It is difficult to say what is ethical and what is not in business world since ethics can be examined from many different perspectives. Employees, excecutives and society can have a different opinion of what is ethical. This can lead to conflicts of interest where the company has to decide whose ethichal guidelines to follow. Especially multinational companies face many ethical problems when operating in a foreign country and culture. Then the company has to consider weather to act according to law of their country of origin or to obey the laws of the country where they do business in or manufacture products.
If a company for example adopts environmental standards of a certain country in which they produce also those standards are not as high as the standards of the corporation home country, but still according to local law. Then this behaviour is ethical but still not acceptable from a social responsible view. Usually it is easier to obey the laws of production country, since they have less strickt laws and lower minimum wages. Etch-A-Sketch Ethics One of the biggest ethical problems companies face nowadays is the outsourcing of production to a low-wage country in order to cut costs.
Big companies move production from their own country to a less developed country leaving old employees unemployed. The company usually hires a subcontractor in the country they move production to and let them handle the practical things. Unfortunately in most cases the way the subcontractor treats their employees is inhuman and the wages they pay them are below legal minimum wages. Even though the company itself is then not directly treating the production workers poorly, they are still responsible for the actions of their subcontractors.
The Coursework on Host Country Companies Multinational Local
Examine The Costs And Benefits From Multinational Business Investment In Poor Economies Introduction A multinational corporation is a very large firm with a head office in one country and several branches operating overseas. These branches can be to do with production, marketing or distribution it doesn t matter. However each branch has its own role and this is part of the trend of globalisation ...
Thus before outsourcing their production, companies should really think through the effects of their actions on everyone who is affected by their decisions. For example in the end of year 2000, U. S. A based Ohio Art Company moved the production of their Etch A Sketch toys China from Ohio to China. Etc A Sketch is the company’s most famous product and is in fact the most successful toy of all times in United States. It was invented almost 50 years ago and was known to be entirely made in Bryan, Ohio by American employees. Bryan is a small city with only 8. 000 inhabitants and it became known as the manufacturer of these Etch A Sketch toys.
Ohio Art Company employed about 200 workers, and many of them were from same family. But today the Ohio Art Company manufactures Etch A Sketches in Shenzhen, China. This way they can pay ridiculously low wages, save in manufacturing facilities and get their product made cheaper than ever. This has been the trend in production for a couple of decades now and seems to continue. The underlining reason for this is that consumers want to pay as little as possible for their purchases forcing retailers and manufactures to find new and more effective ways to cut costs.
Big retailers such as Wal-Mart have to offer their customers cheap products so their suppliers have to adjust to it. In some cases one supplier can only supply its product to Wal-Mart and then it is Wal-Mart who lays the rules. Ohio Art Company was probably afraid facing a bankruptcy and loosing the whole company if they would not figure out ways to get the price of the product down. Now all of their former employees left unemployed and the small town of Bryan won’t be able to provide all of them employment. Of course the outsourcing affected mostly on the old employees but there are still other effects.
The Essay on Office Art Memo
As an employee and a student taking a humanities class, I have been asked by my boss to select six various art pieces for the new corporate offices for our real estate firm. When my boss first gave me the task of managing the art budget and selecting the pieces I was quite nervous. She then reassured me by stating that she knew I was the person for the task, as I have asked her to read over and ...
The social costs occurred to the town of Bryan were unemployment and death of the small community. The economic costs were the eroding of the tax base and decline in population. All in all, it seems that the decision to outsource production was beneficial only to Ohio Art Company. The disadvantages the company faced were losing of the skilled employees and worsening of the company’s image. Still in some sense it was not unethical for the Ohio Art Company to move the production to China because the company can not be held responsible for supporting the town of Bryan.
The town did not obviously benefit from the outsourcing in any way, but it certainly benefited of the factory being in Bryan. The Ohio Art Company on the other hand gained many benefits including lower overhead costs of production and lower wage expenditures. But one has to keep in mind that if the production had not been moved to China the company could have faced bankruptcy and all the employees would have been let go anyway. It is more beneficial for the whole society that the Ohio Art Company keeps functioning, even though it does not use American workforce anymore.
When they build the factory in Ohio, Bryan they build the community from nothing. The town of Bryan did not have anything before Ohio Art factory and now they have returned to the same situation. Ohio Art Company acts as ethically as it can when it keeps the company alive and does what is good for the company. If something, it is the consumers who are unethical requiring cheap toys regarding of the true non-monetary costs to companies and employees. The decision to use Chinese subcontractor did have many negative affects on the new employees and Chinese society.
This is where we should really start to think about the ethicality of the outsourcing decision. Ohio Art Company uses a private nonunion company as their subcontractor in China. Meanwhile Chinese labor unions try to get organized and ensure that every employee in both private and foreign-owned companies gets at least the minimum wage. Since the company Ohio Art uses does not belong to a union, they among many other foreign companies are sabotaging union’s efforts to succeed in guaranteeing Chinese workers normal working conditions.
This is not the intention of foreign companies, but what else could they do to keep the prices of their products low enough for supermarkets to sell them and consumers to buy them. It is most certainly not ethical for the Ohio Art Company to continue using the same subcontractor if the working conditions stay the same. The company should try to solve the problems occurred and encourage the manufacturer to start treating their employees more humanly. The company should not in any circumstances allow inhuman treating of the employees if they want to follow norms of business ethics.
The Term Paper on Propagandistic Art of Communist China
On October 1st 1949, Chairman Mao Zedong, leader of the Communist Party of China, declared the fall of Chiang Kai-shek's reactionary government, and announced the creation of the new People's Republic of China. However, the good chairman did not achieve this victory by military might alone; through the utilization of propagandistic artwork the communist party was able to win the support of the ...
It could be possible that Ohio Art Company’s executives did not know how bad the working conditions were in China. But I do not believe this because how could the company executives outsource their production to a factory they do not know anything about? They probably assumed that the leading toy manufacturer in China would follow all the legislations, but they should still ensure rules are followed. If Ohio Art Company wants to start taking responsibility and behave more ethically, it should try to help the employees at the manufacture by threading them to eliminate the contract if the conditions are not improved.
Joining a union should also be encouraged to help the workers and Chinese society. If nothing is done, the company should terminate the contract in order to avoid getting labelled. They could also establish some kind of ethical Code of Conduct and exercise strict supervision that it truly is followed. As stated earlier, companies have social responsibility and they should ensure that their actions cause as little damage as possible. In my opinion Ohio Art Company did this when it decided to move production to China instead of endangering the whole company’s existence.
Business decisions are always complicated and can not benefit every party involved; still the decision has to be made keeping the company’s and stakeholder’s interests in mind. The fact that made the Ohio Art Company’s decision unethical was the choice to use subcontractor without caring enough to check their factories and their ethical principles. Of course the working conditions can not be as civilized as in States, but at least the minimum requirements of the foreign country have to be met. Ohio Art should not in any circumstance sacrifice humanity and moral principles in search of cheap labor.
The Essay on Chinese Art Piece Jade China
Sharon Matute October 24, 1999 Art 100 007 Professor Sax Art can be used to study the progression of a civilization through time. Art is usually used to express ones beliefs religiously, politically, and sometimes as a source of communication, which is accomplished through imagery. Symbols in works of art can be related to nature and myths. 1 From the beginning of Chinese history, art and ...
