Solving an Ethical Dilemma Using Ethical Theories - Volkswagen - Case Study Example

• Description of the Dilemma

Ethical dilemmas occur almost in all aspects of human life, including the workplace, homes, and schools. Decision makers are often left with tough choices to serve the interests of the parties involved and at the same time preserve the law (Hurley, 2012). In the recent past, Volkswagen, a leading car manufacturer, has been hit with an ethical dilemma relating to almost 11 million cars sold worldwide. In September 2015, it was discovered that Volkswagen had installed special software in the 11 million cars that would detect when the vehicles were undergoing emissions testing (Patel, 2015). This software then made the engines run smoothly without any emissions. However, when normal driving conditions are resumed, the software then switches off the emissions control and the car begins to emit high volumes of toxic gasses.

In the United States, the emissions regulated by the U.S. Environmental Protection Agency are nitrogen oxides, smog, and other pollutants that cause repository problems (Frumkin, 2010). In the United States, this became a major issue because the software meant that these cars would go above the set emissions limits by over 40 times (Patel, 2015). This led to a massive protest from the public and other stakeholders. Volkswagen was faulted for failing to observe such an important environmental safety issue. The company’s engineers failed to perform their duty as professionals. In other words, the engineers at Volkswagen had attempted to protect the public from the U.S regulatory authorities at the expense of environmental safety.

Volkswagen has been criticized for failing to uphold the laws and regulations in place because of its greed for profits. This problem was not just blamed on the engineers alone but the entire management of Volkswagen. Questions have been raised on how these installations took place without the involvement of senior managers at the company.

• Justification

The case of Volkswagen is an example of an ethical dilemma in a business situation because it has an impact on various stakeholders. First, in any business, clients or consumers are the most important stakeholders (Parboteeah & Cullen, 2013). In the present case, customers are affected in two major ways. First, since they are the direct users of the vehicles, they are concerned about the quality and performance of these vehicles. Considering the competition in the market, the company has to reassure its customers that the vehicles perform as per their expectations. In this case, the consumers’ faith in the performance of these vehicles has been dented. Any decisions made regarding the present situation will have an impact on the customer’s perception of Volkswagen vehicles in general. The second way consumers are affected relates to the fact that they are citizens who want the laws and regulations of the country to be upheld (Amy, 2011). As things stand, it appears that Volkswagen is violating these laws on environmental protection, and this hurts the image of the company in the eyes of consumers. As a result, the decisions that are to be made will affect the future sales of the company, and this could have a major impact on the company’s bottom line.

The second set of stakeholders is the government and regulatory authorities. It is the responsibility of every business to uphold the rules and regulations of any country or jurisdiction (Schaffer, Agusti & Dhooge, 2014). In the present case, the installation of the software has made the company to violate these laws. This therefore means that the company risks being fined by the government for failing to follow the set guidelines. This could lead to heavy losses in the form of added taxes and fines, and this could affect the overall performance and profitability of the company. Also, any decisions made will have an impact on the past and future engagements with the governments. For example, when a business fails to follow government rules and regulations, its previously signed contracts and agreements may be in jeopardy. The decisions to be made by the managers will, therefore, affect how the government and regulatory authorities interact with the company in future.

The present dilemma also has major implications for the workers at the company. In any business, the workers are major stakeholders whose contribution directly affects the performance of that business (Meenakshi, 2009). When a business is faced with an ethical dilemma of some kind, the impact the decision will have on the current and future employees needs to be analyzed. In some cases, those directly involved in the dilemma are actually the employees themselves. For the case above, the decision that will be taken may affect how these workers operate and how they undertake their activities. The engineers responsible for installing the software remain an important part of the company, and thereof any decision touching on them affects the company. Decision makers are left with the challenge of picking choices that keep current employees happy but at the same time improve on the problematic areas.

Finally, the shareholders of business are concerned with the profits and overall running of the business. When faced with an ethical dilemma, decision makers have to find the best solution that guarantees shareholders of returns (Trevino & Nelson, 2010). In the current case, Volkswagen has a difficult challenge of maintaining shareholder confidence mainly because of the number of cars involved. Decisions that will be made have to restore the confidence of investors and shareholders in order to keep the company running.

The current ethical dilemma has a direct impact on the stakeholders of the company and the overall operations of the company. Any decision that the company takes in attempting to resolve the issue is likely to affect all the stakeholders in one way or the other. It is, therefore, important to use ethical theories to arrive at the best solution.

• Ethical Solutions

3.1 Defined Generally

The solutions to ethical dilemmas should take into consideration the affected parties and the measures that restore their status, compensate the negative consequences and/or prevent the furtherance of undesired consequences. Solutions to ethical dilemmas take into consideration of some ethical theories. For instance, one may consider the theory of virtue of ethics or virtual theory. Based on this theory, the individual character of a person plays an important role in decision making (Crane & Matten, 2010). Virtual ethics is concerned about honest and acting with integrity. Therefore, the decisions taken should uphold integrity and honesty.

Another theory that could be used in solving the above dilemma is the ethics of duty or deontological ethics. According to this theory, people are required to do the right action because it is the right thing to be done (Crane & Matten, 2010). Although some actions might appear to have produced good results, they are supposed to be treated as wrong if indeed they are wrong. Duty-based ethics are based on the premise that people are bound to their duties by ethics (Singer, 2011). Therefore, the ethical solution takes into consideration whether the action was right instead of focusing on the outcome of the action.

Finally, Utilitarianism is another theory that can guide the decision-making process. According to this theory, the consequences of actions have to be analyzed before they are carried out (Crane & Matten, 2010). If an action is found to produce the greatest good, then it is the best action to take. Decisions that bring the greatest pleasure to the majority should be taken. Therefore, the best solution is considered to the one that benefits the majority of the involved parties.

3.2 Case Analysis

In the present scenario, it is clear that the software installed meant that the affected cars were operating above the required limits regarding emissions. It was wrong to install the software in the vehicles, even if that action meant that the vehicles could pass the emission tests. Basing on the virtual theory it is the duty of the engineers to ensure that any information about the vehicles is correct and is not manipulated to suit certain needs or groups. The engineers did not act with honesty and integrity. Also, considering the deontological theory engineers failed to do the right thing because they used the software to conceal the negative consequences of the vehicles on the environment as a result of excessive emission. Although the company made huge sales and profit, the actions by the engineers were immoral. Finally, in the light of the utilitarianism theory, the company’s action was not the best because the software was covering the actual effects of the car to the environment due to excessive emissions instead of preventing emission. The engineers want to make the company appear to comply with environmental standards when in reality they violated the laws. Therefore, the solution to this problem should yield the best outcome to the relevant parties.

3.3 Ethical Solution

Ethical solutions to ethical dilemmas involve taking a decision that appears right in the eyes of the community or the affected parties. As a virtual ethicist, solving the above dilemma would mean taking the cars from the market. Although this might inconvenience users of the vehicles, it is right to save the environment by taking away these cars. More importantly, as a virtue ethicist, it is important to maintain honesty by admitting that the company made a mistake by releasing the vehicles into the market. Solving the above dilemma will thus not just involve recalling the cars but also offering an apology to the public and the environmental protection agency about the reckless actions of the company.

The best action to take would be to sack those employees or engineers who installed the software. They failed in their duty to the public and the company. This will demonstrate that the company is willing to work within the set guidelines and will not engage in some actions for the sake of profits or other benefits.

To promote the image of the company, Volkswagen needs to pay fines as compensation for the emissions. Taking this decision will affect all stakeholders because it is a loss to the company. This might lead to a decline in the profits for the company. Failure to pay such fines will affect the company in the long term, and this could lead to even heavier fines in future. Agreeing to pay the fines will be of great benefit to the government and the company as a whole, and hence producing the greatest good.