Ethics and Corporate Responsibility in the Workplace and the World: PharmaCARE

PharmaCARE is an organization that has caused a great many problems during its lifetime. In fact, it has caused so many ethics, legal, and humanitarian issues that it is a wonder the company still exists at all. Virtually every possible moral wrong that a company has the potential to commit, PharmaCARE committed in some shape, form, or fashion, and is now reaping the consequences for its actions. This is justice unto itself, of course, but it is still not enough. In order to truly understand the extent of the damage which PharmaCARE and its subsidiary, CompCARE, have caused, it is necessary to examine each of their individual violations in detail.

Their first major violation deals more with ethics and morality than any real legal violations. Of course, it could be argued that these violations are even worse. The problem stems from the fact that PharmaCARE has launched a new initiative, which pledges its commitment to the environment, yet, at the same time, is forcing the workers in the African nation of Colberia to perform manual labor for a mere dollar per day. Furthermore, this manual labor being performed is destroying the habitat of many of the endangered species that live in those forests. The contradiction between PharmaCARE's supposed commitment to the environment and its treatment of indigenous peoples is bad enough, but the manner in which it treats these natives is nothing short of despicable. As if to add insult to injury, PharmaCARE also has a compound in the area that houses many of the PharmaCARE executives, with the residents of the compound living in nothing short of luxury, with a swimming pool and golf course. This entire situation falls squarely into what is known as the "grey area" of business ethics, where an act is legal but not ethical (Crane 7). Quite simply, business ethics is defined as a form of applied ethics that examines the moral principles of a business and its actions, as well as the consequences of those actions, in order to determine if a business is justified in its particular actions (Crane 5). Of course, there is no pure, objective way to measure what is and is not ethical, as with law, so the issue largely comes down to an individual or group's perceptions about what is "right" or "wrong." While the public would largely consider PharmaCARE's actions unethical, perhaps the one group that matters the most, especially to PharmaCARE themselves, are the stakeholders. Stakeholders are simply defined as individuals with some sort of personal investment within an organization, be that through money, time, or any other investment (Crame 186). When a stakeholder takes an action, accuses the company of wrongdoing, or anything else, three key factors are observed of the stakeholder by the organization: power, legitimacy (i.e. whether the organization perceives the stakeholders' particular actions as appropriate) and urgency (the degree to which the stakeholder's claims are perceived to call for immediate action) (Crane 186). In this case, the stakeholders' complaints that they are bound to vocalize and threaten to make public would instill a great deal of interest within PharmaCARE, who would like to stifle this resentment as soon as possible.

Unfortunately, ethical quandaries are much more difficult to remedy than legal ones, as stakeholders are being represented by PharmaCARE, and their unethical business practices cast a negative light on the stakeholders as well. Thus, the stakeholders would be justified in pursuing what is known as "street justice," creating petitions and generally making PharmaCARE's business practices known in an attempt to spread the word and collectively cause them to lose a great deal of business. In short, PharmaCARE has only two real options here: change its environmental stance, which would reduce much of the whistle-blowing and ethics violations accusations coming from stakeholders, or keep its environmentally-friendly stance and actually adhere to it by paying its workers more than one dollar per day, preferably by selling a large portion of the compound in which many of the PharmaCARE executives reside, which would help to further reduce complaints.

Adding to the woes of PharmaCARE are the problems facing its subsidiary, CompCARE. CompCARE elected Allen Jones to run the operation's cleanroom. However, Allen is running into a number of problems, particularly with three employees. For starters, CompCARE's own negligence, there was a great deal of mold around the air vents, which made Donna, an employee for CompCARE, sick with chronic bronchial issues and filed for worker's compensation. Considering Allen's scenario, it would be wise not to fire Donna, for two reasons. First, the sickness Donna contracted was a direct result of CompCARE's own cost-cutting and negligence in the first place, and secondly, CompCARE is a subsidiary of PharmaCARE, and as such, the public eye is trained firmly on both of them, so seeing an employee contract a serious illness, only to be fired for seemingly no reason soon after would only spark more outrage at both PharmaCARE and CompCARE. Furthermore, businesses have an ethical obligation to keep their employees safe and protected while within their business, and considering the problems PharmaCARE has been having in that department, it would be best for them to play it safe and allow Donna the worker's compensation she requires.

The next problem facing CompCARE is that his supervisor, Tom, threatened to complain to OSHA about the air quality. This creates both an ethical and legal obligation for Allen, who would be at a severe disadvantage if he fired Tom since he would certainly complain to OSHA, as well as cause even more outrage about CompCARE's sanitation and ethics policies. Since inaction is also not an option, since Tom would complain to OSHA anyway, the best course of action is to simply rectify the problem of air quality in the lab. This has the potential to be an extremely pricy venture, but considering the stakes, as well as the numerous health problems it can cause, it would be an even worse proposition to do nothing about it. In addition, the neglect in regards to the mold around the air vents and generally unclean air in the lab represent a legal threat in addition to ethical. This is because the original purpose of CERCLA (Comprehensive Environmental Response Compensation Liability Act) is to monitor and sanitize any businesses that are found to be in certain health code violations (Healy 67-69). The health problems that the air and mold have caused in CompCARE, as well as the general lack of sanitation that caused these problems in the first place, would make both CompCARE and PharmaCARE prime targets for CERCLA. Even though PharmaCARE is technically located outside of the United States, it is still subject to the same laws as if it were, since it is a company that is headquartered in the US (Healy 68).

Given the method of operation for CERCLA, there are two possibilities for courses of action for CERCLA to take. The first is what is known as a "removal action" and is usually used in emergencies to rectify releases of harmful chemicals or some other violation (Healy 70). The second, and more likely, option is known as "remedial action," which is for less urgent, but longer-term, situations (Healy 70). These actions are designed to reduce the risk associated with certain chemicals entering a worksite, such as mold, in the case of PharmaCARE (Healy 70). In this case, the remedial action that would likely be taken by CERCLA would include a thorough mandatory cleaning of the air vents, an inspection by representatives of CERCLA in order to determine if the air vents are sufficiently clean and whether or not the mold was a direct case of the unclean air in the laboratories. In any case, it would be bad PR for PharmaCARE, but would hopefully be a learning experience for them.

At the same time, CompCARE is also undergoing a complaint from an employee on an unrelated issue. Ayesha has filed an EEOC (Equal Employment Opportunity Commission) complaint that states that she had not been promoted to supervisor because of her Muslim religion. In fact, Allen simply did not believe that Ayesha did not have what it took to be a satisfactory supervisor, and his decision not to promote her had nothing to do with her religion. In addition to Tom and Donna, Allen's boss also recommended he fire Ayesha, but perhaps this recommendation is too hasty. The immediate best course of action would be for Allen to call Ayesha into his office and explain the situation with her, including his personal feelings about Ayesha's inadequacy for the role of supervisor. While Ayesha can claim that Allen's decision is based on her religion, she has no real proof of this, and Allen's personal contestations about Ayesha's lack of people and management skills actually have some sort of weight. If, after having the situation clearly explained to her, Ayesha continues to want to pursue her case of workplace discrimination based on religious practices in the workplace, she should then be fired, simply because her case would only add more scrutiny onto the company that is simply not needed, especially considering that Ayesha's claim has absolutely no basis whatsoever. So, out of the three employees Allen was told to fire, only one of them should actually be fired, and even then, only after extensive deliberations with the employee herself.

The last and perhaps more important issue facing the company is their creation of a drug, known as AD23, which supposedly could slow the progression of Alzheimer's disease. While this drug sounds beneficial on paper, it was mired by problems. For starters, PharmaCARE violated numerous legal and ethical codes by marketing the drug directly to hospitals and pharmacies, even going so far as to encourage these reputable organizations to fax them bogus lists of customer names so as to get around some of the legal hurdles. Perhaps even worse, the AD23 drug was soon after linked to more than 200 cardiac deaths, which caused their stock price to plummet as a result. This violation, which was likely caused by sheer negligence and greed on PharmaCARE's part, since they rushed the drug to market without properly evaluating and testing it, represents what could be considered the company's most egregious fault of them all. The best way to describe why this ethical and legal failing is so significant is to explain the ways it harms or generally fails virtually everyone associated with the company. First, it adversely affects the shareholders, whose expectations and needs PharmaCARE is directly responsible for (Laszlo and Nash 1). These shareholders are also stakeholders in the company as well, and PharmaCARE is failing all of them with their deplorable business tactics and lack of corporate personhood.

The second major group is the employees themselves. Aside from the numerous health code violations, PharmaCARE's release of such a harmful and poorly tested drug casts a negative, perhaps even dangerous light on all employees of the corporation. Because it is so critical that all employees within a company share a vision, this is a huge problem for PharmaCARE (Laszlo and Nash 2). The third group, and probably the most important, are the customers themselves. Releasing a drug that is directly harmful, even fatal, to their health represents one of the most cardinal sins a company can possibly commit. With this mistake comes a complete lack of trust from the customers, and since a company's ultimate goal is to make its customers happy, this failing is perhaps PharmaCARE's greatest of all (Laszlo and Nash 2). The release of drug AD23 also represents a failure to the environment, since a company is constantly striving to live in harmony with the environment, and since PharmaCARE failed to uphold even the most basic of environmental or workplace safety codes, it is safe to say that PharmaCARE failed here, as well, especially considering the ultimate goal, AD23, was detrimental to its users (Laszlo and Nash 2). Lastly, PharmaCARE failed the local communities, which relied on PharmaCARE as a source of work and income. In fact, it is likely that the native citizens of Colberia will see future endeavors by businesses much more negatively than they did before, after seeing the destruction a single greedy and careless company can commit.

Works Cited

Crane, Andrew, and Dirk Matten. Business Ethics: Managing Corporate Citizenship and Sustainability in the Age of Globalization. Oxford University Press, 2007. 507, 186.

Healy, Michael P. "Direct Liability for Hazardous Substance Cleanups Under CERCLA: A Comprehensive Approach." Case W. Res. L. Rev. 42 (1992): 65.

Laszlo, Christopher, and Jeremy Nash. "Six Facets of Ethical Leadership: An Executive’s Guide to the New Ethics in Business." Electronic Journal of Business Ethics and Organization Studies EJBO 6.1 (2001). 1-2