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Essay / Ford Pinto Case in terms of corporate ethics
Josephson's core values model provides the core values that can guide a CEO in making decisions that protect the interests of the consumer and investors. The three core values I would have used to make a decision regarding Pinto's safety are citizenship, trustworthiness, and respect. Trustworthiness requires that the individual act according to the truth. Several previous tests by Ford engineers revealed that the Pinto was unsafe and needed additional modifications to make it safer. Those changes, Ford engineers say, would cost the company about $5 per car. These changes, if undertaken, could make Pinto safer, although it could result in investors losing money. Citizenship requires a CEO to act in accordance with the laws of the land. I would have ensured that Pinto's design met all the requirements set by government agencies. Instead of pushing to delay the implementation of National Highway Traffic Safety Administration (NHTSA) rules, I will ensure that Pinto meets all required standards. Respect requires that a CEO make impartial judgments and that decisions be based on merit. After analyzing the crash reports presented by the engineers, I will make objective decisions that put the safety of our customers before money. Say no to plagiarism. Get a Custom Essay on “Why Violent Video Games Should Not Be Banned”?Get Original EssayThe rushed design of the pinto so that it could counter Japanese entry into the American market had negative impacts on the business. Several stakeholders were affected by the CEO's decision to bypass security measures so that the car could be revealed on time. The first group is investors. These are the people who own shares in the company. The news that Pinto is not safe scares away customers, few customers therefore implies a drop in the company's revenue. Competitors are other stakeholders affected by the Pinto affair. Competitors, especially local ones, such as General Motors and Chrysler, lost significantly during the trial. General Motors' sales fell 7.2% and Chrysler's fell 26%. Following Ford's lawsuit, customers began to question the safety of cars made by other companies, which was the cause of the decline (Fisse & Braithwaite). Foreign companies that Ford sought to compete with by making subcompact cars benefited from selling more cars. Ford shares also fell during this period. Before the scandal, Ford shares traded at $50 in the 1960s and 1970s, but that price fell to $22 after the scandal became public. Pinto's reduced sales due to safety concerns will result in reduced revenue for the company, which has had to reduce its workforce. Respect for the law implies respecting the law for its own sake. This means obeying the law without question. Corporate ethics ensures that a company works ethically while taking care of the interests of stakeholders (Tai & Chuang, 2014). What the law considers right is not necessarily what is ethically right. To succeed as a business, a blend of corporate responsibility and compliance with the law is necessary. In Pinto's case, Ford complied with what the law required at the time, but to minimal standards. The NHTSA said that in 1972, cars hit from behind at 12 mph would not, 6(03), 117.