Part A: Unauthorized Immigrant Workers at Chipotle Mexican Grill Restaurants
Question 1: Is being an unauthorized immigrant a form of workplace diversity? How is it similar to and different from the other types of workplace diversity discussed in Chapter 16 of your textbook?
Arguably, I think that modern societies should consider being an authorized immigrant a form of workplace diversity. The concept of workplace diversity describes the employment of individuals from different demographic backgrounds and other socio-cultural characteristics such as race, ethnicity, religion, and gender (Suharnomo, Wahyudi, & Wikaningrum, 2017). According to the textbook, diversity refers to the unique variations in different human characteristics, distinguishing people from each other. The acceptance and tolerance of such unique attributes can create a comfortable workplace environment. Unauthorized immigrants describe a group of people residing in a particular country illegally.
However, despite their illegal citizenship, immigrants come from different demographic backgrounds. They can introduce stipulated human characteristics into their workplaces. As such, modern societies should organize and implement policies that integrate and accept unauthorized immigrants. In essence, illegal immigrants are different from other common types of workplace diversity. For instance, unlike other forms of diversity, unauthorized immigrants exist illegally. Employees can suffer legal consequences for harboring illegal immigrants. Secondly, unauthorized immigration is an unethical practice. Therefore, entities such as Chipotle Mexican Grill Restaurant should encourage their employees to seek legal citizenship status. The business should also help its immigrant employees to become law-abiding individuals to avoid possible legal and ethical implications.
Question 2: Which stakeholders, other than employers, are helped and which are hurt when an organization hires unauthorized immigrants?
Markedly, the hiring of unauthorized immigrants by local organizations may hurt different stakeholders. For instance, local workforces and individuals with legal citizenship status may lose vital employment opportunities. Typically, most of the unauthorized immigrants are ready and willing to accept wages below the industry averages to survive in their new environments. The existing employees in an organization may also lose their jobs to the cheap labor offered by the immigrants (Hall, Greenman & Yi, 2019). In some cases, companies may fail to provide pay raises and promotions to their existing employees to encourage their resignation and the subsequent hiring of cheap immigrants. Local authorities may also experience stress on the existing facilities such as shelter homes housing the illegal immigrants.
However, local companies may benefit from the influx of unauthorized immigrants. The firms may save on salaries and record higher profits. The employment of cheap labor offered by the aliens may also promote unfair market competition. Companies with a large staff comprising of legal citizens may incur more expenses in terms of salaries. As such, there should be an effective control over the influx of immigrants into a country to protect local employees and companies from such unjust practices.
Part B: Case Study: Merck, the FDA, and the Vioxx Recall
Section 1: Do you believe that Merck acted in a socially responsible manner with regard to the development and testing of Vioxx? Explain why and/or why not
I think that Merck’s actions towards the development and testing of the Vioxx product were socially irresponsible. The concept of social responsibility encourages individuals and companies to engage in different humanitarian activities and other ethical practices (Wang et al., 2016). According to the concept, companies such as Merck should be responsible for actions and mitigate the adverse impacts associated with their production processes. In the case of Merck, the company failed to cushion the consumers against the harmful effects of Vioxx (Lawrence & Weber, 2014). The management also depicted socially irresponsibility from the way it coordinated its public relations activities to conceal important information about Vioxx. In particular, Merck’s public relations team failed to disclose relevant information on the risks and benefits of the product to the consumers.
Notably, Merck had the ability and means to caution its consumers against the side effects of the product to minimize the harm on the consumers. However, the management chose corporate profits over social responsibility to the public. During the early stages of development and testing of Vioxx in 1977, Merck’s scientists, led by Dr. Alise Reicin, accurately identified some of the destructive side effects of the drug (Lawrence & Weber, 2014). The company possibly feared the perceived market reactions and impacts on their reputation and profit, choosing to conceal such vital information. Specifically, according to Merck’s director of research, warning the public about such dangerous side effects would have negative impacts on the firm’s public image. Moreover, Merck failed to follow the FDA’s guidelines on product labeling. According to the FDA, essential companies such as Merck should include important product information on their labels to promote rational purchase and consumption decisions. Therefore, by ignoring such important guidelines, Merck exposed its consumers to the adverse side effects of Vioxx.
From the above descriptions, I believe that Merck was unfair and violated the principles of corporate social responsibly. The company could have included its shareholders in every step of development and testing of Vioxx. The actions and decisions of the company’s director of research were also unethical. The case is a clear illustration of corporate irresponsibility and lack of empathy towards the consumers. Merck’s actions are common in most of the contemporary pharmaceutical companies whose primary objective is on amassing corporate profits through every means possible. In this case, Merck’s failure to include warnings about Vioxx’s dangerous side effects on the labels violated consumer trust and confidence (Lawrence & Weber, 2014). In conclusion, I think that the company could have introduced the necessary precautions to identify and eliminate the lethal risk of Vioxx during the development and testing stages as part of Merck’s social responsibility.
Section 2: Do you believe that Merck acted in a socially responsible manner with regard to Vioxx in its relations with customers and shareholders? Explain why and/or why not.
I believe that Merck’s actions towards the development and testing of Vioxx were socially irresponsible in its relations to customers and shareholders. The main objective of most business entities is the maximization of corporate profits and customer satisfaction irrespective their social responsibilities. Typically, consumers and shareholders demand transparency and fairness from a company’s market operations (Liang & Renneboog, 2017). They may also request fair pricing of the products and higher dividends from their investments. Other frequent demands from customers and shareholders include the prompt production and efficient supply of quality products in a particular market.
As such, in the case of Merck, the company failed to comply with most of these typical demands by the customers. For example, during the development and testing of Vioxx, Merck was unable to publicize the concerns from its scientists about the dangerous side effects of the commodity. The firm’s director of research failed to initiate proper channels of communication about Vioxx’s side effects on the consumers and shareholders (Lawrence & Weber, 2014). The possible inclusion of such information on the product’s label could have encouraged rational consumption and investment decisions. As such, by choosing to ignore such critical information, Merck depicted lack of professional decorum and respect towards its stakeholders. Markedly, such irresponsibility threatened Merck’s market reputation and trust with the consumers and shareholders.
Merck’s social irresponsibility towards the stakeholders was also evident from the pricing decisions. In particular, despite having insider information about the Vioxx’s quality, Merck decided to charge a premium price of $3.00 per pill (Lawrence & Weber, 2014). I believe that such high pricing strategy focused on generating corporate profits, ignoring the fact that Vioxx was ineffective. The high price further affected the company’s market reputation and relationships with consumers and shareholders. Besides, while marketing the product through different platforms, Merck failed to warn the consumers about the lethal side effects through the labels.
Overall, I believe that the consumers and shareholders could have made rational decisions on Vioxx if they had access to correct and accurate information about the product.
A pharmaceutical company likes Merck. The firm feared the possible impacts of releasing such information, such as loss of loyal customer bases and the decrease of corporate profits. The subsequent recall of Vioxx also affected the company’s market reputation and the possible reduction in shareholders’ dividends. The company also suffered legal consequences, especially after a court awarded an applicant a total of $9million for damages and another $4.5 million in compensation. Overall, the case is a clear illustration of the significance of businesses adhering to different principles of corporate social responsibility.
Section 3: Do you believe that Merck acted in a socially responsible manner with regard to the marketing and advertising of Vioxx? Explain why and/or why not
I think that Merck’s actions towards the marketing and advertisement of Vioxx were socially irresponsible. The primary objective of most advertisement and marketing processes is to communicate accurate information about a specific product. In the case of Vioxx, any promotional campaigns could have delivered truthful information about the alleged quality, side effects, and price of the product. The targeted consumers can use such information to make independent and rational decisions on whether to purchase and consume the commodity. However, while Merck invested a lot of money and time in the marketing and advisement of the new product, the company did not include information on the lethal side effects of Vioxx.
Accordingly, Merck’s promotional campaigns violated the basic principles of marketing. The use of mediums such as magazines and television can influence a large consumption bases. The promotional messages about Vioxx through such platforms could have been truthful and accurate (Lawrence & Weber, 2014). I think that limiting such information to cover only the effectiveness of Vioxx is an unethical business practice. Correspondingly, the use of such direct-to-consumer marketing strategies discouraged specialists from asking relevant questions the new product. Typically, through such medium, companies can use luring and sweet messages to create positive impressions about their products. As such, I believe that Merck’s decision to rely on the direct-to-consumer marketing strategy was socially irresponsible. In essence, the information through such channels can also be misleading and ineffective. The consumers may also believe the communication through such channels quickly without questioning. I think that Merck should have included essential facts and concerns, such as the reported cardiovascular impacts of consuming Vioxx. The company’s decision to include deceitful promotional messages was unethical. For example, the DTC advertising company should have insisted on ethical practices (Lawrence & Weber, 2014). Specifically, the media company could have encouraged Merck to include truthful information in their promotion of the controversial drug, Vioxx.
Lastly, I believe that Merck should have limited its use of direct-to-consumer marketing strategies to such as relying on doctors to promote Vioxx. Doctors can have undue influence and control over their patients. Specifically, most patients would rarely question their doctors’ prescriptions. In the case of Vioxx, the doctors could have provided positive reviews about the new product, further exposing the consumers to the real consequences. Overall, the failure to communicate vital information about the cardiovascular risks of Vioxx was unethical marketing and advertisement practice.
Section 4: Do you believe that Merck acted in a socially responsible manner with regard to Vioxx in its relationships with government policymakers and regulators? Explain why and/or why not.
I believe that Merck’s actions about its relationship with the government policymakers and regulators were socially unethical. In most pharmaceutical companies such as Merck, the primary objective is to amass corporate profits through any means possible. These companies may influence government officials to change the development and implementation of fair market policies (Chan, Cheah, & Montanheiro, 2016). The companies may also ignore their social responsibilities towards various stakeholders in their respective markets. In the case of Merck, the company was socially irresponsible in facilitating the development and testing of Vioxx without following the laid down guidelines by government agencies such as the FDA (Food and Drug Administration) (Lawrence & Weber, 2014). The FDA is responsible for ensuring the full protection of public health. The agency should ensure the safety, efficacy, and security of human drugs such as Vioxx.
In the case study, Merck did not comply with FDA’s regulations on product labeling. Other government agencies such as antitrust agencies may also protect the consumers from unfair market competition and related practices. In addition, I think that Merck could have influenced some officials at the FDA to overlook the development and testing of the Vioxx. Typically, the FDA has the legal and professional ability to monitor the introduction of such products into the market. As such, the FDA’s failure to exercise its control and authority over Merck is questionable. Primarily, ignoring such vital details may have exposed Merck’s consumers to possible dangers associated with the Vioxx’s side effects.
Notably, if the FDA had acted in a socially responsible manner, it could have prevented Merck from developing, testing, and releasing the flawed Vioxx into the market. The government agency could have influenced Merck to implement the requirements for product labeling. Through such labeling, the FDA could have made it mandatory for the pharmaceutical company to include the possible side effects of Vioxx to promote rational decision-making among the consumers. Furthermore, I believe that Merck’s failure to ascertain the efficacy of Vioxx was enough reason for the FDA to block the product’s release into the market. In addition, the government agency could have delayed the release of the flawed product without establishing its quality standards (Lawrence & Weber, 2014). Overall, I believe that Merck acted in a socially irresponsible in its relationship with relevant government policymakers and regulators such as the FDA. Merck was irresponsible and unethical for failing to adhere to the FDA’s recommendations on product labeling.
Section 5: Do you believe that Merck’s voluntary public recall of Vioxx was an act of corporate social responsibility? Explain why and/or why not. (10 marks)
I believe that the decision by Merck to initiate a voluntary recall of the product was an act of social responsibility. Undeniably, Merck’s initial decision to develop, test, and market Vioxx was unethical and socially irresponsible. In particular, the company risked the lives of susceptible consumers who could have possibly consumed the flawed product. Without sufficient understanding of the lethal side effects of Vioxx, the consumers risked suffering the perceived fatal consequences of the medication. Government agencies such as the FDA and other policymakers also failed to regulate the production and release of the Vioxx into the market.
However, despite these failures, I think that Merck’s decision to recall Vioxx was unethical and socially irresponsible. The recall decision was an admission of fault on the part the pharmaceutical company (Lawrence & Weber, 2014). I believe that recalling the product from the market would give Merck the opportunity to make things right for its consumers. Through such adjustments, the company’s customers would benefit in the end from the improved products. The recall would also improve Merck’s general public image and correct their past unethical and socially irresponsible decisions.
The recall decision was also socially responsible because Merck placed the needs of their customers and shareholders above their corporate profits and economic advantage. From the recall, the company accepted to lose its strategic market advantages and reputation. The firm also agreed to bear the corresponding legal challenges and possible penalties associated with their illegal development, testing, and marketing of the Vioxx. I believe that Merck succeeded in transforming public trust and perceptions in their products through such socially responsible recall decisions. Arguably, most companies in the pharmaceutical industry would rarely admit such potentially destructive mistakes. The company used the opportunity to introduce warnings on the products’ side effects through the packaging labels.
Lastly, I believe that the recalling decision by Merck should encourage other pharmaceutical companies to make related voluntary and ethical choices. The companies should be willing and ready to embrace economically unfavorable strategies to eliminate some of their controversial products such as Vioxx (Lee et al., 2019). Overall, I believe that the inclusion of honest warnings on the Vioxx’s labels would eventually help Merck to attract and retain a loyal group of consumers in the pharmaceutical industry.
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