I am going to present alternative solutions for the ethical issues arises in global and domestic environments. First, I am going to give an overview of the ethical issues faced by your Corporation for plant relocation. Mainly, the major production industry for your onboard computer components used for automobiles is existing in United States only, and this was a major reason causing profit decline for your business. The major reason behind increased production cost is the wage rate i.e. $15/hourly i.e. also implemented for the new workers. Moreover, stringent safety and environmental regulations have made the cost of production expensive. Also, disposal of waste require extra facility that is way too costly for your Corporation. A major concern related to the high production cost has highlighted by the shareholders of your Corporation i.e. a cause of declining fortunes for the business. However, the competitors for your business have moved up their production department to the less developed countries that have given them a cost benefit.
Analysis: Your Corporation is well aware of its standing in the market.
However, your corporation was the only one moving in a single pattern i.e. by creating a number of production plants at offshore sites for production purpose. Your corporation has plants located at major cities, which has caused economic dislocation in these communities. As, it is a major cause behind unemployment, when workers are being laid off due to plant closure and due to jobless workers, as there has increased social costs. As your corporation is aware of other Corporation that are closing their plants located in the United States and your corporation is following the same strategy to implement.
After a full analysis over different countries, I find different possible alternative solutions based on investigating distinct countries. Findings that I found through different cities data that include Mexico which is one of the cost benefit country. Such relocation of the sites can offer major benefits in terms of health safety, labor and environmental factors. The wage rate per day is $3 as compared to the hourly rate present in United States and also paid by your Corporation. However, many workers find this rate very low, and they migrate to US to increase their wages. But, many are still present in Mexico that are ready to accept $3 a day.
Also, your Corporation can find favorable factors that are related to Mexican Health and Environmental Law towards toxic or chemical production goods. Moreover, the concern has related to the wastage and disposal of the chemical laws are way too lenient in Mexico as compared to United States, therefore, the corporation doesn’t have to abide by the strict disposal laws. So, toxicity disposal and spending to buy costly components for the wastage is not necessary for Mexico.
The only disadvantage the business has is the increased rate of death that has a major issue i.e. caused by the chemical discharge in the country due to the production plants situated in the Mexico major areas. This has given rise to health groups that are citizen of Mexico as they are accusing the policy and lawmaker of the country who are letting these corporation in to their country and provided with a facility to discharge their chemicals and build their production plants without taking any preventive health rules and policies.
Another selected county for investigation is Philippines. Considering labor, health, safety and environmental benefits as compared to Mexico have found more favorable. The wage rate is $1 a day. Also, less can be paid to the workers working under the age of 16. However, the citizen has a major concern with wage rate i.e. a market rate but not a living rate for the workers. However, health and environmental regulations are the same as Mexico, but there are no death toll recorded or public complaints filed against any corporation due to environmental pollution.
The final destination that has investigated is South Africa. However, South Africa is not the one that has said as favorable one. But, it has some positive aspects when compared with other two destinations that are Mexico and Philippines. However, the wage rate is $10 a day in South Africa, but the citizen has demanded to increase wage rates and also provide benefits. Also, I have investigated that there is a powerful union movement going that may create a possibility of increase wage rate and benefit. Moreover, this union has a major concern with the government towards health and safety protection.
Conclusion: Although, these ethical issues faced by the corporation is the major reason of their increased production cost. The wage rate on an hourly basis i.e. $15 is a way too high when compared with the other destination i.e. Mexico $3 a day, Philippines $1 a day and South Africa with a wage rate of $10 a day. Plus the policies and rules for the environmental friendly air not to be polluted are difficult to follow in US as it has strict rules and policies as compared with the easy protection concern present in the Mexico, South Africa and Philippines.
However, if your corporation selects a destination best for your production sector will be Philippines. Not, only the wage rate is $1 or less if under age workers are hired by the company, but also, less strict rules against health and safety issues as there are no major death rate recorded or reported due to chemical or toxic pollution by any citizen.
Moreover, a company can also consider Mexico as it has a wage rate of $3 that can be cost effective for your corporation. But, the complaints against death reported due to chemical and toxic issues are a major concern as many workers or citizens or groups working to make hard policies against environmental factors and health plus safety issues.
Future implication: If corporation selects South Africa for their production plant than in a future it can face major issues related to wage rates and environmental policies. However, if company select Mexico wage rate might not be an issue but citizen standing against environmental, health and safety issues might become a cause of concern in terms of wastage and disposal of the chemical or toxic components. Whereas, selecting Philippines cannot only cost effective, but it can be beneficial for the future also as it has no such issue arise up till now related to death or health issues.
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