Question 1 (Total 40 Marks)
Consider the following scenarios:
Scenario 1:
The nation of Mythos had a nuclear disaster causing widespread death, destruction
and injury. There were not enough medical personnel, medicines, food or water to
treat injured so the Disaster Relief Director made the following decision:
1) Those injured who will die without extraordinary medical attention are to be
turned away from help and not given any food or water;
2) Those injured who will live are to be told to wait for attention but be given food
and water; and
3) Those injured who may live if they receive urgent medical attention now are to
receive medical care. food and water.
Scenario 2:
A much-loved sports star has been rushed to the hospital, seriously injured in a game.
He needs a kidney transplant immediately to survive. The only suitable donor is a
motor accident victim on life-support in the emergency room. Doctors believe she
may only have three days or less to live. Without the transplant, the sports star will
die within the next 24 hours while the accident victim may die within three days
anyway. The transplant team turned off the life-support system of the victim causing
her death and carried out the transplant without the public ever knowing that they
killed the victim for her kidneys and saved the sports star.
Scenario 3:
A manager at an oil company found out its factories were illegally releasing nitrous
oxide into the air to save the costs of filtering the air and capturing the toxin. This
made their production cost more competitive and maintained employment in the cities
with its factories and earned him a bonus for higher profits. She remained silent.
Scenario 4:
A manager at an airline discovered that a passenger on an aircraft flying into his city
had died from what the pilot said was a horrific breakdown of the person’s body and
looked like Ebola. He knew if he told authorities there would be panic and the
aircraft would be refused permission to land and that it was likely no other nearby
nation would allow it to land meaning it would crash with a loss of all lives. He chose
to tell no one and allowed the plane to land at the airport and passengers and crew
disembark before the pilot reported the death of the passenger.
Scenario 5:
Two supermarkets with 90% of the market share in their nation agree to charge the
same inflated prices for products so they can make huge profits.
REQUIRED
Comment on the decisions taken and give reasons why you would agree or
disagree with the solutions using the Utilitarian Theory as your guide.
(40 Marks)
SOLUTIONS
Work Done
1) Correct Decision because it is in accord with Utilitarian Theory
2.0
The Director has used their skills and assessed the situation with a
view to their survival prospects of people
2.0
Those who are going to die would be usin
g up scarce resources such
as medical assistance, food and water that may cause more deaths
2.0
Those who are going to live can wait awhile for care so that others
may live
2.0
2) Incorrect Decision because it’s not in accord with Utilitarian Theory
2.0
The laws protecting individuals are there for a reason so that
people’s lives are not taken at random
2.0
This is a case of a life for a life and no evidence that the sports star
living would lead to other lives being saved
2.0
Doctors only believe the accident victim may die within a few days
2.0
3) Incorrect Decision because it’s not in accord with Utilitarian Theory
2.0
The manager is not taking into account the possible injury and
deaths to many people from breathing toxic air
2.0
The employees are also at risk of being injured or dying
2.0
The manager is also putting their personal interest before others
2.0
4) Incorrect Decision because it’s not in accord with Utilitarian Theory
2.0
The manager is not taking into account definite injury and deaths to
many more people than the passengers and crew on the aircraft
2.0
He is most likely directly causing the death of many people to save
his aircraft from destruction
2.0
The manager is also putting their personal interest before others
2.0
5) Incorrect Decision because it’s not in accord with Utilitarian Theory
2.0
The supermarkets are not taking into account the effect of increased
prices of products on end customers who may not be able to pay
2.0
They are benefiting a minority at the expense of a majority
2.0
Price collusion is illegal in many nations as it is seen as unethical
2.0
END OF QUESTION 1
Question 2 (Total 30 Marks)
Part A (20 Marks)
Consider the following Products:
1) McDonalds
2) Red Bull Energy Drink
3) Nestles Coffee
4) Philip Morris Cigarettes
5) SlimFast Slimming Shakes
6) Hardys Fur Coats
7) Loreal Products
8) Novadol Anti-Aging Cream
9) Anthony Gates Baldness Treatment
10) Kinglake Hardwood Timber Flooring
REQUIRED
For each product group above, state whether you believe they are Ethical giving
your reasons for each decision (20 Marks)
SOLUTIONS
Conclusion + Any One Comment = 2 Marks
1) McDonalds – Not Ethical
o Targeted at children
o Low nutrition value but high on fat, salt and sugar that can
cause health problems
2) Red Bull Energy Drink – Not Ethical
o Targeted at people needing extra energy
o Very high sugar content that can cause health problems
3) Nestles Coffee – Not Ethical
o Only motivated by profit
o Very low payments to Ethiopian farmers
4) Philip Morris Cigarettes – Not Ethical
o Products do not disclose the direct links to cancers, lung
and
heart disease
o Product does not disclose the effect of long term use on the
health of a person who uses the product
5) SlimFast Slimming Shakes – Not Ethical
o Products do not by themselves reduce a person’s weight
o Products do not have any sustainable independent evidence to
prove they work
6) Hardys Fur Coats – Not Ethical
o Products are fashion items and result in needless killing of
Foxes and Mink
o Some species are at risk of extinction
7) Loreal Products – Some not Ethical
o Some products tested on animals
o Alternative testing reduces torture or injury to animals
8) Novadol Anti-Aging Cream – Not Ethical
o The aging of the human body cannot be prevented
o The products do not have any sustainable independent evidence
to prove they work
9) Anthony Gates Baldness Treatment – Not Ethical
o Baldness cannot be treated or cured other than by surgery
o Products do not have any sustainable independent evidence to
prove they work
10) Kinglake Hardwoord Timber Floors – Not Ethical
o Products use scarce rainforest timber
o Companies deal with often illiterate workers
Part B (10 Marks)
The European Union has had to bail out the Portuguese economy in 2011 by giving
loans made by both governments and financial institutions.. The Portuguese
government is reluctant to take the necessary fiscal steps to restructure the economy
and be able to repay the loans
REQUIRED
a) Determine the main Stakeholders involved and why (5 Marks)
b) Using an Ethical Perspective, determine whether the Portuguese
government lack of action is ethical (5 Marks)
SOLUTIONS
a)
1) Portuguese government
o The government only risks further default on loans and no new
loans to support the economy leading to its collapse and deep
recession
1.0
2) European governments bailing out Portugal
o Governments could lose up to 100% of the loans made
1.0
3) Financial Institutions
o Institutions could lose up to 100% of the loans made
1.0
4) The taxpayers of European governments bailing out Portugal
o These taxpayers have to suffer higher taxes than could be
expected if their governments did not have to make loans
1.0
5) The Portuguese citizens
o Citizens either face short term hardship if their economy is
restructured or long term hardship if Portugal enters a long deep
recession
1.0
b)
o The government IS NOT ethical if it takes loans knowing that by
inaction on the economy it will default
1.0
o The Duty Ethics or Utilitarian are the best Perspectives
1.0
o The Duty Ethic Non-Maleficence, i.e. avoid harming other
people, is relevan
t as to default on loans harms governments and
financial institutions
1.0
o Duty Ethic of Promise-Keeping, i.e. act according to explicit and
implicit promises, as the Portuguese government made promises
to the European Union to get the loans
1.0
o Utilitarian Theory could also be used as the number of taxpayers
and depositors in other nations who made possible the loans will
lose if Portugal defaults
1.0
END OF QUESTION 2
Question 3 (Total 30 Marks)
REQUIRED (Show all Workings)
Read the “Western companies use child labour by using Asian suppliers” article
and apply the Ethical Framework below in determining whether companies
doing business are ethical.
Ethical Framework
1) Identification Of The Broad Issue (3 Marks)
2) Determine whether it is Accounting, Commercial or Operations related
(2 Marks)
3) Identification of Main Stakeholders Concerned and why (10 Marks)
4) Identify the Ethical Perspective being taken and what Perspective should
have be taken (6 Marks)
5) Consideration of Alternatives (6 Marks)
6) Recommend the correct Course of Action (3 Marks)
SOLUTIONS
1) Identification Of The Broad Issue
o Companies seek low cost suppliers to increase their profits
o There is no effective checking of the supplier practices
o The suppliers use practices not acceptable in developed nations
3.0
2) Determine whether it is Accounting, Commercial or Operations
related
o Definitely a commercial related activity designed to increase
profits
o Also is operations related as there is no policy to check supplier
practices before or after appointment
2.0
3) Identification of Main Stakeholders Concerned
o The main stakeholders are the companies (increased profits);
suppliers (winning supply contracts through lower costs); child
workers (bodies not developed, deprived education and proper
food and rest breaks), adult workers (long hours, no rest breaks,
poor pay and conditions) and governments (turning a blind eye to
unethical practices)
10.0
4) Identify the Ethical Perspective being taken and what Perspective
should have be taken
o The directors of all companies involved probably would have
argued the Utilitarian Perspective as the suppliers create jobs for
unskilled workers who would otherwise have no jobs and
customers get the benefit of lower prices
o The main ethical perspective that should have been followed was a
duty of non-maleficence to avoid harming other people. The
directors of companies and the suppliers have a duty of care with
regard to employees and children
o Virtue Ethics and the Sunlight Test could also be considered but to
a lesser extent
6.0
5) Consideration of Alternatives
o Companies, under threat of fines from their own government,
should not use any supplier using child labour or unfair
6.0
employment work practices
o Companies, under threat of fines from their own government,
should not use any supplier using unfair or unsafe production
processes
o Companies should only use suppliers with similar practices and
processes to their own
6) Recommend the correct Course of Action
o Cancel contracts with any suppliers with unsafe work practices or
processes
o Carry out a pre-contract audit of all new suppliers
o Carry out ongoing audits of suppliers on an ongoing basis
3.0
END OF QUESTION 3
“Western companies use child labour by using Asian suppliers”.
Western companies have been in the news over the last decade for using suppliers
who use child labour. These supplier problems occur because of weak regulation in
the Asian nations. The bad news however is doing potential and substantial damage
to the companies' brand and products.
Child labour is particularly difficult because they and their families may otherwise
starve. This however is no justification for the continued use of child labour.
Directors claim it isn't their problem, but a world problem with regard to priorities and
a general lack of enforcement by local agencies but this doesn’t absolve these
companies for being part of the problem.
Companies seek to find the lowest-cost providers and look globally to find them.
While they often have guidelines for things such as green practices, bribery and child
labour they don’t enforce them well enough and they know which nations have few if
any laws, but often don’t check too closely to optimize margins and assure profits.
Companies seem unable or unwilling to assess the risks against the savings from
using these suppliers. While financial benefits are understood, the risks aren't.
The main problem is a sole focus on costs. Laws in the nation of the companies need
to have strong monetary and personal liability penalties to change the policies of these
companies.
END OF EXAM PAPER