Business Society and the Planet

BUGEN5930 Business Society and the Planet

Part A – Business Values Assessment report

This activity is based on the exercise on page 226 of ‘Business Ethics’ (Crane & Matten, 2010) – a copy of the relevant pages are available on the course Moodle page.

You are required to consider and discuss the companies as a group, but must submit your responses to the questions as individuals.

  1.  Select two companies that produce social reports and whose values are identified on their websites or in other company documents (that are publicly available). At least one of these companies must have had the social responsibility and/or performance of their business activities queried that could present an ethical dilemma. 

Chosen Companies are: VOLKSWAGEN & TOYOTA

  1. As an individual, you are required to submit responses to the following questions:
  1. Identify and describe the two companies you have researched; the countries and/or industries in which they operate. (15 marks)
  2. What differences are evident between the two companies in terms of the range of issues dealt with in their social reports and the depth of coverage on specific issues? (15 marks)
  • To what extent can these differences be explained by the country or industry differences? What other explanations might there be? (15 marks)
  1. Assess the apparent quality of the social accounting approach utilized by each company according to Zadek et al.’s (1997) criteria. (15 marks)
  2. Discuss the extent to which the social reports provided by these companies reflect their stated values. (15 marks)
  3. Briefly reflect on your groups’ discussions of these companies. In what ways did the ideas presented by your group confirm your own conclusions, influence your thinking and/or present another perspective to you? (15 marks)
  • A score (10 marks) will be allocated for presentation, written expression, spelling, grammar, punctuation and referencing.

 Word limit: 2000 words

Referencing:  You are required to follow the APA style of referencing for this task. There is no set number of references required. It is recommended, however, that you independently seek out resources in addition to those provided by the lecturer.

Business Society and the Planet

Expert Solution

Description of the two companies

Volkswagen (VW)

It is a vehicle manufacturing company that is based in Germany with its head office in Wolfsburg (Wiese, 2009).  Reports regard it as one of the largest and most advanced car factories in the world. It is a German automaker which began its operations on May 28, 1937. The German Labor Front established the firm. It is the Volkswagen Group’s flagship marque. The company operates in the automotive industry in Germany (Kubik, 2011). It avails its automobiles worldwide. For instance, the company has factories in most parts of the world, either manufacturing or assembling vehicles for local markets. They include Mexico, the US, China, Slovakia, India, Russia Indonesia, Malaysia, Argentina, Brazil, Portugal, Poland, Spain, Bosnia, the Czech Republic, Herzegovina and South Africa. For a long time, VW has had over 20 percent market share with its core markets being Germany and China.

Toyota Motor Corporation

It is a Japanese automotive manufacturer whose headquarters are in Toyota, Aichi, Japan (Borowski, 2010). The firm was established by Kiichiro Toyoda in 1937. It was as the spinoff to create automobiles from his father’s company Toyota Industries. The company manufactures vehicles under five different brands which include the Toyota brand, Lexus, Hino, Ranz, and Daihatsu. It has factories in many parts of the world which either produce or assemble vehicles for local markets. They include; Australia, Japan, India, Canada, Sri Lanka, Indonesia, South Africa, Poland, Colombia, Turkey, the US, the UK, Brazil, France, Portugal. Most new markets are Mexico, Argentina, Malaysia, Czech Republic, Thailand, Egypt, Pakistan, China, Egypt, Vietnam, the Philippines, Venezuela, and Russia.

 Volkswagen’s social reporting/performance issue

The firm deliberately set out to formulate a strategy to circumvent emissions control with the aim of guaranteeing itself an unfair upper hand over the rivals in 2015. It intended to obtain the world’s number one car ratings, principally by the firm’s supposedly environmentally friendly vehicles while it was poisoning the planet. VW had developed particular lines of software that can switch the engine from test mode to “dirty mode” and vice versa. The scandal led to the resignation of the chief executive officer, Audi’s head of R+D and director of Porsche engine after downplaying the ethical standards of engineering thus suggesting that the Corporate Social Responsibility (CSR) was aware of the malpractice. It is assumed that VW did all it could result in an attempt to cover up for the highly contaminating nature of their diesel engines. It is perceived that the company was making CSR a marketing exercise. The fact that VW cars emitted 40 times the legal limit of nitrogen oxide, it still continued with the activity of producing the defective cars and releasing them into market worldwide. The firm resolved that it did not matter whether its brand of cars intoxicated the world as long as doing so made it the world’s leading car manufacturer. The VW case presents a stark on the need to reinvent CSR (Sherman, 2016). The scandal highlights the failings of capitalism relating to the system that is blind to the reality of the future and explicit unsustainable future.

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