Authentic Leadership and Ethical Organizational Culture - Essay Example

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Ethics Executive Summary Apple Inc., a leading multinational business company which deals in electronics products, faced a significant ethical issue with its major supplier i.e. Foxconn The various ethical issues include about the working hours and the compensation of the workers among others Apple’s decision in order to make continuous business transaction with Foxconn is for the purpose of producing its various products with reasonable outsourcing costs A few implementation plans have been proposed for both Foxconn as well as Apple in order to minimize the ethical issues The plans include complying with the legal principles of Fair Labor Association (FLA), offering fair compensation to the workers and engaging them in different union structures The implementation plans would help both Apple along with Foxconn in minimizing ethical issues along with reducing public relation risks The business organizations can maintain their productivity as well as quality by managing ethics in their respective workplace. Moreover, the organizations can preserve a sustainable working environment by taking into concern the aspect of ethics in the current business context. Introduction Ethics is principally described as a philosophy of study which is particularly concerned with the assessment of human behavior. The aspect of ethics involves the learning about determining the correct as well as the incorrect activities which occur in the workplace (Singer, 1993). In this context, it can be stated that it is quite important particularly for the business organizations to manage ethics in a specific workplace in order to gain broad variety of benefits. The benefits include cultivating strong output as well as teamwork, supporting the growth of the employees and effectively organizing as well as managing the values linked with quality, diversity and strategic planning management (Guha, 2008). In this paper, a current ethical issue which is faced by Apple Inc. associated with one of its suppliers i.e. Foxconn will be taken into concern. Moreover, a detailed analysis about the emergence of the ethical issue along with formulating an effective plan in order to deal with the issue will also be depicted in the discussion. A Brief Overview of Apple Inc. Apple Inc. is an American based multinational business organization which designs as well as sells broad assortment of consumer electronics, personal computers and computer software. The various standardized products of the company include iPod, iTunes, iPad and iPhone among others (Apple Inc., 2012). The company pays much attention and significantly focuses upon designing its products in such a way so that there lays a minimum affect upon the environment (Apple Inc., 2012). Moreover, the company remains much committed to preserve the highest benchmark of social responsibility by delivering safe working atmosphere and treating the working personnel with equal dignity as well as respect (Apple Inc., 2012). Analysis of Current Ethical Issue It has been viewed that Apple faced an ethical issue associated with one of its key suppliers named Foxconn while producing the valuable products of the company. According to the investigation made by Fair Labor Association (FLA), Foxconn has been involved with few ethical issues which include the working hours of the employees, health as well as safety, compensation and worker integration along with industrial relations. The report of the investigation which is conducted by FLA has revealed that Foxconn has failed to comply with the ‘Workplace Code of Conduct’ as well as labor law which prevails in China. From the perspective of the ethical issue relating with the working hours of the employees, FLA has identified that the standard amount of working hours of the employees per week at the factories of Foxconn surpassed the standard guidelines of FLA. This particular issue was observed in every factory of Foxconn (Scribd Inc., 2012). The principal causes behind the increased rate of the working hours which surpassed the legal guidelines include high rates of labor turnover and significant gaps between the capacity planning and production. In terms of the ethical issue linked with the health along with the safety of the personnel, the report of the investigation has revealed that an extensive amount of working staff belonging to Foxconn felt insecure about their safety as well as health. The frequent appearance of aluminum dust was the chief basis behind the feeling of insecurity of the employees which adversely affected their health and raised the subject matter of security towards them by a considerable extent. From the viewpoint of the ethical issue associated with the industrial relations along with the worker integration, the investigators of FLA observed that the working staff of Foxconn were mostly alienated rather than integrated. Moreover, the workers hold little confidence about the management of health as well as safety related issues, which ultimately is considered to be a chief contributory factor in raising the ethical issue considerably (Scribd Inc., 2012). On the basis of the aforementioned grounds, it can be stated that the ethical issues which prevail in one of the suppliers of Apple i.e. Foxconn is due to ineffective decision-making procedures which are utilized by the management team of Foxconn. The significant issue of Apple in relation to its supplier can be considered as a global one due to the reason that Foxconn produces its valuable products as a form of supplier and the company delivers the products in worldwide business markets. However, it can be stated that the ethical issue of Apple with Foxconn poses considerable impact upon their business performances along with maintaining their huge business reputations. Moreover, the ethical issue linked with Foxconn can have an intense effect upon the success of the company in future (Anderson School of Management, 2011). Analysis of the Emergence of the Ethical Issue Foxconn Technology Group (Foxconn) is viewed as a major supplier of Apple which is regarded as one of the largest electronics manufacturers throughout the globe. Since the beginning of the year 2010, it is observed that there have been augmenting ethical issues which include poor livelihood as well as working situations of the employees, exceeding working hours of the employees, unhealthy working atmosphere and disintegration of the workers within Foxconn. In this regard, Apple does not seem to be much concerned about the ethical issues which are faced by Foxconn (Didovych, n.d.). The major reason of Apple for not giving utmost attention to the rising ethical issues associated with its major supplier is that its manufacturing product related components are constantly being produced at a faster rate from Foxconn. Consequently, the company has attained significant competitive position over the chief business market contenders. After observing the various ethical issues which prevail in Foxconn and Apple’s decision to continue business with Foxconn, it can be stated that the transaction of business of Apple seems to be quite unethical. The major reasons for the company in order to continue business with Foxconn are that the company is making significant profit on the sale of its several valuable products and thus growing considerably (Didovych, n.d.). The emergence of the ethical issue faced by Apple was largely due to one of its chief suppliers i.e. Foxconn who did not fully comply with the applicable FLA based rules as well as guidelines. In relation to management viewpoint, on the basis of the aforementioned ethical issues, the decision of Apple for making constant business transaction with Foxconn can be considered to be unethical. This is due to the reason that Foxconn did not comply with the legal rights of the workers as it forced the working personnel to work for longer hours. According to the legal rights based on Chinese labor guidelines, the workers must be able to rest and must take a particular day off. However, the workers have been viewed to work for longer hours and they are not paid sufficient for the work which they perform in Foxconn (Didovych, n.d.). Thus, it can be stated that Apple’s decision to continue business with Foxconn in spite of bearing an explicit idea about various immoral practices which prevailed in the manufacturing unit ultimately emerged as a considerable ethical issue for the company. The issue was immensely publicized and captured more attention of the media at large. Plan After acquiring a brief idea about the immoral practices which prevailed in Foxconn, it can be stated that both Apple along with Foxconn should introduce a few important remedial measures. In this regard, from the perspective of the unethical practice associated with the working hours of the employers, Foxconn would have to comply with the legal guidelines of FLA. While lessening the worker’s working hours, Foxconn will have to raise more employment in order to retain its existing output level along with quality and productivity. In order to minimize the working hours of the workers, the supplier needs to recruit extra workers as well as provide them with adequate training (Scribd Inc., 2012). In terms of the ethical issue relating with the health along with safety of the workers, Foxconn would have to augment the active participation of its workers in formulating as well as implementing an indispensable policy linked with their wellbeing and security. The dynamic engagement of the workers would assist the supplier to ensure future compliance with the ethical guidelines of FLA. Moreover, Foxconn would have to monitor and trace the rate of accidents which cause injuries to the workers that will help the supplier to maintain ethical standard of health along with security of the workers considerably. From the viewpoint of the aspect of integration of the workers along with maintaining industrial relations, the supplier must have to improve as well as augment the participation of the workers in different unions along with other committees. In this respect, the supplier i.e. Foxconn should comply with the local legal guidelines and must agree to ensure the fact that the elections of the employee representatives would be conducted without the interference of the management. Furthermore, Foxcon would have to introduce the perception of collective bargaining based agreements by which the workers can receive any sort of information about the different activities of the unions along with their orientation procedure (Scribd Inc., 2012). In relation to the ethical issue relating with the compensation of the workers, the supplier would have to pay fair compensation to its valuable workers in order to attract them for the purpose of raising the output level. In addition, the supplier should permit the workers to participate in various work-related meetings which take place outside the usual working hours (Scribd Inc., 2012). Therefore, these are few crucial plans that can be implemented by both Apple along with Foxconn while dealing with their respective ethical issues. By developing as well as implementing the aforementioned plans, the various ethical issues which prevailed in Foxconn can be minimized by a large extent and the issue would be less publicized along with grabbing less attention of the media. While implementing the plans, both Apple along with Foxconn would have to bear additional costs owing to the fact that they have to offer fair compensation to its workers. The main benefit for both Apple and Foxconn by implementing the proposed plans is that both of them can cope up with their respective ethical issues and can preserve an ethical standard while producing and delivering products worldwide. Furthermore, the minimization of the ethical issues by implementing the plans would ultimately support both Foxconn and Apple to reduce public relation risks by a considerable extent. Conclusion Ethics play a vital role for every business organizations. It has been viewed that Apple Inc. has faced a significant ethical issue which is related to its chief supplier named Foxconn. The ethical issues include the working hours, wellbeing as well as security and compensation of the workers. In order to minimize the ethical issues, a few implementation plans have been proposed through which both Apple as well as Foxconn can be able to maintain an ethical standard while performing their operational functions by a considerable extent. References Anderson School of Management. (2011). Ethical issues at Apple Inc. Retrieved from http://danielsethics.mgt.unm.edu/pdf/Apple%20Case.pdf Apple Inc. (2012). iPod. Retrieved from http://www.apple.com/ipod/ Apple Inc. (2012). Environment. Retrieved from http://www.apple.com/environment/ Apple Inc. (2012). Supplier responsibility. Retrieved from http://www.apple.com/supplierresponsibility/ Didovych, M. (n.d.). Ethics behind apple and Foxconn relationship. Retrieved from http://kc2odn.com/Maryana-apple.pdf Guha, D. (2008). Practical and professional ethics: economic and business ethics. India: Concept Publishing Company. Scribd Inc. (2012). Protecting workers’ rights worldwide. Retrieved from http://www.scribd.com/doc/87247567/Foxconn-Investigation-Report Singer, P. (1993). Practical ethics. England: Cambridge University Press. Bibliography Morris, J. T. (2009). The impact of authentic leadership and ethical organizational culture on auditor behavior. Proquest Dissertations and Thesis. Read More