Virtue Ethics and Business - Case Study Example

Virtue Ethics and Business There are three virtues which are pronounced in Mattel’s Global Manufacturing Principles (GMP). They are; a. Fairness – fairness meant giving or attributing to each individual what is due to him or her. “It rests on the assumption that each person matters in themselves and is more than a number - to put it formally, persons are separate bearers of dignity and rights” (BBC Today, 2010). Being such, any transactions which shortchanges what is due to an individual is not fair. In a paper by Manitoba Ombudsman, fairness is defined to have three aspects which are procedural fairness which relates the manner decisions are made in consideration of the process followed before, during and after a decision is made. Substantive fairness which meant the fairness of a decision by itself and relational fairness relates how to people are treated and how they feel about the process and its outcome (nd). b. Justice – is the standard of what is right which makes render unto every person his just due without discrimination. It is consistent with divine and human laws and is the support of every civil society. c. Honesty – is the opposite of deception and untruthfulness. It is a value that “deplores dishonesty, is not amused by certain tales of chicanery, despises or pities those who succeed by dishonest means rather than thinking they have been clever, is unsurprised, or pleased (as appropriate) when honesty triumphs, is shocked or distressed when those near and dear to her do what is dishonest and so on” (Standford Encyclopedia of Philosophy, 2007). The virtue of honesty was institutionalized at Mattel Incorporated when it created an independent auditing body that would “verify Mattel’s compliance with its code of conduct in a manner that would be credible to the public and engender trust in Mattel’s GMP-related performance claims (Sethi et al., 2010, 487). Such auditing body was Mattel Independent Monitoring Council (MIMCO) which later evolved to the International Center for Corporate Accountability (ICCA). 1) Next, apply each of the three virtues you have chosen to the case. Tell me how each of the virtues you've chosen might have been used to appropriately guide the actions and policies of the company. You may discuss how each relates to working conditions, worker safety, fairness, attitudes towards the environment, etc.  The virtues of fairness, justice and honesty appropriately guided Mattel Incorporated especially when it implemented its Global Manufacturing Principle between 1997 to 2008. This virtues were particularly helpful because “product safety is not so thoroughly embedded in developing countries where expectations toward adherence to product safety standards are generally lower than those prevailing in industrially advanced countries” (Sethi et al., 2010, 494). This was especially true in its China factories where its local partners have the predilection of cutting corners and circumventing local laws. It sought to end the exploitative nature of business and to regain public trust in the company. There are a lot of ways where these virtues have guided the company but for brevity, we will cite a few; a. Working conditions – the virtue to be fair with Mattel’s employees by treating them right was evident in the Thailand plant audit when workers were complaining of excessive heat in the factory because it is not air-conditioned. In response, Mattel put on a major effort to reduce the heat by increasing the air circulation. The plant was reconfigured so that the temperature would decrease by 3-5 Celsius to make the working condition more humane. In China, Mattel GMP sense of fairness and justice to its employees was unwavering in making sure that employees are treated right and given their just due. During the initial audit of ICCA in China, it was found that a dormitory was such in a poor condition that it was uninhabitable. Mattel would like it improved but its partner in China protested that the dormitory was already in such shape way before the introduction of GMP and as such, should be exempted by GMP standards. ICCA dismissed their argument as untenable rejected it which was equally supported by Mattel to be unacceptable. To have a just working condition, Mattel took the responsibility of rehabilitating the dormitory to make it suitable for a humane living (Sethi et al., 2010). b. Worker safety – In one of its plants in Mexico, the MX3 audit of MIMCO reported that the plant’s safety practices were far from the ideal. “The flow of materials, processing, waste handling, storage anddisposal, suggested a disregard of normal safe handling procedures. The molding area of the plant was unkempt with oil spills on the floor, draining into an open channel. There were large amounts of makeshift electrical wiring and bare electrical connections. In several places, live electrical cords were lying across employee pathways” (Sethi et al., 2010, 497). This was strongly denounced by MIMCO and again the business partner in Mexico protested and even suggested a “change of language” in their report. MIMCO however was steadfast and honestly reported the undesirable worker safety condition of the Mexico plant despite the protestations of the local business partner. In response, Mattel supported MIMCO’s findings and ordered the plant’s shortcomings to be rectified. In a follow-up audit in February 2001, the MX3 plant in Mexico revealed a remarkable improvement of the factory safety. This was a product of honest reporting by MIMCO despite of the protestation of the plant’s senior managers. c. Fairness to employees – the virtue of fairness and genuine regard to the welfare of its employees was best displayed at Mattel when ICCA findings in its plant in Indonesia revealed that workers were pressured to render overtime when they are unwilling to do so. As a response, Mattel implemented corrective actions to eliminate forceful rendering of overtimes (Sethi et al., 2010). Attitude towards the environment – when Mattel’s foreign plants especially those who were located in China have environmental protective issues as reported by the audit of ICCA, e.q. treatment and disposal of wastewater, air and water quality, ventilation, and a culture of inadequate attention to general plant maintenance and operations, Mattel worked with these local vendors to address these environmental protection issues whose implementation can be verified and “if appropriate, provided for ICCA’s review, copies of proper certification from appropriate government agencies and professional bodies” (Sethi et al., 2010, 498). The honest reporting of ICCA ensured that its foreign business partners comply with the environmental standards set by Mattel’s GMP. 2) Which of the three normative ethics we've studied - i.e., deontological, utilitarian, or virtue - do you believe is most useful in evaluating the Mattel case? Why?  The most useful normative ethical standard that is most useful in evaluating the Mattel case is the deontological virtue. Deontological virtue in plain language meant “on what is the 'right' thing to do by doing what 'feels right' and acting it from a sense of law or duty” (Sevenoaks School Philosophy Department, 2009-11). This was manifested by Mattel’s desire that the Global Manufacturing Principle (GMP) is “‘‘the right thing to do,’’ a position that required a sustained level of value-based ethical commitment (Sethi et al., 2010, 485). This is a laudable position of the company about good business ethics especially when nobody in the industry cared about it. Mattel even went as far as instituting MIMCO and ICCA to ensure that their claim is credible by allowing a third party to audit its operation without restriction about the substance of its findings where it can publish it anytime. Mattel acted more from a sense of duty “to do what is right” rather than in anticipation of a potential benefit of implementing a good business practice. References: BBC Today (2010). What is fairness? Online. Available at . Retrieved on December 27, 2011 Manitoba Ombudsman (nd). Understanding Fairness. Online. Available at Retrieved on December 27, 2011. Sethi, Prakash S.; Emre, Veral A.; Shapiro, Jack H. and Emelianova, Olga (2010). Mattel, Inc.: Global Manufacturing Principles (GMP) – A Life-Cycle Analysis of a Company-Based Code of Conduct in the Toy Industry. Journal of Business Ethics . 99:483–517. DOI 10.1007/s10551-010-0673-0. Sevenoaks School Philosophy Department (2009-11). Deontological Ethics. Online. Available at retrieved on December 27, 2011. Stanford Encyclopedia of Philosophy (2007). Virtue Ethics. Online. Available at . Retrieved on December 27, 2011. . Read More