Due to the complexities of dealing with human nature, many will agree that it is difficult to determine a sole set of moral rules, guidelines or principles to follow in the business industry. To remedy this dispute, the field of business ethics presents a set of diverse ethical theories that suggest justification for the determination of moral or immoral actions, whilst also providing a basis for claims regarding moral obligations (Monteverde 2014). These ethical theories are grounded upon ethical principles, with each highlighting distinctive features of the ethical dilemma in question in order to aid in directing the subject to the most ethically sanctioned judgement according to the guiding principle within the ethical theory itself (Ozsozgun, Ozarslan, Akbas 2010) (William 2012). Such a process can be applied to a variety of ethical dilemmas within the overarching field of business, including that proposed by major Australian vehicle manufacturer, Broom Broom Limited. A major fault in the fuel delivery system has been discovered in Broom Broom Limited’s only offered product, The Yakka, an inexpensive utility vehicle that sells 250 000 units annually, mainly to third world countries. This fault causes one vehicle in every 100,000 to explode suddenly into flames without warning and will affect the existing 8 million models currently in use. Hence, this leaves Broom Broom Limited in an ethical bind, stuck between the option of recalling all existing models for repair worldwide, at a cost of $750 million and the loss of mum and dad investors, a refusal from superannuation funds to accept a recall expense and a significant drop in the company’s share price. Alternatively, the company may choose to not recall the faulty products and accept that between ten and fifty people will die or be seriously injured every year, resulting in compensation claims of $5 million per year for the next ten years. The assessment of cases via the use of ethical theories is essential in deciding upon the most morally sound course of action, as a comparison of conclusions resulting from the ethical theories being applied will assist the subject in arriving at the most selfless and justly right means of judgement for their particular predicament in question and also learn valuable lessons for future dilemmas with which they are faced. Hence, the process of evaluating ethical dilemmas through the use of ethical theories will be applied to Broom Broom Limited’s disclosed situation. Using the ethical theories of utilitarianism, Kantian deontology and justice and fairness, a conclusion will be reached as to which course of action is the most morally correct and also as to which ethical theory is the most convincing in such circumstances.
Utilitarianism is an ethical theory that insists an action is considered to be right or wrong based on the consequences of the actions and its effects on the majority of people (Heayry 1994). This theory, first established by classical utilitarians Jeremy Bentham and John Stuart Mill, enforces that morality’s main goal is to improve society’s overall quality of life by increasing the amount of good things in the world and decreasing the amount of bad things, ultimately resulting in a debate of pleasure versus pain (Hollander 2016). Hence, before this theory is applied directly to Broom Broom Limited’s current ethical dilemma, it is important to note how it has been exercised in previous real-life scenarios (Hollander 2016). Several years ago, a pharmaceutical company released the drug Accutane as a means for treating severe acne in young men (Study.com 2018). Whilst the drug was very effective, it was known for causing life-threatening birth defects if pregnant women were exposed to it (Study.com 2018). Under the principle of utilitarianism, it was concluded that it was ethically acceptable to release a drug such as Accutane with appropriate warning (Study.com 2018). This is as the number of young men who experience relief from the skin condition outweigh the few cases in which an individual will fail to adhere to the warning (Study.com 2018). Therefore, utilitarianism provides moral permission for the distribution of such drugs because the sum of their contributions are argued to be far greater than the negative outcomes they cause (Study.com 2018). This noted, Broom Broom Limited’s ethical dilemma can be analysed under the principle of utilitarianism by contrasting the net happiness produced for the majority of people in the instance of recalling the Yakka or alternatively remaining quiet about the vehicle’s life-threatening fault (Hollander 2016). If a recall were to occur the company itself would suffer financially through reparation costs, the establishment of a negative company image and declines in company investment, market share prices and superannuation fund values (Hollander 2016). However, in the event of a recall there would be minimal to no deaths or serious injuries inflicted on the 8 million current owners of the Yakka and other people who may operate these vehicles in circulation (Hollander 2016). Hence, in the event of a recall, positive effects are inflicted on the majority of people involved, as only the company suffer as a result (Hollander 2016). It is also important to note that even if a recall was to be withheld, the company would still suffer similarly eventually, as it is highly likely that once deaths start occurring the truth will come out and the effects on Broom Broom Limited’s reputation and financial status would end up far worse (Heayry 1994). Therefore, when considering Broom Broom Limited’s ethical dilemma from a utilitarian point of view, the course of action is for the company to move ahead with the recall, as this is the most morally sound judgement and will create the largest net benefit for the majority of people involved (Hollander 2016).
Moral rights or Kantian deontology is an ethical theory first introduced by German philosopher Immanuel Kant, that stresses an action is only considered to be ethical if it can be accepted as a universal law by every individual (Gotsis & Kortezi 2013). This theory is sometimes referred to as the ethics of duty as it revolves around the principle that actions are not right or wrong based on their result but rather if they are inherently good or evil (Cherkasova 2009). The moral rights approach asserts that human beings have fundamental rights and liberties that cannot be taken away by an individual’s decision and is based on two principles (Schiff 2017). The first is the universality principle which states that act only on that maxim which you can at the same time will that it should become a universal law (Rotich 2015). The second is the principle of reciprocity states that act as to treat humanity, whether in your own person or in that of any other, in every case as an end, never as a means only (Schiff 2017). In conjunction with these principles, Kantian deontology requires consideration of six moral during decision making, those being; the right of free consent, the right to privacy, the right of freedom of conscience, the right of free speech, the right to due process and the right to life and safety (Cherkasova 2009). These concepts can be applied to a similar ethical dilemma to that currently being faced by Broom Broom Limted, that being the faulty airbag scandal Japanese automobile safety equipment manufacturer, Takata, found themselves caught up in (Cherkasova 2009). Takata is unethical under Kantianism since they withheld and reportedly destroyed the results of the safety tests on their airbags (Schiff 2017). Since they were hiding the information that would have resulted in nobody wanting to buy their product including automakers at the first tier, and consumers buying the automobiles at the second tier (Gotsis ; Kortezi 2013). Automakers and consumers were unable to make an educated decision about the product, and they were not given the respect of their individuality (Cherkasova 2009). Also, this decision by Takata to use these faulty airbags was not made in good will at all, but certainly in self-interest (Schiff 2017). In consideration of this information, it is important to note that Kantianism is an ethical theory that is based in respect for all individuals affected by a situation or business in some way, and emphasizes that individuals should be provided the information necessary to make their own decisions (Rotich 2015) (Schiff 2017). People should not simply be used in order to make a profit based in self interests, people instead can assist in growing profits if they are provided with a product that they want to purchase after being provided with all of the necessary information about the product (Schiff 2017). Therefore, under this theory it is in Broom Broom Limited’s best interest to disclose to the public the company error and potential harmful attributes if the effected Yakkas (Rotich 2015). This resolution emerges as the most morally correct option as it treats mankind with respect and does not use people as a mean to get an end, binding the company to follow a set of maxim to ensure their actions are ethically right (Rotich 2015).