Ethics at Work — Ethics 9 (C1)

ETHICS · LESSON 9

Ethics at Work

C1 (B2–C2) · 90 minutes

Where do you stand?

Task Judge each act at work. Write P, N or D for each one.

P = permissible · N = not permissible · D = it depends

1. Accepting a box of chocolates from a supplier at New Year.

2. Using your company's software licence for a weekend freelance job.

3. Telling a customer a product is "the best on the market" when you think it is average.

4. Staying silent about a safety problem that your manager has promised to fix.

5. Paying an official a small cash "fee" to speed up a permit you are legally entitled to.

6. Giving a journalist an internal document that shows your employer broke the law.

A

CASE FILE 1

The Ford Pinto

In 1970 Ford launched the Pinto, a small, cheap car. Its fuel tank sat behind the rear axle with little crush space, and a court later heard that Ford's own crash tests had punctured it at about 20 mph (32 km/h). In 1972 a stalled Pinto was hit from behind in California. The driver died, and a 13-year-old passenger, Richard Grimshaw, was terribly burned. In 1978 a jury awarded $125 million in punitive damages, cut by the judge to $3.5 million, and Ford recalled about 1.5 million Pintos and related models, while denying a defect.

The case is famous for a cost-benefit analysis: weighing an action's expected costs against its expected benefits in money. A 1973 Ford paper, arguing against a proposed federal safety rule, valued a death at about $200,000,

a government figure. It concluded that an $11 fix on 12.5 million vehicles ($137 million) would cost more than the $49.5 million of harm it prevented: 180 burn deaths and 180 serious injuries a year.

Popular accounts exaggerate. The paper concerned fuel leaks in rollovers, for the whole industry, not a secret decision about the Pinto's tank. A 1977 magazine exposé claimed 500 to 900 Pinto fire deaths; a federal investigation counted 27 deaths in rear-impact crashes with fire. The legal scholar Gary Schwartz later found the Pinto's fire record roughly average for its time, and in 1980 an Indiana jury acquitted Ford of reckless homicide. The question remains: may a company put a price on a life?

B

CASE FILE 2

Dieselgate

From 2009 Volkswagen sold "clean diesel" cars in the United States, where limits on nitrogen oxides (NOx), pollutants linked to lung and heart disease, were strict. Its engineers could not meet them in a car that would also sell well. The answer was a defeat device: software that recognised a laboratory test, from clues such as steering position, and switched the emissions controls fully on only then. On the road, the cars emitted up to 40 times the legal limit.

Researchers, not regulators, found it. In 2013–14 a West Virginia University team, working for the nonprofit International Council on Clean Transportation, tested cars on real roads. For about a year VW blamed

technical problems. On 18 September 2015 the US Environmental Protection Agency issued a notice of violation; VW admitted that about 11 million cars worldwide had the software, and its chief executive, Martin Winterkorn, resigned within a week.

A senior VW manager told the US Congress that "a couple of software engineers" were responsible. In 2017 the company pleaded guilty in the US to fraud and obstruction of justice (documents had been destroyed) and paid $4.3 billion in penalties; two employees went to prison. Total costs passed $30 billion. One peer-reviewed study estimated 59 early deaths in the US from the extra pollution.

Two cases, four lenses

Consequences

Duty

Character

Relationships

What will happen?

What rule applies?

What would a good person do?

Who am I to them?

Ford Pinto and Dieselgate

Two cases, four lenses

Task Student A takes the Ford Pinto, Student B takes Dieselgate. Fill in one row of the table for your case: one or two sentences for each lens. Then swap: challenge your partner's row, and agree which lens gives the strongest verdict on each company.

Case

Consequences

Duty

Character

Relationships

What will happen?

What rule applies?

What would a good person do?

Who am I to them?

A

Ford Pinto

B

Dieselgate

The whistleblower's path: Stage 1

Task Read the story and choose one option. Write one sentence on why, naming the lens that drives your choice, and one risk you are taking. Don't read "Stage 2" until you have decided.

Sofia Mendes is a junior chemist at Norhaven Labs, a private laboratory that tests drinking water for town councils. Checking old files, she notices that the lead results for three primary schools in the town of Marlow were recorded as 9 micrograms per litre, just under the legal limit of 10. Her own machine printouts show 14, 16 and 19. The changes were made under the login of her supervisor, Viktor Hale. Norhaven is bidding to renew its contract with Marlow next month.

A

Say nothing. There may be a correction she doesn't know about.

B

Ask Viktor about it directly.

C

Report it to the company's confidential ethics hotline.

D

Send the printouts to the national water regulator.

The whistleblower's path: Stage 2

Task Read what happened after your choice. Then read on, choose one new option, and write one sentence on why. Don't read "Stage 3" until you have decided.

If you chose A: Two months later, the same kind of edit appears for another town. Sofia has now signed off reports she suspected were false.

If you chose B: Viktor says the machine was faulty that week and the corrected figures are right. He thanks her, and asks her to keep it within the team "to avoid a panic".

If you chose C: The hotline is run by Human Resources, which reports to the chief executive. Within a week, Viktor knows who called.

If you chose D: The regulator opens a file but says checks take months. Norhaven's lawyers email all staff a reminder of their confidentiality agreements.

The whistleblower's path: Stage 2

The story continues. Sofia spoke to Viktor. Afterwards, she looks for the record of the machine's repair that week: there is none. Then a colleague forwards her an email from the chief executive, Dr Ananya Rao, to Viktor: "We cannot lose Marlow. Make sure the numbers are clean." The children are still drinking the water.

A

Accept Viktor's explanation. The email proves nothing.

B

Ask to meet Dr Rao.

Write to the company's audit committee, which includes independent board members.

Go to the regulator now, with the printouts and the email.

C

D

The whistleblower's path: Stage 3

Task Read what happened after your choice. Then read on, choose one final option, and write one sentence on why. Then return to the main room.

If you chose A: In the spring, a parent's private test at one school shows high lead. Sofia's name is on the original report.

If you chose B: Dr Rao is warm, says the email was "badly worded", and promises a review. Nothing happens for six weeks.

If you chose C: The committee hires the company's usual law firm, which finds "no evidence of deliberate wrongdoing".

If you chose D: The regulator asks for more evidence. Sofia's access to the test database is removed "during a systems upgrade".

The whistleblower's path: Stage 3

The story continues. Sofia wrote to the audit committee. Soon afterwards she is moved to "data archiving", away from water testing. Then Human Resources offers her a year's salary and a good reference if she resigns and signs an agreement with a strict confidentiality clause.

A

Sign, take the money and leave.

B

Refuse, and give everything to the regulator.

C

Refuse, and go to a journalist.

D

Refuse, stay, and keep pushing inside the company.

How it ended, and the real thing

If you chose A: Sofia gets the money. In many countries, including the UK, such a clause cannot lawfully stop a worker reporting wrongdoing to a regulator, so the silence she was paid for may be unenforceable.

If you chose B: Retests find lead above the limit at two schools. Norhaven loses the contract and Viktor is dismissed. Sofia's legal claim takes eighteen months; she wins, but struggles to find laboratory work.

If you chose C: The story runs and the regulator acts within days. But going to the press first can carry weaker legal protection than going to a regulator.

If you chose D: Months pass. The children are still drinking the water.

READING

Whistleblowing in the real world

A widely used definition (Near and Miceli, 1985) calls whistleblowing the disclosure by members or former members of an organisation of illegal, immoral or illegitimate practices to people who may be able to act. Most whistleblowers report internally first, and go externally, to a regulator or the press, later. In August 2001 Sherron Watkins, a vice-president at Enron, warned its chairman, Kenneth Lay, that the company might "implode in a wave of accounting scandals". Enron's usual law firm reviewed her concerns and largely dismissed them;

she later learned the company had sought legal advice on firing her. Enron went bankrupt that December. Critics note that she never went to the authorities. Laws now protect whistleblowers in many places, such as the UK's Public Interest Disclosure Act 1998, the US Sarbanes-Oxley Act 2002 and a 2019 EU directive; the US Securities and Exchange Commission even pays awards of 10 to 30 per cent of penalties over $1 million. Protection usually depends on using the right channel.

READING

Gifts, bribes and the law

In China, guanxi, the network of personal relationships built on reciprocity and mutual obligation, has long shaped business: banquets, favours and gifts build trust over years. A gift becomes a bribe when it is meant to make someone act improperly in their role, usually against a duty to an employer or the public. Where does guanxi sit? Thomas Dunfee and Danielle Warren (2001) argued that it can be ethical when it makes exchange more efficient, and unethical when it benefits a few at others' expense.

The law draws lines too. The US Foreign Corrupt Practices Act (1977) bans bribing foreign officials, but allows small facilitation payments for routine government actions, such as processing a visa. The UK Bribery Act 2010 is stricter. It covers private as well as public bribery, makes facilitation payments illegal, and makes a company guilty of failing to prevent bribery by anyone acting for it, unless it had "adequate procedures". Reasonable, proportionate hospitality remains legal under both laws.

Gift or bribe?

Task Sort the eight cases. Write each letter under Gift, Bribe or Depends, with a one-line reason. For each "Depends", write what it depends on.

A. Osaka: A supplier sends Haruto, a purchasing manager, a box of fruit worth about 4,000 yen at the end of the year, as it does for all its clients.

B. Abroad: The site manager of a British engineering firm pays a port official $40 in cash to process customs papers that are already in order. Otherwise, the equipment waits three weeks.

C. Shanghai: Before signing a contract, Li Wei invites the client's team to an expensive banquet. The two firms have hosted each other every year for a decade.

D. São Paulo: A drug company pays for a hospital doctor and her husband to attend a conference in Lisbon, with three extra days at a beach resort.

E. Seoul: A building contractor gives a government procurement officer a luxury watch two weeks before a tender closes.

F. Toronto: A software vendor gives a client's IT manager two tickets to an ice-hockey final, "no strings attached". The client will decide on renewing its contract next month.

G. Mumbai: At the wedding of Priya, a junior buyer for a retail chain, a long-standing supplier gives her a cash gift in an envelope, as all the guests do.

H. Berlin: A recruitment agency offers Anna, an HR manager, a personal "referral fee" for every candidate she hires through them, paid into her own account.

Gift or bribe?

Gift

Bribe

Depends

READING

Rana Plaza

On 24 April 2013 the Rana Plaza building in Savar, near Dhaka in Bangladesh, collapsed. It housed five garment factories that made clothes for European and North American brands. 1,134 people died and more than 2,500 were injured. The day before, large cracks had appeared. The shops and bank below closed, but the factories ordered workers back, some under threat of losing pay. The upper floors had been added without permits.

Who was responsible? The building's owner and factory owners were charged in Bangladesh. But global brands' labels lay in the rubble, and campaigners argued that buyers pushing for low prices and fast delivery shared the blame.

READING · CONTINUED

Rana Plaza

In May 2013 brands and trade unions signed the Accord on Fire and Building Safety, a legally binding agreement to inspect and repair factories, which over 200 companies joined. By 2015 an ILO-backed fund had raised $30 million for victims and families.

Should consumers boycott? Garments make up over 80 per cent of Bangladesh's exports and employ about four million people, most of them women. The economist Paul Krugman argued in 1997 that

low-wage factory jobs, however harsh, usually beat the real alternatives. In 1993, when Bangladeshi factories dismissed tens of thousands of child workers for fear of a proposed US import ban, reports said many moved into more dangerous work. Others reply that public pressure produced the Accord. And a 2018 trial in Ethiopia (Blattman and Dercon) found that factory job offers did not raise incomes after a year, while factory work harmed health.

After Rana Plaza

Task Choose three or four questions. Spend most of your time on the one your group disagrees about. Use the four lenses by name where they help.

1. If you buy a T-shirt for five dollars, do you share responsibility for how it was made?

2. Do boycotts of sweatshop goods help the workers, or mainly the buyers' consciences?

3. Should a brand be legally responsible for safety in factories it does not own?

4. Is "a bad job is better than no job" a fair argument, or can it excuse anything?

5. Milton Friedman said business should maximise profit within the rules. Is that enough where rules are weak?

6. Where you live, do people trust companies or governments more to do the right thing?

Private reflection

Task Choose one prompt and write privately. Nobody will read what you write. Sharing afterwards is optional.

Prompt 1

Think of a workplace, real or imagined, where something seemed wrong. What would make speaking up there easy, and what would make it hard?

Prompt 2 (lighter)

Of the companies in today's lesson, real or invented, which would you least like to have worked for, and why?

Before Lesson 10

Task Look again at your letters for acts 4, 5 and 6 on the "Where do you stand?" slide. Would you change any of them now?

This week, pick one thing you own and find out one fact about where or how it was made.

Check the label, the company's website or a news report, and note whether the answer made you feel better or worse about owning it.

Next lesson: The Moral Circle: Machines, Animals, the Future. Who and what deserves moral concern, and how far should our circle reach?

TEACHER'S REFERENCE · SKIP OR DELETE BEFORE CLASS

Answer key (1)

TWO CASES, FOUR LENSES suggested points; other well-argued answers are fine

• Ford Pinto. Consequences: the 1973 paper is itself a consequentialist calculation, so this lens is split. It can defend weighing costs and benefits, but it can also say the sums left things out (the suffering of burns, the loss of trust, the legal costs) and that a cheap fix to a known risk was worth making. Duty: treating people as numbers in a ledger, and selling a car with a known weakness without telling buyers, fails to respect them as ends in themselves; customers could not consent to a risk they did not know about. Character: a good engineer or manager would not shrug at evidence that a fuel tank could burst; the virtues at stake are honesty, care and practical wisdom about risk. Relationships: a carmaker stands in a relation of trust to the families who drive its cars; would Ford's managers have accepted the trade-off for their own children? Fair points in Ford's defence: regulators also put a money value on life, the paper was an industry-wide argument about a rule, and the car's overall record was about average.

• Dieselgate. Consequences: extra pollution, an estimated 59 early deaths in the US alone, billions in costs, lost jobs and lost trust in "clean diesel". Hard to find a defence here. Duty: deliberate deception of regulators and customers, and the destruction of documents; a clear breach of the duty not to lie and of the duty to obey the law. Character: dishonesty that was planned, maintained for years and then blamed on "a couple of software engineers"; questions of courage too, since the scheme ran for years and involved more than a handful of people. Relationships: betrayal of customers who paid extra for a "clean" car, of the public who breathe the air, and of employees whose jobs were put at risk; the engineers' loyalty to their bosses competed with their obligations to everyone else.

GIFT OR BRIBE? suggested; C, D, F and G are there to be argued over

TEACHER'S REFERENCE · SKIP OR DELETE BEFORE CLASS

Answer key (2)

• A. Gift. Small, customary, given to all clients and not tied to a decision. It would change if the value were large or the timing linked to a contract.

• B. Bribe under UK law; Depends elsewhere. A facilitation payment. The UK Bribery Act gives no exemption for it, it reaches British companies and citizens abroad, and the firm itself can be guilty of failing to prevent it. Under the US FCPA, a US company could lawfully make the same payment for routine government action. Many companies ban such payments whatever the law says.

• C. Depends. Reciprocal hospitality in a long relationship looks like guanxi working as trust-building. It depends on whether "expensive" is proportionate and whether it is meant to influence this contract.

• D. Depends, leaning Bribe. Paying for a doctor's attendance at a genuine conference can be legitimate. Paying for her husband and three resort days looks designed to influence what she prescribes.

• E. Bribe. A valuable gift to a public official just before a tender closes, from a bidder. Illegal almost everywhere.

• F. Depends. Hospitality can be lawful if reasonable and proportionate, but the timing, just before a renewal decision, makes it look like an attempt to influence. Many companies would require the manager to decline or declare it.

• G. Depends, leaning Gift. A cash gift at a wedding is customary, and the supplier gives as every guest does. It depends on the amount, and on whether Priya declares it to her employer under its gifts policy.

• H. Bribe. A personal payment to the person who decides, hidden from her employer, in exchange for business: a commercial bribe, and an offence under the UK Bribery Act.