Question:
Discuss about the Volkswagen Emissions Control Device.
Business ethics are the guiding principles that direct a business to operate in a well and effective way. Acting in an ethical way is different from doing right and wrong. Business ethics ensures an existence of certain level of trust in the consumers. The concept of business ethics arose in the year 1960 due to awakening of different consumer based societies. Business ethics are beyond the moral code and attempts to reconcile what company should do to maintain a competitive advantage. As a part of compliance and ethic program a majority of companies are focusing over the concept of business ethics. The government agencies across the world are taking measures to define the process of business this and management. These policies are identified as a based to gain business integrity. Such policies will lead in a positive direction by creating ethical awareness and guaranteeing growth. A competitive business environment is creating a pressure over the employees to perform unethically (Alvesson and Sveningsson, 2015). One of the examples regarding breach of business ethics is The Volkswagen Scandal. The scandal is much talked about and bring forward the concern of government and non- government agencies on the ethical issue (Armour, 2016).
The Volkswagen Scandal started in the year 2015 when the US Environmental Protection agencies questioned the credibility of the Automobile Company. The German company was caught under the violation of the Clear Air Act. The scandal brought the attention of international agencies to the grave issue. The Volkswagen scandal had a long-lasting impact on the company for deceiving government rules and regulations (Barrett et al 2015). The German Giant accepted the allegation it caused due to emission. The government agency received the information regarding intentionally using turbo charged direct injection diesel engines. Due to this, the vehicles were emitting 40 times more NOx output. In order to undue to act, Volkswagen called back 11 million cars across the world from 2009- 2015. The emission was brought forward by the 5 scientist from west virginal University There were severe issues in the organization culture and the consequences raised by the issue(Avolio, Walumbwa and Weber,2009). This brought the attention of local and international agencies across the world to look into the matter. One of the reasons considered the issue was due to the dysfunction of the Organizational culture. The organizational culture was under question due to the intensity of the scandal. There was continuous rule breaking deceptiveness in the organization. The organizational culture and development has an ever lasting impact on the organizational culture. There were severe gaps in the organizational communication and ethical leadership. The continuous fraudulent behavior at a top-level and ignorant attitude of middle level employee is the reason behind the failure (Baumgartner, 2009).
An ethical dilemma is a decision making problem that occur due to moral imperatives. The situation arises due to a conflict in obeying the result. This is sometimes treated as a moral philosophy involved to refute the ethical code of conduct. The ethical dilemma occurs due to a gap in meeting the greater good and lesser evil. A person in this situation has to make a choice in between the given options. There is a constant conflict in between the two options. An individual finds difficulty in avoiding the one and choosing the other. For example: The ethical dilemma can occur in a situation where a poor person has two choices- Either to steal food or to let his family die. The situation regarding the ethical dilemma is tough to be understood and creates disparities in gaining better understanding. In the given case study, Volkswagen is consistently involved in a scandal where the top level management were aware about the discrepancies in the company. The faith of million was lost due to the scandal. Big corporation faces ethical dilemma due to an urge to make enormous profit. There was extreme pressure to show explosive sales. This creates a pressure on the company officials to use ineffective equipments. The question is regarding the wrong choice made by the official during extreme pressure from the senior official. Ethical leadership is important in such a situation to manage the behaviour of the employee. Employees under extreme pressure tend to make such mistake. This is important for the organization to manage the effectiveness caused due to a gap in understanding (Blackwelder, et al 2016). Ethical issues are common in such a situation creating wide gaps in understanding. From the scandal it is clear that system failed due to deceptive people in the company. Ethical dilemma occurs when people are facing difficulty in choosing the fair path. Ethical leadership is the most important part in managing the behavior of the top level executive to make high revenue. The situation here is described as a deceitful activities causing pressure on the organization causing failure of whole machinery. The condition leadership plays a chief role in dealing with the competitive pressure. The company faced enforceable circumstances in an unethical way to make surplus profit. This has made the situation worst for, any stakeholder’s whose interest was directly and indirectly being attached. Such policies will lead in a positive direction by creating ethical awareness and guaranteeing growth. A competitive business environment is creating a pressure over the employees to perform unethically. A rapid change in economy has created wide business opportunities contributing in deceitful activities. Scrutiny of stakeholder has become an important part in managing the business interest. While managing the business functions it has become important to look into the changing competitive advantage. The most important part is in handling the miscellaneous functions. The only purpose is to manage the corporation in case of ethical dilemma. The overall purpose of introducing a change is to manage the productivity by using ethical means. Volkswagen has a huge name across the world. This single incidence has contributed in maligning its image. The organizational development is necessary for managing interest of people. Business ethics are important for an individual to manage the corporation. The factors leading ethical dilemma were: One of the reason considered the issue was due to the dysfunction of the Organizational culture. The organizational culture was under question due to the intensity of the scandal. There was continuous rule breaking deceptiveness in the organization. The organizational culture and development has an ever lasting impact on the organizational culture (Boodoo, 2016).
Violation of business ethics does affect the stakeholders in many ways. These stakeholders are important for meeting business interest. Any such incidence causes a huge impact over the goodwill of the company and affects stakeholders. There are two types of stakeholders in a company: Internal and External. The internal stakeholders are the one whose interest is directly related to the organization. In case of any failure, they are the one who suffers a lot. Employees, management, customers etc are the internal stakeholders. The external stakeholders are the one who are indirectly related with the organization (Carroll, Levy and Richmond, 2008). The external parties are government agencies, media house and other voluntary organizations. Any such change in the organization, does affect them.
The Volkswagen emission had a long-lasting impact on the various stakeholders. The customers were the one who suffered a lot due to the emission. Volkswagen called back 11 million cars across the world from 2009- 2015. This directly had a long lasting impact in the mind of the customers. The German brand is famous for the quality automobile. Such incidences shake the faith of customers (Crête, 2016). Business ethics and responsibilities are important for managing the long term impact caused in dealing with the issues. The Employees were affected by the scandal. There were many expulsions in the company. Employees who were found guilty were suspended. This affected a large section of the employees working it Volkswagen. A major section of employees were afraid of suspension. This incidence had a long-lasting impact on the employees. Stakeholder interest was largely affected due to this incidence. It was one of the kinds of incidence that directly affected every individual attached with Volkswagen (Cue, 2015). The management also suffered as some of the top management resigned after the exposure of the act. During the hearing, the CEO, Michael Horn stated that the matter arose due to the negligence of engineers who installed the software. The organization culture here plays an important role in managing the organization. Ethical responsibility is responsible for the organization in dealing with such a situation (Gates et al 2017). Ethical leadership was under scrutiny, and decisions due to the fraudulent behavior of the top level executive were questioned. Leadership plays an important role in dealing with the competitive pressure. Top management has an impact due to the long lasting behavior of the people whose interest is directly attached with the situation. It has become evident at the part of the company that they have to effectively develop skills in the employees. Such measures will help in organizing the situation in a better way (Milne, 2015).
The Government bodies were highly shacked after receiving information regarding tee emission. There was continuous violation of act. This is due to the fact that the government directly found violation of environmental act. US Environmental Protection agencies questioned the credibility of the Automobile Company (Jung and Park, 2017). The German company was caught under the violation of the Clear Air Act. In such way, it can be seen that the interest of each and every individual attached with the organization was under question after this incidence. It was due to the government responsibility to safeguard the interest of public (Oldenkamp et al 2016).
Philosophical arguments in favor and against of ethical egoism have been spirited. This is an only normative ethical framework doing justice to human motivation. There are two questions to this propose theory:
Realities of human motivation are important for considerate the realities of human responsibility
Human are purely motivated with the egoist asserts, purely selfish.
In the given situation, the need completely depends on relationship between facts and values. Human tend to perform the act specially to which those facts seem to the point. Severe views on this issue range from the argument related to values to the contention that is desirable at the same time. The modern views insist the significance of ethics related with human nature (Zoback, Kitasei and Copithorne, 2010).
The ethical theory argues that the most precise expression behind the moral point is benevolence. There is a conventional function that forces an individual to act in a favor or against. This particularly affects the decision related with the authority and its tendency to maximize utility over the long term. An individual depart from the activities due to internal and external criticisms. In case of serious difficulties and measurement of essential concepts there is a gap in understanding the issue. The theory is completely based on utility. This is based on the demand. If the demand increases, there will be an increase in the activities. People try to find out different means to meet their needs. They often choose wrong way to meet the desired target. The failure is caused due to an excess need to something (Wheelen and Hunger, 2011).
Example: Either actual or hypothetical, situation are put forward to demonstrate deepest moral convictions. The situation is been over-ruled by the unjust treatment of an innocent victim or minority. In the given situation, the interest of the customers was compromised in order to increase the profit margin. No consideration was given to the moral values while developing the concept (Smith and Parloff, 2016).
The Kant theory formulates “supreme principle” in different ways. The two best-known formulations are:
The first Act is framed only according to that maxim where one can act same time where it will become a universal law.
The motive behind is to treat every individual with humanity or in that of another, never as a means only(Meadocroft, 2009).
The overall motive behind the situation is to motivate the rule or policies to satisfy criteria in a categorical force. The theory is based on the accepted principles that state the unreliable and unacceptable indicators of right and wrong. These parameters are important for managing the situation at best provisional. The theory will vindicate the motives that lie beneath them (Mearns and Yule, 2009).
The dilemma was resolved after the reporting of the issue. Various government bodies took initiative in managing the situation. The company has to face serious legal charges for damaging the environment. The situation has lead to many changes where the council purchased the data generated by PEMS invented in 1995. The findings in the situation were handed over to California Air Resources Board. Volkswagen became the target of all the regulatory bodies. The stock price of the company fell down. This severely affected the organization goodwill in the market. As a result the group CEO resigned (The Volkswagen Emissions Scandal, 2016). They finally had to make an investment in order to rectify the emission by recalling the vehicles. The overall purpose was later resolved, as they have to accept there is take. Moreover they are still re-calling the vehicles from different market. The overall purpose is to resolve the severity of the issue that is attached with the given situation. The German Giant accepted the allegation it caused due to emission. The government agency received the information regarding intentionally using turbo charged direct injection diesel engines. It has now modulated its internal system in order to keep a check over such incidences (The Volkswagen emissions scandal explained, 2016).
The Australian ethical standard serves as an important tool in dealing with the issues arising due to involvement in unethical activities. The business thereby has to meet the requirements as mentioned in the Common wealth regulations. Any discrepancy in follow ethical standard is not good for the company. The local Australian law and organizational body keep a check on the business organization while accomplishing duties. The Australian or international companies has to follow the Environmental legislation. It is thereby mandatory for an individual to focus on the regulations in order to avoid penalties and severe punishment. The federal, state and local governments are jointly working for protecting the environmental Through the Environment protection laws in Australia through bilateral agreements. The business enterprise has to understand the law that applies to the individual.
The federal Environment Protection and Biodiversity Conservation (EPBC) Act, is thereby administering the Department of the Environment and approves process of national environmental and cultural concerns. The following matters are taken under consideration while protecting the Environment. It is clear from the act that both local and international organization has to follow the legal obligation in order to balance the consequences on the following:
Conclusion
To conclude, the concept of business ethics arose in the year 1960 due to awakening of different consumer based societies. Business ethics are beyond the moral code and attempts to reconcile what company should do to maintain a competitive advantage. The emission scandal created an alert in the market. There are situation where the organization has to face the ineffectiveness caused due to ethical dilemma. These dilemmas are vital to be understood. It is clear from the report that, a competitive business environment is creating a pressure over the employees to perform unethically. A rapid change in economy has created wide business opportunities contributing in deceitful activities. Meanwhile such incidence act as an alarm, it has become important to relocate the changes in order to manage the business activities on a long run. The Overall purpose of this report is to focus on the relationship in between business ethics and organizational goals. Volkswagen emission scandal was one of the kinds of scandal creating a big impact on the people around thaw world. This created alertness in managing the business ethics functions in a well-organized way.
References
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