Question #3: Chiquita Banana Case
Corporations are dependent on their suppliers, employees, and customers to provide materials, labor, as well as sales; this dependent relationship of the company on its stakeholders implies a moral obligation by the company to protect the welfare of these stakeholders, especially if the company is to be successful in the long-term. Furthermore, a company like Chiquita not only has the financial flexibility but also the social and political power to help resolve social issues. Therefore, according to stakeholder theory, utilitarianism, and duty based ethics, Chiquita’s decision on how to approach the dilemma in Colombia should not be solely motivated by profit maximization alone, but should consider the impact …show more content…
This is because the payments are used to finance organizations that murder hundreds of innocent people as well as extort companies working in Colombia. According to utilitarian ethics, “right actions are those that result in the most beneficial balance of good over bad consequences for everyone involved” (Pojman, 217). While the company risks losing shareholder profits, and potentially the lives of its employees, more people will be hurt if it continues to support the terrorist organizations. Furthermore, by refusing these payments, Chiquita sets an example for other companies and businesses operating in the region. Should other companies choose to replicate Chiquita’s decision, the AUC and FARC would continue to lose funding and power as a result. However, if the company continues to help finance the AUC, it risks not only litigation by the U.S government, but also a negative impact on its brand image since the international community may associate Chiquita with terrorist organizations (similar to what we saw with Carlson Corporation and child sex-trafficking). All of these ramifications result in financial losses due to a loss in sales as well as legal fines, which harms Chiquita’s employees, shareholders, and its suppliers. Therefore, Chiquita continuing payments to the AUC is unethical due to the adverse impact it has on the company’s shareholders, employees, as well as the local …show more content…
However, one major challenge of TBL is that there is no defined structure on how to quantify the impact a company has on these aspects of society. To develop a TBL framework suited for their company, Chiquita can refer to the models other companies (e.g., AT&T, Dow Chemical, Shell) have implemented in addition to hiring consulting services that can help collect and report social and environmental data. While TBL can be difficult to implement due to the challenges measuring the impact of the company’s activities, doing so will help improve Chiquita’s social performance, which will promote profitability in the long term (Norman and MacDonald,
Corporations are dependent on their suppliers, employees, and customers to provide materials, labor, as well as sales; this dependent relationship of the company on its stakeholders implies a moral obligation by the company to protect the welfare of these stakeholders, especially if the company is to be successful in the long-term. Furthermore, a company like Chiquita not only has the financial flexibility but also the social and political power to help resolve social issues. Therefore, according to stakeholder theory, utilitarianism, and duty based ethics, Chiquita’s decision on how to approach the dilemma in Colombia should not be solely motivated by profit maximization alone, but should consider the impact …show more content…
This is because the payments are used to finance organizations that murder hundreds of innocent people as well as extort companies working in Colombia. According to utilitarian ethics, “right actions are those that result in the most beneficial balance of good over bad consequences for everyone involved” (Pojman, 217). While the company risks losing shareholder profits, and potentially the lives of its employees, more people will be hurt if it continues to support the terrorist organizations. Furthermore, by refusing these payments, Chiquita sets an example for other companies and businesses operating in the region. Should other companies choose to replicate Chiquita’s decision, the AUC and FARC would continue to lose funding and power as a result. However, if the company continues to help finance the AUC, it risks not only litigation by the U.S government, but also a negative impact on its brand image since the international community may associate Chiquita with terrorist organizations (similar to what we saw with Carlson Corporation and child sex-trafficking). All of these ramifications result in financial losses due to a loss in sales as well as legal fines, which harms Chiquita’s employees, shareholders, and its suppliers. Therefore, Chiquita continuing payments to the AUC is unethical due to the adverse impact it has on the company’s shareholders, employees, as well as the local …show more content…
However, one major challenge of TBL is that there is no defined structure on how to quantify the impact a company has on these aspects of society. To develop a TBL framework suited for their company, Chiquita can refer to the models other companies (e.g., AT&T, Dow Chemical, Shell) have implemented in addition to hiring consulting services that can help collect and report social and environmental data. While TBL can be difficult to implement due to the challenges measuring the impact of the company’s activities, doing so will help improve Chiquita’s social performance, which will promote profitability in the long term (Norman and MacDonald,