TOPIC:Understanding the Role of Communitarian Ethics and Corporate Social Responsibility

SEMESTERSPRING2013

BUSINESSETHICS (MGT610)

ASSIGNMENTNO.02

DUEDATE:4THJULY 2013

MARKS:30

ASSIGNMENT:

TOPIC:Understanding the role of communitarian ethics and corporate social responsibility in the business strategy.

LearningObjective:Tolearnaboutthecommunitarian ethicsand corporatesocial responsibility for ethically benchmarked business practices.

LearningOutcome:Studentswillunderstandaboutthecommunitarianethicsinline with corporate social responsibility and the applicable principles of business ethics.

Scenario

Alphapharmaceuticalstartedlocallyproducingadrugforthetreatmentoflungscancer inthehumanbody.Thediseasespreadrelativelyquicklywithinthelastonedecade mainly due to the pollution of industrial smoke and traffic pollution in urban areas. The drugisapreciousoneandfallsinthecategoryof lifesavingdrugs.Onlyafewfirmsare supplying the drug of this disease category in the market. Alpha pharmaceutical was alreadyanestablishedbrandinthepharmaceuticalmarketandthisnewdrugofcancer was only a line extension for them. In the present situation, this company was in a better position to launch this drug at much higher price than the cost of production.

Alphapharmaceuticalwasthepioneerforintroducingthisnewlocallymanufactured drug of cancer. The company had the option of skimming pricing strategy (a high price) forthisnew productbecauseapotentialmarketsegmentwasdesperatelywaitingfora bettertreatmentoption.Othercompanieswhowereprovidingsuchadrugforlungs cancerpatientswereimportingthisdrugfromthedevelopedcountries.Theadditional cost of import and governmental deregulation of prices for cancer medicine suppliers, allowedtheotherpharmaceuticalcompaniestochargeheavypricesfortheirlungs’

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cancertreatmentdrug.Thisexpensivetreatment optionfurtheraddedtothemiseryinthe lifeofcancerpatients.Butthemanagersof Alphapharmaceuticalareconvincedthatitis therighttimeto actwith corporatesocialresponsibilityandmakethisnewdrugavailable inthemarketatanaffordablepriceforthecancerpatientswhoalready hadthelimited purchasing power. They thought that this will give the long termrepute to the company in themarket.Butthemanagersof this company arealsoinadilemmaofspoilingstrong relations with other marker operators because they were supplying the similar imported drug at a much higher price with a better profit margin. Another question in their mind is that they will lose the chance of making a huge profit.

Requirement

Carefully considering the above mentioned scenario, answer the following questions,

1. Whatstrategicbenefitsthisorganizationmaygainbyfollowingcommunitarian ethics and corporate socialresponsibility?

(15 marks)

2. WhatmaybethedifferentreasonsforAlphapharmaceuticaltoavoidbusiness profitonethicalbasisforsuchararedrug?Mentionitwith reference todifferent principles ofbusiness ethics that support ethical practices inbusiness operations.

(15 marks)

Note: Answershouldbetothe point.

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