INTRODUCTION: Ethics occupy an important place in today’s modern business world. Every organization makes use of ethics to make day-today decisions and fulfill societal expectations. This essay brings to light ethical and social responsibility that every individual and company should follow in order to become better citizens for society. Essay presents analysis based on real case of Philip Morris, a tobacco company in U. S. A versus Mayola – a widow, who took legal action against company for her husband’s death due to smoking.
Essay draws balanced argument based on evidences about unethical behavior of tobacco company and smokers personal responsibilities for their actions. We have used Ethical decision-making model of Lagenderfer and Rockness to frame our analysis. ETHICS & BUSINESS Ethics in simple terms means set of moral principles or list of rules, which can determine whether particular action undertaken is ‘right’ or ‘wrong’. All the activities undertaken by society are based on ethics. Ethics can be personal as well as professional.
Personal ethics are based on individual’s values, beliefs, attitudes and actions while business ethics are based on certain principles or code of conduct to guide individual or a group in accordance with societal expectations. Business ethics can be defined as “study of business situations, activities and decisions where issues of right or wrong are addressed”(Crane, A& Matten ,D, 2007,P. 5). Thus, ethics helps in making decision and is a key for solving problems. Today, society is facing considerable increase in number of ethical issues such as fraud, exploitation, misleading advertisement and increasing pollution. Birt, Chalmers, Beal, Brooks, Byrne, Oliver, 2008, P. 65). CORPORATE SOCIAL RESPONSIBILITY It is essential for every organization to undertake corporate social responsibility along with its goals and objectives. According to (Birt et al. , 2008, p. 70) Corporate social responsibility can be referred to responsibility that an entity has to all its stakeholders, including society in general and physical environment in which it operates. There are many companies, which lack sense of corporate social responsibility and acts against interest of society.
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RELEVANT FACTS DETERMINED UNDER CASE: Today, business is giving rise to numerous ethical issues, as many companies are involved in exploiting its customers, selling harmful products in markets, false marketing of products and increasing environmental and health issues. Many tobacco companies like Phillip Morris are selling harmful and addictive products like cigarettes that cause serious diseases like lung cancer and heart attack. Analysis of Phillip Morris v. Mayola, Williams case brings down certain relevant facts that give rise to ethical issues.
Mayola took a legal action on Philip Morris on the grounds of false and misleading advertisement and marketing undertaken by company for its products. It is fact that Philip Morris knew that tobacco was harmful for health still he advertised his product as non-addictive and safe and Williams death was caused by smoking. Second, fact is that Philip Morris appealed solely against damages that company had to pay to other smokers who did not bring any actions against court. Their appeal was only based on excessive damages that company was supposed to pay to strangers.
This clearly indicates that he is very well aware of harms caused by his cigarettes to smokers and did not appeal on the grounds that his products were safe and less addictive. It is also relevant fact that Supreme Court made decision in favor of Philip Morris that company is not liable to pay excessive damages to Ms Williams on the grounds that damages were proper under Oregon statute but was excessive under federal constitution (BBC article, 20 Feb, 2007). This indicates that ethical laws are still complex and not clearly stated under constitution.
ETHICAL DILEMMAS FOR BOTH SMOKERS AND COMPANY: Ethical dilemma arises when there is a situation with conflict of interest. We have built certain arguments based on ethical dilemmas from perspective of both smoker and company. We have constructed evidence-based arguments on unethical behavior by Philip Morris Company, which includes major ethical issues, such are selling harmful products, misleading and false advertisement, acting against societal expectations and caring out unethical business practice.
Company is involved in producing and selling harmful tobacco products that contains high amount of nicotine, are addictive, and can cause serious health issues such as lung cancer and heart attack. Company acts unethically by encouraging people to smoke and their conflict of interest with societal ethical standards and expectations. According to (Janine and Ruth, 2008) company prevents old smokers from quitting and targets young people and children. Company adopts new and innovative marketing approaches to promote its products like direct mail advertising and sending coupons with discounts. Low tar” cigarettes were developed in response to the health concerns of older smokers in 1970, but experts found them no advantageous to health and did not help smokers to quit. Company lacks in corporate social responsibility as they perform activities that are against interest of society in general and physical environment in which it operates. Company undertakes massive fraud by acting dishonestly having financial motive in mind. Company is involved in false advertisement indicating their products to be less addictive, more filtered and safe.
According to ( Rosner, 2006, P. 193-196) company tries to create illusion by sponsoring cigarette cessation programmes and try to make society believe that they act in ethical way, but their real motive behind it is to promote company’s goal of selling cigarettes and meet their financial interests . Their misleading marketing activities makes lots of people to go for smoking. Philip Morris promised to shut down instantly if their cigarettes were found to be harmful but has failed to keep its promise, which gives rise to ethical dilemma. According to (David & Silva, 2004, p. 9-22) Company uses their political and economic influence to create an environment that encourages continued consumption of cigarettes. Company is accused of political lobbying. They lobby legislators and officials in finance ministry in order to keep tobacco prices low and thus encouraging people to smoke. Philip Morris was after minimizing total tax burden on cigarettes in order to keep smoking affordable. Article in Ethical Corporation magazine (2004) states that company declares itself responsible and argues that there is increasing demand for cigarettes by customers and if they stop selling it, someone else will take their position.
Company tried to safeguard themselves on the grounds that they are selling legal products, which are not banned by government and are acting in ethical way by warning its customers against dangers associated with smoking. Thus, company gives rise to ethical dilemmas as it has an intension to make huge profits by selling harmful products that are responsible for death of millions of people and still trying to gain creditability as responsible company.
From perspective of smokers in general, they give rise to ethical issues by consuming harmful products that are not ethically accepted by society and do not take warnings given by companies and government seriously. It is unethical to blame companies solely responsible for damages caused to them and bring their own actions against company. Their behavior can give rise to ethical dilemmas as their actions have a deep impact on their children and makes smoking more desirable for their kids in future. They also lack in personal and social responsibility by giving rise to health issues and environmental concerns for society in general.
CONCLUSION: Thus, we conclude that tobacco is one the world’s greatest preventable health problems. According to our analysis, we came to a balanced conclusion that smokers should take responsibility for their actions and companies should behave ethically by making its customers fully aware about the dangers of smoking. It is very essential to undertake combined ethical and social responsibility by both smokers and tobacco companies to avoid millions of deaths due to smoking and to act in favor of societal expectations.
Tobacco companies should stop giving misleading advertisement and marketing activities, which indicates their products to be safe and less addictive. They should stop encouraging consumption of tobacco among young and old and should ban children from its consumption. It is the responsibility of companies to support smoking cessation programs and help smokers to quit not just for sake of creating illusion but also to act in favor of societies interest in general and to build better image in society.
Company should change their unethical business practices of creating massive fraud to fulfill its financial motive and provide support to government activities that help smokers to quit. Smokers should follow their personal ethics and should take responsibility for smoking. They should take warnings given by tobacco companies and government to quit smoking seriously. They can search on internet for more information or consult doctor to improve heir knowledge about serious health issues caused by smoking. Smokers should not escape from their personal and social responsibilities towards society and their families.
It is unethical to bring their own action against company and solely blame company for health issues caused by smoking. It is moral duty and responsibility of every citizen to bear risk associated with their actions. It is responsibility of government to take care of its citizens and find solutions for their health relating issues. We believe that Political parties should not accept any funds from Tobacco Company for their campaign and government should ban any kind of commercial ads for cigarettes in magazine, newspapers or on television.
Government should support smoking cessation programs and quitting and should be alert if tobacco company provides any support as they may mislead government by doing indirect advertising for their products. We recommend that there should be strict tobacco control strategy that restricts consumption of all tobacco products. Thus we conclude that it is ethical, moral and social responsibility for smokers, tobacco companies and government to stop consumption and selling of harmful products for betterment of society and environmental concerns. REFERANCE )Birt, J. ,Chalmers, K. ,Beal, D. , Brooks, A. , Byrne, S. , & Oliver, J. (2008). Accounting: Business Reporting for Decision Making. (2nd ed). John Wiley & Sons: Milton, Old. 2)Crane, A. , Matten, D. (2007). Business Ethics: Managing Corporate Citizenship & Sustainability in Age of Globalization. (2ND ed). Oxford University Press: New York. 3)David, A. , Silva,V. ( 2004). Building Blocks for Tobacco Control: a handbook tools for advancing tobacco control in xxist century. Publisher World Health Organization: Geneva 4)Rosner, F. (2006).
Contemporary Biomedical Ethical Issues and Jewish Laws. KTAV Publishing House: New Jersey 5)Janine, C. , & Ruth, M. (2008). False Promises: Journal of American Geriatrics, 56(9), p1716-1723, 8p, 1 chart retrieved on 5/ 09/2009 from Academic Search Premier Database. 6)Tobacco firm wins payout appeal: BBC news article https://news. bbc. co. uk/2/hi/business/6379767. stm retrieved on 6/9/2009. 7)Philip Morris executive declares his company ‘Responsible’: Article from Ethical Corporation Magazine: http://www. ethicalcorp. com/content. asp? ContentID=2345 retrieved on 8/09/2009.
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