Straight Talk about How to Do It Right - Assignment Example

What is the conflict or issue? Why is there an ethical problem? Discuss which TWO ethical principles may be relevant or in violation (Be specific).  Discuss from the perspective of the main decision maker identified in the case.  In other words, what makes this an ethical issue? Levi Strauss and Co. faced a critical dilemma about their operations in China. On one hand China was a huge market and the production costs were low, but on the other hand, the human rights violation in China were not in line with the strong ethical stance that Levi Strauss and Co had adopted for many years. Hence, the main issue was the difficulty to arrive at a decision on whether the operations in China should continue or not. The ethical stance taken by Levi’s with regards to human rights (arbitrary arrests, poor prison conditions, personal privacy) was not possible to follow in China and hence, it created an ethical problem for the organization. The ethical principles that got violated the most are the principles related to Respect for Autonomy and Justice (Trevino and Nelson, 2011). The ethical principle of Respect for Autonomy is based on the tenet that people should have the freedom to reign over them and also take the decisions that they want to. However, in China, Levis Strauss and Co found this violated their ethical stance because the leadershipin China had refused to ratify the 10 basic guidelines which prohibit the use of forced used of labor according to the International Labor Organization. Similarly, the country has also enforced forced family planning, again proving to violate the principles related to Respect for Autonomy. The people did not have much choice when it came to these matters of basic human rights and hence, were forced to comply, thus creating an environment where they could not do want they actually wanted to. The ethical principle related to Justice has not also been upheld with regards to human rights in China. For example, even though there are regulations related to arbitrary arrests and providing limits on detention, these factors are not taken into consideration in case they ‘hinder the investigation’. This vague clause is very ambiguous and gives enough scope for the authorities to violate this basic human right. Therefore, this is a clear violation related to the principle of justice. Levi Strauss and Co has been known as an organization that has taken a very strong stance against any form of ethical violation. Even though there were speculations regarding entering the Chinese market (China’s stand on many human rights issue was known even before the operations began), the plan to operate from China was implemented in the hope that continued presence of many U.S based organizations can have an impact on the stance adopted by China. However, over the years, Levi Strauss realized that the issues were quite big to be solved just with the help of corporate presence. Hence, the organization was faced with a big question of whether to continue its operations for the profitability or to withdraw its operations based on ethical grounds, something that the organization has always proudly endorsed. The China Policy Group as well as deliberations by the senior management failed to come up with a decision regarding China operations. In the end, the CEO took the bold decision to bring about an end to the operations in China due to ‘pervasive violation of human rights’. A corporate organization does not merely operate with the sole goal to improve its profitability, but in addition, it also forms a set of ethics that would help it achieve its profitability with the help of certain value system. As Levi Strauss and Co had followed, endorsed and promoted these values for a long time, it is difficult for them to operate in an environment where these values do not have meaning. Hence, it becomes an ethical issue and the organization was forced to weigh out their options between ethical stances versus profitability, ultimately deciding to withdraw its operations. 2. Resolve the case using ethics theories.  From the perspective of management at the company in your case, what should the main decision maker(s) do?  Defend your answer using the ethically defensible theories.  Talk about which stakeholders benefit and which may be harmed.  Thus, I am asking you to think broadly.  A. Please use utilitarianism to make the decision.  B. Use Kantian ethics to make the decision OR, evaluate the decision in the case using Fairness/Justice theory.  (Choose 1) C. Explain which of the theories was best for resolving this dilemma in an ethically defensible manner.  Why do you think so? The case related to the operations of Levi Strauss and Co in China is one that requires thought and deliberation. While staying in China would mean being forced to support a repressive rule, moving out would mean a lost opportunity in one of the most promising markets in the world. The staff of the organization had mixed opinions on this, because some felt that the organization was not a human rights agency and in the end, it was a profit making corporate organization. Some were of the opinion that operating in China would mean violating the guidelines of the company about how and where it would conduct its business. The utilitarian approach related to ethics put forth by Jeremy Bentham and John Stuart Mill states that ethical actions are those which are able create a good balance of good over the evil. Thus, an ethically correct decision would be one that is able to provide a higher benefit to higher number of people (Trevino and Nelson, 2011). Therefore, to solve the case of Levi Strauss and Co in China, the utilitarian approach can be taken into consideration. In this case, the profitability of staying in China can be measured in terms of profits from the country, but it is difficult to quantify the value that is placed on ethical considerations. However, as the organization has a very high value given to its ethics, it is more beneficial for a higher number of people to put an end to its operations in China. The employee base of the organization, as well as many ethical and human rights activist would become pleased with this decision. It would also put end to numerous speculations on whether any of the company was violating any of the values that has been uploading proudly. Even though there may be a setback in terms of financial benefits for a short period of time, the organization would be healthier because it would be able to actively adhere to the values that the organization considers to be critical. Continuing operations in China would also mean following two different set of ethics or compromising on ethics based on convenience, which may result in loss of valuable social capital. This case also can be looked at from the perspective of Kantian ethics. Kantian ethics take root on rationality and states that rational decisions are in fact ethical decisions. For Levi Strauss and Co, the rational decision could be a rather difficult one because both the sides have strong arguments from the perspective of reason. When it comes to a business, most often, rationality is measured in terms of what is more profitable for the organization. In addition, profitability does not mean that profit is monetary or financial. If the decision was made in favor of staying in China and continuing the operations there, then it would mean working in a suppressed environment, and adhering to many violations in a silent manner. The organization already saw that the presence of the company in China would not be able to bring about a significant change in China’s way of approaching human rights. Also, the government of China also did not feel threatened in any way because of the decision to move out. China also continued to enjoy the most preferred nation status. Therefore, a rational decision would mean withdrawing its operations from China. For resolving the dilemma that Levi Strauss faces, it is better to stick to the utilitarian approach, especially because it focuses more on the fact that a higher number of people are happy. It would also make it easier for the organization to uphold its values and ensure that it is able to have consistent ethical stance across the nations that it is operating in. References Trevino, L. K. and Nelson, K. A. (2011). Managing Business Ethics: Straight Talk about How to Do It Right. 5th Edition. US: Wiley Case study from: Epstein, E. M., Perkins, T., O’Connel, C., Orosco, C., Ricky, M., Scoble, M. (1995). Case Study: Levi Strauss & Co. and China. Current Issues in Business Ethics, 5, pp. 295-298. Read More