Business Ethics Workshop

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Business Ethics Workshop
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Proceedings
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What is CIBE
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Case Study(1)
Text
Consumer and Product Safety
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Key Words
English
Chinese
n.????? n.?? n.?? v.??,??,?? n.??? v.??,??(??)
adj.???,??? n.????? n.???,????
product safety plaything magnet coat with
paint lead paint recall toxic Early Light
Industrial sub-contractor

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5-Ws

• Mattel, Early Light Industrial Co., Hong Li Da,
  Lee Der, United States, European Union, China

who
August-November 2007
when
Hong Kong, China, United States, United Kingdom
where
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What

• In 2007,companies such as R2 Corporation and
  Mattel, the largest toy-maker in the world,
  responded to safety concerns by recalling over 20
  million products.

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What

• The recalls included sixty-three Mattel products
  such as the miniature doll play set, Polly
  Pocket TM which contained small magnets.

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What

• In August 2007,Mattel reported over 400 cases of
  the magnets coming loose.
• Three serious injuries occurred where children
  swallowed the magnets and needed surgery.

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What

• Barbie TM dolls also affected by the recall were
  coated with lead paint.

• Lead paint is linked to impaired intellectual and
  physical growth in children.
• The U.S. Consumer Product Safety Commission
  issued a recall in August 2007.

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What

• Mattel responded by taking out full page ads in
  New York Times.
• Mattel issued a personal letter from Mattel CEO
  Robert Eckert. Eckert acknowledged the problem
  and reasserted Mattel's concern for safety.
• Mattel should take full responsibility for magnet
  related recalls due to design problems.

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What

• The Chinese and U.S. government responded by
  forming an agreement in September 2007.
• China signed an agreement prohibiting the use of
  lead paint on toys exported to the United States.

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What

• The pact was unveiled at the second joint
  US-China summit on consumer product safety.
• It included joint efforts by the two countries to
  increase understanding of those standards among
  manufacturers and exporters.

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Why
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Why

• Lee Der, another subcontractor, also involved in
  production of the lead-coated toys.
• The newspaper Southern Metropolis said that Zhang
  Shuhong,owner of Lee Der Industrial, received the
  leaded paint from a company controlled by a close
  friend.
• Zhang Shuhong hanged himself in a warehouse in
  Foshan.

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Questions
What role does government regulations play in the
marketing or production habits of a company?
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Role Play
next
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Role Play (A)

• Bribing corrupt foreign officials in order to win
  foreign orders, on the grounds that where bribery
  is a way of life, you have no alternative if you
  want to win a contract.

back
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Role Play (B)

• Telling only half the truth in advertisements, or
  exaggerating a great deal, or keeping quiet about
  the bad aspects of a product.

back
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Case Study(2)

• Ethical Marketing and
• Competitiveness

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Key Words
English
Chinese
n. ??,???, n.?? n.????, ?? vt.?? adj.???? n.??? v.
????? adj.?????? n.?????
counterfeit formula malnutrition hospitalized nutr
ients BigHead Disease breast-feed bottle-fed prot
ein

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5-Ws
Baby Milk Industry ,Multinational Corporations
e.g. NESTLE,DANONE and local Chinese brands
who
April,2004
when
the province of Anhui, P.R. China
where
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What

• 10 brands of counterfeit formula were found in
  Shandong province.
• It has been estimated that as many as 200 babies
  have died as a result of being fed the
  formulathe worst case of malnutrition in the
  country in 20 years.

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What

• After being put on the fake formulas ,the
  affected babies lost weight rapidly with the side
  effects being a bloated face.
• An analysis of one particular formula found that
  it contained one sixth of the required amount of
  protein to sustain the average babys dietary
  requirements for development.

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Why

• Breast-feeding or bottle-feeding ?
• True conundrum product marketing
• How far are companies willing to go in order to
  win market share?

OR
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Why

• A prominent example is Nestle who came under fire
  in the 1970s especially for the way it marketed
  infant formula in the developing world to poor,
  illiterate women.
• Nestle has been accused of putting their own
  profit before the safety of babies.

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Why

• Chinese authorities are concerned about the
  emergence of a bottle-feeding culture and the
  impact on infant health and mortality.

• The baby milk industry in China reached an even
  more shocking extreme with the sale of
  counterfeit formulas.

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Result

• The Chinese government has promised the family of
  each dead infant 10000 Yuan and ordered local
  authorities to help pay the medical bills of
  hospitalized children.
• Authorities have banned 55 brands of cheap milk
  powder after they were found to contain
  insufficient nutrients.
• Police detained 47 people accused of making or
  selling counterfeit formulas.

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Questions

• How effective is an ethical code for marketing?
  What can be done to attract and encourage
  compliance?

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Role Play
next
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Role Play (C)

• Undertaking' profit smoothing, i.e. using all
  the techniques of creative accounting to hide
  big variations in profit figures from year to
  year, and threatening to replace the auditors if
  they object.

back
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Role Play (D)

• Whistle blowing, i.e. reveal confidential
  information to the police or to a newspaper, e.g.
  that a company is breaking health and safety
  regulations and therefore putting peoples lives
  in danger, or illegally selling arms to foreign
  dictators.

back
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• Q A

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Thank You !

• Michael Li Kitty Zhao Cici Shen