Ethics and Corporate Social Responsibility †MyAssignmenthelp.com

Question: Discuss about the Ethics and Corporate Social Responsibility. Answer: Introduction An ethical dilemma is the situation when comparisons between the two options have to be made, both of the situations are morally correct but are contradictory to each other. There are ethical dilemmas faced by the organizations in the food industries. One of the organizations that is facing the dilemma is KFC. The main objective of the study is to discuss the dilemma faced by organizations and also how the company is dealing with the dilemmas. Introduction to KFC: KFC is well known fast food restaurants in the world. KFC operates in different countries with a number of restaurants throughout the world. It has about 11,000 branches around the world. It is found in 1952 by Colonel Harland Sanders. KFC has a mouth watering taste that customers can cannot give up. Ethical Dilemma: But with the development the eating style of the people has been changed. People are concerned about their health. They are noticing the nutrition value, fats and calories in the food. The concerned is increased due to the obesity coming in the people and also the health issues that are occurring in the smaller age. Therefore the first dilemma faced by KFC recently is the unhealthy food having no nutrition value supplied by the company. Therefore KFC has to take some major steps to increase the food value in the chicken. Also, due to frying the chicken, the fats are introduced in the chicken due to the trans frying oils. This also creates the problem of increase in fat in the body and leads to diabetes and heart disease. Therefore, in this report the discussions are made regarding the ethical dilemma faced by the company and how the decision making and the leadership affects the idea of ethical dilemma. Ethical dilemmas faced by KFC KFC is one of the most famous fast food chain and many people love the food offered by the restaurant. Therefore, it is very important for the company to follow the ethical standards in terms of healthy food. But, it is observed that KFC is serving the food that is not fitting in terms of the ethical standards. It is using the oil, which have fatty acids in it. This type of oil increases the fats and cholesterol in the body and results in diabetes and risk of heart diseases. Therefore, it is recommended by the science group and Public health authorities of Australia to use a healthier oil for cooking as compared to the earlier one. Due to the use of such unhealthy oil, KFC faced the negative effects that are media reporters and in various countries people boycott the KFC. Even KFC in some cases denied the allegations, but also agreed to use healthy oil (Allen, 2012). The company should follow the ethical standards to prevent the health problems due to lack of nutrition in it. KFC has lack of future plan because negative publicity will take away their market share to others. Therefore, in order to make future plans KFC should follow the ethical standards in order to stay competitive in the future and to gain competitive advantage over the competitors like Pizza Hut, Mc Donalds. It is the responsibility of the company to respect the customers and provide them with the food which is healthy. If trust factor is not there the customers will not follow the company services in future. It will reduce the clientage of KFC in the near future. Therefore, management of KFC is responsible for providing the unhealthy food to the customers. So to survive in the future markets KFC has to be honest with its customers and give the customer the satisfaction of having nutritious and healthier food (Gtm, 2011). Also currently the ethical dilemma faced by the company is related to the employee harassment. The two employees of the KFC restaurant chains have faced racism and they filed the case against the company. The third dilemma which the company is facing is due to the advertisements of KFC. Due to the attractive ads, the children get attracted by the product which is leading to the obesity in children. The Australian government is banning such advertisements near the schools and in the channels which kids used to see. Also, the fast food has less nutrition content which is making the kids unhealthier (Stowe, 2015). Analysis of Ethical concerns of KFC Even the KFC is struggling to improve its brand image in the eyes of customers, some ethical issues prove the shortcomings in the brand. The issue is related to using unhealthier oil during frying the chicken and also the advertisements that attracts children towards the fast food. Both of these issues have damaged the company reputation. The company agreed with the issues and said to use a better oil in frying the chicken. The issue was reported on 2015 May, that the company is using unhealthy Trans fatty oils for cooking the chicken. This will cause health problems like diabetes and heart risks. KFC also faced boycotts due the same reasons in various countries (Jones, 2005). Also, it has been reported that, due to the attractive advertisements of the brands running nearby the schools and in tv channels causes the attraction of the kids towards the fast food which is not good for kids health. Therefore, the KFC has faced ethical issues related to the same and were told to remove the advertisements from the school campuses. The two employees named Karen and Marin Galvia filed the case against the harassment at workplace. The company was sued for the unfair treatments towards these employees. The case was settled in 2015 and the company paid amount to both the workers. They were paid less as compared to the local workers and faced the racism in this way (Kien, 2011). Also, the coworkers made gender based comments to these workers. Therefore theses two were facing discrimination in terms of pay, comments were made on them due to their gender and race. This spoiled the reputation of the company and both the employees were paid amounts for the settlement. Decision making and leadership in KFC The KFC uses the democratic style of system in which all the team members have the opportunity to express its views. All the team members are included when the decision is made. A decision represents an action chosen from alternatives. Therefore, opinions of members are considered while making any decision. This leads to the combine decision and one employee cannot be blamed over a wrong decision. During the decision making the problem is analyzed. The manager defines the problem to the members and factors are discussed that are obstacles in the solution to the problem. Therefore, in reference to the problem faced by KFC, the oil should be replaced with the better nutritious oil. The second step is to identify the decision making criteria. The decision is made according to the factors that are responsible for the solution of the problem. The main factor here is the cost and the time. The time taken to change all the oil in the company and the cost of the oil that is in the company and the new oil that is bought by the company. After this, alternatives should be thought of as if the oil, which is replaced will suit the tastes or not. Different oils should be tested against it so that if the oil does not go with the taste the other oil should be taken which enhances the taste. Therefore, alternative ways should be incorporated so that a solution to the problem can be determined. Marketing should be done so that to regain the reputation which was spoiled due to the oil usage. The leader is never sure of the outcome of the solution to the problem (Tea, 2010). Therefore, alternatives should be thought of so that it could be laid off in case of not working of the earlier plan. The alternatives are: Risk involvement during the solution to the problem Proper timing of the decision Final selection of the decision. The last stage of the decision making plan is the evaluation. Evaluating the solution to the problem help in finding the real outcome of the solution. The second problem faced by KFC is the racism comments on the employees. The decision making in this aspect is firstly by evaluating the problem by the leaders. After analyzing the problem the solution to this problem is found. The person hit with this problem are compensated by the company after analyzing the problem (Moreno, 2011). The employees were given a training session before they left the company as the compensation. A leaders ethical behavior is a critical issue. The ethical dilemma in KFC occurred in the large scale. This dilemma is related with people understanding and laws. These dilemmas include negative actions. The best way to deal with such issues is to maintain the personal moral. The leaders have to take specific action and to improve the conditions which went wrong during the course of action. Leaders have to set the bar higher and should be ready for the changes in case if required during the course of the solution. Leaders should maintain the standards of ethical conduct. Therefore, the leader of KFC, followed the similar principles by accepting the problem and found the solution related to the problem. The oil used by KFC was changed and acceptance of the problem helped the company from dealing the boycott (Zydziunatte, 2015). KFC deals with the dilemmas KFC dealt with the ethical dilemma by making an apology publicly for the use of oil that contains the fatty acids. It also made the promises that the oil will not be consumed in the future that will harm the health of the customers. Also, the investigation will be done in this matter. KFC dropped the earlier menu and new menu was introduced that was having a wide range of healthy food items that was good for the kids as well. Grilled chicken and salads were also included in the menu which are healthier food stuffs. Due to the oil, the sales and the customers are reduced. Overall sales in the country went down. Then KFC started to reduce the cost of the product to gain competitive advantage. Also, vouchers having discounts were distributed among the public so as to increase the sale. Some, vouchers that had discount were also made available in the website so that it can be downloaded from there. Also, promises related to the racism contents have been made that there will be no such th ings in the future. Each employee in the company will be treated equally and no employee will be paid less compared to other employees. No such comments will be made by any worker in the future (Soba Aydin, 2011). KFC was involved in the practices like practices in public services. It has helped various children to return the schools and funded various societies for public services. It has helped in poverty alleviation and helped the people to provide shelter in some cases. This all helped in the positive advertisement of the company. It brought the intangible benefits to KFC. IT helped in building the brand name again. It also gained a lot of positive publicity. It helped the company to impress its customers. This all made a good impression on the customers, which was spoiled earlier, due to the negative publicity (CCAB, 2011). Recommendations in case of Ethical practices, decision making and Leadership Different practices should be followed so as to eliminate the negative publicity of KFC. The ethical procedures should be followed and leaders should make proper decision related to the problems that arose due to the issues. Also, the image of the company should be uplifted so as to maintain the image of the company in public. Also, strategies should be made and followed so as to uplift the image. These recommendations will help uplift the image of the company. The recommendations are as follows. Sales of the product can be enhanced with the help of sales promotion. Providing sale on some food products or by providing sale on particular time will help in gaining the sales of the product. IT will also attract the customer and help in showing the corporate image of KFC. The promotion can be made by providing offers during the lunch hours that are 1 PM to 3PM. This will help in the publicity of the company. The promotion programs for the company should be innovative so that customers get attracted towards it. Media will help in the spread of the promotion plan. This will enhance the corporate image of the company and promotional activities will thus build the image (Ferrell, 2004). KFC should do marketing through internet and the media so as to uplift the image of the company. The advertisement should be creative and will help the company to build the image of the brand in the customers mind. The proper publicity in creative way helps the consumers get attracted towards the product. But, the advertisement should be done in the honest way. IT should not focus on the things which is not delivered by the company. Also, it should provide healthy food so that kids can also enjoy it without having the side effects. Also, marketing of new added menu which include grilled chicken and salads should be done. It helps in the recognition of the brand and products. Creativity in the media will help in the proper spread of the brand details (Zafar Lodhi, 2015)s. Also, creativity is to be focused on the target customers. KFC can advertise in various places with the help of hoardings and in buses etc. Healthy food service Ethical practices like healthy food service should be followed. Due to the downfall in the health of people, each one is taking precautions and are eating healthy and nutritious food. Also, due to the awareness about the health each one is determined to eat healthy food nowadays. The increase in the concern regarding the health is the facts that are available in the internet regarding the unhealthy food habits and the inclusion of hazardous substances in the fast food. Therefore KFC was using the oil that contained fatty acids. Effective measures should be taken against the use of unhealthy oil in the company. Healthy and nutritious food in the menu should be added so that even kids can take it without any dilemma. The leaders should ensure that the nutritional survey should be performed time to time to check and inspect the food product. Also, the food safety inspection should be made so that the food products could be examined (Cengage, 2004). This will help in building the trust o f the customers on the product which is lost earlier. Also, healthy food service with proper inspection will be done each month so that customers can be attracted towards KFC. Chicken should be healthier and fresh when it is called from the suppliers. A check on suppliers should be made time to time, so that fresh supplies of chicken should be there. Also, chicken and vegetables should be examined at the time of delivery so that expiry chicken and vegetables are not accepted by the company. Leaders can make the policy of supply check so that there should be no fault related to the raw materials (Team, 2017). Ethical practice also includes honest advertising. Advertising should be done in the way that it should not give a wrong message. An honest way of advertisement is to be made so that no ill message will go to the customers while consuming the product. An actual product serviced should be advertised. Leaders should make decisions for an honest advertising so that brand value can be increased (Caldwell, 2004). Conclusion Business ethics should be followed by every business so as to attract the customers. Dilemmas in the business ethics attract the attention nowadays. IT has become a major topic for the debated and discussions. Also, the media has grown in such a way that any malpractices be highlighted with it. Being ethical is good for business in every aspect as the people nowadays are aware of each wrong practice done by the company. Therefore, for having good customers and to make profits, business ethics must be followed. Business ethics are important for an organization to grow. Ethics help a business gain the customers and profits can be done easily with the help of satisfying customers. The customers can also be made through the loyal and honest business practice that is followed by business ethics. Therefore, for gaining customers advantage KFC must ensure that it will provide healthy and nutritious products to its customers. And also it will be true and honest with its customers. Advertisements will be made in terms of loyalty. No exaggeration in advertisements will be shown with respect to the product value to attract the customers. Following the ethical business values will help KFC to gain trust and respect. Also, corporate image can be developed and protected with the help of following business ethics. References Allen, K. (2012). What Is an Ethical Dilemma? Retrieved from https://www.socialworker.com/feature-articles/ethics-articles/What_Is_an_Ethical_Dilemma%3F/ Caldwell, C. (2004). Leadership Skills for Managers. AMACOM Div American Mgmt Assn. Retrieved from https://books.google.co.in/books?id=n4D9Q6J6ogsCpg=PA11lpg=PA11dq=Leadership+and+ethical+dilemma+in+fast+foodsource=blots=L03452GDL1sig=MSTZMpapWNPceA98Dovc_qLvv5Ihl=ensa=Xved=0ahUKEwiGtYH0s_nTAhVJQo8KHQazCLUQ6AEITzAG#v=onepageq=Leadership%20and CCAB. (2011). Ethical Dilemmas Case Studies: Professional Accountants in Public Practice. Retrieved from https://www.icaew.com/-/media/corporate/files/technical/ethics/ethical-case-studies/ccabeg-case-studies-accountants-public-practice.ashx?la=en Cengage. (2004). Managerial Ethics and Corporate Social Responsibility. Retrieved from https://www.cengage.com/resource_uploads/static_resources/0324405715/8910/0-324-40571-5_04_REV.pdf Ferrell, O. (2004). Business ethics and customer stakeholders. Academy o/ Management Executive, 18(2), 1-5. Retrieved from https://danielsethics.mgt.unm.edu/pdf/Customer%20Stakeholders.pdf Gtm, L. (2011). Ethical Report of KFC and Its Problems. Retrieved from https://www.scribd.com/doc/216573851/Ethical-Report-of-KFC-and-Its-Problems Jones, S. (2005). Australian industry responses to current ethical dilemmas fast cars and fast food. University of Wollongong. Retrieved from https://ro.uow.edu.au/cgi/viewcontent.cgi?article=1135context=hbspapers Kien, K. (2011). Research a current ethical issue at KFC. Retrieved from https://www.academia.edu/13000644/RESEARCH_A_CURRENT_ETHICAL_ISSUE_OF_KFC Moreno, M. (2011). Ethical dilemmas : pressures on leaders to walk the talk. Retrieved from https://repository.usfca.edu/cgi/viewcontent.cgi?article=1221context=diss Soba, M., Aydin, D. (2011, December). Ethical Approach to Fast Food Product Contents and Their Advertisement Strategies. International Journal of Business and Social Science , 2(24), 1-10. Retrieved from https://ijbssnet.com/journals/Vol_2_No_24_Special_Issue_December_2011/17.pdf Stowe, S. (2015, May 06). Ethical standards important say KFC and Red Rooster after ABC report. Retrieved from https://www.franchisebusiness.com.au/news/ethical-standards-important-say-kfc-and-red-rooste Tea, G. (2010, March 18). Kfc Case Complete. pp. 1-14. Retrieved from https://www.slideshare.net/guestea96e4/kfc-case-complete Team, U. (2017, May 04). KFC Ethical Audit Report. Retrieved from https://www.ukessays.com/essays/marketing/kentucky-fried-chicken-ethical-audit-report-marketing-essay.php Zafar, R., Lodhi, S. (2015, November). The Study Of Ethical Issues In Restaurant. IJSTR Jor=urnal, 4(11), 1-5. Retrieved from https://www.ijstr.org/final-print/nov2015/The-Study-Of-Ethical-Issues-In-Restaurant-Of-Karachi-Pakistan.pdf Zydziunatte, V. (2015). Leadership Styles in Ethical Dilemmas. Retrieved from https://tampub.uta.fi/bitstream/handle/10024/97177/978-951-44-9844-2.pdf?sequence=1 Ethics and Corporate Social Responsibility – MyAssignmenthelp.com Question: Discuss about the Ethics and Corporate Social Responsibility. Answer: Introduction Corporate social responsibility is an initiative in which company work to protect the environment and well-being of society. In the current business scenario, CSR strategies are effective for the company because it not only provides profitability but also builds the companys image. In this way, the company tries to meet the legal standards like an employment contract. But, at the same time, it may increase the cost of company (Drea DeFoe, 2015). This essay discusses the arguments in favor and against of corporate social responsibility. It also supports the arguments with a real example. Arguments in favor of CSR It is argued that corporate social responsibility pulls the attention of stakeholders. Labour force makes the unions and create demand to protect their right from the company. Hence, it has become essential for companies to release the duties of employees as a result it helps the company to get the support of workers. For example, Woolworths use caveat emptor strategy which means let the buyer beware and no more holds true because the customer is a key player around whom entire marketing practices are revolved. The consumer does not purchase the products and services which are offered to them instead they only purchase those goods and services that they actually want (Shyamala Sankaranrayanan, 2017). Hence, companies that unable to meet the needs of customers, have the possibility to close down sooner and later. It is analyzed that Wesfarmers Company uses remedy cells for consumers which protect them against the anti-consumer acts. In this way, consumer control forced the firms to use social responsiveness with respect to them. For example, if Wesfarmers Company uses effective social responsibilities then it may suffer loss for a short period but accomplishing the obligation is effective for a company to survive at long-term (Forbes, 2012). Although, it can be a short-term cost for the company yet, provides long-term profitability to it. Flammer (2013) is also in the favor of CSR as it discusses that CSR is beneficial for the company to survive in the market at long term. In this way, it is analyzed that business companies are a strong factor for the society because it provides different benefits to them. But, if a customer ignores the social problem then society can deny the acceptance of companys products and services. Therefore, the company considers social responsibility in its strategy to avoid self-destruction in long-run. Tai and Chuang (2014) are in favor of the corporate social responsibility as it depicts that CSR is effective for self-enlightenment. It is analyzed that education level and business understanding is increasing in society hence company can encourage the customers to buy the products and services by involving the social activities. Moreover, managers build the public anticipation by considering the social and moral responsibilities. For example, BHP Billiton ensures to pay taxes to the government, fair wages to employees, dividends to shareholders, and quality goods and services to consumers (Joutsenvirta and Vaara, 2015). Moreover, it involves the social responsibility rather than using legislative interference. CSR is also beneficial for a business to avoid the government regulation. Non-conformance to social standard is used to attract the legislative limits. Government directly control on the corporation by making regulation regarding business functions. As well as, there are different agencies that affect the business activity. For example, central pollution control board addresses the issues associated with environmental pollution and Australia stock exchange focuses on the issues associated with investors protection. As well as, Employees State Insurance Corporation highlights the issues associated with the health of employees. Hence, company will be held liable to pay fines and penalties for violating the regulation (Esping-Andersen, 2017). The organization must involve the social responsibility by using the effective policies for their employees and customers. According to the Husted (2015), the business organization uses different resources that can be partially exercised for solving the social issues. Moreover, business is a creation of society because it works in the interest of society. These interests could be related to economic and social benefits. In addition, it can be evaluated thatmanagement is going towards professionalism which contributes towards the social orientation of business. Moreover, increasing professionalism is the main reason for managers to use formalmanagement within an organisation. It is analyzed that managers is proficient to make a plan, organize, lead and control by using their understanding as well as subscribe the code of conduct that is developed by the organization and recognized authority. In this way, managers are bounded to use social values due to ethics of the profession. This code of conduct enables the employees to gain their awareness about social responsibility. For example, Australian Airlines consider social responsibility by keeping the safe environment for employees and travelers. It is beneficial for the company to grow in the dynamic environment and to get the competitive advantages in the industry. This company also decided that how much social responsibility will be delivered rather than focusing on whether or not to discharge the social responsibility because it enables the company to attain the future targets (Ioannou, and Serafeim, 2015). Arguments against CSR It is argued that business is an economic activity and social responsibility is a fundamental function for the company to move towards the economic viability of its operations. Moreover, the government should look towards the societys interest instead of the business. In addition, the government should be held liable for social responsibility rather than the business enterprises because society expects with the government, not to the business (Schrempf-Stirling and Palazzo, 2016). In against, Flammer (2013) argued that corporate social responsibility has the limitation that what can measure the social responsibility and at what level, should a company be engaged in it. As well as, there is a limitation to assess what kinds of resources should be integrated to social values and whose interest should hold priority over others such as investors should be prioritized over suppliers or the vice versa. There are several questions which are based on the subjective consideration that states social responsibility is not an easy task for the company. Apart from this, a cost-benefit analysis is another limitation of using corporate social responsibility within an organization. In this way, corporation cannot be executed any social benefit acts where initial cost exceeds the benefits in the short run. Moreover, professionally trained managers may not have the skills to resolve the social concern (Hopkins, 2016). Hence, inadequate skills and competencies are key issues for executing the social responsibility within the corporation. It is stated that transfer of social cost is another limitation of using corporate social responsibilities. Costs associated with social programs can be adjusted through business concerns in a different manner. For example, the cost is passed to the customer by increasing the rate of products and services. Another example is that if managers keep the price then they deduct the few amounts from wages of employees as a social cost. Along with this, if wages are constant and profits are declining then the company will decline the dividend amount of shareholders. In this way, low profits will decline the interest of managers to further engage in CSR activity. It is also evaluated that sub-optimal utilization of resources is another limitation of CSR (Glavas and Kelley, 2014). Because, when limited resources are utilized for meeting social objectives then this can violate the purpose of companys existence. It is argued that every business deal in the larger operating system. Hence, CSR cannot come in that system and transform the society. Further, the company is only responsible for creating the products and services rather than dealing with welfare and societal activities. In addition, corporations do not have the proficiency and understanding to handle the social concern. It can also be stated that if a manager focuses on the social responsibilities which means they have not performed the primary responsibilities of the company with full capacity (Hopkins, 2016). It is also stated that being socially responsible, can lose the companys financial position in the global marketplace. There are different activities has involved in social responsibility which creates a high cost for the company. These activities are donating money, ensuring product safety, cleaning up the atmosphere, and spending time for welfare issues. In the ending level, these expenses will be passed on the customers in terms of final prices of goods and services (Flammer, 2013). In such case, some customers can wish to pay more prices for products and services that are socially responsible but, at the same time, some customers cannot pay the high amount for products and services. As a result, it can provide the economic disadvantages to the company. Conclusion It can be concluded that there are different companies in Australia which use social responsibility. Because, the company has realized that CSR is beneficial to gain financial performance. It can also be evaluated that company can gain sustainable advantages via using the CSR activities within the organization such as it can invest in good employment practices and proper labor standards. But, there is some limitation of using CSR activities such as it does not addresses that what consumer is willing and pay for ethical approaches. There are certain examples of business that are willing to adopt socially responsible activities because it may affect its profitability. Woolworths and BHP Billiton is one of the examples of the company that involved in the CSR activities and gained its profitability. References Drea DeFoe (2015) Arguments for and Against Corporate Social Responsibility. [Online]. Available at: https://toughnickel.com/business/Arguments-for-and-Against-Corporate-Social-Responsibility (Accessed: 19 September 2017). Esping-Andersen, G. (2017)Politics against markets: The social democratic road to power. USA: Princeton University Press. Flammer, C. (2013) Corporate social responsibility and shareholder reaction: The environmental awareness of investors.Academy ofManagement Journal,56(3), pp. 758-781. Forbes (2012) Six Reasons Companies Should Embrace CSR. [Online]. Available at: https://www.forbes.com/sites/csr/2012/02/21/six-reasons-companies-should-embrace-csr/#2c8813613495 (Accessed: 19 September 2017). Glavas, A., and Kelley, K. (2014) The effects of perceived corporate social responsibility on employee attitudes.Business Ethics Quarterly,24(2), pp. 165-202. Hopkins, M. (2016)The planetary bargain: corporate social responsibility comes of age. Berlin: Springer. Husted, B. W. (2015) Corporate social responsibility practice from 18001914: Past initiatives and current debates.Business Ethics Quarterly,25(1), pp. 125-141. Ioannou, I., and Serafeim, G. (2015) The impact of corporate social responsibility on investment recommendations: Analysts' perceptions and shifting institutional logics.Strategic Management Journal,36(7), pp. 1053-1081. Joutsenvirta, M., and Vaara, E. (2015) Legitimacy struggles and political corporate social responsibility in international settings: A comparative discursive analysis of a contested investment in Latin America.Organization Studies,36(6), pp. 741-777. Schrempf-Stirling, J., and Palazzo, G. (2016) Upstream corporate social responsibility: The evolution from contract responsibility to full producer responsibility.Business and Society,55(4), pp. 491-527. Shyamala Sankaranrayanan (2017) Arguments For and Against Social Responsibility! [Online]. Available at: https://www.fibre2fashion.com/industry-article/5638/arguments-for-and-against-social-responsibility (Accessed: 19 September 2017). Tai, F. M., and Chuang, S. H. (2014) Corporate social responsibility.Bu