Essay On The Future Enterprise

Considering the case of how the Australian-owned company Lorna Jane which deals with women’s active wear has been fined with $5million owing to the false claims of its active wear amidst the Covid-19 pandemic is definitely an ethical dilemma. The case largely states how often consumers are mislead by such false claims specifically amidst a crisis situation like Covid-19 pandemic where all across the globe customers are looking for solutions to stop the spread of this virus (accc.gov.au, 2021). The company brought claims that its LJ Shield Active wear can actually stop the spread of transfer of all pathogens in the body ones it comes in contact with the fabric. However such claims were completely false for which the brand has been fined by the court for misleading the customers (Schwartz, 2015). This is definitely an ethical dilemma owing to the fact that it had brought in false claims, misguided customers, raised false hopes and statements that can be damaging to the health and safety of the customers who might under the influence of such persuasion by the products and expect such kind of protection which in reality is not true

 

 

Considering this above mentioned issue, one of the primary stakeholders in this dilemma is no doubt the customers. Being a regular customer of Lorna Jane, I personally feel that I will automatically develop a trust and out of this trust I would naturally intend to purchase this new LJ Shield Active wear if it can help me protect myself and my dear ones amidst the pandemic. Hence this can actually lead to a disastrous situation where the customer’s trust is broken and it can also lead to health risks as the customer will think that he is protected against the virus while the claims being completely false (Falck, 2016). As a customer it definitely disturbs my trust on these brands as I would feel cheated and mislead by the organisation. In such situations customers definitely do not have such means to confirm such claims on spot which is a major drawback and the reason why businesses like Lorna Jane choose to mislead customers. It also challenges my moral values as a seller because I would never choose to put forward such false claims just for promoting my brand that too in a crisis period where people are actually struggling to save themselves (Figar & Đorđević, 2016). Making such anti-virus claims without any medical knowledge or awareness and saying loud to millions of customers is definitely a heinous crime

 

 

The ethical dilemma and the overall scenario presented here in this case of Lorna Jane clearly states  the stakeholders that are deeply involved in this case definitely includes the management of the organisation along with the investors, the suppliers and most importantly the customers. Thus analysing the potential harm that this ethical trouble has brought in for the business and knowing that the management is deeply aware of the false claim yet decided to go along with the same makes the situation worse (theguardian.com, 2021). The investors, the employees and the suppliers who are associated with this fashion retail will equally suffer in this ethical tussle as the business has to bear such a heavy amount of fine. The societal impact is definitely damaging as it will lower the trust of the customers on the corporate brands and make the customers think twice before trusting a genuine product as well. In terms of business impact this fine will no doubt bring financial loss for the business that will affect the staffs of the organisation. In order to address the issues which Lorna Jane has faced as a retail fashion brand, it is first and foremost important that the board members or the management should prioritise on building an ethical and socially responsible business that would follow a certain code of ethics (Cornelissen, 2016). Authenticity and general welfare of the community must be prioritised by the businesses to avoid such ethical dilemmas

 

 

Personally I feel that as a business leader, it is extremely important to hold a strong morale that will guide the business to move in the right direction. Therefore as a stakeholder of the business I would first and foremost strengthen the code of conduct and business policies were no claims can be made without proper approval of the concerned authority or authorisation from the government itself. I would also prioritise on proper ethical training of all the managers as well as the employees to improve workplace behaviour and practices (Kourula et al., 2019). Therefore focusing on the presented analysis and reflection on ethical dilemma in business, one of the important aspects that I would like to further develop for better handling such challenges in future is the aspect of emotional intelligence. This actually helps individuals take the right decision if at the time of crisis and ensure that he does not let into bias or any such unethical workplace practice which in turn can have long-term devastating impact on the business.

 

 

accc.gov.au. (2021). Lorna Jane pays $5 million over false ‘anti-virus activewear’ claims. Australian Competition and Consumer Commission. Retrieved 17 June 2022, from https://www.accc.gov.au/media-release/lorna-jane-pays-5-million-over-false-%E2%80%98anti-virus-activewear%E2%80%99-claims.

 

 

Cornelissen, J. (2016). Preserving Theoretical Divergence in Management Research: Why the Explanatory Potential of Qualitative Research Should Be Harnessed Rather than Suppressed. Journal Of Management Studies, 54(3), 368-383. https://doi.org/10.1111/joms.12210

 

 

Falck, W. (2016). Social licencing in mining—between ethical dilemmas and economic risk management. Mineral Economics, 29(2-3), 97-104. https://doi.org/10.1007/s13563-016-0089-0

 

 

Figar, N., & Đorđević, B. (2016). Managing an Ethical Dilemma. Economic Themes, 54(3), 345-362. https://doi.org/10.1515/ethemes-2016-0017

 

 

Kourula, A., Moon, J., Salles-Djelic, M., & Wickert, C. (2019). New Roles of Government in the Governance of Business Conduct: Implications for Management and Organizational Research. Organization Studies, 40(8), 1101-1123. https://doi.org/10.1177/0170840619852142

 

 

Schwartz, M. (2015). Ethical Decision-Making Theory: An Integrated Approach. Journal Of Business Ethics, 139(4), 755-776. https://doi.org/10.1007/s10551-015-2886-8
theguardian.com. (2021). Activewear brand Lorna Jane fined $5m for claiming clothes could stop Covid spread. the Guardian. Retrieved 17 June 2022, from https://www.theguardian.com/australia-news/2021/jul/23/activewear-brand-lorna-jane-fined-5m-for-claiming-clothes-could-stop-covid-spread.