CATHERINE OWENS DB FORUM BUSI 561 REPLIES
Can someone do a reply to this thread HAS TO BE 450 WORDS EACH REPLY ANSWER
Reply to the threads of 2 classmates who offer views different than yours. Identify the points of difference in your analyses and explain how your application of the relevant law to the facts of this situation led you to a different conclusion.
Each reply must be 450 words supported by 3 scholarly sources other than the textbook/course materials. Each source must be properly cited in current APA format.
Review the Assignment Instructions for Discussion Board Forums, noting especially requirements for word counts, scholarly sources, and biblical worldview integration.
Submit your replies by 11:59 p.m. (ET) on Sunday.
FIRST THREAD NEEDED TO BE REPLIED TO
The Result of a Decline in Business Ethics
Business ethics is defined by “the application of ethics to the special problems and opportunities businesspeople experience” (Kubasek, Browne, Barkacs, Herron & Dhooge, 2016, p. 16). When ethical decisions appear in a person’s life, more likely than not, a plethora of choices are considered when determining the best course to take for justifying our actions. In many cases, we consider our Lord and Savior Jesus Christ, his heavenly father God, our parents, our spouses, our children, friends, colleagues, physical and mental emotions, plus more before committing to one-way or the other. However, when the word “business” is placed in front of ethics, the ramifications are often much larger, including monetary value, and the effect decisions will have on stakeholders and the public. First Timothy 6 verses 10 states “For the love of money is the root of all-evil: which while some coveted after, they have erred from the faith, and pierced themselves through with many sorrows” (KJV). By highlighting the definition of Business Ethics as well as 1 Timothy 6:10, we expose the very public lambasting of Volkswagen Group, whom recently stated “11 million of its diesel cars worldwide were equipped with software that was used to cheat on emissions test” (Lippe, 2015). A multitude of responses, questions, and political backlash reduced Volkswagen’s image in the public, however, we will identify the steps that should have been enforced to prevent this incident, starting at the managerial level and ending with the Chief Executive Officer (CEO).
As children of God, we are instilled with the rationale between what is right and wrong. James 4 verse 17 (KJV) states “Therefore to him that knoweth to do good, and doeth (it) not, to him it is sin”. We are endowed with the conscious capability to distinguish between doing something right and doing something wrong, however, when we choose to do something wrong, it is considered a Sin. Other factors may weigh heavily for or against the determination of right or wrong to include family beliefs, childhood, and life experiences. Nevertheless, as employees working in the Legal office or the Engineering department of Volkswagen, the responsibility to determine the best ethical, moral, and legal path fell squarely on each and every employee to make the correct decision, and if something was legally, morally, or ethically wrong, say something to someone such as the Department Director, or CEO. If fear of retribution was prevalent amongst the employees in these departments, they should have contacted an anonymous reporting service to present the evidence in question.
First, employees should have known there had to be something or someone who they could report the infractions to regarding the software which cheated diesel testing requirements. For instance, the Sarbanes-Oxley Act of 2002 was established by Congress to protect corporate insiders and create an anonymous reporting system for employees to present suspicious activity by companies (McClurg, 2017). Additionally, the Dodd-Frank Act prevents Whistleblower’s, or those who implicate their company for illegal activity, from being discharged, demoted, suspended, threated, harassed, or removed for any attempt of reporting the illegal activity (McClurg, 2017). Aside from these provisions by Congress, there are multiple employee guidelines for reporting suspicious behavior, on top of the character and courage to stand up for what is right, and socially responsible from a company, and an individual. Ideally, managers should have prevented this by asking questions, remaining aware, and conscious towards the behavior of employees and the reporting systems in place for protection, especially since “If God is for us, who can be against us?” (Romans 8:31 KJV).
Secondly, managers or employees in Volkswagen Legal or Engineering department, must have known that the people affected most by this decision to cheat the software detecting system was there stakeholders, which includes the company. For instance, Cremer and Taylor (2016) reported that Volkswagen would take a $18.2 billion loss due to the diesel deception scandal the company attempted in 2015. Although a loss of $18 billion may not deplete Volkswagen of their assets, as it may numerous companies across the world, the image and trust from customers have drastically been impacted, and that is something that cannot be repaired so quickly.
As the CEO of the diesel division of Volkswagen, they should have taken full responsibility for the mistake and attempt to cheat software detection. Afterwards, if not arrested by the Police, could have launched a massive legal investigation into the reason why 11 million cars were equipped with diesel deception software, in order to identify the areas of failure from the management and legal/engineering offices, and hold as many people accountable as possible. This response would have revealed to the public, business ethics is much more complicated than people imagine. In a competitive, business-run environment, money and production become the figures of success, and through cheating the diesel software technology, Volkswagen was able to attract more money, product, and customers around the world. Additionally, this type of legal investigation would perhaps reveal as Clegg, Kornberger and Rhodes (2007) stated:
Ethics cannot be encapsulated in lists of rules that inform action; thus, there can be no ‘one best way’ in which good ethics may be guaranteed through prescription, judgment or legislation. The concept of ethics as practice cannot offer a clear black and white grid that divides the world into good and bad; things are more complicated. (p. 13)
Business ethics is not as easy as deciding upon right and wrong. There are multiple ethical dilemmas that could appear, however, the basis for decisions should be the best legal course that would potentially increase value for the stakeholders, no matter the situation. Additionally, an investigation into the failures of the Volkswagen reporting system, would identify the reinvigoration of legal outlets for suspicious reporting such as the anonymous report hotlines, employee confidentiality policies, and clear guidelines to preventing something like this from happening again. Also, the CEO or investigator leading the investigation may unveil what systemic or deliberate cover-up occurred such as Lippe (2015) belief that Volkswagen engineers neither discussed with nor hid what they were doing from Volkswagen’s in-house lawyers, and the in-house lawyers didn’t realize what was going on.
Ultimately, Volkswagen’s decline in business ethics stemmed from the competitive misconception that cheating was an attempt at achieving company goals. The sorrows that follow the obsession with money can lead to illegal activity, penalties, fines, and supporting the wrong-doings of others. Furthermore, the lack of character or failure to report the wrongdoings by employees, must be fortified and consistently addressed from the executive level down to the lowest employee. Although an $18 billion loss is large and galvanizing, the timeline for repairing the damage done to the environment, customers, and other stakeholders could take decades and cost exorbitant figures.
References
Clegg, S. , Kornberger, M. and Rhodes, C. (2007), Business Ethics as Practice. British Journal of
Management, 18: 107-122.
Cremer, A., & Taylor, E. (2016). Volkswagen takes $18 billion hit over Emissions Scandal.
Retrieved from
probe-idUSKCN0XJ19U
Kubasek, N. K., Browne, M. N., Barkacs, L., Herron, D., & Dhooge, L. (2016). Biblical
worldview edition of dynamic business law. N. J. Kippenhan (Ed.). New York, NY:
McGraw Hill Education
Lippe, P. (2015). Volkswagen: Where were the lawyers? ABA Journal. Retrieved from
McClurg, D. D. (2017). Whistleblower protections: Internal reporting and dodd-frank’s anti-
retaliation provision. Labor Law Journal, 68(3), 156-164. Retrieved from
com.ezproxy.liberty.edu/docview/1936467803?accountid=12085
SECOND THREAD NEEDED TO BE REPLIED TO
Discussion Board Forum 1: Volkswagen Scandal
Jordan Contreras
Liberty University
June 3, 2018
Prevention of the Emissions Scandal
In September of 2015 Volkswagen recalled around 500,000 diesel cars and the company lost around $16.9 billion dollars of the company’s market value (Jung and Bin, 2017). According to Jung and Bin (20117) 11 million of their diesel cars contained a device that would change emission levels during diesel-exhaust tests. When this scandal hit the media, Volkswagen had a huge economic damage occur and they lost many shareholders in the stock market. Diesel vehicles are typically known for the benefits they have with durability, repair cost, and fuel efficiency. So, when Volkswagen designed a car that was supposed to be the top of the line the sales sky rocketed which helped with Volkswagen’s ratings in the market. The Volkswagen scandal really hurt their reputation, and by the CEO of the company not being honest it made the consumers frustrated with the company and destroyed their credibility.
According to the bible “The Lord detests lying lips, but he delights in people who are trustworthy” (Proverbs 12:22, New International Version). As an employee or manager in the legal office or the engineering department I would have done a couple of things differently to prevent this problem. First if I was an employee and I noticed something was off or didn’t seem quite right I would have immediately reported the incident to the managers or executive team. This would have escalated the issue to the senior executives that way everyone is informed of the situation.
As a manager you have a couple of options that could have taken place in order to prevent this incident. I would have designed an ethics and compliance training program, made my team take the course, led by example, created a strong culture to enforce policies, and designed a strict hiring policy. When designing the ethics and compliance training program I would have made is mandatory for my team to take. In addition to this I would made my team sign a paper showing that they took the course. This would hold them accountable for their actions if any mischief or foul play were to of taken place. Next, I would lead by example. I would hold my team accountable for their actions and make actions have rewards and consequences. This would go in hand with creating a strong culture to enforce policies and procedures. Rules and laws are created for a reason. No acceptation. So, by holding my employees up to high standards you can set the expectation that foul play is not permitted. Lastly, I would create a strict hiring process to ensure you are hiring the most trust worthy candidates. In order to achieve this goal, I would design mandatory behavioral and personality test that will need to be taken prior to interviewing and do an extensive background check. By making candidates take a behavioral test you are able to gauge what type of personality they may have, that could lead up to foul play. There were several actions that Volkswagen could have taken to help gain credibility in the media but instead they decided not to admit their actions were wrong and deceiving. In result to their actions that they made they lost valuable customers and ruined their credibility in the market. As a manager I would of done several things differently to prevent this incident, held true to my morals and the way God would of wanted me to take action.
Damage Control and Honesty from the CEO
The CEO of Volkswagen was given an impossible situation to handle when the media broke free that the company and deceived so many people. “Corporate fraud committed under climate mitigation pressure is becoming more frequently observed in line with the ever-increasing environmental standards and relevant regulation enforcements” (Li, McMurray, Xue, Liu, Sy, and 2018). However, the bible say’s “whoever walks in integrity walks securely, but he who makes his ways crooked will be found out” (Proverbs 10:9. New International Version). Lying is never the answer, you will get caught. To live in a Godly way, you have to admit the mistakes made by you or your employees. Being honest helps with your credibility, the company’s credibility and ensures that we are making choices the way God would want us to.
When the media broke free about the scandal, as the CEO over the diesel division I would have first gathered all of the facts. I would have done as much research as possible, brought on a team of investigators to look into the incident, and immediately terminated those involved. As a final step I would have held a press conference to speak openly about the incident that occurred, and recalled all vehicles involved. During this press conference I would have gone over what we as a company are doing to handle all of the recalled vehicles, what we intend to do to accommodate those customers affected by the incident, and gone public about the termination of employees involved in the incident. By showing the public that we are taking matters very seriously could help save the company’s reputation. To prevent future incidents from occurring strong policy and procedures needs to be written and enforced. When the legal team is telling engineers not move forward with the incident and they do so anyways this needs to be escalated up to the proper executive. If the executives choose not to solve the incident than it needs to be reported so legal action can take place. When preventing future incidents than Volkswagen has to be up front and honest with the situation at hand. There are no exceptions to cheating to getting a head. You are ultimately hurting the company even more and aren’t living in the way of god. Investigations need to be occurring but at random time periods to ensure that the company is abiding by the rules. The findings of the investigations need to be made public. When rebuilding Volkswagen’s reputation, you need to be up front and honest about everything going on internally. It is important to live by the way of God, keep your morals, report anything unethical that is occurring, and remember that the customers are what drives the sales of the business. You will drastically hurt yourself in the market if they feel that they are being lied and manipulated. Since Volkswagen has made poor choices around their scandal they now need to do damage control and be transparent with their customers and make everything public.
References
Jung, J. & Park, S. B. (2017, January 1). Case Study: Volkswagen’s Diesel Emissions Scandal.
Thunderbird International Business Review. 59 (1). 127-137. Retrieved from http://rx9vh3hy4r.search.serialssolutions.com/?ctx_ver=Z39.88-2004&ctx_enc=info%3Aofi%2Fenc%3AUTF-8&rfr_id=info%3Asid%2Fsummon.serialssolutions.com&rft_val_fmt=info%3Aofi%2Ffmt%3Akev%3Amtx%3Ajournal&rft.genre=article&rft.atitle=Case+Study%3A+Volkswagen%27s+Diesel+Emissions+Scandal&rft.jtitle=Thunderbird+International+Business+Review&rft.au=Jung%2C+Jae+C&rft.au=%E2%80%9CAlison%E2%80%9D+Park%2C+Su+Bin&rft.date=2017-01-01&rft.issn=1096-4762&rft.eissn=1520-6874&rft.volume=59&rft.issue=1&rft.spage=127&rft.epage=137&rft_id=info:doi/10.1002%2Ftie.21876&rft.externalDBID=n%2Fa&rft.externalDocID=10_1002_tie_21876¶mdict=en-US
Li, L., McMurray, A., Xue, J., Liu, Z., & Sy, M. (2018, January 20). Industry-wide corporate
fraud. Journal of Cleaner Production. 172 (1). 3,167-3,175. Retrieved from
cdn-com.ezproxy.liberty.edu/S0959652617327099/1-s2.0-S0959652617327099-
main.pdf?_tid=86e8669c-1366-43af-9ca5-93ef022bea2f&acdnat=1527826213_
92823702e5c9e426563d12e9b250891f
Lippe, P. (2015, October 13). Volkswagen: Where were the lawyers? ABA Journal. Retrieved
from
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Reitze, A. W. (2016, July 1). The Volkswagen Air Pollution Emissions Litigation.
Environmental Law Reporter. 46 (7). 10,564-10,571. Retrieved from
