Saturday, November 11, 2017

Kobe Steel Scandal

Kobe Steel Scandal (2017) 


Kobe Steel is one of Japan's third largest steelmakers. In a rising scandal the company admits that they falsified data with several car companies such as Nissan, Ford, Toyota, Honda, Mazda, and Subaru. This scandal is still on the rise releasing new information this past fall. (2017) The scandal begins with the quality of the products being made. Kobe performed safety checks over looking the data on Copper and Aluminum strength as well as durability for cars, aircrafts, and rockets. In turn some of the employees of Kobe were skipping the safety checks and falsifying the data. The data was released to the companies, and shipped to customers. This poses safety threats because they are producing products for transportation companies. These products could fail, create fatalities, accidents, and create even more of a scandal. Ford uses the aluminum for the hood of certain sedans. It hasn't been released if they have had safety issues with it, however Ford is being cautious with Kobe to protect their company. In a company in Tokyo, a power plant had improperly certified copper piping made by Kobe. This is a very serious company at stake because if something went wrong with the power plant, it could cause an explosion, gas leak, and not only threaten the company but civilians, and people around the company. And Kobe is responsible because their company is supposed to ensure safety checks and guarantees. An internal investigation is currently going on for Kobe Steel to find out exactly why the proper certifications and tests weren't being performed. The company is facing a great loss already. Their stocks have dropped forty percent since the start of the falsified data scandal. The company hasn't released a number of profit they have lost, but they have spoke out to their partnering companies and are paying for recall damages to the aircrafts and automobiles. This scandal started off as a small one, just with copper and aluminum, and it eventually worked into steel products as well. The data was configured to have positive reports on safety checks. It has been said to be going for over ten years. Having companies going extra miles and finish what Kobe steel should have done. 


Stakeholders are people that are affected by a certain company. In this specific case we could identify the stakeholders as Kobe Steel, the official company. Kobe steel is a stakeholder because their company is the one at fault, and the company that began the scandal. Kobe Steel's stakeholders can be Hiroya Kawasaki the CE of Kobe. The employees who did not perform the data checks, other employees even if they did perform the checks because the company will do an investigation on everyone. The companies that had been affected by Kobe Steel such as car manufacturers. Customers of those companies, because they could be getting falsified transportation that could be a safety hazard. People around those affected by the Kobe Steel Scandal. The stakeholders really took a negative affect on this because the company has been around for 112 years. The companies reputation is at stake, employees and their family relies on this income to survive, if the company was shut down because of this scandal, everyone would loose everything. 


Individualism is when a company chooses to maximize its profits without going against the laws. In an ethical standpoint its important for companies to maximize their business without going against the law. If an individualist looked at this case, they would see the harm that by trying to maximize the business, they are behaving in an unethical way. They are in turn not maximizing their business but adding more harm in going through a quicker data check and lying about the data. By not following these standard codes of safety checks, they are breaching contracts with other companies, and breaking safety check laws for Steel, aluminum and copper. 
Kantianism theory is to act in a moral and ethical way. Kobe Steel did not act in an ethical way because Hiroya the CE did not know that the data was being falsified. The employees not performing safety and data checks for the products of Aluminum, Copper, and Steel. By acting in this immoral way and lying about the performance all of the companies stakeholders are being affected negatively. Kant's advice would have had more supervision in the safety checks, for the CE to add a more complex, in depth data check, and to keep an eye on the most important part of the business. This could be done by developing or buying a software that tracks, and modifies safety checks automatically through a computer system. It would have all the data in one part, and the software would forbid employees to write their own safety checks. By running this program it can eliminate the lack of work these employees have been putting in. If the employees acted in a more ethical way, the company would not be suffering in this scandal as they are now. 
Utilitarianism focuses on acting in a ethical way to achieve maximum happiness within a company. If more people are benefited and happy, then the ethical way to achieve the happiness has been maximized. A utilitarian would look at this case in an unethical way. Kobe Steel was simply " lazy" with the performance checks which made the employees feel good for not doing as much work, but still getting  paid for it, and the outcome was that over 500 firms were affected negatively by this, making this not achieve maximum happiness because more people felt  bad than good. 
Virtue Theory
The Virtue Theory focuses on the character traits in an ethical or non-ethical way. The character traits of these employees who did not perform the proper safety check and falsified data were not behaving in an ethical way which shows through with their selfishness, doing something that only benefited them because at the time they did not feel like following through with there job. They don't have proper working skills, and work ethic, and have no motivation to succeed because they brought their company to a massive scandal that has negatively affected many people. 

1 comment:

  1. Nice job explaining this ethical controversy. One key I would include in your action plan of your paper is a step by step process of an internal evaluating process so employees don't cost the company 40% of their stock next time. Be sure to reinforce the virtue theory characteristics you specify.