Bài tậpmôn đạo đức kinh doanhcase 19 mattel responds to ethicalchallenges

TRƯỜNG ĐẠI HỌC KINH TẾ QUỐC DÂN VIỆN ĐÀO TẠO TIÊN TIẾN , CHẤT LƯỢNG CAO VÀ POHE _ _ BÀI TẬP Môn: Đạo đức kinh doanh CASE 19: MATTEL RESPONDS TO ETHICAL CHALLENGES Sinh viên thực hiện: Mã sinh viên: Chuyên ngành: Lớp: Giáo viên h ướ ng dẫẫn: Nguyêẫn Như Ngọc 11214350 Kinh doanh quốốc têố clc 63D Nguyêẫn Bích Ngọc Hà Nội – 2022 Table of Contents A SUMMARY I INTRODUCTION II COMPANY HISTORY III MATTEL’S COMMITMENT TO ETHICS AND SOCIAL RESPONSIBILITY IV MATTEL’S RESPONSE TO ETHICAL CHALLENGES V CONCLUSION B QUESTION This is a preview Do you want full access? Go Premium and unlock all 13 pages A SUMMARY I INTRODUCTION Access to all documents Mattel, Inc is a global leader in designing and manufacturing toys and family products Well-known for brands as Barbie, Fisher-Price, Disney, Hot Wheels, Get such Unlimited Downloads Matchbox, Cabbage Patch Dolls, and board games, the company boasts nearly $ 6.27 billion in annual revenue Headquartered in El Segundo, California, with Improve your grades offices across the world, Mattel markets its products in over 150 countries Being a multinational company majoring in the sale of children's toys, the company is easily plagued with various ethical challenges that are associated with Upload the company’s products at various levels of the supply chain Share your documents to unlock Despite having faced a series of difficult and potentially crippling challenges, the company still handled it well After those tough times, Mattel still looks toward the future and appears to be steadfast in its commitment to restoring its reputation Free Trial II COMPANY HISTORY Get 30 days of free Premium It all began in a California garage workshop when Ruth and Elliot Handler and Matt Matson founded Mattel in 1945 The company started out making picture frames, but the founders soon recognized the profitability of the toy industry and changed their emphasis to toys Mattel became a publicly owned company in 1960, Already Premium? Log in with sales exceeding $ 100 million by 1965 Over the next forty years, Mattel went on to become the world’s largest toy company in terms of revenue Barbie and American girl In 1959, Mattel introduced a product that changed its future forever: the Barbie doll After one of the founders had noticed how her daughter loved playing with paper cutout dolls, she decided to create dolls based on an adult rather than on a baby Barbie has had 40 different nationalities and many outfits made by 75 different fashion designers throughout the years The popularity of Barbie allowed Mattel to introduce many different versions of the iconic doll Apart from manufacturing dolls for children, Mattel often releases limited edition dolls at a more expensive price geared toward adult collectors Barbie took off to become one of Mattel’s critical product lines and the number one girls’ brand in the world Annual sales of Barbie net approximately $ billion, and one doll is sold approximately every seconds The Barbie line today includes dolls, accessories, Barbie software, and a broad assortment of licensed products such as books, apparel, food, home furnishings, home electronics, and movies Hot Wheel Hot Wheels roared into the toy world in 1968 Co-founder Elliot Handler recognized the potential demand for die-cast cars among boys and decided to create a toy to compete with British company Lesney’s Matchbox toys Much like Barbie, the brand is hotter than ever and includes high-end collectibles, NASCAR (National Association for Stock Car Auto Racing) and Formula One models for adults, high-performance cars, track sets, and play sets for children of all ages It is even connected with racing circuits wolrdwide and have a huge amount of adult collectors As reported, more than 15 million boys aged five to 15 are avid collectors, each owning forty-one cars on average; and 1,550 cars on average for adults Two Hot Wheels cars are sold every second of every day, and annual sales total approximately $ billion The brand began with cars designed to run on a track and evolved into a “lifestyle” brand with licensed Hot Wheels shirts, caps, lunch boxes, backpacks, and more Cabbage Patch Kids Since the introduction of mass-produced Cabbage Patch Kids in 1982, more than 90 million dolls have been sold worldwide Although new line of product, called Snacktime Kids was expectd to meet with immense success, the product backfired due to reports of children getting into troubles by its new feature Fortunately, Mattel effectively handled the situation that could easily have created bad publicity or a crisis and finally stopped producing Cabbage Patch Kids in 2000 III MATTEL’S COMMITMENT TO ETHICS AND SOCIAL RESPONSIBILITY Because the company’s products are designed mainly for children, sometimes it must be sensitive to social concerns about children’s rights Recognizing these potential issues, Mattel takes steps to strengthen its commitment to business ethics Not only that, the company also purports to take a stand on social responsibility, encouraging its employees and consumers to the same Privacy and marketing technology Respect for privacy could be noticed in the company’s online marketing policy because Mattel has repeatedly addressed children’s privacy with regard to the use of technology in marketing their products The business understands that it must consult with parents about its corporate marketing plan since it markets to their children, so Mattel has taken steps to inform both children and adults about its philosophy regarding Internetbased marketing tools, such as the Hot Wheels website In 2013, Mattel updated their website's privacy to make it more detailed; and even developed answers for the most frequently asked Internet privacy questions to increase understanding By assuring parents their children’s privacy is respected, Mattel demonstrates that it takes its responsibility of marketing to children seriously Legal and ethical business practices Mattel, Inc makes a serious commitment to business ethics in manufacturing itself and in its dealings with other industries as well As a testament to that, in the late 1997, the company conducted its first full ethics audit of each of its manufacturing sites as well as the facilities of its primary contractors Now, an independent monitoring council audit in manufacturing facilities still is conducted every three years Moreover, Mattel instituted a code of conduct titled Global Manufacturing Principles in 1997, as an effort to continue its strong record on human rights and related ethical standards These principles require all Mattel-owned and contracted manufacturing facilities to favor business partners committed to ethical standards comparable with those of Mattel and other principles relate to safety, wages, and adherence to local laws Mattel’s concern for relationships between and with employee and business partners is also a bright spot of the company It cares deeply about increasing its employees’ skill sets and providing opportunities to excel, that gives it more This is a preview Do you want full access? Go Premium and unlock all 13 pages productivity and opportunities The company’s code is a signal to potential partners, customers, and other stakeholders that Mattel made a commitment to fostering and upholding ethical values,to and and encouraging responsible Access allcreating documents business practices throughout the world Get Unlimited Downloads Expectations of Mattel business partners Mattel prefers to partner withImprove businesses similarly committed to high ethical your grades standards; which must comply with the local and national laws of the countries where they operate, respect the intellectual property of the company, and support Mattel in the protection of assets such as patents, trademarks, or copyrights They should be responsible for product safety and quality, protecting the environment, Upload customs, evaluation and monitoring, and compliance Share your documents to unlock Mattel’s business partners must have high standards for product safety and quality, adhering to practices that meet Mattel’s safety and quality standards In their assistance to compliance, Mattel maintains that all manufacturing facilities should provide explicit access for on-site inspection by either a party assigned by Mattel Free Trial or by Mattel itself Besides, quality assurance requires that such partners should 30 days of free Premium give full access to records andGet annual compliance statement Mattel having created an independent monitoring body (MIMCO) emerged to have positive global branding The company expects to keep this body for continuous checks and balances for achievement of high standard products If some elements Already Premium? Log in of quality and standard products are not being met by a partner, Mattel is ready to work with them so that they fix the problem together This is an indication of team work However, the business will be broken if the partner does not observe recommended corrective measures, and this is recognized as party of business improvement process Philanthropy and Community Development It can be deduced that Mattel values philanthropy and community development through the children foundation Established in 1978, through the Mattel Children’s Foundation, the company encourage its employees to support children in need through personal contributions that runs on annual basis Funding priorities include building a new Mattel Children’s Hospital at the University of California, Los Angeles (UCLA), sustaining the Mattel Family Learning Program, and promoting giving among Mattel employees In November 1998, Mattel donated a multiyear, $ 25 million gift to the UCLA Children’s Hospital; and the Mattel Family Learning Program uses computer learning labs as a way to advance children’s basic skills, that offer software and technology designed to help children with special needs or limited English proficiency International manufacturing principles As a U.S.-based multinational company owning and operating facilities and contracting worldwide, the company’s Global Manufacturing Principles reflects the company respects cultural, philosophical, and ethical differences of the countries of their operation These principles also set uniform standards on the company’s manufacturers hencebenefiting both consumers and employees Mattel’s principles cover issues such as wages, work hours, child labor, forced labor, discrimination, freedom of association, and working conditions Mattel refuses to work with facilities using forced or prison labor, or use these types of labor itself The company respects employees’ rights, beliefs, and provides safe working environment to all employees IV MATTEL’S RESPONSE TO ETHICAL CHALLENGES Unethical Behaviors in the Case Despite Mattel’s best efforts, not all overseas manufacturers faithfully adhere to its high standards There was a recall of toys by this company in 2007 due to discovery of lead on their surface by a European retailer When this problem was traced, it was found that the company’s manufacturer in China, Lee Der was responsible for the mess, that rising labor and raw material costs and the resulting pressure it created likely caused manufacturers to cut corners in order to save money An estimate of 10million personal toys produced in this country was affected Eventually, an estimate of 10million personal toys produced in this country was affected, and Zhang Shuhong, operator of Lee Der, himself after paying his 5,000 staff members In a separate incidence later that month, Mattel was compelled to recall many toys because of powerful magnets, which could easily come loose and expose a choking hazard to young children In this regard, it was reasoned that swallowing of one magnet can attract more magnets in the child’s stomach, thus causing fatal complication Hence, this led to several parents filling lawsuits that the toys harmed their children and over 21 million Mattel’s toys were recalled this time Responsible people in the Unethical Behavior in the case There are three broad players that could be blamed for the unethical behavior in case These are the Chinese government, Mattel’s business partner, and Mattel Inc The company’s manufacturer in China, Lee Der, could be held responsible for the lead paint issue This is due to the fact that they knew very well how Mattel prohibits contracting third party suppliers but defied this and went ahead to be involved with a contractor, which supplied lead-tainted paint hence leading to the whole problem Lee Der Company seems to have committed this mistake knowingly on the basis of cutting costs associated with rising costs of labor and raw material Thus, responsible people in this case were procurement manager and human resource manager as well as top level managers of Lee Der Inc On the other hand, with regard to lead paint that was discovered on the toy surface, and loose magnet, the Mattel Inc could be held responsible for failing to implement effective inspection and monitoring in the entire supply chain In response to the claims, it could be noted that Mattel had poor product design and supervision on product quality Thus, Mattel’s design engineers and quality assurance managers should be held responsible for this The government of China is held responsible for the unethical behavior given that they failed to properly protect citizens Thus, in their bid to strengthen supervision of export goods, it suggests that her international trade minister contributed to not only the lead issue but also the loosemagnet problem in the toys Intellectual property right battle with former employee and MGA Carter Bryant, an on-again/off-again Mattel employee, designed the Bratz dolls and pitched them to MGA while employed with Mattel After two years of investigation, Mattel sued Bryant A year later MGA fired off a suit of its own, This is a preview Do you want full access? Go Premium and unlock all 13 pages claiming Mattel created Barbies with looks similar to those of Bratz in an effort to eliminate the competition Mattel answered by expanding its own suit to include MGA and its CEO, Isaac Larian ycle to Four after the initial suit was filed, Access all years documents Bryant settled with Mattel under an undisclosed set of terms In July 2008, a jury deemed MGA and its CEO liable what it termed “intentional interference” Get for Unlimited Downloads regarding Bryant’s contract with Mattel In December 2008, Mattel won another victory when a California judge bannedyour MGAgrades from issuing or selling any more Improve Bratz dolls In April 2011, a California federal jury rejected Mattel’s claims to ownership of Bryant’s ideas under the contract he had with the company In another blow to Mattel, the jury ruled the company stole trade secrets from Upload MGA, that Mattel employees used fake business cards to get into MGA showrooms during toy fairs; and MGA CEO Isaac Larian also announced he was Share your documents to unlock filing an antitrust case against Mattel Although the antitrust suit against Mattel was dismissed, and in January 2013 the U.S Court of Appeals overturned MGA’s victory over Mattel concerning the theft of trade secrets However, the court maintains Mattel is responsible for paying MGA’s legal fines totaling $ 137.2 Free Trialto contest this issue in court again million MGA CEO Isaac Larian is determined Get 30 days of free Premium in the near future V CONCLUSION Although the company faced a seriesPremium? of difficult and potentially crippling Already Log in challenges, including the lawsuits with MGA regarding ownership of the Bratz dolls due to poorly handling affairs, the company still has some core values and it is attempting to rectify its mistakes and to prevent future mistakes as well Maybe it is hard at work restoring goodwill and faith in its brands, even Mattel continues to be plagued with residual distrust over the lead paint scandal and its alleged theft of trade secrets but Mattel appears to be steadfast in its commitment to restoring its reputation B QUESTION Q1: Do manufacturers of products for children have special obligations to consumers and society? If so, what are these responsibilities? Customer protection and product responsibility are core issues when discussing the manufacturing industry In the profoundly aggressive business, corporate social obligation (CSR) concentrates on making the organizations in charge of their exercises on investors, providers, clients, workers, groups and condition all in all, it assumes a noteworthy part in building an expansive client base, so manufacturing companies must acknowledge and understand the expected compliance regulations in manufacturing products and their obligations to consumers and society Some of these obligations of the producers towards kids are: The safety and quality of the product: children are the most vulnerable citizens During the hour of playing, they tend to lick the toys, toss the toys, and open their parts; so it’s necessary for the manufacturers to satisfy the worldwide legitimate guidelines for security during the assembling and planning of the toys They ought not to utilize hazardous mechanical assembly in the toys with the goal that the youngsters would not be hurt by these risky instruments and types of gear of toys, just as not utilize unsafe synthetics, electronic wires They should all of the injurious chemical and toxic substamce such as lead paint while producing merchandise as well It is responsibility of them to ensure that no damage is made Confidentiality of customer: Manufacturers should not just make safe toys, but they should also be aware of societal concerns about children's rights and privacy because the toy manufacturer products are also sold online Normally online marketers use cookies and other means to track consumers online, to collect customer data and analyze it for product marketing purpose And those informations may be wrongly used to harass children So all companies should be clear in informing their privacy policy and philosophy regarding Internet-based marketing tools They have to reassure the parents or caregivers that the information collected about the children would not be used wrongly such as commiting not collect online information from children under the age of 13 without parental consent; trade, share or sell any pertional data, etc 10 Promoting cultural and educational activities: Not only does a toy manufacturer have a responsibility to make its products as safe as possible, but it must also be constantly aware that childhood play is a formative experience, an important part of growing up and helps kid learn about their identities and where they fit in the world In another word, each toy must contribute to the positive psychological development of children into civil, successful adults The toy makers should create toys with messages that promote positivity through affirmations that build confidence and self-esteem, or form children's perception of the world For instance, there are dolls that come in a variety of skin tones, hair color, gender or shape to eliminate kid’s perceptions of gender stereotypes and self worth In addition, nowadays toys are sold all over the world so they should also be sensitive to cultutal aspects To illustrate, the girl dolls sold in religion Islam countries expected to cover their hair and even their body fully and no part of their anatomy should be seen in public Sustainability and environment: Manufacturers are one of the main sources of environmental pollution, by mismanagement of waste products or dangerous chemical exposure, so they have a crucial role to play To conserve precious natural resources, and minimize damage both internally and externally to the business, toy companies should invest in alternative energy sources to create toys, minimize releasing toxic chemicals to the environment or hold more programs that allow consumers to collect and send in their used toys to be recycled into reusable raw material, which can be used to make new products Moreover, the firms have to follow all the regulations and laws, safety and health standards for keeping the employee safe and incident and risk-free Community service: As the manufacturers make huge profits just by selling their products, they give back a part to society by providing community service such as free education, donations for uplifting the weaker sections of the society Being in the toy industry that its main target is children, manufacturers should make more charitable investments to better lives of children in need, such as building schools, hospitals; or participating in a wide range of volunteer activities 11 This is a preview Do you want full access? Go Premium and unlock all 13 pages Q2: How effective has Mattel been at encouraging ethical and legal conduct by its manufacturers? What changes and additions would you make to the company's Global Manufacturing AccessPrinciples? to all documents Mattel has performed an excellent job of promoting moral and lawful behavior For Get Unlimited Downloads global manufacturers and subcontractors, it has created its Global Manufacturing Principles These ethical behaviors cover a range of topics, such as nonImprove your grades discrimination policies, forced labor, working hours and wages, and ethical behavior toward children Additionally, Mattel assists its suppliers in adhering to its code of ethics or global manufacturing principles: + the contractors should respect local laws, including the regulations relating to the Upload environment Share your documents to unlock + the work conditions and other practices in its contractor’s factoties should be comparable to what exists in its own factory Overtime work would be voluntary + the contractor factories should have proper policies on hiring, promotion, rights of employees and appropriate Free disciplinary action that address discrimination Trial Get 30 days of free Premium + the contractor’s facility has to recognize the employee’s rights to engage in lawful union ctivity and collective bargaining through selected representatives However, ‘if a business partner is either unable or unwilling to work with Mattel in order to meet and maintain its standards, Mattel is prepared to end the working Already Premium? Log in relationship’ (Mattel Inc 2010) Although Mattel has high global manufacturing regulations, it also needs to timely update its standards The nature of business is currently evolving quickly As Mattel operates in more than a hundred nations worldwide, it can sometimes be challenging to manage all the production sites or the subcontractors' codes of conduct To overcome this issue, Mattel can strengthen its principles by defining distinct principles in each country based on ethics, local culture, law, and labor, such as creating a criterion for paying workers a sufficient wage that complies with local or industry norms Another change Mattel could take into consideration is it should monitor the implementation of its Global Manufacturing Principles frequently, ensure that its business partners can match the company's ethical standards and conduct their commercial agreements efficiently, such as make 12 certain that the partners would not use any children under the age of 16 and would use forced labour to accomplish the order, ascertain that contractors and subcontractors are using the proper Mattel facilities Q3 To what extent is Mattel responsible for issues related to its production of toys in China? How might Mattel have avoided these issues? Due to a fault with the products, Mattel has recalled 13,970,000 units of toys from China, according to the Consumer Product Safety Commission Lead paint and tiny loose magnets, which can pose a number of health risks, were the primary causes of the majority of the issues Toys can include small magnets that can be ingested or breathed, and lead paint, which is very poisonous and can cause a variety of health issues when swallowed or inhaled in significant amounts There are numerous ways in which Mattel is to blame for this failure First, the lead paint in the product was provided by a Chinese company that had been subcontracting with a different business that Mattel had not approved It is due to lack of supervision and monitoring process and contract manufacturers are granted a little profit margin, so theyattempted to increase profit margins by lowering production costs Second, in their monthly audit they did not check the quality of each product, which they should have checked The chinese manufacturer did the quality control and they did not it properly Third, Mattel simply failed to make good design for toys, which caused the loose magnet hazards Mattel might have avoided the above issues if they made several design changes in their products which caused the loose magnet problem On the other hand, the lead paint problem occured due to insufficient supervision in the supply chain management of Mattel’s There should be more monitoring and controlling needed in the manufacturing chain Although it was a complex process to manage such a huge process, they could have minimized this if the regulations and code of conduct were tightened Mattel should investigate contractors and audit the subcontractor anually, have a quality check by Mattel before the assembly begins and providing enough facilities and a sufficient margin to the subcontractor, resulting in high-quality production 13