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Ethical issues in Business valuation

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Contents

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Ethics

Ethical issues in Marketing

Ethical issues in HRM

Ethical issues in Finance

Wal-Mart Case Study

Ethical Behaviour

Ethics are moral principles and values that govern the actions and decisions of an individual or group. In the marketing context, ethics is the

moral evaluation of marketing activities and

decisions as right or wrong.

Understanding Ethical Conduct

Individual Factors

Organisational Factors
Perceived Opportunity

Individual Factors

Perceived Opportunity

Organisational Factors

Resulting Ethical or Unethical Behaviour

Understanding Ethical Behaviour in Marketing Decisions

Individual Factors
When marketing managers face ethically

challenging situations and are unable to resolve them all alone, they experience ethical conflict,

though they make decisions in their everyday lives

based on their personal concepts of right or wrong.

Organizational Factors

Corporate culture refers to a set of values, beliefs,

goals, norms, etc., shared by its members and expressed in every day working through work

habits, and other activities.

Perceived Opportunity

Opportunity refers to a set of conditions perceived as favourable that limit barriers or provide rewards. Most managers in marketing do not

deliberately take advantage of every opportunity

for unethical conduct in their companies.

Marketing Related Ethical Issues

Ethical issue refers to some situation, problem, or opportunity that can be recognised and requires a person or organisation to select from among different actions that must be evaluated as right or wrong, or ethical or unethical.

Ethical Issues in Marketing

Marketing ethics: Marketers standards of conduct and moral values

Criticisms of the Competitive Marketing System

Marketing costs are too high The marketing system is inefficient Marketers and the business system collude and commit price-fixing Firms deliver poor product quality and service Consumers receive incomplete, false, and/or misleading information The marketing system produces health and safety hazards Marketers persuasively promote unwanted and unnecessary products to those who least need them

 Ethical Problems in Marketing Research

Alleged invasions of personal privacy Gathering marketing information in exchange for money or free offers
Ethical Problems in Product Strategy

Product quality Planned obsolescence Brand similarity Packaging

 Ethical Problems in Distribution Strategy

Determining the appropriate degree of control over a channel Determining whether a company should distribute its products in marginally profitable outlets that have no alternative source of supply
Ethical Problems in Pricing

Probably the most regulated aspect Most unethical pricing behavior is also illegal

 Ethical Problems in Promotional Strategy The source of the majority of ethical questions Ethically questionable personal selling
Gifts and bribes

Questionable advertising Promotion of questionable features (air bags) Questionable WWW related promotional practices

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Advertising Social/ Ethical and Legal Aspects

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Unethical Advertisement
Unethical advertising: is advertising which degrades or underestimates the substitute or the competitive products. It gives false promises or misleading information about the value of the product. It fails to give information about the side effects. It could be advertisements that are obscene or immoral. The usage of certain words as better, more, best, largest, tastiest, only can change a ethical advertisement into an unethical advertisement.

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Unethical advertising promises something that cannot be delivered like a fitness centre that advertises that the customers will loose 50 pounds per month with its program. On top of it the fitness centre says the weight loss is guaranteed. Quite plainly the fitness centre cant deliver that much of weight loss to every person who comes into his centre.

ADVERTISING ETHICS
There should not be any racial discrimination. For e.g.: Benetton

It should not hurt the sentiments of women. For e.g. Fair and lovely.

Contd.
It is morally wrong to use manipulative, exploitative , corrupting methods of persuasion and motivation For e.g. Nestle.

Contd.
The content of communication should be communicated honestly and properly.
More spending of money should be stopped.

Contd.
Advertisers are morally responsible for what they seek to move people to do. Advertising may not deliberately seek to deceive by what it says, what it implies or what it fails to say.

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Contd..
Advertisers should not promise which is impossible and cannot be delivered.
E.g. A fitness centre that advertises that the customers will loss of 50 pounds per month with its program. On top of it the fitness centre says the weight loss is guaranteed. Quite plainly the fitness centre cant deliver that much of weight loss to every person who comes into his centre.

CODE FOR COMMERCIAL ADVERTISING

Advertising shall be so designed as to conform to the laws of the country
No Advertisement shall be permitted which can hurt some ones emotions. No advertisement message shall in any way be presented as News.

Contd

No advertisement shall be permitted the objects whereof are wholly or mainly of a religious or political nature.

Contd.

Indecent, vulgar, suggestive, repulsive or offensive themes or treatment shall be avoided in all advertisements

GENERAL CODE
Criticism of friendly countries; attack on religions or communities; anything obscene or defamatory; incitement to violence or anything against maintenance of law and order; anything amounting to contempt of court; aspersions against the integrity of the President and Judiciary; anything affecting the integrity of the Nation; and Criticism by name of any person.

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Unethical Advertisement-Tag lines

Outside a bank Nobody likes a fat girl but everybody likes a girl with a fat bank balance. For a washing machine dont let washing clothes kill your pretty wife. Let our washing machine do that dirty job for you. Brochure of an office automation company Improve your secs (secretarys) life.

Some Examples of Unethical Advertisement

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Even big companies stoop to unethical advertising the famous examples can be.

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1. AP PL170
A.P Scooters came out in collaboration with Vespa with a scooter and they named it AP PL 170. The customers thought PL 170 meant Pay load 170. Later a lot of negative publicity was generated when the customers came to know that PL 170 does not stand for Pay load 170. PL 170 was just some fancy word work from the advertising agency.

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2. Activia Yogurt
Dannon's popular Activia brand yogurt lured consumers into paying more for its purported nutritional benefits -when it was actually pretty much the same as every other kind of yogurt. Falsely touting the "clinically" and "scientifically" proven nutritional benefits of the product, Dannon even got a famous spokesperson, Jamie Lee Curtis, for the supposed digestionregulator. But after a while, some customers didn't buy it.A class action settlement last year forced Dannon to pay up to $45 million in damages to the consumers that filed the lawsuit and others who said they'd been bamboozled. The company also had to limit its health claims on its products strictly to factual ones.

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3. Eclipse Breeze
Eclipse gum claimed that its new ingredient, magnolia bark extract, had germ-killing properties. Consumers sued Wrigley [in 2009] in federal court arguing the subsidiary of privately held Mars Inc. made misleading advertising claims about the germ-killing properties of Eclipse. As part of the settlement, Wrigley will change how it markets and labels its gum. It agreed to pay $6 million to $7 million to a fund that will reimburse consumers up to $10 each for the product and cover other costs of the settlement, according to the law firms Blood Hurst & O'Reardon and Robbins Geller Rudman & Dowd.

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4. Taco Bell's seasoned beef

When consumers raised questions about what was actually seasoning Taco Bell's seasoned beef, the company didn't know how to respond. It was simply using oat filler -- which means the meat isn't seasoned beef at all, according to USDA standards. The franchise had been tricking its consumers into thinking its products were of a higher grade than they actually were. Taco Bell took the opportunity to poke fun at itself, hoping to mitigate the PR disaster. The company even took out a full-page newspaper ad thanking complainants for suing. So far, so good. Taco Bell's proactivity and willingness to address the controversy have restored some faith in the fast food giant. The woman who started all the hullabaloo ultimately dismissed her lawsuit.

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5. Definity Eye Cream

In 2009, an Olay ad for its Definity eye cream showed former model Twiggy looking wrinkle-free -- and a whole lot younger than her years (she turns 62 next week). Turns out the ads were retouched. British lawmakers yanked digitally altered spots, citing not only a gross misrepresentation of products, but the ad's potentially negative impact on people's body images.

6.Hyundai and KIA vehicles' horsepower

Hundreds of car owners were extremely disappointed to find out that Hyundai and Kia overstated the horsepower in some of their vehicles. In 2001, the Korean Ministry of Construction and Transportation uncovered the misrepresentation, which for some models was as much as 9.6 percent more horsepower than the cars actually had. A class action lawsuit in southern California claimed the companies were able to sell more cars and charge more per vehicle because of the false claims. In the end, the auto powerhouses had to pay customers -- the settlement was estimated to be between $75 million and $125 million.

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7. Rice Krispies & Frosted Mini-Wheats

Kellogg's popular Rice Krispies cereal had a crisis in 2010 when it was accused of misleading consumers about its immunity boosting properties. The Federal Trade Commission ordered Kellogg to halt all advertising that claimed that the cereal improved a child's immunity with "25 percent Daily Value of Antioxidants and Nutrients -- Vitamins A, B, C and E," stating the the claims were "dubious." Just a year prior, the company settled with the FTC over charges that its Frosted MiniWheats cereal didn't live up to its ads. The campaign claimed that the cereal improved kids' attentiveness by nearly 20%, and was shot down when the FTC found out that the clinical studies showed that only 1-in-9 kids had that kind of improvement -- and half the kids weren't affected at all.

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8. Splenda
The Sugar Association says Splenda's "Made from Sugar" slogan is misleading, and that the sweetner is nothing more than "highly processed chemical compound made in a factory," reports CBS. In 2008, the association first filed a suit against Johnson & Johnson subsidiary McNeil Nutritionals, which then countersued the association engaging in a "malicious smear campaign." The two parties reached a confidential settlement before going to trial. Equal also took its rival to court in 2007, accusing "the makers of Splenda of confusing consumers into thinking its product was healthier and more natural than other artificial sweeteners." The two parties also reached a confidential settlement.

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9. A New Balance
A New Balance sneaker that reportedly helped users burn calories were called out when studies did not find any boosted health benefits from wearing the shoe. The toning sneaker, claimed to use hidden board technology, were advertised as calorie burners that activated the glutes, quads, hamstrings and calves. Plaintiffs discovered that the shoe was instead an injury hazard, without any secret technology, and are seeking $5 million in compensation. The sneakers cost about $100.

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10.Classmates.com
Millions of people lit up when Classmates.com sent them an email saying old friends were trying to contact them, promising to rekindle old friendships and flames if subscribers upgraded to a "Gold" membership.
But even with an upgrade, the expected reunions never came. Turns out the social networking site used the ploy to get users to pony up extra dollars. In 2008, one miffed user filed suit alleging the "deceptive" emails were false advertising. He eventually bested the website, which agreed to pay out a $9.5 million settlement -- $3 for every subscriber who fell for the dirty trick -- to resolve the case.

Unethical Advertisement

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Ethical Issues in Human Resource Management

Outline
Ethics, Morality and Values Nature of Ethics Sources of Business Ethics Law Vs Ethics Conflicts of Law and Ethics Importance of ethics Ethical Dilemmas - Its sources HR ethical issues Managing Ethics Ethical decision making

Ethics, Morality and Values

Ethics is the study of morality Morals are the standards used to judge right and wrong Values are the degree of conviction about the way to conduct life

Nature of Ethics
Two theories are relevant in the context of the nature of ethics: 1. The Theory of moral unity
Business should be judged by ethical standards of the society There is only one set of ethical standards for both society and businesses Business can be amoral The market mechanism automatically works for the benefit of the society

2. The theory of amorality

Sources of Business Ethics

Religion Culture Law

Idea of Reciprocity or mutual help

Reciprocal actions can help explain the maintenance of social norms

Law Vs Ethics

Conflicts of Law and Ethics

Example: Legal but unethical?

Jim Crow laws that required discrimination against Black Americans

Example: Ethical but illegal?

Provide service in violation of Jim Crow laws to a Black American in a restaurant

Laws in Nazi Germany that contributed to the holocaust

Help a holocaust victim escape from Nazi Germany

Importance of ethics
If you have integrity, nothing else matters. If you don't have integrity, nothing else matters. - Alan K. Simpson

Ethics is very basic to mankind Values create credibility with the public Values create credibility with the employees Considered important for companies striving for long-term success and growth.
"Not only is ethical behaviour in business life the right thing to do in principle, we have shown that it pays off in financial returns. - Philippa Foster Black, The Director, The Institute of Business Ethics (IBE),

Ethical Dilemmas - Its sources

situations in which they are required to define right or wrong conduct These ethical dilemmas arise from three sources Face to Face Ethics Corporate policy Ethics Functional area Ethics

HR ethical issues
Race, Gender, Age and Disability Performance Appraisal

Job Discrimination

Privacy Issues

Cash & Incentive plans

Safety and Health Care

Employee Responsibility

Ethical Issues

Restructuring Layoffs

Managing Ethics
Top Management Code of Ethics

Ethics and Law

Ethical decision making

Moral Idealism Intuitionism

Utilitarianism
Ethical perfection is illusionary Seek advice of an intelligent person

Commit oneself publicly to ethics

Evaluate pros and cons

Act before problems occur

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Ethics in Finance

Overview
Introduction Ethics in Financial Services Ethics in Financial Markets Insider Trading Hostile Takeovers Accounting Ethics Conclusion

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Ethics?
Ethics represents the attempt to resolve the conflict between selfishness and selflessness; between our material needs and our conscience. -Demsey A business that makes nothing but money is a poor kind of business. -Henry Ford

Introduction
Principal-agent model of relationship in financial transactions. Modern capitalist system based on rational-maximizer paradigm# Individuals are self seeking. # Seek to maximize own interest.

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Introduction
Behavioral assumption for modern financial- economic theory runs counter to ideas ofTrustworthiness Loyalty Fidelity Stewardship Concern for others

Ethics in Financial Services

Deception Withholding of relevant information or

giving false or misleading information

What is deceptive? Choices of what and how much to disclose?

Ethics in Financial Services

Churning Breach of fiduciary duty How much trading is excessive? Solutions??

Ethics in Financial Markets

Fairness is important Fraud and Manipulation
Investors depend upon issuer of information Transparency requirements

Ethics in Financial Markets

Fairness in markets Equal Information Encourage acquiring all information possible `Legitimacy play by the rules Equal Access Equal Bargaining Power Efficient Pricing

Insider Trading
Trading of stock or securities by individual with potential access to non-public information about the company Insiders when buys or sells based upon company owned information, violates the contract with shareholders There are legal insider trading and illegal insider trading

Hostile Takeovers
Corporate takeover which is carried out against the wishes of the board of the target company. Original company may be entirely swallowed up or may operate semiindependently.

Accounting Ethics
Nature of work of accountants require high level of ethics. Accounting concepts and conventions- GAAP

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Accounting Ethics
Preparation of financial statements. Keeping management aware of present conditions and future estimations. Confidentiality of organizations financial position

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Conclusion
Financial ethics depends on a complex interlay of FM ,industry leadership and individuals personal integrity. It makes the companys activities more legal and policies more social. As consumers we must be aware and cautious about the individuals and corporations who manage our money.

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Ethical Concerns in Business

Ethics

Whether men understand it or not, they are impelled by that power behind to become unselfish. That is the foundation of morality. It is quintessence of all ethics, preached in any language or any religion, or by any prophet in the world. Be thou unselfish, Not I, but Thou that is the background of ethical codes.

- Swami Vivekananda

Ethics.
Crucially important that our thoughts and actions be governed by ethical values and habits. Basis of ethics is to become more and more self less.

Knowledge of the importance of virtue does not deter people from moving to the evil side of things. This is the illusion covering the consciousness of man, says the Vedanta.

Ethics and Success

Try not to become a man of success but rather try to become a man of value.

Albert Einstein 1879-1955

Gandhi on Entrepreneurial Ethics

Truthfulness in conduct of business is reflective of image of the Nation. Seven Social Sins:

Politics without Principles Wealth without Work Commerce without Morality Knowledge without Character Pleasure without Conscience Science without Humanity Worship without Sacrifice

Need for Ethics

Social Contract Guidance to operate business, professions

Business Ethics is the set of principles or reasons to govern the conduct of business at individual or collective level by the application of ethical reasoning to specific business situations and activities

Being Ethical
Awareness of

Need to comply with rules, laws of the land, customs and expectations of the society, the principles of morality, policies of organization or institution, general concerns for others and fairness How the products and services of an organization or institution and the actions of its members, can affect its employees, the community and society as a whole, either positively or negatively.

Ethical Dilemmas
Many issues seems straight forward and easy to resolve but are not always true Making choices amongst alternatives Questions between right and wrong

Conflict between right and right

Benefits of Ethics
Improved society Maintain moral course in turbulent times Cultivate strong team work and productivity Supports employee growth Ensuring policies are legal Avoiding criminal acts of omission and lowering fines Managing values of quality, strategic planning and diversity Strong public image

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UNETHICAL BUSINESS PRACTICES

Case Study of Wal Mart Stores Inc.,U.S.

ETHICAL BUSINESS CALL OF TODAY

There is a need do business with an open eye, continuously measuring & evaluating the consequences & impact of actions taken . This obligation is seen to extend beyond the statutory obligation to comply with legislation and seeing organizations voluntarily taking further steps to improve the quality of life for employees and their families as well as for the local community and society at large.

SURVIVAL IS FOR ONLY ETHICAL ORGANISATIONS

The companies that survive are the ones that can spot ethical issues and correct them before they become problems .

GIANT MONSTER OF US ECONOMY EATING THE DREAMS OF PEOPLE

WAL-MART
The first true Wal-Mart opened in 1962 in Rogers, Arkansas. Wal-Mart eventually became the world's largest retailer

Company profile and history

The Wal-Mart story began in 1962, when Sam Walton opened the companys first discount store in Rogers, Ark. Five years later, there were 24 Wal-Mart stores in Arkansas ringing up $12.6 million in sales. 1968 saw the hiring of Wal-Mart Aviations first full-pilot, who provided help to Sam and Bud Walton, as well as the opening of the first stores outside of Arkansas, in Sikeston, Mo., and Claremore, Okla.

 The company officially incorporated as WalMart Stores Inc. on October 31, 1969. Today, 7,390 Wal-Mart stores and Sams Club locations in 14 markets employ more than 2 million associates, serving more than 200 million customers per year.

 Sam Walton. Walton was an entrepreneur with an innovative vision, started his own company and made it into the leader in discount retailing that it is today. In fact, Wal-Mart is considered to be the biggest company in the U.S. and it has stores worldwide .

The Wal-mart culture rests upon 3 basic beliefs which are: Respect for the Individual Service to customer

Striving for excellence

Wal-Mart employs more people than any other company in the United States outside of the Federal government, yet the majority of its employees with children live below the poverty line.

In addition, Wal-Mart likes to portray itself as a seller of U.S. manufactured goods but in reality the company has products on its shelves made in foreign countries and at questionable workshops.

 It would seem that Wal-Mart encourages made in the USA but it really encourages products made outside the USA. As a result, Wal-Mart has forced many manufacturers out of business. As a matter of fact, this big giant is facing a significant amount of controversy for unethical business practices. In fact, some of these unethical business practices include the following.

GIANT UNETHICAL CORPORATION OF AMERICA

UNETHICAL PRACTICES OF WAL-MART

Open door policy as against labor union
Wal-Mart is a non union organization that feels it does not need third party intervention. So, Instead of unions, Wal-Mart has an open door policy that encourages employees to take their complaints beyond management.

 According to this policy the door of the management is always open for the associates to share suggestions, ideas, and voice concerns. Whether its help with a problem, guidance or direction, or simply getting an answer to a question. Managers also treat all discussions fairly, with an open mind, and without bias. They maintain complete confidentially, whenever its possible. They work with the associates to mutually resolve any issues or

Analysis of open door policy: 1)The open door policy does little to help its

employees but gives the business the leverage it needs to terminate unwanted non compliant help. 2) Employees start out at lower wages than unionized corporations and end up quitting by the end of the first year. 3) Its anti-union policy is a central part of its obsession with minimising costs. 4) Wal-Mart provides managers with its infamous Managers Toolbox to Remaining Union Free that states: Staying union free is a full time commitment. Unless union prevention is a goal equal to other goals and objectives in the organization, management will not devote the necessary day in, day out attention and effort. If there is any evidence of moves towards unionisation, managers are ordered to phone the Wal-Mart Union Hotline immediately.

Un Ethical And Aggressive policies of Wal-Mart

 Wal-Mart engages in unit packing and other tactics to prevent organizing efforts. When workers have successfully organized, Wal-Mart has refused to bargain, or has shut down stores and units where workers have organized. Wal-Mart also prohibits employees from talking to union representatives. It is unethical for Wal-Mart to prohibit employees to talk to union representatives since according to the National Labor Relations Act; employers are not allowed to discourage employees from forming a union for they have that right.

Violated Federal Labor Law By "Bribing" Employees To Report On Coworkers Who Favored A Union.
. Therefore, the United Food and Commercial Workers Union filed a complaint with the National Labor Relations Board against Wal-Mart. The complaint, filed with the National Labor Relations Board, alleges that Wal-Mart violated federal labor

law by "bribing. employees to report on co-workers who favored a union.

and websites to influence public opinion against WalMart, including Wake up Wal-Mart (United Food and Commercial Workers) and Wal-Mart Watch (Service Employees International Union). But Wal-Mart denied
the charges that were brought against the company.

In 2005, labor unions also created new organizations

 Thus, Wal-Mart is wrong by bribing employees for it encourages dishonest behavior. If Wal-Mart wants to avoid a hearing or a lawsuit in this situation, they need to post notices saying the retailer will not oppose employees talking to union representatives. In addition, if Wal-Mart takes more seriously the employees complaints, it might encourage them not to unionize.

Unfair Treatment of Employees:

Wage And Hour Violations : Not only does the company have a history of methodically violating workers right to join a union, the Wal-Mart record on worker rights is a laundry list of abuse. Wal-Mart has racked up a striking number of wage and hour violations.

 Decreased health care coverage: Wal-Mart has decreased health care coverage to employees while touting its commitment to offering affordable care. Evidence suggests that Wal-Mart may have even adopted a strategy of eliminating long both as measures to reduce payroll and health care costs.

time workers and discouraging overweight or otherwise unhealthy workers from applying

Violations Of Child Labor Laws

One internal audit of 25,000 employees in 128 Wal-Mart stores in the USA found 1,371 violations of child labor laws, including minors working too late, too many hours a day and during school hours.

Wal-Mart is proving to be a nation and future breaker by violating the child labor laws
and spoiling the future of the children to enrich themselves, ignoring seniority.

According to Newsweek magazine

Denial to pay wages and salaries: The Bentonville-based multinational employs thousands of young people to pack its customers' bags. But the 4,300 young teenagers don't receive any pay from Wal-Mart. Wal-Marts model is fast becoming the industry standard, as other firms slash employee wages and benefits in an attempt to compete with the retail giant .

Reasoning given by Wal-Mart: So, Wal-Mart succeeds to defend its position as the undisputed leader of the pack when it comes to violating fundamental workers' rights

Payment of low wages: Wal-Mart pays low wages and appears to aggressively seeks to keep wages down

UNETHICAL PRACTICES OF WALMART

.

Gender Discrimination The company faces the largest gender discrimination case in the history of this country. Discriminatory policies are as follows: 1. Denied Training: Women had been denied training and promotion opportunities that are offered to men. 2. Under payment: women are underpaid in relation to men. According to Hoovers handbook of American business, in June 2001 a group of six current and former female Wal-Mart employees filed a sex discrimination lawsuit (seeking to represent up to 500,000 current and former Wal-Mart workers) against the company . The suit was filed because Wal- Mart failed to provide equal employment for women.

Gender Discrimination
Less Managerial positions to women: In fact, there are over 70 percent of women working at Wal-Mart, but only a small amount of those women are managers. So, men are holding more management positions than women. Less dignity and respect to women: WalMart is the nation's largest employer of women, but unfortunately they are being treated without dignity and respect."

Expensive Health Insurance

Wal-Marts health insurance is so expensive that some of

the employees can not even afford to pay for it.

So, those employees who couldnt afford the health plan will probably have to get their health care benefits through their spouses or the state from our tax dollars. Wal-Mart responded to this problem by offering discounts on health care coverage. Members can save as much as 50% on services not normally covered by medical insurance. Discounts are not enough. Wal-Mart still has a moral responsibility to provide

affordable health care to its employees not shift the cost onto the American taxpayers. Wal-Mart can also raise employees wages so they can afford to pay for their health plan.

No Over Time /Wages not in proportion to Work

While wages are low at Wal-Mart, too often employees didnt get paid at all for overtime. In fact, according to Wal-Marts policy, they are supposed to pay employees for every minute they work. But, since Wal-Mart is such a big company, there will be cases in which managers might do unethical things. For instance, employees were forced to work unpaid overtime. As a result, they filed a suit against WalMart for not getting paid for overtime. So in February 2004, a federal judge ruled that Wal-Mart should pay workers for overtime hours .But, the case is still pending. In fact Wal-Mart claimed their policy is against such work. So Wal-Marts managers who required overtime were disciplined and fired. In fact, it is Wal-Marts responsibility to make sure that people get paid. They should settle the suit by paying their employees for unpaid overtime. It seems that Wal-Mart needs to periodically examine its pay practices to make sure that all employees are getting paid for all the hours worked.

Sufferings below the low Cost Offerings to the public

Wal-Mart is leading the race to the bottom by relentlessly squeezing cost efficiencies out of the supply chain. Wal-Mart frequently requires its suppliers to open their books for Wal-Mart inspection and tells them exactly where to cut costs. When national labour or environmental standards create a barrier to cost cutting, suppliers are encouraged to relocate to a labour market that will enable them to produce at the low price Wal-Mart requires. Even where wages are rockbottom, Wal-Mart insists that its suppliers drive prices ever lower. To do this lot of unethical activities crop in to come on to the lowest cost ,lot of people in the supply chain suffer because of this cost cutting drive

Use Of Illegal Migrants As Workers

Finally, Wal-Mart was under investigation for the use of illegal immigrants as workers. In fact, in October 2003 federal agents uncovered 300 illegal immigrants employed by outside contractors cleaning its stores. As a result, the company became the target of a class action suit. So, Wal-Mart was accused of breaking immigration laws. In addition, Wal-Mart cheated immigrant on account of low wages social security payments, federal payroll taxes. Contractual employments No security of tenure No payments for over time. Immigration experts said the arrests of so many illegal immigrants at Wal-Marts across the country demonstrated that these workers have come to play a significant role in the American economy. They often take the low-end, low-paying jobs shunned by not just American workers, but also legal immigrants. But, WalMart claimed they hired those particular

REPORTINGS BY EMPLOYEES
I hate wall-mart I worked there 3 years and saw many bad practices. The final straw that made me quit was the fact that I was a full time department manager, yet only was getting 16-22 hours a week!!! When I asked why my hours where being cut they told me it was due to a lack of busness.HELLO you are WAL-MART a short drop in sales should not lead to me and my family being broke. get things together wall-mart if you would actually pay your workers enough to live maybe you would save money in the 'loss prevention' department because your workers wont have to steal from you to make ends meat!!! Mike Bismarck, Arkansas U.S.A

WALMART INJURY DEVELOPED CANCER - WALMART DOES NOT CARE *Rebuttals *Consumer
Suggestion ex-employee

In a unfortunate incident an employee was hurt and compensation was asked but was completely denied and the small wound was converted into cancer because she was poor and couldn't afford medical treatment. So in wall mart employees are not treated as a part of the family and business and have no values in the eyes of management and board as was reported by the ex-employee.

Success of Wal-Mart in question

The sentiment behind Wal-Mart founder Sam Walton's promise of a "better life for all" belies questionable business practices - many that have been challenged by employees, unions, environmentalists, recording artists and human rights organizations. All these challenges should be met and it should learn lessons from their mistakes.

Conclusions:
The companies that survive are the ones that can spot ethical issues and correct them before they become problems. In this case Wal-Mart failed to acknowledge those potential problems and they are probably going to pay for it. Thus, Wal-Marts unethical business practices have hurt its companys reputation. If Wal-Mart wants to survive they will have to try hard to improve their image. That is, they need to show that they care about ethics by treating employees fairly. As a result, it will attract good employees and people will have no reason to complain about the company. In addition Wal-Mart needs to be socially responsible in order to avoid economic harm and in order to maintain the legitimacy granted by society.

Conclusions:
As Wal-Mart is not just a threat to the standard of living of its own employees. It damages the standard of living of numerous others in the economy. In some cases, it forces the closure of better paying firms. Business Week estimates for every WM supercenter that opens, two other supermarkets will close.

We will hail Wal-Mart if it hails the society at large

There should not be any compromise on ethics and socially responsible behaviour,as it is giving back to the society, other wise its survival will be in

Say no to unethical practices

Wal-Mart's immoral, predatory practices and reprehensible behavior has to be mended which is essential for the survival of Wal-Mart