Samsung: Illegal Labor Practices (2012)

Controversy

Samsung company logo

Samsung is best known for its production of electronics, particularly mobile phones, which has been the primary power for its income. According to research done by Strategy Analytics, Samsung overtook Nokia to become the world’s largest maker of mobile phones in 2012, and reported its highest quarterly profit since 2008 at $4.5 billion in net profit, up 81% from the year prior.
In the year 2012, Samsung was investigated for using illegal labor practices in their China manufacturers. The allegations of this case were that the employees at this manufacturer were in some cases working 16-hour days with one day off per month, and they were also found hiring employees under the legal working age of 16 years of age.

Individualism
According to Friedman's theory of individualism, the only obligation that the business has is to maximize profit for the owner and stockholders. Samsung's manufacturer in China was trying to cut their costs and maximize their profit by hiring younger employees and over using overtime. This would be deemed ethical by individualists, but they used illegal methods to maximize profit. 

Utalitarianism

Utilitarianism is the maximization of happiness for all stakeholders. Utilitarians would see this case as unethical for many reasons. They didn't maximize happiness for employees, who were overworked, underpaid, and under appreciated. Shareholders' happiness also wasn't maximized in this case because they found out that they were funding a company who not only used child labor at their manufacturer but also their other illegal labor practices they were found to have used. 

Child labor controlled by Samsung in China

Kantianism
Kantianism bases its perspective on people's ability to act rationally and their motivations for their actions. It is clear in this case that Samsung didn't act rationally. Their motivations for their actions were to maximize their profits for personal gain, treating their employees as means to increase their profit by not following the formulation of humanity. 

Normative Theory
The last normative theory is the virtue theory, in which honesty, justice, temperance, and courage are evaluated to judge whether or not the company was ethical in their decision making. Samsung was unethical in virtue theory as well because they didn't possess any of these virtues. They weren't honest to their employees when hiring them, the employees weren't aware of what they were getting themselves into. Justice wasn't demonstrated in this case either because they didn't perform "fair practices." They used child labor and overused overtime so they didn't use fair practices. Temperance wasn't portrayed either because Samsung didn't have "reasonable expectations and desires." Samsung's manufacturer expected their employees to work 16-hour days with sometimes just one day off per month. These expectations are absurd and definitely not reasonable. Courage also wasn't possessed by Samsung in this case. Samsung didn't stand for "right ideas and actions." Their actions were very poor and unethical, and certainly not courageous. The lack of these virtues proves that Samsung is deemed unethical by virtue theorists. 

Work Cited

1. "WantChinaTimes.com." WantChinaTimes.com. N.p., 14 Sept. 2012. Web. 13 Apr. 2013. http://www.wantchinatimes.com/news-subclass-cnt.aspx?id=20120914000094&cid=1502

2. "Samsung Overtakes Nokia in Mobile Phone Shipments." BBC News. BBC, 27 Apr. 2012. Web. 13 Apr. 2013.http://www.bbc.co.uk/news/business-17865117

3. Grandoni, Dino. "Samsung Finds More Labor Violations At China Factories." The Huffington Post. TheHuffingtonPost.com, 26 Nov. 2012. Web. 15 Apr. 2013.http://www.huffingtonpost.com/2012/11/26/samsung-labor-china_n_2190246.html