Starbucks Real Estate Manager, An Ethical Analysis

Lori N. Comstock

Professor William Erwin

BIS 345 Organizational Ethics

December 5, 2014

Introduction For this paper I have chosen to explore the ethical dilemmas I may face in my

future career as a Starbucks real estate manager. Real estate manager is not by itself a job

title, so for better explanation I can say that I would like to eventually join our corporate

offices as a supervisor or manager of a real estate team. These real estate teams

participate in the selection of new store locations, the management of lease negotiations,

store build outs and lease renegotiation. With many thousands of Starbucks stores

throughout the country this is a busy division at corporate.

In this paper you will find that I have reviewed six business case studies. They

are included after this introduction with commentaries on each from me.

I have also completed two in-depth interviews with professionals in this field.

The first, Danny Sheehan is a manager in the finance and real estate team at Starbucks

corporate offices. The second, who I refer to as J.A., is a colleague and regional real

estate manager for a large Fortune 500 quick-serve restaurant chain. J.A. has asked that I

not include her name in my report because she doesn’t want her stories tracked back to

her or her employer in case this report is published somewhere. Her contact information

is available to Professor Erwin upon request for confirmation of the interview. The

results of these interviews detailed after the case reports and are preceded by a brief

methods section.

This paper concludes with a discussion of what I learned from the interviews and

what new perspectives this allows me to bring to my future as a real estate manager.

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MOZILLA: Mozilla CEO Under Fire for Prop 8 ContributionsMonday, Mar. 31, 2014

/docs/images/rte/blogapp_img/b490/Mozilla_Firefox_logo_2013.svg.pngSource: Wikipedia

Mozilla, the makers of the popular web browser Firefox, is facing a media firestorm in protestof their recent promotion of Brendan Eich to CEO. Eich was an internal promotion for thecompany, having been CTO since 2005, but it’s Eich’s $1000 contribution to the 2008 anti-gaymarriage “Proposition 8” that sparked the controversy. Mozilla, a nonprofit organization, isheavily committed to “keeping the web open” as well as values such as equality and inclusivity.In response to Eich’s promotion a number of key employees and developer groups called forhis resignation on Twitter and other social media sites. Eich responded in a personal blog postthat he would continue Mozilla’s effort of “commitment to equality in everything we do.”Critics are largely unsatisfied by the response, demanding either a retraction and apology fromEich or his resignation. Complicating matters, three of Mozilla’s six board members resignedthis week, citing their desire to hire an outsider with expertise in mobile computing. Can a CEOhave personal values that conflict with the values promoted by the organization?

Kirk: If Eich were anything but the CEO (or perhaps a C-level executive), this wouldbe a nonissue. Employees are clearly entitled to have their own views on matters, regardless ofwhether they conflict with those of the company. The question is, when does one’s personalvalues become inextricably linked to the identity of the company? It’s safe to say that CEO is onthe other side of that threshold. Eich’s blog post reiterating his commitment to equality andinclusivity at Mozilla is a step in the right direction, but the critics’ demands for a fullexplanation are not unwarranted.

Patrick: This is a tough one. In my book, Eich is entitled to his personal beliefs, butemployees are well within their right to question the new CEO’s ability to reflect the company’svalues. Like mixing Diet Coke and Mentos, some things just don’t go together. It leaves mewondering what the CEO hiring committee expected to happen here, particularly given thedesire to hire a mobile oriented CEO by half the board. This case also leaves us with aninteresting question: does Mozilla’s commitment to inclusiveness and openness demand thatthey embrace Eich and his views, despite disagreeing with them?

Objecting to new CEO, resignations sweep Mozilla board http://www.cnet.com/news/resignations-sweep-mozilla-board-because-of-new-ceo-report/ (CNET)

Inclusiveness at Mozilla https://brendaneich.com/2014/03/inclusiveness-at-mozilla/ (Eich)

A Framework for Thinking Ethically http://bit.ly/ethicsframework (Markkula Center)

NEXT STORY: Is Oculus Leaving Early Backers Out to Dry? http://www.scu.edu/r/ethics-center/ethicsblog/business-ethics-news/19253/OCULUS-VR:-Leaving-Early-Backers-Out-to-Dry?

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Comments

Alexa said on Apr 6, 2014

I do not believe a CEO should add their own personal values and beliefs into their career.I believe a personal view and a professional view should be kept seperate for a number ofreasons. One, this will cause controversy to the employees in the company that couldpotentially hurt the business. Two, consumers may disagree upon what employees of thecompany believe in, especially the CEO, and be influenced to walk away from thecompany. - Like javascript:ilike(4762,2) - 1 person likes this.

Reply

Patrick said on Apr 6, 2014

Alexa, thanks for your comment. What do you think about Eich never publiclyexpressing his views on gay marriage? (It was only found out because people dugthrough his public records) - Patrick - Like javascript:ilike(4763,4) - 3 people like this.

Reply

Dave said on Apr 7, 2014

This truly concerns me. Eich didn't mix business and personal, and his coworkers reporthim as inclusive and a great choice for CEO. It concerns me that the current LGBTestablishment doesn't seem to have any respects for personal beliefs. Should the 40% ofthe nation that opposes gay rights be automatically removed from the running for CEOpositions? - Like javascript:ilike(4764,5) - 4 people like this.

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Robert said on Apr 16, 2014

We now know that Eich's modest contribution supporting Prop 8 wasn't unusual for theCalifornia tech industry. We also have learned that his contribution was leaked by theIRS. While people may disagree with Eich's personal views, it seems to me that we needto reeducate our citizens about true tolerance, and seek to create an environment wherepublic figures aren't denigrated (or asked to resign their job) for their personal views.Tolerance is a two-way street. - Like javascript:ilike(4776,4) - 3 people like this.

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Patrick said on Apr 16, 2014

To both Dave and Robert - I share the same concerns. Eich didn't get a fair hearing here.Then again, I do empathize with the employees who feel strongly about this issue spokeout. Ideally it would've led to a continued conversation as opposed to a witch hunt. - Likejavascript:ilike(4783,2) - 1 person likes this.

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Greg said on Apr 22, 2014

Patrick, The employees are free to have a strong opinion, as does Mr. Eich. As Robert andDave both point out, tolerance and respect is a two-way street. No person should bebarred from employment solely based on their beliefs. Even their actions must be judgedin the context of the agents purpose and intention, and all given the opportunity toexplain and defend. - Like javascript:ilike(4798,3) - 2 people like this.

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Patrick said on Apr 22, 2014

Greg, I hear your point, but I think the statement "no one should be barred fromemployment" doesn't do justice to the situation; particularly, Kirk's point about thespecial role of the CEO. Again, I don't think Eich got a fair hearing, but I think we

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have to distinguish general employment from occupying the head leadership role ofthe company. - Like javascript:ilike(4799,1)

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Greg said on Apr 23, 2014

The role of Eich in the company should not supercede his rights as a member of society tohave, form, and express his opinion. If Mr. Eich actively prevented others fromexpressing a differing view point, there would be an issue. In this instance, Eichsupported and promoted a variant perspective, but did not silence or impede others fromstating and supporting their opinion. There are a multitude of reasons to support orprevent gay marriage. Without the variety of opinions being voiced, we trade onetyranical opinion for another. It could be a great example if the CEO and Mozillasimultaneously promotes or supports both side of the issue, beining a real example oftolerance and inclusivity. - Like javascript:ilike(4808,4) - 3 people like this.

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Nik said on Nov 20, 2014

Love it Greg! - Like javascript:ilike(5008,1)Reply

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Case Study Commentary # 1

Commentary for: Kirk O. Hanson & Patrick Coutermarsh. MOZILLA: Mozilla CEO Under Fire for Prop 8

Contributions. Business Ethics in the News. Markkula Cetner for Applied Ethics, Santa Clara University, 31 Mar. 2014. Web. 5 Dec. 2014. <http://www.scu.edu/r/ethics-center/ethicsblog/business-ethics-news/19269/MOZILLA:-Mozilla-CEO-Under-Fire-for-Prop-8-Contributions>

I chose this article because conflicts between personal views and politics can

often conflict with the views of a big organization. For an organization the size of

Starbucks, this is especially true, with 25,000 or more partners working at Starbucks, the

views of the various partners and managers are bound to be different on different issues.

The authors of the case study talk about how such conflicts become more

important the higher level the manager. As a store manager, I may frequently have

views that are diametrically opposed to those of senior management and the shareholders.

Right now it’s not as big of a deal. Because I hope to move into a more senior

management role and into the corporate headquarters, this changes.

While a senior manager is still definitely entitled to have different views, by

choosing to accept a management role, they can’t always share those views as publicly.

If I post something about politics on my facebook page, that doesn’t really get linked to

Starbucks. If a senior manager does, it might. The same goes for the Mozilla guy’s

donations.

This is a really hot topic because the CEO of a major company was getting

pushed out for an old donation. I suspect this also happens on the smaller level, with

managers in the corporate office being called to task for posting things that the majority

doesn’t agree with.

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In the ethics class, this also poses a separate dilemma. Kant’s teachings told us

we had a certain duty to be honest with our peers. Here we see people punished an

losing their livelihood for doing that. I think it is probably unethical to push the CEO out

for his political views, especially if they were expressed long ago and don’t show up in

his running of the company.

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The Case of Due Diligence

Ethical principles and values are, of course, key to ethical decision making, but how should they be

applied to actual business situations? Thomas Shanks, S.J., executive director of the Markkula Center for

Applied Ethics, was asked to walk readers through a real-life case for The Monitor, the publication of the

Investment Management Consultants Association. Here, he shows how ethics can guide the conduct of a

brokerage firm rewarding sales representatives with trips for the sale of a particular fund. This case was

presented at a workshop for Dean Witter.

When it comes to ethics, I often recommend that most of us need to develop an "ethics reflex," almost asecond-nature ethical instinct that enables us to know the right thing to do well before the loss ofbusiness, reputation, or (self)respect that comes from making a moral mistake. We develop this reflexonly by focusing on fundamentals. For example, when we bump into a questionable business practice (or

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when we have to make a decision ourselves), we can analyze it using three basic questions:

1. What are the ethical issues?2. Who are the stakeholders? 3. What is the ethically appropriate decision-considering the consequences of my action, the rights ofindividuals involved, and fairness?

Consider this case, based on a true story. Suppose a stock brokerage rewards in-house sales with trips,offering double credits and five-day "due diligence trips" to European and U.S. resort towns for brokerswith more than $500,000 in production in a particular fund. The firm currently owns 20 percent of thefund group, and its ownership stake apparently grows with increased sales. Although the firm has a policyagainst sales contests on mutual funds, and in the past, reps were unable to accept trips from other fundsbecause of a strict interpretation of NASD rules, the firm says these are not sales contests and the trips are"informational and related to due-diligence." Apparently, reps are not being forced to sell the fund. "Nopressure to do more or less," says one of the firm's brokers. However, the firm says, "participants do needto qualify (for the trips) by doing business with a particular product and expressing an interest in doingmore." The firm considers the trips "advanced training."

Let's consider the questions briefly.

What are the ethical issues?

If the firm's response as reported in the story makes you say, "Give me a break!" it's probably because thejustification for the trips isn't consistent with your own moral standards or what many (most?) people inthe industry would accept. Ethical issues are not the same as legal or business issues. Let's assume thatthe firm's actions represent a good business decision and are consistent with the laws and regulations. Arethey ethical?

The earliest known texts with ethical content date back some 5000 years to the inhabitants ofMesopotamia and reflect on our earliest attempts to live together and form societies. Over those manyyears, philosophers have described ethics as focusing on:

1. character...and encouraging individual, corporate, and community virtues (like integrity, trust, andresponsibility) 2. relationships...where we treat all people as free and rational human beings capable of making their owndecisions, and where we treat everyone fairly (in other words, we distribute benefits and burdens equallyto everyone, unless there's some clearly relevant moral reason to treat people differently) 3. consequences...where we attempt to produce the greatest balance of benefits over harms, consideringeveryone's interests.

What do you think are the ethical issues here?

Who are the stakeholders?

When you consider the ethics of any case, consider all the stakeholders, i.e., any person or group who willbe directly and significantly affected by a decision. In this case, let's just consider the key stakeholders asthe firm, brokers, and clients. What questions are clients likely to ask about this case? Are they beingtreated the way they want to be treated? Why would this case pose some serious ethical questions forthem?

What is the ethically appropriate decision?

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Consider just a few of the main ethical standards. One asks us to consider possible consequences and tobe sure that the overall benefits outweigh the harms of a particular course of action. Clients mightrightfully ask who benefits the most from involvement with the fund-they, the broker, or the firm? In thebest world, all will benefit equally. When might that not be the case?

Another standard says that each individual has a right to be treated as a free and equal human beingcapable of making his or her own decision. In this case, how would clients react if the broker told themahead of time that the broker would qualify for "advanced training" from the firm in return forinvolvement with the fund? How would the clients react if they found out later, without the broker tellingthem? Most clients would probably feel that they should have had all the information they needed tomake their own decision.

The third standard is related to the second: fairness, an equal distribution of benefits and burdens. Clientsshould feel that this fund was presented to them because it represented the broker's best judgment of avaluable client opportunity, not because it had an edge due to some irrelevant criterion (i.e., the broker'spersonal gain or the firm's larger ownership stake in the fund.) In other words, clients should feel thatthey would benefit from purchase of the fund; the fund should not be a burden to them and a benefit forbroker and firm.

The broker is clearly in a conflict of interest here. Clients don't generally like to deal with brokers in sucha situation. Most brokers will try to avoid even the appearance of a conflict of interest, no matter thereality. Feeling that something else guides the broker's judgment besides the client's best interest is thequickest way to erode trust and business.

This case was written by Thomas Shanks, S.J., Executive Director of the Markkula Center for Applied

Ethics.

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Case Study Commentary # 2

Commentary for:

Thomas Shanks, S.J. The Case of Due Diligence. Markkula Cetner for Applied Ethics, Santa Clara University, N.d.. Web. 5 Dec. 2014. <http://www.scu.edu/ethics/dialogue/candc/cases/diligence.html>

I chose this case study because it raise a couple of interesting subjects which I

think are likely to come up in the context of managing a real estate portfolio for

Starbucks. It covers issues with potential travel budget usage and issues with hidden

compensation and with results in actual due diligence. I think all of these could be found

in the Starbucks job I would like to end up with in the future.

In the travel budget context, these employees were being sent on international

trips as a reward for their sales. Their expenses were probably not being reported

correctly. In Starbucks, I could see this coming up with real estate managers who want to

take trips to nice sunny places in winter. A corrupt and unethical real estate manager or

employee could arrange “due diligence” trips to Arizona, San Diego or Hawaii. In the

end they would not be productive trips, but by then the money has been spent and the free

vacation taken. This is not fair to the company’s owners or to the other partners.

Hidden pay is also an issue that real estate managers may encounter. If a property

owner offered the real estate manager some perks, the manager may be more likely to

choose a location. My fiancée told me that he once worked at a company that paid him

on a “spiff” system for selling items. He hated it because to make some money he often

had to sell the customer the worse products. This would be no different. If a real estate

manager got Starbucks into a worse lease at a worse location because of some sort of pay

back system, that would be unethical.

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Lastly, if these “due diligence” or “training” trips start being more and more like

vacations, I don’t think that the employees would really take the real due diligence and

training trips in the future seriously. These are important in the real estate context, as you

can’t really know a site until you visit it. If you get used to spending most of the trip at

the beach, you’re going to rush the inspection you should be paying attention to or bail

out of training class for something more fun. This would be unethical.

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The Case of Nutritional Foods

By Kirk O. Hanson

What do we do when products go wrong? That question was explored by the Ethics Center's EthicsRoundtable for Executives at a September meeting featuring Greg Steltenpohl, chair of Odwalla Inc., andKirk O. Hanson, director of Stanford University's Sloan Program at the Graduate School of Business. Tofacilitate discussion of the issue, Hanson created the following fictitious case. It does not represent a realevent, but it does provide a framework for looking at questions of product responsibility. The case ispresented in four parts to mimic how such a scenario might evolve in real time. At each break in the case,stop and ask yourself what you would do given the information you have.

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First Warnings

Fred James, chief executive of Nutritional Foods Inc., a $50 million manufacturer of healthful foods,listened with concern as John Healy, his vice president for production, described reports that had come induring the past hour.

The reports came from two county health departments, one in Seattle and the other in SouthernCalifornia. In each case, the health department official reported a possible link between acute foodpoisoning of a child and an unpasteurized apple product produced by Nutritional Foods and distributedthroughout the Western United States. The health departments had not yet ruled out all other possiblecauses. Additional information was not yet available, and Healy did not have batch numbers for theproducts in question.

Nutritional Foods was rapidly becoming the best-known brand of natural or nonpasteurized foods in theWestern United States. It made its products in two facilities, one in California's Central Valley and theother in a coastal city of Central California. Fresh fruit and vegetable products were shipped fromgrowing regions throughout the West to these two facilities for processing and canning or bottling. Thehandling of nonpasteurized products was critical as contamination could occur in picking, transporting, orprocessing the fresh product.

Distribution was also critical to the freshness and safety of the company's products. Daily distributionfrom the company's processing facilities in company-owned refrigerated trucks ensured freshness.

Unpasteurized products had been popular in the health-food market for many years, but Nutritional Foodswas the most successful of several companies seeking to appeal to the mainstream market as well as tothe niche consumer. The company's success had led to its rapid growth and the construction of its newprocessing facility in the Central Valley.

"OK, John," said James, "what's our response? Do two 'maybes' mean we should do somethingimmediately? We have had an occasional report, perhaps one every couple of months, during the past twoyears. None of those turned out to be traceable to our product. Do two reports represent anything otherthan a statistical quirk? Should we be doing anything but waiting for the final reports from the healthdepartments in a couple of days?"

Concern Deepens

Healy dispatched company managers to the two counties where initial reports indicated there might beacute food poisonings related to one of the company's unpasteurized products. He was startled a shorttime later to receive a third and fourth report similar to the first two.

Although also not conclusive, the new reports made Healy wonder if something was terribly wrong.Healy immediately dispatched company managers to the two new counties, urging all four to get the

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batch numbers of the products in question. He also asked for an immediate meeting with James.

"Now what should we do?" asked Healy. "Should we warn the retailers, asking them to stop selling theproduct? Should we also warn the public? Such a move could devastate the company's reputation and itsstock price at a critical moment. Don't we have an obligation to think long and hard before we take thatstep? How much certainty must we have and how serious does a problem have to be for us to proceed?"

Time to Act?

Healy was deeply troubled when he heard from his managers that health officials in the four counties theyvisited were virtually certain Nutritional Foods' product was indeed involved in the food poisonings. Allthe batch numbers, however, were not available. The two cases where company managers could get batchnumbers were from a single day's production.

Healy was further troubled that three additional reports of possible food poisonings had come in by theend of the workday, though two were relayed by newspaper reporters. Each was checking claims byconsumers that one of Nutritional Foods' products had made them sick. One of the reports involved adifferent company's products.

Healy also heard late in the afternoon from one of his children who had read in an Internet nutritional chatroom that Nutritional Foods had a poisoning problem. Had the time come, Healy wondered, for moredramatic action? If so, what action should he take?

Crisis

At 7 p.m., Nutritional Foods announced publicly and through its retail network that it was pulling allbatches of the unpasteurized product associated with all but one of the alleged poisoning incidents. Oncethe news hit the wire services, 50 more calls cascaded into company headquarters late that night and earlythe next morning. Most were from consumers alleging they, too, had been poisoned by the company'sproducts. Five more were reports from health professionals who stated they were treating possiblepoisonings.

At 9 a.m. the next morning, James convened a meeting of his Crisis Action Committee, an ad hoc groupof managers that had been formed a few months earlier for just such a crisis. "Let me put severalquestions before the group," said James. "Are we doing enough by conducting a recall for the specificproduct in question, publicly asking consumers to return all unused products to their local retailer, andasking retailers to stop selling and return all of their supply to us? The press has done a pretty good jobgetting the word out. It's on the front page of perhaps 80 percent of the daily newspapers in ourdistribution area this morning.

"Should we do more to notify customers? Should we consider pulling all our products? The calls this

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morning allege adverse reactions from many different products.

"And what should be our strategy toward those who have been made sick by our product? If we showconcern, isn't there a risk we will look like we are admitting liability? Finally, what should we do aboutthe sickest of those affected? Two children are reported this morning to be in critical condition."

If you were Fred James, what action would you take?

Winter 1998

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alternative points of view.

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Case Study Commentary # 3

Commentary for: Kirk O. Hanson. The Case of Nutritional Foods. Markkula Cetner for Applied Ethics,

Santa Clara University, Winter 1998. Web. 5 Dec. 2014. <http://www.scu.edu/ethics/dialogue/candc/cases/nutritional.html>

I chose those this study because I think it has a lot to consider for anyone working

at a bigger food company. While it doesn’t directly touch on responsibilities of a real

estate manager for a company like Starbucks, it affect my current job for sure and there

could be tie-ins with real estate and facilities management issues.

For example, the real estate works with construction teams to make sure that

stores are built in the right way for the right place. If we didn’t do our job, a store could

suffer from having an improper filtration system or bad refrigerator. In my current job, I

have been the victim of this kind of real estate carelessness leading to issues with systems

that make sure our food is safe. I once had to essentially close my store and throw out a

lot of food because of a construction/installation error.

This case study really caught my attention because it deals with people’s health.

As a food company, keeping our customers healthy is probably our most important job.

It’s also the easiest way for use to lose our customers and their trust. Once I get sick

from a restaurant, I never go back. As a chain, getting someone sick would not only

affect my store, but maybe every other Starbucks out there.

Ethics for food companies needs to be much higher than for other kinds of

businesses. If a customer gets a bad pair of jeans, they are not going to end up in the

hospital or even dead. If they get bad food, it could happen. This important ethical duty

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has to be balanced against the ability to make money. However, the fear of short term

waste or loss can’t be balanced against the customers health. It’s just not even, and the

ethical decision will always be to protect the customer.

The hypothetical company described here looks like it was better prepared than

other companies and had a crisis team and people to dispatch out. The questions at the

end of the case study are harder. I think that ethically you obviously pull the product and

try to find out as much as you can about those kids who got sick. At the same time, you

have to be careful about scammers who are going to try to take advantage. Some sort of

faster process and investigation for determining who needs the company’s help should

probably be set up for food companies.

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CYBER ATTACKS: Should Companies Admit They've BeenHacked?Sunday, Feb. 24, 2013

Cyber attacks on American companies have become increasingly more common, but not all

companies respond to security breaches the same way. Companies such as Facebook, Twitter

and Apple, have voluntarily gone public with their security troubles. Alternatively, a number

of companies have continued to deny cyber attacks, despite reports stating otherwise;

including, Exxon Mobil, Coca­Cola, Baker Hughes, and others. The U.S. government has

encouraged transparency on cyber attacks as part of a wider effort to protect American

intellectual property. Advocates of disclosing breaches claim it will set a precedent for other

companies to get more active in fighting cyber attacks. The majority of company lawyers

advise not to disclose, pointing to potential shareholder lawsuits, embarrassment and fear of

inciting future attacks. Health and insurance companies must disclose breaches of patient

information, and publicly traded companies must when an incident effects earnings. What

policy should companies adopt when dealing with a cyber security breach?

Kirk: The common good demands a united effort by public and private institutions tofight cyber attacks. Companies owe it to the public to admit they've been hacked and to usetheir experience toward improving efforts against hacking. Anything short of full participationwill guarantee that cyber attacks will continue to be a problem, and companies will be pickedoff one by one as they stand silent. Due to the sheer number of incidents the stigma of beinghacked has decreased dramatically, opening the door for more companies to come forward. It'stime for companies to think of the common good over protecting their own tail.

Patrick: The focus here should be on the legal system, not the victims of cyberattacks. Hacked companies are being further victimized by being pressured to release securitybreaches, while being inadequately protected from the liability that comes with it. This is not tosay that companies should not be held accountable for a reasonable amount of preventativesecurity, but the U.S. government is sending companies mixed messages. If the FederalGovernment really wants collaboration from hacked companies they should consider offeringanonymous participation in their current initiatives, as well as insulate companies fromunwarranted shareholder lawsuits.

Some Victims of Online Hacking Edge Into the Lighthttp://www.nytimes.com/2013/02/21/technology/hacking-victims-edge-into-light.html?pagewanted=2&_r=2&ref=business&pagewanted=all&

A Framework for Thinking Ethically http://www.scu.edu/ethics/practicing/decision/framework.html

NEXT STORY: ARE SUPPLIERS PAID ENOUGH TO MAKE ETHICAL LABOR PRACTICESPOSSIBLE? http://www.scu.edu/r/ethics-center/ethicsblog/business-ethics-news/15401/HP:-Are-Companies-Paying-Suppliers-Enough-to-Allow-for-Good-HR-Practices?

Posted by Patrick Coutermarsh

Comments

Joe Schmid said on Feb 28, 2013

The conversation needs to be re-centered from simply cyber attacks to cyber warfare

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against the U.S. In this new context disclosure takes on a much different significance.Laws already exist that dictate disclosure when material harm has been incurred; and theSEC is promulgating new guidelines in this arena. These attacks are acts of war and thevictims are many as in the case of the hacking of the SC Department of Revenue and theloss of taxpayer names, SS numbers, as well as the names and SS numbers of theirdependents. The federal government's primary responsibility is to protect its citizens. Ina state of war decisions about what and how ought to defer to the feds and theadministration. The feds need to step up and decide what and how disclosures are madein a coordinated public/private united effort against the cyber war we find ourselves in,and in the best interest of the common good. - Like javascript:ilike(3679,3) - 2 people like this.

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Joe Schmid said on Mar 2, 2013

The conversation needs to be re-centered away from simply cyber attacks, to cyberwarfare against the U.S. In this new context disclosure takes on a much differentsignificance. Laws already exist that dictate disclosure when material harm has beenincurred; and the SEC is promulgating new guidelines in this arena. These attacks areacts of war and the victims are many as in the case of the hacking of the SC Departmentof Revenue and the loss of taxpayer names, SS numbers, as well as the names and SSnumbers of their dependents. The federal government?s primary responsibility is toprotect its citizens. In a state of war decisions about the what and how of disclosure oughtto defer to the feds and the administration. The feds need to step up and decide what andhow disclosures are made in a coordinated public/private united effort against the cyberwar we find ourselves in, and in the best interest of the common good. - Likejavascript:ilike(3711,1)

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Kevin Greenberg said on Nov 15, 2014

I believe that the companies owe it to the public to disclose the details of any attack. I seethis to be true due to the potential information of shareholders and users. Although,lawsuits may be a very avid fear i don't believe that this fear justifies withholdingimportant information from all involved. - Like javascript:ilike(5002,1)

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Case Study Commentary # 4

Commentary for: Kirk O. Hanson & Patrick Coutermarsh. CYBER ATTACKS: Should Companies Admit

They've Been Hacked? Business Ethics in the News. Markkula Cetner for Applied Ethics, Santa Clara University, 24 Feb. 2014. Web. 5 Dec. 2014. <http://www.scu.edu/r/ethics-center/ethicsblog/business-ethics-news/15517/CYBER-ATTACKS:-Should-Companies-Admit-They've-Been-Hacked>

I chose this article because if a company has been hacked it has effects on the

customer base and their trust in safety with the company they chose to do business with.

This seems to be an issue that is happening more and more often with the advancement of

technology.

I can see this happening in the real estate area of Starbucks because of the amount

of finacial transactions that are paid to landlords, construction companies as well as third

party vendors on a daily basis.

The study caught my attention because it compares the reporting of how the

disclosure of a hack to a retailer should be conducted versus the hack of the health

industry. It states that most companies shouldn’t disclose information of the company

having a cyber attack because of the overall shareholder commitment. This is in contrast

to health industry companies, who should disclose the breach due to the amount of

patient information that is collected.

This is a currently a hot topic because we are hearing about more and more

instances of this happening: first, it was Target and now there is Home Depot, Neiman

Marcus and Michaels joining the ranks. And that is just this year alone.

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It is important to create policy around cyber attacks because it affects commerce

and people’s opininons with regard to where and how they would like to spend their

money. For example, my information was apart of Targets scandal, due to that it

diminished my trust with them and now if I shop there, I only pay with cash.

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Back to Blog /ethics-center/ethicsblog/silicon-valley.cfm?

Quality Management: Signing Off on a SubstandardProductLauren's first job after graduation from Santa Clara University was working asa quality engineer with a highly respected technology company. She had tomonitor the manufacturing process and make sure that all products metcustomer specifications. Just three months into her position, the companybooked a very large deal with a strategic customer, helping establish thecompany's dominance in the industry.

Specifically, Lauren's company was designing a device that would beintegrated into another company's product. The customer contracted out thiswork because they were experiencing rapid growth and cannot meet demandotherwise. They picked Lauren's company because of its good reputation andfast turnaround time. Lauren's role was to test the new device and make sure itmet technical and environmental specifications, particularly functionalityunder extreme conditions, such as high humidity.

The test results showed that the products did not meet the quality standardsagreed upon, but only by a very small margin. Her general manager instructedher to push it through anyway, stating that the risk of failure was not greatenough to delay mass production. Moreover, the likelihood of the product everbeing placed in such extreme situations was so small that the manager did notfeel jeopardizing the contract was worth it.

Lauren spoke to her immediate boss, who worked under her general manager,and he also advocated pushing the product through to production. She wasfaced with the choice of ignoring company protocols or going againstmanagement. Sweeping the problem under the rug would require Lauren tosign off on a report that she knew to be fraudulent. She also knew that if shewent to upper management her working relationships with her immediatebosses would be strained, maybe even preventing her success in the company.Not to mention, the company would have to delay production and possiblylose the contract.

What should Lauren Do?

Posted by Noah Rickling, Hackworth Business Ethics Fellow ‘13

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achandrakar said on Sep 12, 2014

If the risk of failure is considered as not great enough to delay massproduction and her supervisor's are willing to in include this exception,

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then Lauren can sign off the report, however few important steps beforedoing that: 1. Document the critical analysis of the potential issue andthe corresponding argument of low risk/less frequency. 2. Work with thegeneral manager to add a note of exception in the contract or analternate means of informing the customers about this corner case andthe product?s capability of handling such exceptions. Also ProjectManagement has an interesting concept of Change Control Board tocater to such tweaks and tits. In this method a small committee ofinvolved stakeholders (say Quality manager, development manager andproduction manager) take charge of due diligence, cause and effectanalysis, releasing a go or no go decision and recording the exceptionsfor future reference. I think it is equally applicable to manufacturing andproduction.

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Patrick said on Sep 15, 2014

I appreciated your thoughts on documenting the decision makingprocess. As far as the probability of failure, what benchmarkshould Lauren use to draw the line between acceptable andunacceptable risk?

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Case Study Commentary # 5

Commentary for:

Noah Rickling. Quality Management: Signing Off on a Substandard Product. Silicon Valley Business Ethics Dialog. Markkula Cetner for Applied Ethics, Santa Clara University, N.d.. Web. 5 Dec. 2014. <http://www.scu.edu/r/ethics-center/ethicsblog/silicon-valley/16452/Quality-Management:-Signing-Off-on-a-Substandard-Product>

I chose this article because at Starbucks we have a high volume and variety of

products that make it into the customer’s hands or body on a daily basis. If we don’t

spend the time with proper development, testing, sourcing the best ingredients, and/or

researching the third parties that we are getting our products from, we will risk putting

our customers in danger.

This can directly relate to a real estate management role in Starbucks through the

store opening and build process. We have to conduct the testing to make sure the

physical environment is suitable to build on. Alternatively, for an existing brick and

mortar location, we need to make sure it’s safe. If we were to hire an outside company to

conduct a lead test for instance and the test came back on the cusp of toxic, and they

chose not to disclose the proper clean up solution, we run the risk of not only

endangering our partners’ health, we also endanger the customer visiting our

establishment.

This caught my attention because there are unfortunately many companies that

knowingly put out a less than stellar product just to make money. They choose not to act

ethically or think about the long-term effects on a customer. They then run the risk of

having a product recall that results in a costly process that could’ve been avoided from

the beginning. The underlying situation and the recall both hurt their brand.

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We see this in the car industry more and more, for example the current General

Motors lawsuit, where they knew there was an issue and they produced and distributed

cars anyways. It’s important because you are contributing to the loss of trust that you’ve

developed over the years with the general public, the consumer.

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12/6/2014 The Case of the Plant Relocation

http://www.scu.edu/ethics/dialogue/candc/cases/relocation.html 1/4

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The Case of the Plant Relocation

By Karen Musalo

Production costs are rising. Your company can make more money for shareholders by relocating your

plants to a country with lower labor costs and fewer regulations. Using this case, Stan Raggio, senior vice

president for sourcing and logistics at The Gap, and Karen Musalo, then director of the Markkula Center

for Applied Ethics International Human Rights and Migration Project, discussed the ethical issues

companies should consider at an Ethics Roundtable for Executives.

You are the chief executive of Electrocorp, an electronics company, which makes the onboard computer

components for automobiles. In your production plants, complex hydrocarbon solvents are used to clean

the chips and other parts that go into the computer components. Some of the solvents used are

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12/6/2014 The Case of the Plant Relocation

http://www.scu.edu/ethics/dialogue/candc/cases/relocation.html 2/4

carcinogens and must be handled with extreme care. Until recently, all of your production plants were

located in the United States. However, the cost of production has risen, causing profits to decline.

A number of factors have increased production costs. First, the union representing the workers in your

plant waged a successful strike resulting in increased salary and benefits. The pay and benefits package

for beginning employees is around $15/hour. A second factor has been stringent safety regulations. These

safety procedures, which apply inside the plant, have been expensive in both time and money. Finally,

environmental regulations have made Electrocorp's operations more costly. Electrocorp is required to put

its waste through an expensive process before depositing it at a special disposal facility.

Shareholders have been complaining to you about the declining fortunes of the company. Many of

Electrocorp's competitors have moved their operations to less-developed countries, where their operating

costs are less than in the United States, and you have begun to consider whether to relocate a number of

plants to offshore sites. Electrocorp is a major employer in each of the U.S. cities where it is located, and

you know that a plant closure will cause economic dislocation in these communities. You know that the

employees who will be laid off because of plant closures will have difficulty finding equivalent positions

and that increased unemployment, with its attendant social costs, will result. However, you are aware of

many other corporations, including your competitors, that have shut down their U.S. operations, and it is

something that you are willing to consider.

You have hired a consultant, Martha Smith, to investigate the sites for possible plant relocation. Ms.

Smith has years of experience working with companies that have moved their operations to less-

developed countries to reduce their operating costs. Based on your own research, you have asked Ms.

Smith to more fully investigate the possibility of operations in Mexico, the Philippines, and South Africa.

A summary of her report and recommendation for each country follows:

Mexico

A number of border cities in Mexico would be cost-efficient relocation sites based on both labor, and

health and safety/environmental factors. Workers in production plants comparable to Electrocorp's earn

about $3 per day, which is the prevailing wage. There is frequent worker turnover because employees

complain that they cannot live on $3/day, and they head north to work illegally in the United States.

However, a ready supply of workers takes their place.

Mexican health and environmental laws are also favorable to production. Exposure to toxic chemicals in

the workplace is permitted at higher levels than in the United States, allowing corporations to dispense to

some degree with costly procedures and equipment. Mexico's environmental laws are less strict than

those of the United States, and a solvent recovery system, used to reduce the toxicity of the waste before

dumping, is not required.

The only identifiable business risk is possible bad publicity. The rate of birth defects has been high in

many Mexican border towns where similar plants are in operation. Citizen health groups have begun

protests, accusing the companies of contamination leading to illness.

Philippines

Conditions in the Philippines are more favorable than those in Mexico in terms of labor and health and

safety/environmental factors.

The prevailing wage in the Philippines is about $1/day, and young workers (under 16) may be paid even

less. As in Mexico, the workers complain that the rate of pay is not a living wage, but it is the present

market rate.

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12/6/2014 The Case of the Plant Relocation

http://www.scu.edu/ethics/dialogue/candc/cases/relocation.html 3/4

The health and safety and environmental regulations are equivalent to those in Mexico, but there have

been no public complaints or opposition regarding birth defects, cancers, or other illnesses.

South Africa

Conditions in South Africa are positive in some respects, but not as favorable in economic terms as in

Mexico or the Philippines. The prevailing wage in South Africa is about $10/day. Furthermore, there is a

strong union movement, meaning that there may be future demands for increases in wages and benefits.

The unions and the government have been working together on health and safety issues and

environmental protections. Exposure to toxic chemicals in the workplace is not permitted at as high a

level as in Mexico and the Philippines. Although the equipment necessary to reduce toxic chemicals to an

acceptable level is not as costly as in the United States, this expense would not be incurred in the other

two countries. Furthermore, there are requirements for a solvent recovery system, which also increases

operation expenses.

You have to decide how you would like to proceed. Your options are to further investigate one or more of

the overseas sites or to simply continue all operations within the United States. Examine each possibility

and the factors you will consider in weighing the pros and cons.

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12/6/2014 The Case of the Plant Relocation

http://www.scu.edu/ethics/dialogue/candc/cases/relocation.html 4/4

The views expressed on this site are

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Case Study Commentary # 6

Commentary for Plant Relocation:

Karen Musalo. The Case of the Plant Relocation. Markkula Cetner for Applied Ethics, Santa Clara University, N. D.. Web. 5 Dec. 2014. <http://www.scu.edu/ethics/dialogue/candc/cases/relocation.html>

I chose this study because it deals with ethical dilemmas in site selection,

something I will likely face working on the real estate and leasing teams for Starbucks.

While my experience working in placing stores will certainly face different issues than

those faces by those considering moving a factory off-shore, there may be a surprising

amount of overlap.

This caught my attention especially because I hadn’t considered that local

regulations might have an impact on how I would ethically do a real estate management

job for Starbucks. When I read this case study I realized it could be an issue. While not

international like the in case study, Starbucks faces different laws which affect profits in

different areas just within the state here. For those that aren’t familiar with the area it

may not seem like such a big deal, but the Seattle metro area is a patchwork of local

cities. You can have totally urban areas where one side of the street is in Seattle and the

other is a suburb or just the county.

In the past couple of years two local cities have passes minimum wage laws that

raise the minimum wage to $15 per hour over the next couple of years. In addition, the

city of Seattle has requirements for paid sick leave that other cities don’t. Even the sales

tax amounts can be pretty different depending on the side of the street. This case study

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made me think about how I would react if faced with a decision on where to open a new

Starbucks store in such a border neighborhood.

The best profit decision for shareholders would likely be to open the store on the

side of the street that is outside the city. You can pay workers less, and not pay for sick

leave for new employees. However, it is also unresolved about whether the $15/hour

baristas would still get the same great benefits as those who make less per hour. This is a

very hard question because it would be hard to keep a store profitable with such a big

hike in labor costs. It’s a much harder choice than the plant selection outlined in the case

study because there you are polluting and killing kids with the move, and in my story

you’re just debating wages.

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Method I have also completed two in-depth (over one hour each) interviews with

professionals in this field. The first, Danny Sheehan, is a manager of Financial Lease

Administration in the Global Real Estate group at Starbucks corporate offices. The

second, who I refer to as J.A., is a Real Estate Manager for a large Fortune 500 quick-

serve restaurant chain. J.A. has asked that I not include her name in my report, but her

contact information is available to Professor Erwin upon request for confirmation of the

interview. I wrote the following questions for my interviews.

1. Tell me about your current position and your responsibilities? 2. What attracted you to working for this company? 3. How would you describe your personal ethics? Are those the same are your business

ethics? 4. What kind of role does ethics play in your day-to-day job? 5. How did you start out in this business? 6. What career path led you to where you are? 7. Were there any major ethical dilemmas you faced in those previous positions? 8. What was the most difficult decision you’ve ever had to make career wise and why? 9. How are your personal ethics a strength in your current role and why? 10. Tell me about some ethics challenges you have encountered in your role and why? 11. If you learned your company was conducting a form of business that was border-line

illegal what would you do? 12. If your direct supervisor asked you to do something that was within the rules and law,

but you still felt it was unethical, how would you handle it? 13. Do you play a role in making sure the company maintains compliance in ethical

standards? How so? 14. If there was a decision made above you that was going to negatively impact the

customers trust in you personally, how would you handle the conversation to the customer?

15. Describe a specific instance, in a group situation where you made your views known about an issue important to yourself, especially if this was a view that the others did not share. What was the issue and why is it crucial?

16. Tell me about a time you faced a proposed course of action that you believe was unethical, how did you react?

17. What kind of role do you see ethics playing in the future of this career path?

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Results – Interview with Danny Sheehan Tell me about your current position and your responsibilities?

I am currently work in the Financial Lease Administration division for Starbucks

Coffee Company as a manager for the customer service team. We oversee all

lease agreements in the US, Canada and Central America. We make sure all

landlords receive their rent payments as well as handle the finances for any

contractors that are building, remodeling or repairing any property that Starbucks

is leasing.

What attracted you to working for this company?

I came to work for this company because of the work atmosphere as well has how

ethically run this company is. I wanted to work in a corporate environment, but

not in the sometimes-traditional stuffy suit and tie workforce that corporate

offices can have.

How would you describe your personal ethics? Are those the same are your

business ethics?

I would say that I have a significantly strong moral order, and they go hand in

hand with my business ethics on a daily basis.

What kinds of role does ethics play in your day-to-day job?

There are times when I have to make decisions that are best for the company, but

not necessarily best for the lease location. Such as if we are coming to the end of

the lease agreement, I partner up with the sister half of my division that is the

financial analysis group to determine based on operating costs and over all sales if

we should keep the store open by signing a new lease or if we should let the

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current lease run it’s course and we close the store and have to lay off partners or

relocate them.

How did you start out in this business?

I have been in retail since I retired from the Marine Corps, I started out as an

associate at a clothing store, was a district manager for a Hollywood Video as

well as a district manager for Game Stop. I had been working at Zumiez in a

similar position when a friend recommended me to Starbucks where I started out

as an supervisor for the team that I am currently a co-manager of.

What career path led you to where you are?

Once I began my career as a district manager, that’s when I began to not only

continued to learn my people management skills, I began to learn the other side of

the business. A main part was dealing with property managers and lease

agreements. From spending a couple of years with Hollywood Video and having

to close locations, I began to develop a passion for the leasing teams whom had to

deal with the day to day operations of a location and all that it encompassed.

When I was referred to Starbucks, this was the direction that I decided to pursue

and was hired on. I just celebrated my 8 year anniversary with them this past fall.

Were there any major ethical dilemmas you faced in those previous positions?

Nothing worthy of mention, but the situation what I always come back to is a

situation I was made a part of in our Canada division. We had a location in which

the landlord claimed we still owed him money on for a repair to the

establishment. While he broke the condition of the lease agreement that only

Starbucks can contract out the repair work for one of their locations he insisted

that we were wrong and he was right and that we owed him the money. He also

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was violating the condition of the agreement that he is not allowed to discuss

information with the Store Manager of the location.

How did you respond?

We responded with asking for a copy of the bill from the contractor who did the

work so that we could cross-reference it with the District Manager. We were also

looking into the situation with the legal team since this landlord was violating the

lease conditions. In the mean time, the landlord decided to put a lock and chain on

the front door of the location.

Where did you look for guidance on how to handle the situation?

We knew that we should wait for the legal team to decide the correct actions to

follow, but at the same time we didn’t want a location to be closed since it would

result in loss of sales as well as loss of income for our partners at that location.

What happened in the end?

We ended up getting the landlord to come to the location to cut off the lock and

chain so that the District Manager could go in and retrieve money out of the store

safe to pay the landlord so that the situation would be finalized and we could go

about our daily business. That sad part is, all of this was for only $80 dollars!

What would you have done differently?

I would have advised the District Manager to go in the store safe and paid the

landlord right off the bat, instead of waiting for the legal team to come up with a

more legal answer. This way the District and Store Manager wouldn’t have had

to be involved to which the extent that they were.

How are your personal ethics a strength in your current role and why?

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I have to encourage my teams to make the best ethical choice in the decision

when they have to resolve an issue with a lease agreement. I always make sure

they have to do what is right for the people involved, not just the company.

If your direct supervisor asked you to do something that was within the rules and

law, but you still felt it was unethical, how would you handle it?

I would revisit the code of business ethical conduct that we follow as a company

and see if it violated any of the policies. I then would document what was asked

of me and present it to the next level of management so that they were aware of

what was being asked. I would point out that I believe the act to be unethical and

not a best practice for the company to play a role in.

Do you play a role in making sure the company maintains compliance in ethical

standards? How so?

Yes, everyday, since we are the division that makes the company run by keeping

our locations open for business I make sure that we follow our set standards with

our landlords, contractors and any third party vendors. If we have to close a store,

we have a proper standard for doing so, they are made aware well enough in

advance, we would never just close a store by putting a sign in the window and

leaving the staff in a horrible situation.

If there was a decision made above you that was going to negatively impact the

customers trust in you personally, how would you handle the conversation to the

customer?

I would make it quite clear to the customer that yes there was a negative decision

made, but it’s something that we could work through and find a solution so that

both parties are happy. I would never want to compromise a relationship based

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on others actions, especially if I’m the one that has spent the time developing the

relationship with the customer.

Describe a specific instance, in a group situation where you made your views known

about an issue important to yourself, especially if this was a view that the others did

not share. What was the issue and why is it crucial?

A couple of years ago we donated several millions of dollars to help develop a

plan to help Veterans join the workforce after their career in the military. I

encountered several partners that didn’t understand why we would donate money

to this program instead of investing the money into better technology for the

company. Being a retired Marine I was appalled at what I was hearing, and

decided to help with this initiative and to educate my peers on what it’s like to

transition into civilian life. This was very crucial to me to educate my peers

because we were continuing to hear more and more about PSTD and how it was

affecting our troops in their transition into work life.

What kind of role do you see ethics playing in the future of this career path?

We are a company that does a lot for our partners as well as for the communities

in which we have stores. We should always value our ethical practices whether is

healthcare or ethical sourcing of coffee beans.

We do our research when it comes to the countries in which we do business with;

we educate ourselves on ethical values so that we have an open and honest

working relationship with our business partners. We continue to take care of our

farmers and their land in any case of disaster. More times than not we are the first

responders to financially help them before the Red Cross.

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Healthcare and overall quality of living is always discussed in the media and what

companies are doing for the employees versus no doing. We continue to provide

healthcare that meets the government standard and we are currently focusing on

what are the best working conditions for our store level partners. We

continuously run the topic of work/life balance into our stores to make sure that

all partners are treated fairly.

I don’t ever foresee Starbucks losing its moral code with the world especially if

Howard Schultz remains the leader. He’s never about greed; he’s about serving

people through the lenses of humanity.

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Results – Interview with J.A. Tell me about your current position and your responsibilities?

J.A works as a Real Estate Manager for a Fortune 500 quickserve restaurant

company. She is involved in new site planning and new store growth

development; she is based out of Washington State and has a large territory that

spans from the Pacific Northwest including Idaho and Montana.

What attracted you to working for this company?

The multinational scope of the organization with the large opportunity for growth

in any division.

How would you describe your personal ethics? Are those the same are your

business ethics?

I would say they are very similar; I come from a moral standpoint whether it’s in

my personal or work life. I try to be as transparent as possible, treat people fairly

and am very honest. I never want to over commit and under deliver on what

could happen in any situation.

What kinds of role does ethics play in your day-to-day job?

I am constantly faced with conflicts of interest when making a real estate

decision. I try to be impartial and if I can’t be then I have to step aside and resort

to another person stepping in to make the final decision.

How did you start out in this business?

I spent sometime in the Housing Real Estate business and from that I would meet

customers that were investors in Commercial RE and they constantly would tell

me how wonderful that direction was and so it was on accident that I feel into this

field and have continued with it through a few other companies.

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What career path led you to where you are?

I began in retail at a younger age and then broke into the Housing RE market,

from there onto Commerical RE and eventually into publically traded quickserve

restaurant RE. Honestly the salary, interaction with co-workers as well as

customers and the overall different events that can happen from day to day are

what keep me in this field.

Were there any major ethical dilemmas you faced in those previous positions?

As an agent we are constantly put into a situation where the seller or the sellers

representative is trying to treat us with gifts in order to sway our decisions. We

aren’t allowed to have meals purchased for us and or the acceptions of gifts.

Some examples include meals at four-star dining establishments or

concert/football game tickets.

How did you respond?

It’s a matter of sticking to the answer of NO, and making sure they understand

what are standpoint is and that it’s unethical and creates bias if we were to accept

their gifts in order for us to finalize a deal.

Where did you look for guidance on how to handle the situation?

In simple form, it’s listed on our code of company guidelines and ethics, if we

were to violate this it could lead to termination.

What happened in the end?

Everytime it happens it always leads to both parties paying separately and there is

no exchange of gifts.

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What was the most difficult decision you’ve ever had to make career wise and why?

To leave a company and do something different, especially when it’s a company

that has employees that you really care for and love working with. Everyone at

some point in their life will have to do this because they want to chase down

another opportunity that is hopefully for the better, and if it turns out to be the

opposite, it makes that decision that much harder.

How are your personal ethics a strength in your current role and why?

Morals are synonymous to me; moral codes drive me to not put my company into

compromising situations. Just as I would never want to jeopardize myself by

breaking moral code, I would never want to put my company in a situation that

would reflect negatively.

Tell me about some ethics challenges you have encountered in your role and why?

For me when I’m looking at a new location and have to choose the contractor to

build or remodel a space I find it difficult to not be bias. There are times when

the company wants me to use a new contractor, but I don’t know his work and he

has few references it’s hard to choose him because I haven’t spent anytime

developing the relationship that I already have with a contractor that I’ve worked

with several times. So I generally always defult to the original contractor because

I know his work, I know he is the best for my client and I know what the overall

outcome will be. I want to help the new guy, but I don’t know what the end result

will look like, so I don’t give him a chance.

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If you learned your company was conducting a form of business that was borderline

illegal what would you do?

I would immediately run it up the chain of command and start asking questions. I

would also call our HR resource line and state the issue and clarify that I am and

do not want any part of the situation. I would also find out what precautions I

should take in order to cover myself so that I am not involved in the ramifications

of the issue.

If your direct supervisor asked you to do something that was within the rules and

law, but you still felt it was unethical, how would you handle it?

Firstly I would state that I am not comfortable and then I would document in

email that I am not comfortable with what is being asked of me. I would then

notify the person above my direct supervisor the situation and let them know that

I am not comfortable.

Do you play a role in making sure the company maintains compliance in ethical

standards? How so?

Yes, especially in RE, I make sure my decisions aren’t based on gifts or monetary

influence. That my offers and actions are in good faith and that I follow through

with my best intentions. I make it a point to not put people into an unethical

situation.

If there was a decision made above you that was going to negatively impact the

customers trust in you personally, how would you handle the conversation to the

customer?

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I would disclose open and candidly the issue to my customer that this was a

decision made above me and that I have no part in it. That I will work together

with them (customer) on the issue to reach a solution in order to work together.

Describe a specific instance, in a group situation where you made your views known

about an issue important to yourself, especially if this was a view that the others did

not share. What was the issue and why is it crucial?

There was a group of us at an event in restaurant and we were all mingling and

drinking cocktails, at which time I decided to order another one and mentioned to

the server to just add it to our tab (Unbeknown to us there was another large

function on the other side of the establishment) the server then told us that the

company wasn’t paying for cocktails, just beer and wine. At this point I told the

server that we were with Company X, and the server then realized that there were

two completely different companies in the room. At this time I made it clear to

the server that she needed to make sure all beverages would in deed charged

correctly to the correct parties.

This was an especially crucial catch because we didn’t want to give the other

company a negative outlook about our company. It would be morally wrong to

have not said anything and just left thousands of dollars be wrongfully charged to

another company.

Tell me about a time you faced a proposed course of action that you believe was

unethical, how did you react?

At a previous company I found a franchisee canidate that wanted to sign a

contract with our company purely based on the site location. After I had found

this person I passed him to our contracts manager where they signed all

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documents and the franchisee passed over his check for thousands of dollars.

After a couple of months the deal fell through because of incorrect documentation

of which specific site location the franchisee wanted. Which was the only

location this person wanted.

How did you respond?

Since this was part of the deal that I wasn’t apart of there was nothing that I could

personally do since it was out of my hands.

What happened in the end?

In the end nothing could be done since both parties signed the contracts, the

franchisee to my knowledge never received a refund of his paid fee.

What would you have done differently?

Express to the franchisee to thoroughly read each document as well as have a

lawyer go through to confirm what you are in deed signing. Also to make sure

communication is clear as to what the deal actually is, make sure that both parties

interests are met so that this situation doesn’t happen again in the future.

What kind of role do you see ethics playing in the future of this career path?

I will always continue to follow my own personal beliefs no matter which

company I work for. I believe that companies should hold all staff accountable

for their actions and not just follow the status quo. I also believe that there

should be constant training, monitoring and resources available in a company to

ensure that the ethics of the company are not only respected, but also followed.

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Discussion

Afterconductingbothofmyinterviewswithmembersofthecorporatereal

estatecommunityIhavecometotheconclusionthatethicsremainanimportant

factorindecisionsmadethroughoutthebusinessprocess.Theneedforethical

decision‐makingdoesnotendwiththeinitialbusinesswheretheleasingdocument

issigned,butitshouldbeginthere.Bymakingadecisiontopurchaseorleasea

pieceofrealestateforyourcompanyyouarethencreatinganotherviewinwhich

thepubliccanobserveandjudgeyou.Whenthatlocationputsthecompanyname

onthefrontofitsbuilding,peopleareautomaticallygoingtochooseiftheywantto

shopornot.Ifyourcompanyhasastrongethicalbackground,morethanlikelyyou

willhavethecustomerbasetosurviveinthatlocation.Asanemployeeyouare

representingyourcompany,thereforeyourethicalbeliefsshouldmatchwiththe

companies,andyoushouldalwaysdisplaythatpositivelybymakingthebest

decisionspossible.Ihavelearnedthatnomatterwhatyourownpersonalethicsare

youshouldn’ttrustthatallyourcoworkersandcounterpartsareequallyethical,I

knowthatdoesn’texactlysoundfair,butuntiltheyhaveproventhattheysharea

similarmoralorderyoushouldalwayscoveryourselfinsituationaldecisions.

Ihavealwayslovedthesaying,“It’snotpersonal,it’sbusiness“(Godfather

1972).Buttomeitshouldbepersonalwhenyouarechoosingtogointobusiness,

becauseofwhatyouarerepresenting.ThereareseveralbusinessesinAmericathat

areknownfortheirunethicalbusinesspracticesandthepublicremembersthose

situationsandtheydecideiftheywanttospendtheirdollarsthere.

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IbelievewithmyownKantianpracticesandstrongmoralorderIcanand

willcontinuetoconductbusinessinthewaythatitisrightforthepeoplefirstlyand

secondlyforthecompany,thatitwillbemyowntouchofpersonalethicswhena

locationischosenfortherightreasons.

ThroughoutthisentirecourseI’velearnedtheethicalterminologythat

representstheday‐to‐dayactionsthatonemayencounter.Thisethicallearninghas

putthesehappeningsintoaperspectivethatletsmehandlemattersinamore

nuancedway.Iguessinawayitcomesdowntothesimplerealizationthatsome

individualsaren’tjustlackingmoralcode,butmoralorderaswell.Iwasraisedto

dotherightthing,notjustforthatmomentintime,butforthelong‐termoutcome,

thisiswheremystrongethicalnaturecomesfrom.

Itseemsasifinthisdayandagetherearealotmorepeoplethatare

centeringthemselvesonthetheoryofconsequentialism,particularlytheiregos

(EthicalIssuesinBusiness,APhilosophicalApproachpg5).Ifeelthatweareliving

ina“Me”society,thatit’sallaboutthemandnothingornobodyelsematters.These

arethemembersofsocietythatgenerallyseemtolackmoralcodeororderandwill

dowhateveristhemostbeneficialtothemratherthentherestofsociety.

Isurroundmyselfwithpeopleofgoodmoralcharacterandtrytolearnfrom

themandmodelmyselfafterthem.J.A.andDannyarebothexamplesthathave

taughtmealot.DannyandIhavesimilaremploymenthistoryandIwasproudto

seehisvaluesshineinhisinterview.WhilehisethicalcodeisrootedinaMarine

Corpsbackgroundandmineinfamily,IstillthinkIcanfollowhisexampleat

Starbucks.

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J.A.’sexperienceswithdifferentcompanieswillserveasmyeducational

experienceofwhattypesofcompaniestoavoid.Shehashadmoreexposureto

ethicaldilemmasthananyoneinherpositionsshouldhave.IhavelearnedIwould

neverworkforacompanywhichwouldwantmetocompromisemyethics.Iam

gladStarbucksdoesnot.

Ifwehadmoreutilitariansinourmixthismighthelpopentheeyesofthose

whomlackmoralorderandwanttohelpthefuturegenerationstomakegood

choicesnotonlyforthemselves,butforothersaswellsothatchaosdoesn’tensue.

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Works Cited

Kirk O. Hanson & Patrick Coutermarsh. CYBER ATTACKS: Should Companies Admit

They've Been Hacked? Business Ethics in the News. Markkula Cetner for Applied

Ethics, Santa Clara University, 24 Feb. 2014. Web. 5 Dec. 2014.

<http://www.scu.edu/r/ethics-center/ethicsblog/business-ethics-

news/15517/CYBER-ATTACKS:-Should-Companies-Admit-They've-Been-

Hacked>

Kirk O. Hanson & Patrick Coutermarsh. MOZILLA: Mozilla CEO Under Fire for Prop 8

Contributions. Business Ethics in the News. Markkula Cetner for Applied Ethics,

Santa Clara University, 31 Mar. 2014. Web. 5 Dec. 2014.

<http://www.scu.edu/r/ethics-center/ethicsblog/business-ethics-

news/19269/MOZILLA:-Mozilla-CEO-Under-Fire-for-Prop-8-Contributions>

Kirk O. Hanson. The Case of Nutritional Foods. Markkula Cetner for Applied Ethics,

Santa Clara University, Winter 1998. Web. 5 Dec. 2014.

<http://www.scu.edu/ethics/dialogue/candc/cases/nutritional.html>

Karen Musalo. The Case of the Plant Relocation. Markkula Cetner for Applied Ethics,

Santa Clara University, N. D.. Web. 5 Dec. 2014. <http://www.scu.edu/ethics/dialogue/candc/cases/relocation.html>

Noah Rickling. Quality Management: Signing Off on a Substandard Product. Silicon

Valley Business Ethics Dialog. Markkula Cetner for Applied Ethics, Santa Clara

University, N.d.. Web. 5 Dec. 2014. <http://www.scu.edu/r/ethics-

center/ethicsblog/silicon-valley/16452/Quality-Management:-Signing-Off-on-a-

Substandard-Product>

Thomas Shanks, S.J. The Case of Due Diligence. Markkula Cetner for Applied Ethics,

Santa Clara University, N.d.. Web. 5 Dec. 2014.

<http://www.scu.edu/ethics/dialogue/candc/cases/diligence.html>

The Purdue OWL. Purdue U Writing Lab, 2010. Web. November 12,2014.

Ethical Issues in Business A Philosophical Approach, Thomas Donaldson, Patricia H.

Werhane, Introduction to Ethical Reasoning, pg 3-5

The Godfather. Dir. Francis Ford Coppola. Distributor. Paramount Pictures, 1972. DVD

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