Companies often behave in unethical manners, from using child labor to cutting costs by using materials that are harmful to consumers and/or the environment. Find an example of a company that has behaved in an unethical manner, and describe in detail what they were doing, how they were caught or how it was reported, and what repercussions (if any) it had on them or their customers. Provide evidence by including citations, urls to the media stories, etc.
Question
Companies often behave in unethical manners, from using child labor to cutting costs by using materials that are harmful to consumers and/or the environment. Find an example of a company that has behaved in an unethical manner, and describe in detail what they were doing, how they were caught or how it was reported, and what repercussions (if any) it had on them or their customers. Provide evidence by including citations, urls to the media stories, etc.
Solution
Sure, I can provide an example of a company behaving unethically. Volkswagen, a German car manufacturer, was involved in a scandal known as "Dieselgate" in 2015.
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What they were doing: Volkswagen installed software in their diesel cars that manipulated emissions tests. This software, known as a "defeat device," detected when the car was being tested and changed the performance accordingly to improve results. When the cars were not being tested, they emitted pollutants up to 40 times above what is allowed in the U.S. (Ewing, 2017).
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How they were caught: The International Council on Clean Transportation and West Virginia University conducted tests that showed discrepancies in the emission levels of Volkswagen cars. The U.S. Environmental Protection Agency (EPA) and the California Air Resources Board (CARB) investigated these findings, leading to Volkswagen admitting to the use of the defeat device (Ewing, 2017).
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Repercussions: Volkswagen was fined $14.7 billion in the U.S., which included compensations for the car owners. They also had to spend billions to fix the cars and prevent further pollution. The scandal damaged their reputation significantly and led to a drop in sales. The CEO, Martin Winterkorn, resigned and several employees were fired or suspended. Some faced criminal charges (Ewing, 2017).
Evidence: Ewing, J. (2017). Faster, Higher, Farther: The Volkswagen Scandal. W. W. Norton & Company.
URLs to media stories:
- https://www.nytimes.com/2017/01/11/business/volkswagen-diesel-vw-settlement-charges-criminal.html
- https://www.bbc.com/news/business-34324772
- https://www.theguardian.com/business/2015/sep/23/volkswagen-scandal-us-sales-fall-20-percent
Please note that this is a simplified summary of the scandal. The actual events were more complex and involved many more people and organizations.
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