Business Ethics and Responsible Management: A Case Study of Johnson & Johnson's Opioid Crisis

Business Ethics and responsible management

LIST OF FIGURES

Part 1 A AT JOHNSON AND JOHNSON’S REPORT TO SENIOR MANAGER

INTRODUCTION

The report will mainly focus on the aspect of business ethics and responsible management and the case of Johnson and Johnson’s will be reviewed as well as from the middle manager to the senior manager perspective its approach to marketing will be reviewed and analyzed in it.

In the case of Johnson and Johnson’s it is presented that the company is trading in opioids drugs as well as some misleading of information it given to the major stakeholders of the company. The main aim of the report is to analyze the position of the company in terms of ethical working and its impact on the overall position of the company as well as perception of the customer will be explored in it. The position of the company is getting affected because they are not dealing ethically and selling of the opioid drugs also affected the operations of Johnson and Johnson’s. Also the users on the internet is getting affected because wrong advertisement are spreading false information and thus the users as well as the customer are getting affected from it (The Guardian, 2019).

For the opioid addiction crisis the company will have to pay around $572m as well as it is going to affect the profit earning capability of the company and the current performance of the company will negatively affect with it. This report will also explore the issues as well as challenges that are faced by the company and guide will be given to the senior managers so that ethical working will be promoted and better image of the organisation will be formed from it (Parramore, 2017).

1. Role of business in the society

The strategic marketing the corporate social responsibilities are interrelated because it affects the behavior of the customer as well as the business policies gets affected from it. Working in the organisation by fulfilling the corporate social responsibility leads to fair, just and right approach in the organisation as well as it improves the quality of society, community and the employee life. Also CSR in the organisation creates the values for the customer as well as the better perception of the stakeholder is formed with it. On the other hand it directly affects the company performance as well as the chances for increased financial rewards are more, and thus the company manages business operation by performing more ethically (The Guardian, 2019).

Figure 1 CORPORATE SOCIAL RESPONSIBILITY CAROLLS MODEL

Source: (Lu et al. 2020).

Example: A famous brand of shoes TOM is having the mission statement to give every needy children a shoe pair and therefore in this way the company is fulfilling CSR as well as they are making better image in the industry with this effort.

At Johnson and Johnson’s corporate social responsibility is also fulfilled by giving importance to the aspect of sustainable environment. But as per the case of the company for the opioid drugs the position of the company is getting affected because they are not delivering right product to the customer and thus the CSR is not fulfilled by the company. It also affected the perception of the doctors as well as Purdue Pharma is in collusion with Johnson and Johnson’s where in US around 1.7 million people got affected (Lu et al. 2020).

At Johnson and Johnson’s the Oklahoma general attorney stated that society interest is getting affected because the culture and the operation of the company is not carried in the right direction as well as it influenced doctors, medical culture, regulators and many more. Thus all such things at Johnson and Johnson’s are negatively affecting the interest of the stakeholders and the position of the company is getting affected from it (The Guardian, 2019).

2. STAKEHOLDERS

Stakeholders in the company is majorly getting affected with the objective and the performance of the company therefore it becomes important to set proper objectives and working in the right direction in order to maintain the interest of the stakeholders. For the ethical responsibility the company should give importance to the corporate effect principle and corporate right principles. For increasing the profitability of the shareholders the companies are giving more efforts and they are working on the aspect of corporate social responsibility. With the democracy model of stakeholders it can be said that business activities gets controlled from it as well as it leads to proper rights and welfare of the stakeholders (Lu et al. 2020).

With the opioid drug the stakeholder’s interest is getting affected at Johnson and Johnson’s and they are getting influenced with it because the ethical working is not getting promoted within the organisation. Thus the position of the company is in threat because value of the organisation is getting negatively affected from it as well as it is impacting on the stakeholders of Johnson and Johnson’s.

Stakeholders	Internal	External	Impact	Influence	With opioid drug crisis the impact on the stakeholders
Owners of the company	?	-	Highest	Highest	The brand image of the company as well as the reputation of the company is getting affected. Reviewing and assessing the marketing strategy in order to work ethically (Lu et al. 2020).
Supplier/employees	?	-	Medium	Medium	Staff turnover is taking place due to unethical working practices The working of the company is also getting affected because they had lost their current position (The Guardian, 2019).
Patients	-	?	Highest	Highest	Wrong information is offered and that is leading to adverse impact on the health.
Specialist	-	?	Highest	Highest	Among the doctors conflict of interest is taking place. To the extent of countries risk is taking place (Lu et al. 2020).
Administration	-	?	Highest	Medium	The company is also spending huge money in order to reduce the negative effect of opioid drugs With the misleading of information the laws of the government is not followed.
The public	-	?	Medium	Lowest	Due to the increased effect of opioid drugs the society at a large is avoiding other drug brands (Lu et al. 2020).

3. on the companies impact of ethical choices

Different companies had made mistake and that affected the working as well as the position of the company. For example Door Dash is offering meals delivery services to the offices, houses and they had captured market share as well as the it is important to work on the legislation in order to give better working opportunity to the employee. The company is paying below the guidelines of the government therefore in such also it becomes important to work properly on the laws of the government. Thus paying lower salary to the staff affected the reputation of the company and this affects to the level of competition in the market (The Guardian, 2019).

There are other companies that are working ethically and thus the ethical working practices is giving better results because it is positively affecting to the brand image of the company. Taskforce.com is mainly known for the corporate social responsibility platform and it brings all the customers together with the equal effort of the management. Thus with the good practice of the company it is continuously getting rewarded for it as well as the they are spending on the education of the children as well as plenty of chartable activities are organized by the company (BBC, 2019).

4. recommendations

It becomes important for Johnson and Johnson’s to review its activity related to the CSR so that the positive changes will be brought in the organisation as well as it will form good image and reputation of the company. With its good name and image in the health sector it can be said that more efforts of the company will positively affect and long term growth as well as development o the business will take place from it. People in the United States are more addicted to the opioid drugs and it is affecting the image of the company because the company is involved in such kind of activities (Lu et al. 2020).

Thus for the company is becomes important to work on the better communication so that doctors will not be influenced negatively as well as it will form good image among the employee and the customers. Also it can be said that with the proper sources of the information there will effectiveness in the ethical practices as well as the company will successfully attainment the goal by overall promoting ethical working condition. Thus it is also recommended to the company that they should give proper advertisement so that the customer will not get affected with it negatively and the customer will have positive perception towards the company (Lu et al. 2020).

Additionally it will good for the company that they can make better strategy so that profitability of the company will increase as well as it will promoted to the ethical working practices. The reputation of the company will also improve with it as well as there will be higher set of ethical standards.

Part 1 B DEMONSTRATION OF ETHICAL THEORIES

If the organisation works or carries the business operation and activities in the unethical way then it can be said that the decision of the company as well as the challenges in the business increases and it leads to complex situation. The use of ethical theory is important in the business because it affects the working as well as position of the company positively and therefore discussion of the theories will take place under it.

Utilitarianism

According to Smart, (2020) the theory gives importance to the aspect of right and wrong so that it will affect the business positively and thus the better image of the company can be formed with it. By applying this theory the main focus will be on the impact of community with the outcomes of the organisation as well as it helps the organisation in taking better decision. Also in order to gain better results in the business in terms of increased business profitability and overall better position in the business this theory is applied in the workplace.

At Johnson and Johnson’s in order to apply this theory in the organisation the stakeholders such as patients that are getting affected with the opioid drugs will be taken into consideration. The analysis will be done in order to determine the gains well as the pains and ethical implications with the organisation will be explored. When the company promoted the drug products it resulted in the chronic pain for the customers. On the other hand the gains were increase profitability as well as the company as well as the employees the more engaged in the activities of the business as well as the government was getting increased taxation (The Guardian, 2019).

For the person addicted to the drugs it affected on the health of the patients as well as it can be said that it affected the reputation of the company negatively. The effort of Johnson and Johnson’s for not promoting the opioid drugs it going to affect the less patients as well as the level of the risk will also reduce from it. Thus promoting such drugs in the organisation it can be said that it will affect the reputation as well as profitability of the company and thus the image of the company will become bad from it (Smart, 2020).

With the different gains and pains analysis it can be said that with the drugs offered by Johnson there is no case of death that it recorded but on the other hand information misleading is taking place from it. Therefore in such situation it is good for the company to stop promoting such activities so that reputation will improve as well as the company will be take better decisions. Also the pains from the activities of Johnson and Johnson’s will lead to chances for the health issues as well as in the long run the trust of the people will get affected (The Guardian, 2019).From the above it can also be said that the actions will lead to increased issues in the organisation as well as customer will grab the attention of media. Currently the company is getting benefited because profitability of the company is increasing as well as the impact of the pains is not taken out and thus it will affect the position in the long run with all such pains that affects the customer and the patients (Smart, 2020).

Ethics of right and justice

According to Magrizos & Roumpi, (2020) the importance under this theory is given to the rights, freedom that the individual can have and thus it also affects the level of privacy among the individual. As per the human dignity people now a days are talking more about rights of the individual as well as they look after the consensus so that meeting of mind among the people can take place. Thus it becomes important to protect the right of the individual and the theory of ethics of right and justice will be applied to the case of Johnson and Johnson’s.

The right to fair information was denied at Johnson and Johnson’s as well as the patients were not getting proper information with the doctors. With the opioid drug crisis it can be said that consistent strategy is formed by the company and it increased problems in the organisation as well as human rights affected from it. On the other hand with the wrong information to the patients their interest and right to know the fair information is getting affected with it. Also with the use of opioid drug use there are both disadvantages as well as advantages that are attached because in many cases patients are getting fair treatment. The company is also meeting the demand and the need of their patients as well as customer and therefore it can be said that justice is getting positively affected from it (Magrizos & Roumpi, 2020).

It becomes important to the patients to have increased awareness because the drugs are going to affect the health and in the long run it will adversely impact because the health related issues will increase from it. Further with the governmental rules positive results can be brought in the business because the will influence the doctors in giving right prescription and correct information to the customers as well as patients (Magrizos & Roumpi, 2020).

Part 2 ETHICAL LEADERSHIP MANAGEMENT

Leadership is affecting to the overall group because leaders are having influencing capability as they positively affects to the outcomes of the organisation with the higher level of responsibilities. Ethical leadership is increasing the morality in the organisation as well as it becomes important pillar because it will control the action and management will work effectively under it.

Ethical leadership – moral manager VS moral person

The basis of ethical leadership is represented when the person is being ethical and there is certain behaviour, traits that affect the decision making. Talking about the traits leads to honesty of the moral person as well as they form better relationship with one another. The behaviour of the individual includes doing things in the right way and thinking about other so that it will lead to the situation of openness and communicative. In the organisation such kind of behaviour leads to better sharing of information as well as the chances for the conflict and problem declines with it. Also the decision making in the organisation becomes easy with as well as attainment of objective takes place which gives better results to the society and community as a whole (Asif et al. 2019).

Figure 2 Ethical leadership

Source: (Asif et al. 2019)

The image of ethical leadership is completed when the moral manager and moral person traits as well as behaviour is linked with one another. Thus it becomes important for the morale manager to increases the value and ethics in order to get visible actions as well as better results. On the other hand it leads to overall better working system in the organisation as well as reward is given from it. With the ethical leadership in the organisation there is increased chances for employee commitment, job satisfaction as well as performance of the company gets positively affected with it (Asif et al. 2019)

Destructive behaviour – unethical leadership

Some of the leaders in the organisation is found with the destructive behavior and it makes bad reputation of the organisation. Unethical issues are increasing with the seven different types of bad leaders and thus the leaders in the organisation are losing self-control. Many of the leaders are incompetent; they are not open towards new ideas, destructive impulse, intemperate behaviour, corrupt leaders and many more leads to unethical leadership (Asif et al. 2019)

Code of practice and compliance approaches

Towards the sustainability, social responsibility and ethics the level of attention is increased and I felt that it positively supported the organisation in creating better values. In the organisation the code of practice is based on the better employee rights, punishment after the detection of fraud as well as other unethical activities. I experienced that with the increased knowledge of the employees it can be said that employee in the organisation has right to stand for their rights as well as it affects the confidence level of the staff (Wain, 2017).

There is adequate level of dependency on the compliance because company holds employees and leader is playing the important role because leaders are responsible for maintaining the employee base in the organisation. Thus according to me leader in the organisation is accountable for the compliance that are based on the governmental regulations as well as on the ethical laws (Wain, 2017).

2.4 Reflection

With this ethics and responsible management project I can say that it helped in analyzing the case in detail as well as I understood the importance to ethics in personal life as well as in the workplace. I came to know that unethical working practices affected the growth as well as the bad reputation of the organisation takes place with it. I experienced that with equal rights and ethical working practices employee in the organisation are giving better results and thus I gained good experience by working on it. I also felt that it becomes important to have good leader in the organisation because the image as well as position of the business gets affected from it and communication also plays that important role in the workplace in order to work more ethically (Wain, 2017).

References

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BBC, (2019). Too many hooked on prescription drugs - health chiefs. Online available at (https://www.bbc.co.uk/news/health-49639914). Last accessed January 2021.

Mansoor, S (2019) “ Johnson & Johnson Was Ordered to Pay %572 Million for Its Role in the Opioid Crisis. With Similar Lawsuits Across the Country, That Could Be Just the Beginning”. Time Magazine online available at (https://time.com/5662827/johnson-opioid-crisis-lawsuits/). Last accessed January 2021.

Parramore, L (2017) “Worse Than Big Tobacco”: How Big Pharma Fuels the Opioid Epidemic. Institute for New Economic Thinking. Online available at (https://www.ineteconomics.org/perspectives/blog/worse-than-big-tobacco-how-big-pharma-fuels-the-opioid-epidemic). Last accessed January 2021.

The Guardian, (2019). Opioid addiction rising in India as US Drugmakers push painkillers. Available at (https://www.theguardian.com/world/2019/aug/28/india-opioids-addiction-us-drugmakers-push-painkillers). Last accessed January 2021.

The Guardian, (2019). Johnson & Johnson to pay $572m for fueling Oklahoma opioid crisis, judge rules. Online available at (https://www.theguardian.com/us-news/2019/aug/26/johnson-and-johnson-opioid-crisis-ruling-responsibility-oklahoma-latest). Last accessed January 2021.

Wain, A. (2017). Learning through reflection. British Journal of Midwifery, 25(10), 662-666.

Smart, J. J. C. (2020). Utilitarianism and its applications. In New directions in Ethics (pp. 24-41). Routledge.

Asif, M., Qing, M., Hwang, J., & Shi, H. (2019). Ethical leadership, affective commitment, work engagement, and creativity: Testing a multiple mediation approach. Sustainability, 11(16), 4489.

Magrizos, S., & Roumpi, D. (2020). Doing the right thing or doing things right? The role of ethics of care and ethics of justice in human resource management of social enterprises. Strategic Change, 29(4), 485-496.

Lu, J., Ren, L., Zhang, C., Rong, D., Ahmed, R. R., & Streimikis, J. (2020). Modified Carroll’s pyramid of corporate social responsibility to enhance organizational performance of SMEs industry. Journal of Cleaner Production, 271, 122456.