Assessment of Ethical Issues: Case of Coca-Cola Company (Essay Sample)

MARKETING SUITE
RESPONSIBLE MARKETING AND SOCIETY
ASSESSMENT OF ETHICAL ISSUES: CASE OF COCA COLA COMPANY
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INTRODUCTION
Human beings are socially and economically embedded into cultural structures. Therefore have values, norms, and ethics that they are inclined to follow. Research has shown that the ethics, and morals are in most cases ignored by consumer’s culture (Carroll 2013). In the recent studies, ethics and consumption has become a key areas of discussion. Consumer culture is an important aspect that should be understood as it presents humans everyday life (Selart & Johansen 2011). Therefore, in responsible marketing and consumption, the firms as the producing entity, and the buyers who is the consumer should all be responsible in the way they handle production and consumption to ensure sustainability (DiStaso & Bortree 2014).
Background information of Coca-Cola
Coca Cola is a multinational corporation of American origin. It is involved in manufacture, marketing, and retail of non-alcoholic beverages, syrup, and concentrates. The firm has been in operation since 1886 and has more than 500 brand lines. It is located all over the world with more than 2800 outlets. The brand has widely been known and it has thus received extensive loyalty from customers (Mitroff 2001). In the recent years it has had financial issues which have been associated with ethical crises (Mitroff 2001). Therefore, the current essay will make reference to Coca Cola brand and connect to theories, assess ethical issues involved. It will also extend to assessing possible solutions and recommendations.
BODY
Responsible marketing ensures that firms pass information with a lot of consideration to the community. Thus, they ensure information communicated is not immoral, illegal, harmful, irresponsible, or even misleading (Selart & Johansen 2011).
Facts relating to Coca-Cola ethical crises
Coca Cola ethical issue has been lack of societal concern and environmental degradation. According to Mitroff (2001), there was a Cola war that began from the 60s to date. Around 2000, the company was in the spot light for gross misconduct due to poor management, and poor decisions on CSR and future sustainability. According to the business ethics magazine, Coca Cola ethical crises negatively impacted on its performance. In 2013, the firm lost key investors and had internal management crises, with high employee’s strikes. In 1999, the company was faced with contamination crises, where about 13 children got sick after consuming Cola products in Belgian. In Poland the products had mould. The issues was low quality products released to the market. According to Writer & Checker (2003) in 1990, Coca-Cola was faced with a competition issue. This was in France after attempt to acquire some firm which was against antitrust laws. In 1991 it was taken to court and Italy won as the firm was found with anticompetitive-pricing. In addition, the firm was in 2001 accused by African American for racial discrimination in terms of pay, performance evaluation, and promotions. Also, in 2004, the firm was accused for channel staffing which led to misstatements of the financial statements. For instance, the firm sent more than required concentrates to Japan. In 2006, there were raising conflicts with other distributors as the firm had gone beyond its scope. Also, in 2003, the firm was accused for causing pollution to water ways in India. In addition, the firm has had to deal with consumer’s perception as the drink has been seen to contribute to obesity. For instance, in 2008, the firm was sued for having gone against the federal food policy (Selart & Johansen 2011).
Ethical issue defined
The ethical issues at hand involves malpractices involving violation of human rights. The affected stakeholders include employees, community, and competitors. The ethical question requires stipulations and specifications of the level of responsibility the firm owes to the stakeholders.
Stakeholder’s analysis
Major stakeholders of the firm include its employees, shareholders, customers, supplier, local community, regulatory authorities, media, and government (Selvi et.al 2010). Primary stakeholders include the shareholders, employees, and suppliers. The employees have a direct contractual agreement with the firm to work and receive wages, while suppliers are to make supplies and get their pay. The secondary stakeholders include the government, local community, and customers. This category has distant interest. For instance, the government only come in at the point of tax but is not involved with the operations of the firm. As for the customers, they need a finished product and thus are not directly involved with the firm operations. The indirect stakeholders include; regulatory authorities and the media. These are groups with bidding interest. For instance, media will be used for communication as they get a commission after which the deal is dropped (Singh, et.al 2011).
Theories relating to the ethical issue
Research has shown that a marketing decision is judged from its outcomes. According to utilitarianism, a decision is considered ethical if it offers wide benefits to the greatest number of people. For the case of Coca Cola, there has been a lot of decisions that affect a bigger population and community around it. The firm has been having issues both internally and externally. For instance, it has been discriminating its workers, paying low wages, it has been causing pollution, and has exposed consumers to health issues (Singh, et.al 2011. The firm has also been discriminating against workers and has been offering a low pay for them which is against utilitarianism thinkers.
Following the duty- based ethical theories, coca cola has not been an ethical corporation. Weighing its decisions against what is good on bases of intentions, we would say that it is unethical. From a legal perspective, the firm has not been able to ensure it addresses health issues which is a legal issue. The firm has been mishandling workers as well as causing pollution. It has not been able to ensure an overall good (Writer & Checker 2003).
Some of the issues do not conform to contract-based ethical theories. Basing on a major assumption of maintaining social order, Coca Cola has not been able to ensure harmony. Through the distribution chain, the firm has been having distributors conflict, and has been anti-competitive (Mitroff 2001). Therefore, there has not been an agreement for abstaining from exploiting each other. Coca Cola has not been fair in the market operations and has been exercising unfair competition.
Following the Rawlsian theory, the argument is that all persons and firms should have equal rights as well as equal opportunities. The liberty principle which alleges that all persons should have equal rights has been a major ethical critic for Coca Cola. The firm has been criticised on bases of being discriminative of race, has been practicing unfair competition, and has offered poor working conditions for its employees. Following the difference principle of Rawlsian theory, the firm would be ranked as one that ensures least advantage to its stakeholders.
Coca Cola has also infringed the virtual based ethics theory which stipulates that ideas and thoughts should collude to have a one unified move. The firm has been having conflict with other distributors and has been faced with unfair competition critics (Selart & Johansen 2011). The firm in general has not engaged in ethical activities and right virtues have not been key of implementation in the firm. Generally, the firm has also not portrayed admirable traits to the society at large since its decisions have not been society driven. This can be traced from its beginning where its brand had no consideration for human heritage. The firm in general has not been able to observe key values of fairness, integrity, respect, and empathy.
The firm has been having issues with respecting human dignity. According to the religious-based marketing strategies that ensure ethical behaviour, firms should have respect for workers. They should allow for solidarity, and respect for human dignity. Coca Cola has been faced with critics on bases of racial discrimination and workers harassment.
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