Question

Only one question.

1. Why CFS’s business needs to have an ethical approach? Discuss the interrelationship between ethics and sustainability as it relates to the food industry.

Case:
You are a group of fresh business graduates being tasked by an investment company (Alfa Investment) to assist a newly appointed CEO of Centennial Food Supermarkets (CFS).
CFS has been listed on the Toronto Stock Exchange last year and new realities of being a public listed corporation required its new investors (Alpha) to push for a more sustainable agenda in CFS. Alfa Investment and CFS’s directors are concerned about their expansion plans in the coming years. They are planning to expand their chain stores all over Canada as well as some developing nations in South America. Moreover, the company is shaping its global supply chains by engaging with new suppliers from South East Asia and Africa to have a more reliable source for fresh Beef, Pork and Lamb. The transition from a family-owned traditional company to a modern listed corporation is highlighting some serious challenges to CFS. Below are only some issues that Alpha Investment is particularly concerned about:

1. CFS workforce is 80 percent male and 20 percent female. Also, when it comes to ethnicity, approximately 85 percent of CFS employees are white and the rest are Asian, Latino and black. Of the company’s management and leadership roles, 90 percent are held by whites. The company has shown a similar lack of gender diversity in leadership roles, where women hold less than 10 percent of positions.
2. Some suppliers in South East Asia are reported using children across production lines in their factories. 3. CFS has no official corporate code of ethics.
4. Salaries and payments to employees were decided on a case-by-case basis and there is a huge gap in salaries. Moreover, on average, male employees receive 20% more on the same tasks and positions.
5. Animal support NGOs (For instance Animal Liberation Front / ALF, Anti-vivisection Coalition / AVC, and Cruelty-Free International /CFI) are pressing for higher standards and self-regulation about animal products.

Answer 1

Gender discrimination : 80:20 ratio

85% employees are whites

90% of the leadership position is held by whites

Child workers in supply chain

Gap in salary : gender discrimination again

CFS business has serious ethical problems that are readily needed to address. The first problem is to eliminate gender discrimination in the company. Performance in the work place should be judged by skills and knowledge for the same job and not by the type of gender. This is a serious ethical problem in comparison to the global business environment. Gender discrimination in this company is seen in terms of employment ratio between male and female as well as in terms salary. Male employees get 20% more salary in comparison to female workers for same tasks and same designation, which is not desirable at all in an ethical workplace.

Second ethical problem is discrimination among employees based on skin color. Colorism and racism are hindrance for the progress of the company as racism affects the goodwill of the company in market. Racism creates division of labor and also disturbs required coordination among employees.

Third ethical problem observed in CFS is discrimination in leadership position. Most of the highest organizational positions are held by the white people. It indicates preferential bias in the organization, which is risk for the long-term business sustainability. It may give birth of hidden indignation among nonwhite members due to unfair treatment. Leadership position needs to be entitled by the skilled and qualified person having good decision-making power.

Using child labor in the workplace is strictly prohibited in ethical sense. It is a crime in most of countries to use child workers. Therefore, CFS should have a strict official code of conduct in the respect and those are required to be communicated with all the stakeholders of the company including suppliers.

Part 2

Business ethics is a precondition for the business sustainability. Without some specific code of conducts and ethical norms, disciplines and harmony in the workplace are hampered. Ethics also helps to balance and effective utilisation of resources and cost managment and ensures growth of the business in the global market with a good reputation. These criteria are essential for the sustainability of the business in the compatitive market place.