Business Ethics

Whistle-blowing

Whistle-blowing is the act, for an employee to reveal what he believes to be unethical or illegal behavior to higher management (internal whistle-blowing) or to an external authority or the public (external whistle-blowing). Its status is debated: some see [whistle blowers] as traitorous violators of organizational loyalty norms; others see them as heroic defenders of values considered to be more important than company loyalty (e.g., the public health, truth-in-advertising, environmental respect).” From the Kantian perspective, employees should have a duty to blow the whistle on unethical or illegal acts because it is the right thing to do. They are morally responsible to inform the public and/or stakeholders about the wrongdoings because the motive of moral action is more important than the potential consequences of not whistleblowing. Such courage to go against all odds and the possibility of punishment from the employer is necessary if those who are privy to immoral business practices are to make a positive contribution to the respect of consumer rights the world over (Masaka, 2007). Kant did not clearly state that whistleblowing should be a duty in all circumstances. However, what is clear from him is that he expects truth telling and the "good will" of the moral agent. Hence, based on these principles, one can will that an employee should blow the whistle if he/she has information of others' or the organization's intentional wrongdoings (Padgett, 2009).

Unethical pricing strategies

Price fixing involves the agreement between a group of people on the same side of a market to buy or sell a good or service at a fixed price. For example, Samsung and LG being the largest makers of electrical products in South Korea held secret meetings to make an agreement on selling electrical appliances at the same price. Both of the companies are being fined by regulator, however this has caused damage to many consumers as they are selling the electrical appliances at a higher price.

Price gouging occurs when the retailer price the product above the market price when no alternative retailer is available. For instance, a 24-hour clinic charge patient higher medical fee as there is no other clinic that operate during midnight and patient has no other choices but to pay for the high medical fee.

Psychological pricing is the odd pricing strategy prices products just below the whole dollar amount. For example, instead of charge $5 for a product you might charge $4.99. Buyers associate the price closer to $4 than $5 even though it is only one cent less. Another example, of psychological pricing strategy is that Popov brand Vodka increased the price from about $3.80 to $4.10 without increasing the volume and quality of vodka. However, consumer would have a misconception that since the price is higher, the quality is also better.

Hidden cost is the expense that not normally included in the purchase price of a product or service. As an example, carrier companies have also been known to charge customers for services that they do not yet offer and allow third-party companies to attach mystery costs to customers’ bills.

Egoism

Ethical egoism is the normative ethical position that moral agents ought to do what is in their own self-interest. Ethical egoism belong to consequentialist theory and it holds that actions whose consequences will benefit the doer can be considered ethical.

Utilitarianism

Utilitarian says that we should always act to produce the greatest possible balance of good over bad for everyone affected by our actions. Utilitarianism, another consequentialist theory, maintains that the morally right action is the one that provides the most happiness for all those affected.

For example:

1st action – 8 units of happiness & 4 units of unhappiness = net worth 4 units of happiness

2nd action – 10 units of happiness & 7 units of unhappiness = net worth 3 units of happiness

In this case, we should choose first action over the second action as it provides the greatest balance of happiness.

The utilitarian theory is not that each person votes on the basis of his or her pleasure or pain, with the majority ruling, but rather that we add up the various pleasures and plains, however large or small, and go with the action that brings about the greatest net amount of happiness.

Because utilitarian evaluates actions according to their consequences and because actions produce different results in different situations, almost everything might, in principle, be morally right in some particular situation. For example, breaking a promise generally produce unhappiness, there can be situations in which, on balance, more happiness would be produced by breaking a promise than by keeping it. In those cases, utilitarianism would require us to break the promise.