Ethical and Stakeholder Analysis Essay

Instructions:

Please read the below case describing an issue you face as a manager of SwissChem TU, a chemical company. Your supervisor has asked that you identify the issues involved in the case, analyze the options for the business and set forth arguments (not just your opinion) for the most appropriate course of action explaining why that is the best course of action and how you would go about achieving that result. Your answer should be in the form of an essay.

Please use the frameworks set forth in the following articles from the course, our discussions, and your experience to inform your analysis.

• The Social Responsibility of Business is to Increase its Profits, Milton Friedman
• Managing for Stakeholders,R. Edward Freeman Video
• Videos and classroom discussions of moral theories

If you rely on information from the foregoing articles, please include appropriate citations. Please do not consult additional outside sources.

This ethical and stakeholder analysis requires that you consider the interests of all stakeholders of Swiss Chem TU and apply moral theories to formulate a recommendation to your supervisor as to whether Swiss Chem TU should build a new plant in Clearwater. To do so, take the following three steps: (1) conduct a stakeholder analysis of the interests of Swiss Chem's stakeholders, (2) advise how Milton Friedman would analyze and resolve the issues raised in this case, and (3) apply the moral theories of utilitarianism and deontology to the problem. Then set forth how each of these approaches informs your analysis and provide your recommendation to your supervisor as to what the business should do. The recommendation should be in the form of a detailed memorandumsubmitted through Canvas.

To conduct your analysis, consider the following background facts.

The Swiss Chem TU Case

Imagine that you are a manager of Swiss Chem TU and you have been asked to advise your supervisor whether the company should build its next plant, which is expected to produce aniline wastes, in Clearwater, Indonesia. SwissChem TU is currently prohibited from discharging untreated aniline wastes in the United States. But there is no current U.S. law that prohibits pollution by U.S. businesses abroad, and there is no Indonesian law that prohibits the practice.

Swiss Chem TU is considering whether to build a new facility in Clearwater, Indonesia to produce aniline. By way of background, aniline "was the compound that launched the synthetic chemical industry in 1856, when a precocious 18-year-old named William Henry Perkin, experimenting in his parents' London attic, inadvertently discovered that aniline, dissolved in sulfuric acid and mixed with potassium dichromate, made a superb purple dye [that is used in making blue jeans and other blue/purple clothing]. Soon London, Basel, Switzerland, and the Ruhr Valley in Germany were littered with aniline factories, many of which would morph into familiar corporate giants like [Swiss Chem TU], the industry leader. In Basel and London, it was said, you could tell which dyes were being made by the color of the nearby canals and rivers. . . ."^[1] As set forth in the referenced article, disposal of aniline in water supplies has created cancer clusters.

Swiss Chem TU believes that it has found a perfect location for a new facility, Clearwater, Indonesia. Swiss Chem TU needs a location with a deep-water port, highly skilled workers, large amounts of water, and low taxes. Clearwater has all these things, and it seems like an ideal spot to your supervisor. Clearwater also has a 2,000-acre facility that was previously owned by Tastybake Co. that Swiss Chem TU could easily retrofit for its chemical processes.

The people in Clearwater and the surrounding region as well as the local politicians are thrilled with the possibility of Swiss Chem TU coming. The region is beset with economic hard times and the population, much of which migrated from the countryside, is clamoring for jobs. The highly skilled workers of Clearwater are willing to work for $5 per day. Additionally, local politicians have offered Swiss Chem TU tax breaks that would essentially make the retrofitting of the Tastybake Co. facility cost free.

There are some potential problems, however. Clearwater is a resort community that relies heavily on its pristine environment to draw tourists. Indeed, for centuries, members of Indonesia's elite families have traveled to its hot water springs, which are known for their purity and beneficial health effects.

Environmental groups, including the Citizens for Clearwater, maintain that Swiss Chem TU polluted rivers in Germany and in other parts of the world with its aniline production facilities and that it will do the same thing in Clearwater.

^[1]http://www.nytimes.com/2013/01/12/opinion/a-cycle-of-contamination-and-cancer-that-wont-end.html?hpw