Ethical decision-making in toy manufacturing safety standards

Ethical decisions that corporations must make are not always the least costly ones when it comes to fixing a problem. When a CEO is confronted with a choice of doing the ethical, customer-friendly decision, or saving money and shipping a product that is clearly not safe or in the best interest of children, there should be only one solution. That solution is to do the right thing: take the loss, bite the bullet, and pay for the fix so the product that is sent to the public is safe and fully represents the advertising that was designed to entice customers in the first place.

Memo to the Toy Company CEO: Background on Ethics and Toys

In the case of the toy whistles that have more lead than is safe for human health, it is absolutely imperative that the toys that are sent out meet the strictest standards for safety. This is vital to remember not just for the safety of children who may be harmed by excessive amounts of lead; doing the ethical thing is vital for the image of the corporation. The negative publicity from an incident in which a child gets sick because a product was not safe would be devastating and would ultimately harm the bottom line perhaps more than paying $100,000 to replace the flawed toys.

Two Strategies to Ensure Ethical Decisions-Making Takes Place

One philosophy / strategy that should always be part of a corporation's approach to business is Utilitarianism. The man most closely identified with Utilitarianism is John Stuart Mill, and his rule in terms of ethical decision-making is to do "…what provides the greatest good to the greatest number of people" (University of Illinois at Chicago). And in this case, the greatest number of people will be all the children in South America that will be overjoyed to receive this toy but may be harmed if the toy is not safe for human health.

A second strategy to ensure ethics is part of decision-making at your company is to have monthly meetings for employees (all employees attend these 30-minute meetings in small groups) during which ethical issues are presented. At Levi Strauss Corporation the corporate culture is very conscientious about ethics because when an employee witnesses an unethical act on the part of any employee it is that witness's duty to report the violation of ethics. Promotions are given based on reporting unethical acts, and that is another possible strategy that would go along with updating all employees monthly on what is ethical and what is unethical.

The Code of Ethics for AT&T

When developing a code for the first time, it is important to see how other companies approach codes of ethics; AT&T's code has nine important components: a) defining honest and ethical conduct; b) conflicts of interest; c) disclosure; d) compliance; e) reporting and accountability; f) corporate opportunities; g) confidentiality; h) fair dealing; and i) proper use of company assets. The most important component in AT&T's code is the definition of honest and ethical conduct. Do all employees understand what ethical conduct entails? This brings home the need for frequent meetings where ideas can be discussed, employees can raise concerns, and ethics is emphasized over and over. Each company has its own product or service to promote and so each company's emphasis will be slightly different. The second most vital component that AT&T uses is "reporting and accountability": any violation of ethics should be reported in any and all companies, and each employee is accountable to his or her supervisor and moreover is accountable to the mission of the company. Thirdly, employees should know what a "conflict of interest" is; these are the three most important components to be embraced by all companies.

In conclusion, talking about ethics and honesty is not sufficient in today's business world. Because there have been so many unethical, corrupt practices that have been in the news over the past few years all alert CEOs and boards of directors should absolutely insist on a strong, well-worded code of ethics for their company.