An Ethical Questions (1 Viewer)

[irnirn]

This was in one of the trial papers I was doing.
I'll appreciate a full answer for it.:uhhuh:
It's worth 3 marks.

A mining company has been found guilty for illegal disposal of waste and has been accused by the media for being unethical and not socially responsible when dealing with the public.

Question:
Describe how the illegal disposal of waste has affected ONE internal stakeholder.

 

[michael1990]

This was in one of the trial papers I was doing.
I'll appreciate a full answer for it.:uhhuh:
It's worth 3 marks.

A mining company has been found guilty for illegal disposal of waste and has been accused by the media for being unethical and not socially responsible when dealing with the public.

Question:
Describe how the illegal disposal of waste has affected ONE internal stakeholder.

Taking a wild guess.

Displacement between employees and managers which in turn decreases productivity. Could lead to industrial conflict (Overt and Covert)

 

[Heiday]

The illegal disposal act would affect the business manager signficantly as the media has developed an image of an unethical and not socially responsible business. The business may also receive a dramatic fall in sales and customers as the perception of the organisation is damaged.

 

[tau281290]

I don't do business studies but based on common sense, if the company has bad publicity, all the stakeholders of the company will be damaged because the value of the company has dropped. Many ethical investors would refrain from investing in an environmentally irresponsible company. This will drive down the market value of the company and hence the internal stakeholders would have a depreciated value in $$ terms.

I don't do biz studies, but common sense can probably get u a mark or 2 =P

 

[michael1990]

I don't do business studies but based on common sense, if the company has bad publicity, all the stakeholders of the company will be damaged because the value of the company has dropped. Many ethical investors would refrain from investing in an environmentally irresponsible company. This will drive down the market value of the company and hence the internal stakeholders would have a depreciated value in $$ terms.

I don't do biz studies, but common sense can probably get u a mark or 2 =P

Sorry just will clarify a few points for business people reading.

I think you're referring to shareholders. That is if the business is a public one.
The value of the public company will only fall if there is an decrease in revenue as well as shareholders selling off their shares. (which would be very unlikely if the business is a strong and well maintained).

Internal stakeholders are referred to as people like, Managers, employees and owners.

but i like the sentence you gave:
'Many ethical investors would refrain from investing in an environmentally irresponsible company.'
That is brilliant.

 

[Heiday]

'Many ethical investors would refrain from investing in an environmentally irresponsible company.'

+2, nice way of wording it

 

[irnirn]

Thanks guys for the brilliant answers.
Indeed that sentence is GOLD.

We shall all use it in the exam

I think talking about bad image/reputation among the community which results in the disinterest of many people to the company and thus lowering the revenue and profitability for the owner(s) is also a good mention.

 

[tau281290]

Managers/CEOs own X% of the company through shares, in a way they are shareholders as well, right? Owning shares by the manager is an incentive for them to create a good company, because when they can drive up their own company share prices up, their self-worth also increases. This is why the entrepreneur who started the company usually give away free shares to the managers rather than immediate monetary rewards.

This might be getting a bit off topic, though.