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Corporate Responsibility Issues in Manufacturing


The Clean Power Company, based in Cincinnati, Ohio, has been in operation for 5 years. The company produces an energy regulating device that automatically regulates the use of power sources in homes and businesses. Recently, they have realized that in order to stay in business, they will have to move their operations out of the country. They have purchased approximately 500 acres next to the Chavon River in the southeastern part the Dominican Republic.

The land is totally undeveloped. However, it is located across the river from the Altos de Chavon complex that has shops, restaurants, and other commercial attractions. This land looks like a tropical paradise with palm trees and access to the sea via the Chavon River.

As part of the sales agreement, the seller, Teltac Corporation, has agreed to put in roads, septic systems, and water lines. However, electrical power and sewer lines will be up to Clean Power. Clean Power Company plans to be self sustaining by using solar power. Teltec has informed them that there should be no problems running sewer lines directly into the river as the Chavon River is clean and large and can absorb the waste.

You are the Director of Corporate Development in charge of spearheading the development of this new site. In addition, you are responsible for transitioning US employees to the new location and hiring local employees. You will need to decide which Cincinnati employees will go to the new Dominican Republic location or if the company should rely solely on local Dominican workers.

Clean Power also plans to build a new school for local children to address overcrowding and the lack of basic necessities, technology, and space for the students. Clean Power desires to be a good corporate partner in this community, which has many dirt roads and undeveloped areas.

Management knows that the initial capital outlay in this initiative will drive the price of the stock down, thereby upsetting the shareholders. However, management believes it will prove a sound investment in the long run.

To see the Chavon River, go to http://www.bocachicabeach.net/altos_de_chavon.html
Double click on the last picture to enlarge the picture of the river.

Question 1:
What is Clean Power's corporate social responsibility for each ethical issue you have identified in this case? Write a minimum of 2 pages in APA format addressing these issues.

Question 2:
Stakeholder Management: Write a paper in APA format addressing the questions below regarding the following stakeholders: the environment, the employees, the customers, the community and the shareholders:

What are the above stakeholders' interests for each ethical issue or concern you identified? What are the stakeholders' responsibilities for each ethical issue or concern you identified? What are the possible decisions the corporation could make for each ethical issue or concern, and what are the possible effects on the stakeholders?

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Solution Preview

Clean Power Company faces many ethical dilemmas in moving its operations to the Dominical Republic on the Chavon River. There are U.S. employees who may be affected if they do not or cannot go to the new location. There are considerations for how new employees in the Dominican Republic will be compensated. These are economic concerns, though there
are some legal concerns as well, for employees in the U.S. who are laid off. Ethical concerns surround running the sewer line directly into the Chavon River and whether wages offered to new employees will have enough of an impact to improve the quality of life. Philanthropic concerns include the building of the new school for the children in the community along the
Chavon River.

There are ethical issues from a legal perspective that surround the routing of the chemical waste into the Chavon River. Though the river is clean and large enough to handle waste, there may come a time in the future when it will not be able to absorb waste from Clean Power Company. Though Teltec has stated that running the waste directly into the river should be
acceptable, there may be regulations in the country that Clean Power is not aware of. The organization must research this, to ensure it will be in compliance.

Those who may be laid off in the U.S. operation are eligible for unemployment benefits, as long as they meet their state's requirements for length of employment. Clean Power must use caution in firing or letting employees go, when it announces the closing of the facility. However, if there are more than 100 employees at the facility, Clean Power must act in
accordance with the Worker Adjustment and Retraining Notification (WARN) Act, which requires a 60 day notification to workers prior to the facility closing (U.S. Department of Labor, 2009). Choosing to fire employees after this notice is given can end up looking like an attempt to reduce ...

Solution Summary

The document discusses and analyzes the decision making process for an organization faced with the dilemma of relocating its manufacturing plant overseas. The discussion analyzes the impact that various decisions have on the different stakeholder groups, both in the U.S. and in the possible new overseas location, in terms of benefit and harm. 1255 words with 3 references.