Business Ethics

Please read the instructions below before starting the paper
• Module specific information is provided below by the Module Leader
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to any queries via a discussion board on blackboard

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Module Specific Information
Instructions to Students:
SECTION A: This question is COMPULSORY and must be answered. It is worth 20 marks.
SECTION B: Answer BOTH questions in this section, which are based on the case study. Each
question is worth 40 marks.
• A case study is also included in the online timed assessment paper for Section B.
• You will have 24 hours to complete this paper, to allow for different time zones and technical issues.
• Please follow indicative maximum word count: Question 1 (500 words), Question 2 (750 words),
and Question 3 (750 words) and save your work as a Microsoft Word file in order to submit on
• The Turnitin link has been set up under “coursework” left side of your Blackboard page.
• Handwritten answers are NOT acceptable.

Answer the following question:
Q1. In what ways has shareholder primacy undermined business ethics?
Address this question by critically drawing upon the discussion concerning the
influences and challenges of shareholder primacy to business ethics. Also, briefly
outline the alternative approaches for corporations to undertake that would
encourage more ethically responsible business practice, especially during the
current challenging economic environment.
The discussion should be supported by using relevant theories or frameworks
and real business examples.

(20 Marks, 500 words)

Answer ALL of the following questions (based on the CASE STUDY)
Q2. Given the case study provided here and the theories of Business Ethics, outline
the ethical issues and challenges that need to be addressed by Topforma Tyres
Company. What would be the relevant factors that should be considered when
making ethical decisions in business for the company? (40 Marks, 750 words)

Q3. Based on the information provided, what directions would you propose for a
Corporate Social Responsibility strategy and implementation plan for Topforma
Tyres Company? Which should be the areas of focus for the company to
further promote itself as a good corporate citizen?

(40 Marks, 750 words)

(Total 100 Marks)

[Case study starts on the following page]

Case Study:
Read the following case study before answering Questions 2 and 3.
Topforma Tyres is a British tyre manufacturing company and has produced 131 million
tyres at 23 factories located in 8 countries (i.e. Spain, Poland, Finland, UK, India, Thailand,
China, and Malaysia) with the revenues of $1.17 billion in 2019. In 1999, Topforma Tyres
opened its first London sales office, and was able to grow sales in European countries and
expanded the market internationally. By 2005 the company managed to gain almost 6%
market share of competitive OEM (original equipment manufacturer) tyre industry by
European automobile makers. Topforma Tyres Company has also manufactured different
branded tyres, such as Star tyre, Aero Tyro, Westlink, iVentor, and Supercircles to
specifically serve smaller and custom-made tyre sizes to the automobile market, different
than the ones supplied by other leading companies. The company was founded in 1996 by
Josh Brownman, an innovative entrepreneur, who grew up in the rubber family business.
Josh turned the rubber materials further into the tyre corporation with advanced
technologies and innovation to produce the durable and good corner-gripped tyres. The
production lines provide car tyres and off-the -road tyres including all season tyres, run flat
tyres, 4×4 tyres, summer tyres, winter tyres, small tyres and reinforced tyres (for heavy
loads and larger vehicles).
Topforma Tyres has embraced itself with a strong mission statement of “We take great
pride in the excellent quality of our products with integrity, honesty, and people are at
the heart of our business.” However, with the intense competition it looks like the
company cannot completely keep its promises. To battle the rivalries and maintain
competitiveness, Topforma Tyres has implemented rapid mass production across
factories. The company exerts considerable pressure on manufacturing production
processes and workers to keep production costs as low as possible with shorter
production times. There is no doubt that Topforma Tyres has demonstrated great
success in recent years and with the established global customers, corporate clients,
and increased international sales. Yet, when it comes to ethical and social inquiries,
these need further insight. The company’s success, in turn, has provoked controversy
and negative publicity, due to questionable ethical practices and social responsibilities.
There were the accidental and tragic incidents of 76 fatalities and 261 injuries reported
in the United States, France and some other European countries that linked to the tyre
failures. It led Topforma Tyres company to recall and replace 10 million tyres. Several
executives in the company resigned and were fired; and it brought an end to the long-
term corporate relationship with one of its biggest business clients. Publicly, Topforma
Tyres argued that it was because people did not have the right inflation pressure – and
that should have been 30 psi and not 27 psi as the client’s recommendation. Kevin
Stones, the CEO of Topforma Tyres, added that “when a driver of a vehicle has a tread
separation, they should be able to pull over not rollover. The driver should not continue
driving a vehicle; it is a very basic driving rule.” This claim was also supported by many
executives. However, not too long this incident became a hot news topic in the media
and public.

[Case study continues on the following page]

Critics and workers claimed that this could be because of the low-cost manufacturing
and labour policy practising in the company. It led Topforma Tyres to cut corners on
production and to allow substandard tyres to pass inspection that should have been
rejected. This then led Topforma Tyres to pressure workers to accept new labour
contracts that reduced pay and benefits and increased the hours that its factories were
operating. In fact, one of the tyre engineers had raised a concern of the tyre quality to
his supervisors, but his views had never been considered. A large number of lawsuits
were filed against Topforma Tyres and its corporate client (i.e. the car company). The
result of most lawsuits was kept confidential. One that could be evident was that
Topforma Tyres set aside $400 million to handle lawsuits related to the recalled tyres.
Taking this further, there has been some criticism of how Topforma Tyres treated its
employees and an appropriate safe space for employees to express their opinions
regardless of the job titles, ages, and backgrounds.
Much controversy also surrounded by the high level of CO2 emission that the tyre
industry has created; and this included Topforma Tyres’ production processes and the
non-exhaust emissions – that are particles released into the air from tyre wear and
brake wear. The company’s revenues have gone into reverse amid a challenging global
automotive environment and intense consumer activism as a social movement. The
company’s stock has declined nearly 30% year-to-date. One of the consumer activists
pointed out that “their tyres give off tiny, toxic particles as they wear; and the rubber or
tyre burning has caused damage to our environment. The problems come with its
products but how the company can help us.” With such concern of producing and using
tyres, this environmental impact has risen up the political and government agenda,
according to the UK Government’s Air Quality Expert Group (AQEG).

*Notes: This case is strictly hypothetical; any resemblance to real persons, companies,
or situations is coincidental.

[End of case study]