Ethical Dilemmas - Creative Commons - Case Study

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Introduction

In corporate life as well as in personal life, people are faced with various ethical dilemmas. How we behave and what decision we make in these situations are influenced by several different factors, like social norms and objectives. In this essay I will look deeper in to 3 cases; two company based cases and 1 individual case by choosing one stakeholder as the decision maker. By looking from the decision makers’ perspective, I will try to gain more understanding and knowledge of the complexity that is ethical decision making today. The first case I will look into, is the case of Dov Charney (former CEO of American Apparel) versus Irene Morales, former store manager who was sexually harassed by her boss. For the second case I chose the false marketing of Coca- Cola owned Glaceau Vitamin Water. The Centre for Science in Public Health field a lawsuit against Glaceau for their misleading marketing in 2009. My third and last case, will examine Chiquita International and their cooperation with paramilitary troops in Colombia that lasted for several years. The company paid huge sums for protection.

Case 1 - Sexual Harassment

The US clothing manufacturer American Apparel has been the subject of controversy on several occasions, not only because of their highly sexual advertisements but their now former CEO Dov Charney and the sexual harassment cases held against him.

As stated in an article by The Guardian, ever since starting to work at a New York based American Apparel store in 2007, Irene Morales continuously confronted sexual harassment in various forms and psychological abuse from the CEO of the retail chain, Dov Charney. Almost immediately after her 18th birthday, Morales was personally invited to Charney’s apartment. There she was held by force for several hours while preforming sexual acts against her own will. After an eight month period of ongoing harassment, Morales resigned from the company and sued Dov Charney for 260 million dollars. While resigning from American Apparel, Morales had signed an agreement stating that she had no pending claims against the company. As a reaction against the lawsuits, launched by Brooklyn Supreme Court on behalf of the victim, American Apparel used this particular contract signed by Morales to file a lawsuit against the victim (Adams, R. 2011).

Sexual harassment in the workplace is not an unusual event. Some estimates indicate that the number of women facing sexual harassment on some level in the workplace is reaching one out of every two women (Schneider et al, 1997). Keeping that in mind, it is easy to assume that the harasser would have done similar things to other employees. By choosing to confront the harasser in a public way, Morales made it easier for other potential victims to come out as well. The other alternative outcome could have been to keep quiet, thus letting the harasser get away with his actions while potentially closing the door for other women to step forward.

While the dilemma whether to confront the harasser or not might have been difficult to solve, the goal of the victim is relatively easy to establish. By taking legal action, Morales was pursuing justice for herself and give the harasser what he deserved.

Although it would be easy to assume that the case would mainly affect the two parties involved, the case certainly had an impact on several other stakeholders. Among them, the company itself with the interest of making profit and keeping a clean image also the consumers and brand users were touched by this harassment case. Consumers hearing about the case, might choose not to support a store chain that has been linked with a sexual harassment suit, thus making a difference in sales of the company.

As an employee of American Apparel, the victim had the right to freedom from discrimination, covering the issue of sexual harassment (Crane and Matten, 2010, p. 293) which was severely violated when the harasser forced himself on her.  Surely the psychological trauma and emotional fear caused by taking these rights away from the victim, was one of the factors influencing her behaviour and decision. The behaviour of the harasser is complicated to understand, since it is contradicting the social norms that are ruling in the workplace and society itself, which is to condemn sexual harassment.

The situation could have been avoided if the harasser, in this case the company CEO, would have kept a professional relationship between himself and the employee or at least stopped the harassment earlier. The harasser should not have taken the advantage of his position as her boss and there by abusing is power. The victim should could have come forward with the case already form the beginning and inform higher level staff about the situation.

Case 2 – False marketing of VitaminWater

The Coca-Cola owned, hugely successful Glaceau VitaminWater brand faced their first lawsuit launched by the Centre of Public Interest in 2009 on the behalf of consumers, opposing the company’s use of false statements on their product labelling. The focus was especially set on the claims that the beverage would ‘promote healthy joints, support optimal immune function, and reduce the risk of eye disease’. As stated in the article, the company reacted by altering the ingredients, replacing the fructose sugar with stevia. The new taste did not reach the favourable outcome among the consumers which led the company to return to the original recipe. As the class action suits against the company increased and soon was turned into a single case, Coca-Cola had to eventually give in on a $1,2 million settlement (Ross, 2015). The company also agreed to change and add some statements on the bottles, such as adding the words “with sweeteners” (Associated Press, 2015).

The way Vitamin Water is marketed in not unusual, when looking at the distortion of truth. As stated by Crane and Matten, even though consumer rights are being preserved by various regulations like UN Guidelines on Consumer Protection and EU regulations, companies are still misleading the consumers with perhaps not entirely false information but altered truths (Crane & Matten, 2010, pp. 342-343).

Looking from the decision makers, the company’s, point of view, it is crucial to note the dilemmas and ethical issues they were facing. First of all, Vitamin Water contains 32g sugar (cane sugar and fructose) (Vitamin Water, 2014) therefore it is safe to state that the drink has a high level of sugar. Vitamin Water was and still is popular, growing since 2007 to $ 1 billion in sales by the year 2010 (Ross, 2015) with a marketing strategy promoting the health benefits of the drink. This marketing method is controversial considering the recommendation made by the American Heart Association saying that the maximum amount of daily sugar intake should be 25g for women or 6 teaspoons (American Heart Association, n.d.), thus is the drink not promoting health. It is obvious that if the decision maker would have labelled the bottles truthfully, stopped advertising the drink as healthy and making it easier for the consumer to get the right information, sales would have taken a turn for the worse while damaging the image.