Topic 1~Part 2

Scenario: Leah, a producer of Australian-made clothing, has made a decision to move her production from Dandenong to Thailand. Her 22 Australian staff members will be retrenched and she will commence production in Chiang Mail, where wages are only about 20% of Victorian wages. She will also save the 12% Superannuation Guarantee cost that she must pay her Australian staff, making production of garments much cheaper in Thailand. This may mean a cost saving for the buyer ... or does it mean more profit for the shareholders?

 

1)    Explain at least TWO ethical issues surrounding a decision made by Leah to move production of her clothing business to Thailand, where factory workers are paid 20% of Australian wages

 
The public and consumers will look differently at the products. This may lower the   amount of products brought as some customers look differently at products brought  overseas and are made by under paid labour workers.

Another issue is the quality and conditions of the factory the clothes are being made in. The standards of safety and cleanness will be lower than factories in Australia so this could affect the clothing's outcome. 

 

2)  To what extent has Leah acted in a socially responsible manner to her employees?

 Leah didn't act that responsible to her employees by making them lose their jobs for her to be able to pay cheaper workers do to the same job. This would have affected these workers as they would have no income and find and new job, this can then affect their families too.

 

3)  To what extent has she acted in a responsible manner to one other of her stakeholders (ie. shareholders, employees, creditors, consumers, suppliers, government, and local community)?

 Depending on if the sales of clothing drop or rise depends on the amount of profit or loss the stockholders make. If the sales remain the same it was a fair decision as they would earn more as Leah would have to pay the workers 80% less. It is a risk for the stockholders as it could go either way.

 

 

4)  List and briefly explain at least THREE ethical decisions you may need to make when conducing your own eBusiness

Ethical decisions I need to make when creating the business is to make an easy product to make so I can make them by myself. I need to use good quality materials to attract buyers that they are buying quality things. Chose an age group and market towards them, advertise to their liking.