Group Exercise

The one of those ten actions about ethical behaviour which i want to discuss is " In order to reduce its production costs, a sportswear business moves production of its trainers to a country that employs child labour."

From the company's point of view, this is an efficient way to reduce the cost, the company will benefit from the increase of profit. However, this is unethical behaviour, it causes negative externalises (external costs), they are costs imposed on society by the company, and government have to pay the costs, which means the company fails to pay for the full cost of its action( employing child labour) and mike private profit at the cost of social welfare.

Employing child labour is not only unethical, but illegal. The company will lose its environmental responsibility by employing child labour because of the bad reputation for damaging the environment. That means it can have adverse effects on employees' perceptions of firm and its products, leading to a demotivate workforce and adversely affecting the ability of the company to attract high quality applicants. Also, there's the pressure group that might impeach the company with employing child labour and it is against the law, maybe the company will be closed down bu the government, this is very bad to the company's overall reputation and performance.