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Normative Theories of Ethics Case Study Assignment

Business Ethics - Case Review

Introduction

Ethics fundamentally are related with the behaviour of the individuals, what it is right or wrong as per moral conscious and what directives are needed for individuals to stick with the morally right path will be informed by principles of ethics in general. However applied ethics or corporate ethics will deal with the principles that will arise while dealing with the situations that will arise in the business environment. Typically business ethics and the principles that guide these directives will formulate a framework for business operators to take decisions in times of ethical dilemma. Further they will provide a basis for legislation and legal enforcement requirements. However the nature of business ethics is primarily normative (Kagan, 2018). They do prescribe the set of regulations and ethics that need to be followed in the business environment. The following part of the write-up is case review in business scenario based on business ethics principles.

Overview of the case:
By deceitfully claiming caged-eggs as non-caged eggs, Mr. Galton managed to make profits. He was sentenced to about 12 months of home detention and about 200 hours of community work in the whangarei district court in New Zealand. He pleaded guilty for about 20 charges of obtaining pecuniary advantage by deception. This is done in accordance with the Crimes Act 1961(NZ). The honourable justice for this case is Judge Harvey. He mainly focussed on the facts that he falsely packed wrong eggs with the intention of deceiving the system and the consumers. As high as 206,000 dozen cage eggs are sold as non-cage eggs. This may be about $376 000 of pecuniary advantage to him. The judge has considered several mitigating factors like the financial situation of the client, his pleading guilty action at the early stages of the case. Also he came back from Australia to face the consequences of the cases, without any need for extradition. However considering other large scale fraud, seriousness of the case and possible implications, the sentence is delivered accordingly.

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The unethical behaviour:

Discuss consequentialist view (utilitarianism) - Discuss all parties that may be affected i.e. consumers, actual free-range egg producers, etc. Discuss Kantian view. Is this view valid?

1) Consequentialist view or utilitarianism principle (Mill, 2016) both are more or less related with the normative ethical principles. They will formulate a basis either to support or restrict a course of action based on ethical insights. Though there is much coherence in consequentiality view and the utilitarian principles, there is certain difference too between the two. Consequentiality view is concerned more with the consequences of the actions. When an organization or an individual is involved in certain course of action, "what can be the consequences of the same?", will be the fundamental basis for judging the acceptance or rejection of a particular course of action. However utilitarianism principle is concerned more with the possible good to the masses. Both the others and the self and the possible good that can achieve will be criteria in deciding the approval for the course of action as per utilitarianism principle(Mill,2016). In the current case, the actions of defendant are not justified, as they are causing inherent damage to several stakeholders. At the outset the trust of the consumers is breached, some consumers are ready to pay more for the non-cage eggs, however with this deceitful action of the defendant, they lost trust in the system. At the same time, those who respected ethics and brought up eggs in non-cage conditions are at disadvantage, as their actions may be not recognized and they may not receive the necessary privilege they are entitled for. Free-range egg producers may not get benefit for their morally bound egg hatching. Government regulations are getting breached and there are chances that if the same behaviour is allowed, people may lose respect over the government regulations as well there can be increased instances of similar fraud and misuse of the system facilities.

Kantian view of ethics(Stern,2015) is more related with the deontological theory, the theory is against to the principles of the utilitarianism and it is contained in the belief that the people can do what is right as per the ethics of duty but not as per the utilitarianism principles. It is ethical to do duty, but there is no need to concern about what is good for more number of people or good for more stakeholders. However this theory is not applicable in this case, because the actions of the defendant are not being guided by any set of recognized duty list. However if it is believed that his duty to get maximum advantage or benefit to his business firm or for him individually, they it is not acceptable. Comprehensively speaking as there is no any recognized duty of the defendant, the applicability of Kantian view is not valid in this case. However if the Kantian view is considered with the categorical imperative of supreme moralities, then the duty of moral adherence will immediately condemn the actions of the defendant and will refrain him from doing them as they are against the ethical principles.

Make sure you explain why you think the virtues you mentioned are important

2) The underlying virtues recognized in the application of the consequentialist theory in the above case are concerned more with the confinement to the moral and ethical values. Also there is detailed consideration to the integrity in character and adherence to principles. This is important to consider these ethics in judging the case in this scenario, as they formulate solid framework and predicate to judge the future instances of similar nature. As well the stakeholders getting affected in this case need to be justified and should be provided with right justice. Only with these elements consequentialist theory based on right virtues will justify the action.

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Discuss the impact to business and consumers if trust is breached

3) Impact of the breach of trust is very severe. If the trust is breached consumers may not believe in the system, they may not get ready to pay more even for genuinely non-caged eggs. This will impact genuine free trade business owners, who wish to do business with genuine adherence to the ethics. Also if the breach of trust is not enforced through proper governance, it is possible that several similar cases arise in future.

Discuss this question based on the parties affected.

4) Parties effected:
Consumers are cheated - Their consideration to the genuine moral principles is taken advantage of. There are several consumers who paid excess amount ranging to about $376,000 of profit to the defendant. It is a big fraud and all this money is lost by consumers and their trust is breached in this course.

Business organizations - Other free trade business operators are taken advantage of. Their genuine moral adherence is not paid for. They were competed by defendant and lost their market share in non-cage egg market.

Government regulations - Governance is questioned and if won't take up an appropriate action to curb this; it is going to draw less respect and attention and there is every chance that the lenience of governance and legal frameworks will induce more similar instances in future.

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The punishment

Explain if you think punishment should act as a deterrent or something that would absolutely stop people from committing crimes

1) Obviously the punishment is a deterrent in this case; it will discourage the people from committing similar frauds in future. The seriousness of the punishment the people receiving in this case will stop similar cases from evolving in future. However no punishment can absolutely stop someone from committing the same crime in future. They only discourage the repetition of the same. Only the severity of the punishment can increase of the deterrence it can offer to the culprits from committing the fraud.

In other words, should the punishment for cheating a little be the same as for cheating a lot? And why?

2) The severity of the punishment can be directly related with the consequences of the fraud. If the fraud is serious and involves big amounts of fraud, obviously there is need to have more severe punishments. In case if simple punishments are provided even for larger crimes, this will not induce deterrence to the inviduals from committing serious crimes. Also they may risk doing the crime of larger proportions, as the punishment is going to be same. Hence it is need to have major punishments if the crimes are of larger proportions for obvious reasons.

Discuss whether this would be appropriate based on Kantian approach.
Do you think the judge's approach is right? Why?

3) Kantian approach is based on deontological principles. As there is no any recognized list of legal or materialistic duty list of the defendant, the applicability of this rule is limited. However when considered with the duty to be legally approved as well to compliant with the regulations, defendant actions are not justified. Also the foundation of the classical Kantian view has evolved from the categorical imperative duty to be morally binding, these principles are not followed and hence from that perspective Mr Galton actions cannot be accepted as ethical.

Include the mitigating factors in your discussion

Mitigation Factors

1) Well in the judgement, honourable Judge Harvey has given judgment considering the mitigation factors like the pleading guilty by Mr. Galton in the early times of the case, without complex extradition, he returned back to NZ to face the music of the case. Further financial situation of Galton is also pathetic at the time of committing this crime. Considering all these factors Justice reduced the severity of the punishment. However I feel considering the fraud amount ie., $376,000, which is too big to get go off, Galton either need to be provided more serious punishment(Vaughn,2015). Alternatively with the same punishment, he should be given financial punishment like recovery of the fraudulent profits which can be employed for community purpose and so and so forth. Nevertheless the judgement has emphasized the need for ethical compliance in business and provided trust in the system which can refrain, possible similar instances in future.

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