Social Irresponsibility On The Part Of Companies example essay topic

Customers are the end users of a company's goods and services (1). They are possibly the largest stakeholder group that can be greatly affected by corporate social irresponsibility. They depend on businesses to meet their expectations, and businesses depend on them to bring them revenue. When customers place a value on a company's goods and services, they trust that the business will give them what they are paying for. If the company does not perform to customers' expectations, they will place a reputation on the company, and possibly spread that reputation amongst other customers of that same company. An example of how a customer can be affected by corporate social irresponsibility is the Odwalla Inc. e. coli outbreak.

In 1996, there were many bottles of apple juice infected with bacteria that was manufactured by Odwalla Inc. (2). Nearly sixty-six individuals were infected with the bacteria and there was one death of a sixteen month old girl (2). Odwalla wanted to be known individually for being a natural juice manufacturer, but since this unfortunate incident they have begun to pasteurize their apple juice similar to most other companies in their market (2). The families that were affected are most likely boycotting the Odwalla Inc. products, along with their friends, neighbors, co-workers, etc. Even the customers that were not directly involved with the e. coli poisoning will think twice before purchasing apple juice from Odwalla.

Although Odwalla agreed to pay for the surviving victims' medical bills (2), some will suffer kidney damage for the rest of their lives. Another example of how social irresponsibility can affect customers is by being taken advantage of through a company's technological know-how. One of our group members brought their computer to a Compaq store to get fixed. She didn't know anything about computers then, and was not exactly sure what was wrong with it.

The Compaq computer technician looked at it, and wrote a report on what needed to be fixed, however the report contained huge technical words that she didn't understand! After taking the same report to another computer store, the technician had told her that those terms don't even exist! She was misled by Compaq into paying for "fake technical problems" that don't exist. It is very easy for technological companies to cheat customers out of their money because most people are not technical savvy and they trust in what the technician says.

As a result, customers pay more than what they are supposed to and they lose trust in that company's service. Employees are another large stakeholder group that can be affected by corporate social irresponsibility. The traditional role of the employees in a company is to contribute their skills and knowledge in exchange for wages, salary, benefits, and career development opportunities (3). The traditional role of employees has since evolved, however some companies have taken advantage of the employer-employee relationship. Socially responsible companies encourage diversity in their workforce, socially irresponsible companies will hire based on discrimination practices.

Women are widely known to be discriminated against in the workplace. Some employers will see women as a weak link to the company, incapable of defending themselves in the workplace, or lifting heavy objects. As a result, many women are not hired based on this stereotype. On the flip side, men can also be discriminated against in the hiring process as well. Hooters Restaurant is known for their attractive waitresses.

Management adheres to the policy to hire women that fit the "Hooters Girl" look (4). In 1991, the EEOC (Equal Employment Opportunities Commission) charged Hooters for discriminating against men in the hiring process (4). This case was dropped, however Hooters was faced with yet another charge for discriminating against men. In 1997, a group of men from Chicago sued for discriminatory practices in hiring "front-of-house" positions (4). Hooters settled, but they still continue to hire only women. Social irresponsibility on the part of companies does not stop at discriminating against hiring men and women.

It can include discriminating against race, religion, sexual orientation, etc. Furthermore, employees can be affected by socially irresponsible companies by losing their job, benefits, or simply carrying with them the reputation of that company. For example, nearly 6,100 Enron employees were laid off after the scandal in 2001 (5). They lost their health benefits and their job security due to Enron's socially irresponsible act of restating their financial statements in order to make themselves look substantially successful to investors (5).

At the same time, Enron had encouraged their employees to invest in their stock, promising great returns without telling their employees the truth about their financial position. Now, many employees are left penniless after investing so much of their money into Enron stock that is now valued at close to nothing (5). Wholesalers, distributors and retailers are another market group that can be affected by corporate social irresponsibility. They are the channel through which products move from the manufacturer to the customer. With this in mind, if there is a problem or a defect with a product, often times the customer will first complain to the retailer from which they bought it from, and the retailer would have to deal with arranging a new product to be sent from the manufacturer. Therefore, retailers could realize sales returns, a bad reputation, and overall customer dissatisfaction all at the expense of a socially irresponsible company that supplied them with faulty merchandise.

An example of this would be the Source Perrier case in 1990 (6). Perrier bottles of water were found to be contaminated with benzene, a chemical that causes cancer in animals (6). At first, Perrier did not own up to this incident and claimed that the "contamination resulted from an isolated incident" (6). Soon after, more contaminated bottles were found overseas, which forced Perrier to recall the bottles of water all around the world (6). Wholesalers, retailers, and distributors of Source Perrier water was greatly affected by this. Sales dropped tremendously.

Until this incident, Perrier was the leading imported water company, so retailers had huge amounts of stock that was recalled which were a waste of costs.