Ethical Dilemmas in Business
There are many areas where ethical dilemmas arise. Here are five categories of common
ethical dilemmas in business:
1. Human resource issues
2. Employee safety issues
3. Conflicts of interest
4. Customer confidence
5. Use of corporate resources
We shall discuss ethical dilemmas related to customer confidence here.
Customer confidence
It is the ethical responsibility of every employee to ensure that customers are treated fairly
and that no harm comes to customers as a result of using the company’s products or
services. There are three types of issues associated with customer confidence:
• Confidentiality has many aspects. It includes not divulging information about the
particular products or services that a particular customer purchases. It can include medical
information revealed by a patient or discovered by a physician in connection with the
treatment of a patient. In general, it can also include protecting information on mergers or
downsizing plans, or even the fact that an organization or individual is a customer.
What is the purpose of a physician's ethical duty to maintain patient confidentiality? It is to
allow the patient to feel free to tell his doctors fully and honestly knowing that the doctor
will not disclose it to others. Full disclosure by patient enables the doctor to diagnose
conditions properly and to treat the patient appropriately. In return for the patient's
honesty, the physician generally should not reveal confidential communications or
information without the patient's express consent unless required to disclose the
information by law. Under certain conditions, example when a patient threatens bodily
harm to himself or herself or to another person, the doctor may have to inform the relevant
authorities.
From time to time, the officers in the company will have inside information that may not be
known to the general public. This may be information about new products, plans or
processes, mergers, acquisitions, negotiations relevant to significant business deals,
contracts, sales, lawsuits, or special relationships with others. You cannot use
undisclosed material information (including material facts and material changes) concerning
the company, its shareholders or partners to your personal advantage, or the
corresponding disadvantage of others in the securities market. It is also prohibited for a
person with such information to give it to others, or "tipping", so that the other person
may improperly make use of the information.
The issue of confidentially is not very often straight forward. For example, many
businesses do have to situations that may be awkward because of the need for
confidentiality, and yet be transparent. These awkward decisions may arise because
commercial confidentiality requires that the corporation conceals or otherwise deflects
attention away from certain commercially sensitive information. It is not always easy to
draw the line between confidentiality and transparency.
• Product safety means ensuring that the products entering the market are not harmful,
and is the ethical responsibility of every employee. No product is completely safe, but it is
the organization’s responsibility to disclose all known effects of the product.
The recently announced recalls on Aug 14, 2007 by Mattel for 9 million more Chinese-made
toys, including popular Barbie, Polly Pocket and “Cars” movie items, and warned that more
could be ordered off store shelves because of lead paint and tiny magnets that could be
swallowed.
The recalls came nearly two weeks after Mattel Inc., the nation’s largest toy-maker,
recalled 1.5 million Fisher-Price infant toys worldwide, which were also made in China,
because of possible lead-paint hazards for children.
The recent recalls by millions of toys made in China because of safety issues has done
tremendous damage to China as a whole. The boss of one of the China toys maker
committed suicide as a result.
• Truthful advertising encompasses two primary types of ethical issues: exaggerating
product features and falsifying product information. Deceptive advertising is unethical and
it is the responsibility of the employee as well as the organization to see that false
advertising does not occur.
The episode of discovery by two students Anna Devathasan and Jenny Suo in New Zealand
that Ribena contains almost no Vitamin C at all had done tremendous damage to the
reputation of GlaxoSmithKline, a global drug giant. Still stated in the company's web site is
the following statement about Ribena:
"First made using blackcurrants in the 1930s, Ribena is a fruit drink available in a number of
different flavours. The best-selling variety is still made from fresh blackcurrants. "Ribena Really
Light" is the low-calorie, "friendly to teeth" version of Ribena with no added sugar."
The above statement stated that Ribena was first made using blackcurrants - it is a
statement of fact. However, it does not state that it is no more made using blackcurrants.
GlaxoSmithKline had always associate Ribena with blackcurrant in the past (with the claim
"contained four times the vitamin C of oranges") until the episode and most of us were
made to believe that Ribena was made from blackcurrants.
GlaxoSmithKline pleaded guilty and admitted it may have misled consumers in adverts that
said blackcurrants in Ribena syrup had four times the vitamin C of oranges.
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