Ethical Issues in the Supply Chain - Ethico Supremica - Essay Example

Ethical issues in the supply chain Name Institution Tutor Subject Date Ethical issues in the supply chain The company should proceed with the development of a range of breakfast teas using leaves sourced from Assam. There are many dimensions from which this point can be described incorporating ethical concerns. As much as profit making is the basis for the existence of any business, obsession with profits should not occur to a point where ethical issues are assumed. As much as the company will be sourcing tea leaves from the state of Assam in India to make a range of strong, malty, breakfast teas no exploitation will occur whatsoever as all the practices within the supply chain will be exclusively streamlined to ensure ethical issues are highlighted and addressed. It is very important to note that many things are at stake here (Tencati & Perrini, 2011). Various variables need to be analyzed with a deeper insight so as to define the various profits this will bring. Proceeding with this deal will be of profit to both the company and the suppliers from Assam. The company will strike a balance between the benefits it is going to derive from this deal and the benefits the suppliers will obtain. For the reason that ethical practices has many profits to the stakeholders it will be very vital to strike the deal in a way that code of ethics are respected. This will lead to increased profits for the company thus cost efficiency will be enhanced. Furthermore the image of the company will positively grow as the public relations are bound to be adequately promoted. Some school of thoughts always think that business should only operate to make profits, they further assert that businesses should only be focused with making profits even if it means getting into unethical dealings with suppliers. This won’t be the case with Ethico Supremica, it is unacceptable within our standards to enter deals that are do not respect code of ethics in the supply chain. The farmworkers at Assam are extremely poor because of the unethical deals they have been subjected to over the periods, this is in regard to the poor financial compensations given to them. It is important to note that the company will compensate them in a way that their efforts are fully appreciated and that all these will be transparent undertaken (Luo, 2012). The company will fight for the rights of those lured as a result of faulty promises. This may not be our core business but it is part of our codes of ethics, to uphold humanity and its dignity always. The company will be involved in bringing to light any illegal or inhumane dealings at the background. Good compensation to these Assam farmers will end up solving many prevailing issues that are being experienced. Slavery is against humanity and the company does not in any way support such practices even if it means additional profit. The company will put up measures that fervently involve in whistle blowing. This will help in solving any potential unethical practice during outsourcing. Approaches to be applied by Ethico Supremica to guarantee an ethical supply chain free from slavery Besides moral issues related to the devious chains of supply, the reputational injury to a firm can be very challenging to eradicate. What follows is how we will avoid entering any unscrupulous contracts. Slave labor ought to be thrown to the books of history. However the unending downward pressures on prices as well as the preceding globalization of supply chains imply that there still exists exploitation of the vulnerable (Cheng & Choi, 2010). In a world that is extensively globalized, being sure that the company’s supply chain is free from suppliers that work in law breach is continuously turning to be more intricate. Even in cases where there seems to be existing direct contractual relations, it can prove hard to ensure compliance with the applicable standards. For this reason the company will ensure no contracting with criminals. Research The company will carry out due diligence in addition to incorporating Hazard Analysis Critical Control (HACCP) principles of assessment into the entire supply chain process. This will help in exploration of vulnerabilities and risks and how such will be appropriately protected against (Mellahi, Morrell & Wood, 2010). It is important to note that such checks are normally designed to help in identification of hazards such as deterioration thus reducing the risk of these happening (for instance checks on temperature control) in the distribution and production chain, however the application should and can be more broadly. Specific care ought to be taken into consideration for suppliers situated in jurisdictions of high risk or related with sectors specifically susceptible to exploitation, such as Assam, as evidenced in the case study (Rendtorff, 2009). When evaluating the jurisdiction of operation, it will be critical to consider what the licensing obligations, regulatory framework and reporting requirements and whether the firm will need a superior standard. It will important to scrutinize if these standards are being met, instead of solely depending the regulations. Review It will be appropriate to audit the contracts of supply and if need be, consistently vary terms of supply so as to enhance commitments, standards and provisions through placing particular conditions and clause to be complied to. It will necessary for the company to investigate the sanctions received from the suppliers, that their particular licensing, regulatory or reporting obligations are observed keenly, and to ratify the role of the firm in sustaining the process (Kane, 2013). It will be beneficial if this process is not merely regarded as a box ticking process but licenses as well as copies of underlying audits will be provided. The more the length of the supply chain, the more consistent auditing and investigation standards to be provided at all the entire phases. A higher magnitude of micro-management in relation to the major contracts will be provided, for instance meeting with the client either virtually or face to face and subsequent report writings. Revise Market, political and environmental conditions do change continuously and when they change the company will have to be profoundly conscious of the pressures suppliers will be operating under and what the consequential risk are likely to surface. This ranges from the tea harvesters who are gravely influenced by the conditions brought about by weather changes to contamination heightening customer demand for alternative food supplies (Wang, 2013). It can be proposed for example that scandals related to selling poor quality tea, for instance, are partly as a result of the cheaper prices of the same product as well as low risk of detection. Arrangements to purchase need to be frequently compared to the rates at the market and if they are considerably under this, investigation of the knock-on impacts should be put in place. At the top of this company, supports will be structured through this complex and costly process of auditing and investigations. In the long run transparency will be compensated and for this reason also there should not be any fear of sharing the positives as well as the negatives. Going beyond the bare minimum Whereas over the coming 3 years it is anticipated that additional procurement and reporting requirements will be introduced, generally the rule executes no obligation on the company to inhibit any third parties from bringing about injury to another. This implies that currently, the investigation of the practices of the supplier, outside what the supplier is contracted with the company to supply, are in the jurisdictions of Corporate Social Responsibility (CSR) (Garg & Gupta, 2012). Going beyond and above the basic laws, sincerely probing the company’s supply chain, taking voluntary action and obstructing clumsy legislation will be the aim of the brand. The constructive results of rational corporate responsibility and etiquette will be observed in the success of the company. Not every company has the capacity to carry the Fairtrade logo, however every company should be conscious of the risks of failing to conduct an effective research, reviewing as well as revision of the specific actions. Damage to the company’s reputation will be prevented through a resilient supply chain that possess buy in at all the levels and whereas contract management and auditing may appear to be expensive, it will deliver the company with the much required safeguards from a significantly costly and destructing scandals. Code of business ethics that Ethico Supremica will implement to ensure success while sourcing from Assam Professionalism All stakeholder within the company’s supply chain process will be expected to show extreme standards of professionalism. This implies that every participant ought to treat the other with equivalent amount of trust and respect thus by no means should one command or intervene the other (Tencati & Perrini, 2011). All the data that are supposed to be confidential will be safely guarded by all the involved parties. Compliance with the terms and conditions laid down will be a requisite for all the parties. Personal integrity Integrity is described as an individual’s character that reflects the qualities like possessing morally strong values and honesty. Individual integrity is a strong sense of devotion towards high standards of ethics, openness and devotion towards morality that person stand by and practice while acting as a role model for the others (Luo, 2012). Every party involved in this process and not merely the general unit ought to possess high levels of individual integrity so as to ensure that the whole supply chain process is ethically upright. Conducts such as taking favors like gifts, preferential treatments, stakes and monetary commission are taken to be falling out of the confines of codes of business ethics. Accountability and transparency All the stakeholders that take part in the supply chain process will have to be accountable in addition to being open (Cheng & Choi, 2010). For example the company will not in any way try manipulating the local authorities in order to gain competitive advantage over other competitors however it will proceed on legally appropriate networks. Continuous improvement and compliance Compliance to the native regulations is an obligatory pre requisite. No stakeholder should bypass the rules of the state to gain prejudicial advantage (Mellahi, Morrell & Wood, 2010). The entire units should operate towards enhancing a progressive culture of improvement in the activities of the supply chain and act as role models for others to chart. Reflection Developing countries lack stringent regulatory frameworks in regard to labor working conditions and Assam is no special case. After the tragedies currently being witnessed there, the company will start focusing more on the labor conditions and labor rights of the employees. This will be done in order to ensure CSR is taken into consideration (Rendtorff, 2009). The company put much effort on improving the economic and social welfare of all the stakeholders. All the stakeholders in this context refers to the consumers, employees and even the suppliers. Through Corporate Social Responsibility, the highlighted plights of the farmers will be addressed through the right channels. This just doesn’t imply financial support but also creation of awareness in regard to their rights (Kane, 2013). Ignorance and illiteracy seem to be a problem at Assam as most unskilled workers are un-aware of what their rights consist of. Through workshops and seminar, the company will be able to inform them of their rights and responsibility. These are individuals who are not conscious of their rights thus the rich take advantage of them because of their desperation. Summary Generally there are numerous profits that the company will get as a result of proceeding with the development of a range of breakfast teas using leaves sourced from Assam. This is a strategic plan that will strongly position the company in the competitive market. This is to mean that production of this range of teas using leaves from Assam will be useful in rebranding the company. Through this the company will be able to attract new potential customers and additionally keeping the current customer base. This will result into rise in profits due to a widened customer base who imply high sales. However it is important to note that all these should be done with much caution. The supply chain will thus be on the basis of ethical considerations so as to make sure that no dirty dealings are entertained. An ethical supply chain will ensure no party is subjected to unjust practices. References Tencati, A., & Perrini, F. (2011). Business Ethics and Corporate Sustainability. Cheltenham: Edward Elgar Pub. Luo, Z. (2012). Innovations in logistics and supply chain management technologies for dynamic economies. Hershey, PA: Business Science Reference. Cheng, T. C. E., & Choi, T.-M. (2010). Innovative quick response programs in logistics and supply chain management. Berlin: Springer. Mellahi, K., Morrell, K., & Wood, G. E. (2010). The ethical business: Challenges and controversies. Basingstoke: Palgrave Macmillan. Rendtorff, J. D. (2009). Responsibility, ethics, and legitimacy of corporations. Frederiksberg, Denmark: Copenhagen Business School Press. Kane, G. (2013). Building a sustainable supply chain. Oxford: Dō Sustainability. Wang, J. (2013). Management innovations for intelligent supply chains. Hershey, PA: Business Science Reference. Garg, M., & Gupta, S. (2012). Cases on supply chain and distribution management: Issues and principles. Hershey, PA: Business Science Reference. Read More