states are true but if you believe their company's promise which is: ''To do more then sell clothes'' Than don't worry about it ;)

That concludes my introduction, please be sure to check out the rest of my blog and don't be afraid to send me a message. Im more than happy to answer any of your questions :)

Signing off

Sjors

1 Bibliography

http://www.investopedia.com/terms/b/business-ethics.asp

http://www.gapinc.com/content/dam/gapincsite/documents/Gap%20Inc%20Fact%20Sheet_PROMISE_F1.pdf

http://www.gapinc.com/content/gapinc/html/social_responsibility/our_commitment.html