Business Ethics: Whistle-Blowing and the Case of Ford Pinto

Whistle-Blowing
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Whistle-Blowing
Whistle-blowing is a key concept in business ethics that affects a firm’s major stakeholders, including customers, employees, the management, and shareholders. Whistle-blowing is extremely relevant in the modern business environment because employees have at their disposal many ways of exposing irresponsible practices in organizations. Unlike the past, employees today have the internet and social media through which they can report negligent practices in an organization and consequently bruise its reputation even in situations where the harms are preventable. In this regard, it is imperative for businesses to have in place a comprehensive code of conduct that governs how employees approach issues that may be deemed immoral. De George (2014) provides comprehensive coverage on whistle-blowing, including the kinds, the conditions that must be met for an employee to blow the whistle externally, and recommendations for companies and unions.
Types of Whistle-blowing
In his evaluation, De George (2014) differentiates four types of whistle-blowing. One type is internal whistle-blowing, which occurs when improper activities are reported to someone within a system or an organization. Personal whistle-blowing occurs when an employee reports potential or actual harm to self instead of the organization or other people (De George, 2014). Governmental whistle-blowing occurs when a government employee exposes illegal activities within a government bureaucracy. De George (2014) dedicates his focus to external whistle-blowing, which involves employees of profit-making organizations who, for moral reasons, expose products or procedures that threaten to cause serious harm to the public, employees, or consumers. The serious harm that the author talks about in this case could be financial harm or bodily harm. In a commentary of De George’s article, Hoffman and Schwartz (2014) add psychological harm, serious injustice, and serious infringement of basic moral rights. The case of Ford Pinto can be used to understand how external whistle-blowing can come into play as well as its morality.
The Case of Ford Pinto
When American cars were losing market share to Japanese imports in the late 1960s, the CEO of Ford Motor Company ordered the production of a new model, the Pinto, to meet the competition (De George, 2014). Although it usually took 43 months to design and produce a car, it only took 25 months for Pinto. The company’s engineers knew that testing rear-end impact was a standard procedure, but it was not conducted before production. The car failed the post-production test as it had the possibility of bursting into flames when hit from the back by a car speeding at above 20 MPH. The company determined that the cost of fixing the problem would be more than the cost it would incur in suits and fines resulting from related injuries and deaths. It decided against fixing the problem. Against its expectations, the resulting fines it had to pay exceeded the cost it would have incurred in fixing the issue.
Moral Permissibility
A major issue about whistle-blowing that De George (2014) covers well is...