Dutiesand responsibilities that exist between a firm and its staff,consumers and suppliers are referred to as ethical issues (Gunn& Taylor 2014).Consequently, business ethics can be viewed as a professional form ofthe latter. It is an important aspect that minimizes moral hitchesthat ensue in a business environment. Currently, more firms areincorporating ethics in their operations since they have realized thepositive impacts that are associated with it. Investors and customersare attracted to companies that embrace the same. They arecomfortable working with these enterprises since they do not need toworry about how their funds, resources and time are utilized.
Illegalpractices are becoming more dominant in the current global market.Firms are importing goods illegally and selling products that are oflow quality, or have adverse effects on human health. All managementteams need to make sure that the products produced are of highquality and do not affect the consumers` health negatively. LumberLiquidator is an example of a business that has been accused offailing to embrace ethics in its operations. This term paper willgive a brief description of the flooring supplier as well as itsunethical practices. It will also recommend some of the ways throughwhich businesses can avoid getting into such situations and howLumber liquidator can redeem its tarnished image.
LumberLiquidator was established in 1994 after a building contractor, TomSullivan, started to purchase excess unused timber from other firmsand reselling them from the back of a trucking plot in Massachusetts.Sullivan`s business found a niche in the hardwood carpeting market.In January 1995, the first store was opened in West Roxbury,Massachusetts. 150 sq. ft. of flooring was sold on the initial day.After nine months, opened the second store inHartford, Connecticut. This was a breakthrough as more stores wereopened afterward. In 1999, the firm`s management decided to move itshead office from Boston to Colonial Heights. The substantial growththat followed triggered the transfer of its headquarters to the 306,000 sq. Ft. center in Toano, Virginia. It has experienced steadygrowth over 20 years. Currently, it has opened stores in 46 statesand employed more than 1000 employees. hasidentified itself as one of the largest producers of prefinished andunfinished hardwood floors in the US. The firm carries solid andengineered hardwood, bamboo, laminate and cork flooring. LumberLiquidators eliminate intermediaries by negotiating directly withmills. By doing so, it passes savings on to the consumers. It is alsoan environmentally conscious company which purchases only from firmsthat take part in sustainable harvesting. However, it allegedlyengages in deceptive advertisement and selling of low-qualityflooring.
LumberLiquidators ostensibly provided misleading information regarding itsMorning Star Bamboo Flooring (Rubin& Banjo, 2013).The firm claimed that the latter was extremely durable and could notportray any effects within the first thirty years after purchase. InCalifornia, a class lawsuit was filed, and it alleged that theflooring produced by was prone to cracking,warping, shrinking and splitting within a very short time as opposedto the information presented by the company through itsadvertisements. More so, a resident of the same state purchased andinstalled the flooring in October 2013. The installation was done bya `s licensed contractor in the uninhabited home.Consequently, the plaintiff claimed that she noticed defects withinthe first few weeks. She decided to contact Lumber liquidatorimmediately, and she was asked to complete a ‘General DisclosureStatement’ and send it through the email to the firm`s claimsdepartment. According to the lawsuit, an inspection was carried outin the plaintiff`s home by an employee of Inspect Solutions. Based onhis report the inspector claimed that no defects were present and he,therefore, blamed the lady and the installers of the flooring formaking false accusations. However, the lawsuit alleged that the womanstill observed splitting, buckling and warping. It is evident thatthe did not disclose the defects of their products.It continued to market the flooring as being free of faults and longlasting. Lumber liquidator`s defective flooring has caused the lady,and other consumers to suffer financial losses. They did not receivemuch help even when they informed the company about the faults.
Theflooring-producing company has also been sued over the high levels offormaldehyde in its products. In Virginia, a class action lawsuit wasfiled, and it alleged that `s Chinese wood flooringcontained excessively high formaldehyde levels. In addition, itclaimed that the firm acquired wood from China illegally.Formaldehyde is volatile, and it is released in gas form at roomtemperature (Zhang,Li, Wang & He, 2014).The National Toxicology Program categorizes it as a compound thatcauses cancer. Therefore, exposure to the compound could have adverseeffects such as asthma. imported flooring into thecountry that did not comply with the set formaldehyde standards.
A`60 Minutes` report was aired in early 2015 regarding the seriousissues at the company`s factories that are based in China. Accordingto the report, some consumers did away with the flooring that theyhad purchased from s even though they were notfinancially able to buy replacements. For example, the reportindicated that many homes in the country that had defective flooringpurchased the former from the firm. The investigation involved visitsto factories in China. 31 boxes of laminate flooring made in Chinawere purchased in stores located in Virginia, Florida, New York,Texas and Illinois. Only one of the samples complied with theCalifornia formaldehyde emission standards.
Thereare some things that a firm can do to avoid such problems
Adsprovide consumers with information about goods and try to convincethem to buy the products. Companies need to present the correctinformation about the products through the advertisements. LumberLiquidators engaged in a deceptive form of advertising. It emphasizedthat the flooring it sold was of high quality and was durable.However, most consumers claimed that the flooring was prone todefects. The firm also failed to disclose information regarding theformaldehyde levels of its products. Businesses should avoiddeceptive advertisements since they can cause harm to customers. Bydoing so, they will avoid problems related to unethical practice.
ProductLiability and Safety
Afirm should not sell products that can cause harm to the consumers.For example, the ‘60` minutes report indicated that theformaldehyde level in was higher than the setstandards. This posed a significant risk to the consumers` health.Every business should have a clear understanding of what productsafety entails and to assess the products it produces to make surethat it is in accordance with the government set standards.
Toredeem its image the CEO and other responsible people in the companyneed to resign. It is evident these individuals knew what washappening and took no action to stop the production of defectiveflooring even after several lawsuits were filed against the company.It is more efficient to relieve the responsible person of his dutiesrather than a scapegoat. In such a situation, communication isimportant. To regain trust, the needs to inform itscustomers about what it is doing to solve the problem. More so, itwould be important to communicate that it is trustworthy by trustingits clients. Once the worst is behind the company, the firm shouldinvestigate the cause of the crisis. This would help it to preventthe occurrence of the same in future. Lastly, needsto commit to change in order to redeem its image. It will besubstantial for the firm to make serious commitments and to show thatit is actually following up on them.
Inconclusion, ethical practice is essential to a company as it helps itto reduce the moral-related problems that occur in business. Inaddition, it is important since it attracts more investors andcustomers. A good example of a firm that got involved in unethicalpractices is the Company which sells flooring. Itallegedly engaged in deceptive advertisement and sold products thathad a high formaldehyde content. It, therefore, put the lives of itsconsumers at risk and some of them made financial losses.
Gunn,J., & Taylor, P. (2014). Forensicpsychiatry: clinical, legal and ethical issues.CRC Press.
Rubin,B. F., & Banjo, S. (2013). Federal Authorities Raid LumberLiquidators Headquarters. WallStreet Journal,27.
Zhang,C., Li, Y., Wang, Y., & He, H. (2014). Sodium-promoted Pd/TiO2for catalytic oxidation of formaldehyde at ambient temperature.Environmentalscience & technology.
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