Once the Consumer Product Safety Commission (CPSC) prohibits the sale of a particular product in the United States, a manufacturer can no longer sell the product to U.S. wholesalers or retailers. However, the product can be sold in other countries that have not prohibited its sale. The same is true of other countries’ sales to the United States. For example, Great Britain outlawed the sale of the prescription sleeping pill, Halcion, but sales of the drug continue in the U.S. The British medical community reached conclusions regarding the pill’s safety that differed from the conclusions reached by the medical community and the Food and Drug Administration in the U.S. Some researchers who conducted studies on the drug in the U.S. simply concluded that stronger warning labels were needed.

The CPSC outlawed the sale of three-wheeled all-terrain cycles in the U.S. in 1988. While some manufacturers had already turned to four-wheel models, other manufacturers still had inventories of three-wheel cycles. Testimony on the cycles ranged from contentions that the vehicles themselves were inherently dangerous, to arguments that the vehicles were safe but drivers were too young, too inexperienced, and more inclined to take risks. Still, the three-wheeled vehicle can be sold outside the U.S. For many companies, chaos follows a product recall because inventory of the recalled product may be high. Often, firms must decide whether to “dump” the product in other countries or take a write-off that could damage earnings, stock prices, and employment stability.

If you were a manufacturer holding substantial inventory of a product that has been outlawed in the U.S., would you have any ethical concerns about selling the product in countries that do not [yet] prohibit its sale? To what extent will your decision be affected by the level of the write- down in income you must take.

 

 

 

 

 

 

 

Ethical Analysis of Dilemmas in Business Practice

Among the challenges that the business community faces today is making decisions that are morally acceptable even when they are negatively affecting the success of the organization. This is a challenge not only in the business world but also in every person’s life decisions. For the purpose of this paper, the business community is the area of focus.

Different countries have different laws that guide the starting and running of businesses in the country. In the U.S for instance, Consumer Product Safety Commission (CPSC) has the responsibility to assess the safety of products being sold in the nation and prohibit the sale of the products that they agree to be unsafe. The decisions made about the commission about a product will however affect its sale in the U.S only. Since other countries have their own laws and regulations, it is quite common to find these laws differ and thus a product prohibited in one country is allowed in another country. An example is the prohibition of the sale of Halcion in Great Britain but its sale is legal in the U.S (De George 34).

Another example of such a situation is the prohibition of the three-wheeled all-terrain cycles by the CPSC. As much as many people complained over the safety of the Cycles, others thought that the drivers were the cause of the safety risks rather than the Cycles themselves. As a result, the product continued to be sold in other countries other than the U.S. (De George 54).

In such a circumstance where the sale of a product is banned in the home country but allowed in other country, what is the best action to take? For financial reasons, many companies will of course opt for the decision of selling the product outside the country. Although this is legally right, is it morally acceptable? This paper seeks to provide insight to this problem.

In such a scenario, the company and the consumers are affected. The business is affected greatly because it loses its immediate market and thus the total sales will go down. This subsequently leads to the drop of income. This is the biggest worries that investors have in such a circumstance. The business management thus search for alternatives to retain its investors.

Secondly, the employees of the manufacturing company are also affected. If the production of the product was to be stopped then their jobs are at stake. Therefore, the decision to be made should take into account the interests of the employees.

The other group of people affected are the consumers of the products. However, some of the foreign consumers may not be aware of the risks associated with the consumption of the product. This gives the manufacturing companies a loophole to exploit. In some cases, the risk posed by the product is very high and effects can easily be connected to it. Nonetheless, some of the effects are minimal and thus they rarely connected to the product.

Overall, when a commission (in any country) settles on the decision that a product is not fit for sale, its sale in other countries is morally questionable. The consequences that can result from taking the wrong action in such a situation can be categorized into two. Those that will affect the consumers and those that impact on the company and stakeholders.

The consequences on the company can be summarized in a pathway, beginning with the reduction in total sales of the product which in turn cuts off the total income of the company. It is with no doubt investors in the company will begin to pull out leading to loss of competitive advantage of the business. This pathway will occur if the company decides to stop the production of the product.

In case the company decides to continue distribution of the product outside the prohibiting country, two outcomes are probable. Firstly, the product may do well and pose no risks to the consumers. This will be positive for both the company and the consumers. The second outcome is that the product may cause actual negative effects to the consumers. This will not only lead to loss of market for the product but the company may also face legal actions.

The principle of utility, (utilitarianism) states that an action is morally right if it causes happiness or positive consequences to a greater portion of the population. It can also be deducted that an action is morally wrong if it causes pain to many people more than it causes happiness. From the above case, as a manufacturer, the best decision to make would be made after critical analysis of the dilemma. What is the probability that the product will cause harm to the consumers? If there is a high risk of harm to the consumers, then the manufacturer should consider stopping the producing such a product. This is because the intensity of happiness produced by continuing the sale of the product is less than the harm it would cause to the consumers. The company and stakeholders whose number is less than that of the consumers will be the only people benefiting. CITE What is the principle of Utilitarianism?

However, if the sale of the product would pose no actual effect to the consumers thus helping them, continuing producing it is morally acceptable. Take for example a car

manufacturing company. If the sale of a vehicle is prohibited in one country because of one reason or another and that particular reason is not applicable in another country, then it would be wrong for this company to completely stop the manufacturing such a product. This is because it will cause ‘pain’ to the consumers who need it most.

The other philosophical principle that can provide a solution to such a dilemma is the Deontology and Universality principle. This principle explains that one should choose an action as long as the optimum application of it can be made universal (McNaughton 66). In addition, such an action should not be taken just as a means to solve the current situation but should rather be the overall action. This means that an action is morally wrong if it is just a means of solving a current problem at the expense of the consequential problems. CITE using De George!

In applying this principle in the above scenario, the manufacturer should perform an assessment of the environment and predict the consequences of each alternative course of action. If selling the product outside the country is universally defensible then it is right to continue supplying the product. However, it is morally wrong if the company chooses this option for its own personal gains regardless of the future outcomes.

Another way to solve the situation is by application of universal virtues of honesty and justice. It is legally right to sell the product where it is not prohibited, but does the company conform to these virtues? In a drug manufacturing company for instance, if the drug is prohibited in one country, the manufacturer has a responsibility of being honest to the consumers about the prohibition (Kay 43). This can be done by labelling the drug sachet or containers with writings like ‘…the sale of this drug is prohibited in the U.S’. The company in doing so will be fulfilling the virtue of being honest. De George. It was discussed in class.

Justice should prevail. In this case, it is straight forward, ‘do unto others that which you would like to be done unto you’. Put the consumers’ interests over the company’s. The only reason that the manufacturer can use to justify the decision to continue the sale of the product is if the product is essential to the consumers and its discontinuation would cause pain and discomfort to the consumers.

It is always difficult to take decisions that will negatively affect oneself. However, this is why ethics were developed. A right decision even if it would cause the company to incur losses should not be overlooked. In such a situation income cut-down should not be the topmost determining factor. If one is to apply the principle of utility alone then it is easier because it only means assessing the happiness on the people affected and selecting the alternative that causes the greater happiness to many people as possible.

However, inclining ones’ reasoning towards one theory will only solve the problem impartially. The company needs to take into consideration the other theoretical perspectives such as the principle of universality. In addition, the agent should consider the universally accepted virtues. This is the best approach to such a problem. Where is Virtue Ethics? Where is the proper discussion as to what to do, which product was chosen? The paper mentions two products. Where are they, what is the conclusion? Unclear. Rewrite for a better grade. 40

 

Bibliography

 

De George, Richard T. Business Ethics. 7th ed. Prentice Hall: Englewood Cliffs, 2005. Print.

Kay, Charles. ‘Dr. Charles Kay A?» Deontology’. Sites.wofford.edu. N.p., 2015. Web. 25 Feb. 2015.

McNaughton, David, and Piers Rawling. ‘Deontology And Agency’. Monist 76.1 (1993): 81- 100. Web.

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