Question

Question1:

The following are case studies which highlight and explore the principle of Competence from Code of Ethics by FSPB in 2017. ( Financial Services Professional Board Part A: the FIVE Principles of Ethics

Principle 1: Competence Principle 2: Integrity Principle 3: Fairness Principle 4: Confidentiality Principle 5: Objectivity

Part B: 10 Standards Of Professional Conduct For
The Financial Services Industry

Case Study  

You are a sales representative of a financial services company. After providing a sales presentation to a potential customer, the potential customer asks several questions about your company’s services. You are able to answer most of the questions but there are some where you do not know the answer or are unsure. You want to make a good impression and you do not want to seem unprepared, so you gloss over the facts and skirt around some issues.  

Required:

Discuss the above scenario from the perspective of Competence in Principle 1 of Professional Code by FSPB in 2017.

Question 7

Case Study:

                                       Samsung’s Recall of Its Galaxy Note 7

In August 2016, Samsung launched its much hyped-about Galaxy Note 7. Within a week of its launch, Samsung received reports of the Galaxy Note 7 catching fire. The first explosion was reported in South Korea and another was reported in China on the same day. No official feedback was given and instead a staffer replied that burning incidents do happen and the user did not use an original charger.

On 2 September, Samsung announced the global recall of its Galaxy Note 7. Galaxy Note 7 owners were urged to switch off their devices while Samsung investigated reports of the device catching fire and exploding. Two and a half million Galaxy Note 7 were recalled and an exchange programme was offered to US customers (China was excluded). The Chief Executive of Samsung Electronics made a public apology.   

Subsequently, there were reports of the replaced Galaxy Note 7s catching fire, despite Samsung insisting that the replaced devices were safe. Airlines advised passengers with Galaxy Note 7 to turn off their device before boarding. On 11 October 2016, Samsung announced that it would halt the sales and production of the Galaxy Note 7. “Because consumers’ safety remains our top priority, Samsung will ask all carrier and retail partners globally to stop sales and exchanges of the Galaxy Note 7 while the investigation is taking place,” the company said. “Consumers with either an original Galaxy Note 7 or a replacement Galaxy Note 7 device should power down and stop using the device and take advantage of the remedies available,” it added.

Source: Adapted from Samsung Galaxy Note 7 Owners Told to Turn Off Device, 2016.

Required:

1. Identify three stakeholders in the above case and explain their stakes.

2. Critically evaluate Samsung’s action of recalling the Galaxy Note 7 using Velasquez’s Moral Standards Approach.

3. In addition, to recalling the Galaxy Note 7and giving a full refund, propose two possible ways how Samsung can regain customers’ confidence in their products.

Answer 1

Answer to Part A Case Study

Competence principle states that a professional should keep himself updated with all the facts and knowledge associated with his expertise. However, it is impossible to be aware of each and every topic. There might be instances when the professional needs to update himself before parting the knowledge to someone else.

In this given scenario, the professional was the sales representative of a financial services company. It is important to note that when we refer to a financial services company, the facts are gathered around a lot of information related to numbers.

According to the competence principle, it is important for the sales representative to keep his knowledge updated but also to understand the limitations that come up with this knowledge.

The sales representative knew the answers to most of the questions asked by his client. While it is ethical to gloss over the facts, it might not be ethical to skirt around some issues especially if it includes information related to numbers or any other such information which might misrepresent the company’s information. In contrast to this, he could request his client for some time to get back to his remaining questions.