Richard DeGeorge and Donaldson & Dunfee are renowned academics in the realm of business ethics. DeGeorge’s research primarily examines the general ethical concepts and frameworks that are relevant to business. In contrast, Donaldson and Dunfee have formulated the Integrative Social Contracts Theory (ISCT), which specifically deals with the intricate nature of ethical decision-making in cross-cultural situations. Let us analyze the ExxonMobil Oil Pipeline in Chad and Cameroon from the viewpoints of these two theorists.
The ExxonMobil Oil Pipeline in Chad and Cameroon case pertains to the establishment and functioning of a pipeline by ExxonMobil, a major American oil and gas corporation, spanning across Chad and Cameroon. The objective of the project was to extract and convey oil from Chad to the Cameroonian coast for exportation. Nevertheless, the project encountered multiple ethical obstacles, encompassing apprehensions regarding the ecological consequences, infringements upon human rights, and governance dilemmas in both nations.
Richard DeGeorge’s Perspective: DeGeorge’s ethical framework is predominantly grounded in the notion that businesses possess moral obligations that extend beyond the sole objective of making profits. His primary principles encompass the differentiation between minimal ethical standards and ethical ideals, stakeholder theory, and the concept of moral growth within business organizations.
The perspective of Donaldson & Dunfee’s ISCT: Donaldson & Dunfee’s ISCT is a specialized method for addressing business ethics that seeks to harmonize universal ethical standards with regional cultural customs. The theory contends that a collection of “macro” and “micro” social contracts, which include respective general moral standards and particular regional norms, should have an impact on ethical behavior.
DeGeorge would assess the ExxonMobil case by taking into account the different stakeholders, including local populations, governments, stockholders, and the environment. He contends that ExxonMobil has a moral duty to mitigate environmental damage, uphold human rights, and adhere to equitable corporate practices.
When analyzing the ExxonMobil instance using the Integrative Social Contracts Theory (ISCT), Donaldson & Dunfee would take into account the applicable macro- and micro-social agreements. Macrosocial contracts encompass principles such as upholding human rights, practicing environmental stewardship, and promoting fair economic practices. Microsocial contracts would embody the cultural and contextual norms that are unique to Chad and Cameroon. Donaldson and Dunfee contend that ExxonMobil ought to comply with the overarching social agreements by mitigating ecological damage, upholding human rights, and fostering openness. In addition, they would highlight the significance of actively involving local communities and governments to comprehend and integrate the unique micro-social contracts of the region. This would entail resolving issues related to land ownership, fostering employment opportunities, and promoting the growth of local communities.
The Fingerhut Pricing Strategy Case
Fingerhut, a corporation that uses direct marketing, has been sued for allegedly taking advantage of economically disadvantaged individuals. Nevertheless, Fingerhut’s objective is to offer accessible financing options to economically disadvantaged households, enabling them to acquire quality consumer products. Their strategy encompasses the implementation of credit extensions, prominent monthly payment figures, customized catalogs, and the promotion of punctual payments to enhance client loyalty. Fingerhut claims that giving credit is a substantial risk, and their organization suffers more than other providers. Customers who have a strong desire for quick access to particular products support Fingerhut, making it the sole provider.
- K. Prahalad’s notion of capacity creation for consumption argues that the conventional method of generating capacity for consumption through charity and aid, where services and products are provided free of charge, needs to address any issues effectively. Prahalad argues that problems can be resolved by leveraging companies to promote choice and consumption. This can assist impoverished households that are specifically targeted by large corporations as their customer base. Companies modify their products to cater to lower market groups, thereby making previously unaffordable items accessible to them.
Conversely, Crisp asserts that this type of advertising endeavors to generate desires in individuals by bypassing their conscious decision-making abilities and undermining their autonomy, which is in direct opposition to ethical corporate practices. Additionally, he contends that associative advertising fosters misguided impulses in individuals, prompting us to seek fulfillment of our non-market desires through market-oriented methods.
Prahalad would contend that Fingerhut employed an unorthodox marketing technique with the intention of capitalizing on the vulnerabilities of people with little money. Prahalad would consider Fingerhut’s pricing techniques unethical due to their inadvertent creation of price insensitivity among low-income customers, rendering them susceptible to financial exploitation. Fingerhut generated substantial earnings by exploiting a large number of naive customers. Prahalad would additionally argue that Fingerhut’s advertising techniques were misleading, allowing the corporation to exploit vulnerable customers with low incomes. Prahalad asserts that Fingerhut’s pricing approach took advantage of the lack of influence held by the target market. Fingerhut has strategically targeted a susceptible customer niche that it can readily manipulate through misleading advertising strategies.
Roger Crisp argues that Fingerhut specifically focused on the low-market sector because of its susceptibility to manipulation through persuasive advertising. Crisp perceives them as an entity that generates aspirations within the customer base of the lower-market sector. The case affirms that Fingerhut had constructed a comprehensive customer database encompassing information such as their hobbies, age, marital status, birthdays, and number of children. Crisp contends that Fingerhut would use this information to discern the consumers’ latent desires and, after that, employ it to dispatch tailored mailings featuring specialized catalogs to cultivate cravings inside them. These impulses would exert a significant influence on customers, compelling them to make purchases and rendering it difficult for them to resist the offers presented in the catalog.
Works Cited
Crisp, Roger. “Goodness and Reasons: Accentuating the Negative.” Mind, vol. 117, no. 466, Apr. 2008, pp. 257–65, https://doi.org/10.1093/mind/fzn031.
ExxonMobil. “ExxonMobil.” ExxonMobil, December 14, 2023, corporate.exxonmobil.com/en/company/worldwide-operations/locations/chad#About. Accessed December 14, 2023.
Prahalad, C. K., The Fortune at the Bottom of the Pyramid. Wharton School Pub, 2005.
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