St Louis Delights: Companys Ethics Program - Essay Example

? Company’s Ethics Program Company’s Ethics Program Briefly describe your company and then benchmark the s of conduct used by similar companies in the industry. Critique the codes of conduct of at least three (3) similar companies in order to write codes for your company. St. Louis Delights is a medium sized chocolate making company that has been considering the possibility of expansion. Apart from ensuring that its suppliers as well as workers observe all the required rules of hygiene when engaged in the transportation or handling of the product, the company also has different objectives on how it deals with its different stakeholders. Its aim, as far as workers are concerned, is to ensure that they work in a favorable environment that supports their career development and are treated with dignity. St. Louis Delights, though a small company when compared to international players in the chocolate industry, has a diversified workforce. The company is also committed to ensuring that it remains profitable and preserves cordial relationships with its suppliers. For the company, its stakeholders are a kind of extended family which it treats with respect. St. Louis Delights also strives to maintain the best possible service for all customers while actively looking for ways in which it can contribute to their further development. The community at large is guaranteed high quality food products and a commitment to meet and fulfill universally accepted ethical values. The company also aims to be a participant in the social as well as economical development of its community. The internationally known chocolate company, Mars, Incorporated, has a group of five principles that it strives to adhere to in its operations in different nations. These include Mutuality, Quality, Efficiency, Responsibility, and Freedom (Karunakaran and Chatterjee, 2008). Mars Incorporated has also recently been recognized for its efforts towards ensuring that cacao harvesters in third world nations, who are its main suppliers, also benefit from the business. In West Africa, the world’s largest Cacao producer, Mars Incorporated has started programs such as the ‘Sustainable Cocoa Initiative’ to make it possible for poor farmers to operate sustainable businesses by increasing incomes along the cocoa chain of supply (Hosmer, 2008). Mars Incorporated also aims to meet other environmental preservation targets such as minimizing water use, and stopping the use of fossil fuels as an energy source in the next three decades. Other famous international corporations such as Barry Callebaut and Kraft Foods which took over Cadbury’s, along with seeking to improve working conditions for third world suppliers, have also vowed to deal only in cocoa that is ethically sourced (Karunakaran and Chatterjee, 2008). All over the world, consumers, particularly in developed nations, are increasingly becoming interested in only procuring socially conscious products. St. Louis Delights is well aware of this and aims to make the necessary changes before the ethical market for chocolate grows too large to accept new entrants. Analyze ways ethical challenges affect your business and create a code of conduct for your company. Provide a rationale on how these specific codes enhance your company’s ethics program. St. Louis Delights, though not an international corporation yet, is aware of the conditions that most West African suppliers work with. The biggest ethical issue concerns the use of child labor; or, more specifically, child slaves. In West African communities where cacao is grown, poor children are used to harvest the crop without being paid in most cases (Karunakaran and Chatterjee, 2008). The children may be provided with a single meal as payment for their services. However, for them, as well as their parents, they may feel that this is adequate because they would not have any food otherwise. In places where they are paid, they receive extremely low wages. At present, there is no fail safe strategy that can be used to determine if suppliers are using child labor or not. Another ethical issue has to do with the exporters, middlemen, and manufacturers. The cacao exporters have considerable power over the farm-gate price, and usually ensure that the prices are kept low so that their profits do not take a cut. Middlemen then take the bulk of the remaining proceeds; leaving just half of the world price of cocoa for the West African cocoa farmers (International Labor Rights Forum, 2008). This basically leaves the farmers in poverty. The West African governments are either powerless to fight the powerful middle men, or are regularly bribed to keep out of the cocoa business. This means that the cocoa farmers are left to fend for themselves against unscrupulous businessmen. Any corporation has a duty to remain profitable and cater to the financial interests of its stakeholders. However, there are ways in which this can be achieved without hurting the lives of the very people who provide the raw materials that create the product. Even though it sounds like a radical solution, the only way to curb unethical practices is by only relocating when the company is able to afford the sustenance of manufacturing operations in Africa. This should be a very real goal that ought to be achieved soon. This will deal with very many issues at once. In the first place, children work or are forced to work due to poverty. They are assured of one meal or a measly wage when they work. If the company relocates to the nation supplying the raw materials, it will be able to collaborate with local co-operatives and provide farmers with their entire incomes, without the cut made by exporters and middlemen missing. It will also provide finances for social security benefits and pensions. This will remove the need for children to be forced to harvest the crop. Hiring local people for different operations also means that the income from chocolate will be able to benefit their society directly, with taxes being reinvested in building the local infrastructure as well as the local farms. From its position on the ground, the company will also be able to re-invest in the cultivation of endangered trees, thus repopulating the forest. This means that it can realize environmental goals while still ploughing much needed profits back to the cacao-growing communities. This is, naturally, a long term investment that should only be considered when there are firm operations that have been established to supply Western consumers with the product as normal. However, it is a worthwhile endeavor, and probably the only strategy that deals with so many ethical concerns in one action. After reviewing the Federal Sentencing Guidelines for Organizations, explain how these guidelines influence the ethics program you created The Federal Sentencing Guidelines for Organizations address issues such as child labor and the unfair distribution of income. One guideline, the Foreign Corrupt Practices Act (FCPA) also deals with possible penalties for partaking in corrupt practices in foreign branches. This merely serves to underline the importance of implementing the relocation strategy so as to meet all the requirements stipulated in the Federal Sentencing Guidelines for Organizations. Anticipate where the challenges or setbacks may be in the adoption and enforcement of the codes of conduct for your company. Explain how you will address these challenges and anticipated setbacks. In 2001, there were many Chocolate producers that vowed and signed an agreement that they would not use products acquired through child labor (International Labor Rights Forum, 2008). Even though these were admirable plans, the companies were unable to keep their promise. In the Chocolate industry, as in others, the issue of change cannot be accomplished suddenly. It takes time because the families of the children who work for a single meal have to be well sustained before they agree for their children to remain in school. In addition, pulling out of agreements with farmers who use child labor will just result in further impoverishing the community. The community has to be enriched so that its farmers choose to start making use of different sources of labor. Given the influences of changing economic, political, social, cultural, and technological forces on business and society, explain how you can ensure that your codes of conduct will remain relevant in the years ahead. The only way to ensure that true change comes and remains is by remaining in the area in which change is required until the change comes. Some proposals, such as asking that children remain in school and only adults are allowed to work in cacao farms, may be ignored because of cultural reasons. It is a fact that different communities have different rules. In Africa, there are certain jobs that are viewed as being men’s jobs, or children’s jobs. Harvesting cacao may be viewed as being children’s work. This is where the company in question can suggest a compromise where a child can work for a small period of time and then go to school for the rest of the day. The only way in which communities will accept changes that seem foreign to them is if they are not forced to embrace them. Compromising over different issues in the effort to find workable solutions makes a community feel respected. The community will then be more likely to keep the agreement even when not under supervision. References Hosmer, L. T. (2008). The ethics of management. New York: McGraw-Hill. International Labor Rights Forum (ILRF). (2008). The cocoa protocol: Success or failure. http://www.laborrights.org/files/Cocoa%20Protocol%20 Success%20or %20Failure%20June%202008.pdf (accessed November 30, 2013). Karunakaran, A., & Chatterjee, C. (2008). Ethical chocolate: A bittersweet dilemma. Bangalore: ICFAI Business School. Read More