Leander Andreas Zapheriou
Lindsey Wilson College
Leander Andreas Zapheriou, Student Athlete, Lindsey Wilson College.
Leander Andreas Zapheriou is currently studying Business Administration concentrated in Management.
This paper discusses the events leading up to the recall of both the Ford and General Motors. Both these vehicle companies dispatched faulty vehicles after, previously engineers warned against this. Both companies were involved in ethical dilemmas where they utilized the Cost-benefit analysis to weigh up the option of a recall. In this paper we will discuss the event, which might have forced these companies into dispatching faulty vehicles and how they handled the aftermath of various lawsuits and allegations. We will also compare these companies and see what these events have in common and similar ethical approaches that were taken.
Business Ethics according to Investopedia is the study of proper practices and policies regarding potential controversial issues, such as corporate governance, insider trading, bribery and corporate social responsibilities. Law subsequently governs business Ethics and provides a basic framework in which businesses can gain public acceptance through their ethical practices. Over the years business have all tried to adapt some form of corporate culture, which is a specific approach a business conducts its business. Most business nowadays try to conduct business in a way that will make them look good in the public eye which in return will increase their sales and increase the amount of businesses whom will want to conduct and formulate a relationship with them. If Corporate Culture plays a big role in business, my question is - What happens when big corporations such as Ford and General Motors do not disclose information, which can, and has killed individuals? Is that linked to Cooperate Culture, Business Ethics or both, what are the repercussions for such large companies? In the following paper we will discuss both cases and look at the Ethical Theories behind the decisions made, and how they relate to each other.
In one of the most recent articles written by Agostinho Ribeiro, disclosed that as of 6 April 2014 General motors has already recalled up to 1.6 million vehicles after publicizing that all the cars sold between the periods of 2001 to 2013 have faulty ignition switches (Ribeiro 2014). This faulty ignition switch causes the car to switch off in mid motion rendering the cars engine, electrical system and airbags basically unusable. Obviously General Motors did not see or should I say chose not to see the immediate harm this can have on an individual’s life.
General Motors will soon be seeing the implications of their decisions to ignore the problem. The business Journal reports that up to 300 deaths are related to ignition switch problem. “ General Motors said on Wednesday that it had received reports as early as 2001 , three years earlier than previously disclosed” (IVORY 2014). In 2003 a service technician observed that the car had switched off while driving. After further analysis it was realized that a heavy key ring attributed to the faulty switch. The technician then replaced the switch and closed the inquiry about the problem. The continuous reports about faulty ignition switches were ongoing and eventually reached the top executives. In a meeting with corresponding engineers, top executives chose to ignore the initial problem against the wishes of various employees in the room. Moral and ethical questions have to be raised about General Motor’s practices and the median in which they conduct business. At what point does a $10 part to fix the problem become more valuable than an individual driving the vehicle, a customer of General Motors. After a Cost Benefit analysis was conducted by the company it was concluded