Moral Standards of Business

Based On the readings of Food labeling and new rules for overtime as propounded by the Bush administration, the moral issue to be discussed is really quite simple, and is one that has plagued free enterprise for generations: At which point does profit become more important than the rights and needs of customers and employees. In both cases- food labeling and overtime pay- the basic issue is one of rights. It is also a measure of costs. It costs the worker extra pay incentives. It costs the food customer nutrition, and a reasonable healthy diet to reduce the eventuality of obesity, which today is one of the major health concerns for Americans.

First, let's look at the moral concerns in overtime pay, as now defined by the Bush administration: Is there a guaranteed right for overtime pay? The Democrats seem to think so. And, in opposing this new bill blamed the White House for "take(ing) away the overtime pay protection of Americans" (Planin 2003 1). Actually, the bill as passed by the House restricts overtime pay for high salaried workers, and, so the Bush people feel, actually benefits low-income workers. It would seem safe to say that anyone who works more than the required hours, should be eligible for overtime pay. Of course, this may not apply to many salaried executives. However, this bill benefits the business owner who may now "save" overtime pay costs. Where is the justice for the ordinary worker? Arlen Specter, senator from Pennsylvania is quoted as saying "That is a bad thing to do with the economy in its current condition" (editorial 2003 1). It is "justice" for the business owner, and something short of justice for the worker who may be deprived of extra income he sorely needs. It becomes clear that this is a pro-business administration, which is not to say this is "bad" but merely that its regulations and new laws favor the investor, the business owner and top corporate executives far more than the individual owner or, for that matter, the ultimate customer.

Even though the House eventually passed Bush's bill, it was a struggle because, as one congressman stated: "I just had to represent the concerns of my district" (Ellperin 2003 1). One can imply that there is some care and concern about the well-being of constituents in a somewhat depressed economy. It is obvious that the Overtime restrictions are a sort of trickle-down economic problem: less overtime means less money to spend. Less money to sp3end hurts those business owners who rely on customer purchases. And, if business sags, that could mean layoffs, or, to use the politically correct term, "downsizing".

A far greater concern deals with food labeling. Even as government regulations now call for nutrition information on food packaging, it is in the area of serving size that controversy arises. Food companies are concerned with the bottom line, unless caught up in some suspicious food labeling to get around regulations. Morally, the customer has a right to know what the food contains. As more and more Americans become aware of the fact that some foods are basically unhealthy for them because they contain too much fat or other additives that can lead to obesity or other problems, the Food industry feels it has the right to find new and sometimes devious ways, to keep their bottom line healthy. The FDA is not really helping the consumer who "must multiply nutrition data by the number of servings to determine total calories, fat, and carbohydrates" (Day 2003 1). The FDA, however, is now under serious pressure to be "seriously considering a change in food labels to spell out nutrition information for the entire package, not just for sometimes-misleading 'serving sizes'" (Matthews & McKay 2003 1)

The Food industry justifies these mysterious labeling devices as "merely following the letter of the law". Their virtue is in propping up their stock to their shareholders, and using advertising to lure the consumers. In other words, when it comes to food labeling, the industry does what it HAS to do, and often, no more. There are still too many foods containing trans fats. They may provide a better "taste" (and sometimes lower cost by using liquid animal fats), but trans fats "raise blood cholesterol levels, increasing the risk of coronary heart disease" (Weinraub 2003 1).

Given the utility of food, the moral dilemma is that gulf between greater profits (increasing serving size and also the price points) and a better nutritional benefit for the customer. We have seen a growth in health food stores, as well as in the labeling of foods as "organic" (which may also be misleading). Of course, organic foods tend to be higher priced, if for no other reason than the word "organic" itself seems to indicate some extra care or a different growing or processing method, which may or not be actually accurate.

It seems reasonably fair, therefore, to assume that the very idea of "health foods, or "organic" foods puts the manufacturer and distributor on the side of virtue: that is, they are looking out for improved nutrition for their consumers (even if it turns out to be nothing more than an advertising ploy).

Morality in business is not something on the debit side of the ledger, ascribed to "cost of doing business". Ethics is not merely fair competition, or honesty in listing contents on a food package, or looking out for the welfare and benefit of employees. The challenge for American business today is to be moral and ethical and still be able to earn a fair profit. This is not only a challenge, but a dilemma.

Ask most top executives of large corporations about their priorities in their industries, and they may hesitate slightly before replying that the primary goal is to provide growth and income for their shareholders. If, say, Frito-Lay can continue to increase sales of their fat-laden products which translates favorably to the bottom line, why should management change the product, at some high cost for ingredients and machinery? Food manufacturers have gone to great lengths to increase the amount of food in their packaging, but now instead of what once was a single serving package, the package may now be multiple servings. And, they are not doing anything illegal. "Food companies can use flexibility in the labeling rules to make bigger packages, which are still often eaten as a single serving" (Matthews & McKay 20903 2).

If a businessman saves thousands directly to his bottom line by conforming to the n o overtime pay legislation, is he doing something morally or ethically "wrong"?

So how do we answer the moral and ethical challenge that may pit profit against consumer and employee needs and benefits? We live in a free economy. We also live in a time when "Consumer beware" continues to be a watchword all too often ignored by both consumer AND manufacturer. The greater the government regulation, the greater both the constraints and the loopholes to get around them. The government neither wants to, or can muster the will, to regulate morality in business. However, can we count on American business to improve their moral behavior?

WORKS REFERENCED:

Day, S.: "U.S. Considers Food Labels With Whole-Package Data" New York TIMES, Nov. 21, 2003

Ellperin, J. "In a Switch, House Rejects Bush Overtime Proposal; 7 in GOP Reverse Earlier Support of New Rules" Washington Post, Oct. 3, 2003

Matthews, A. W. and McKay, B.: "FDA Re-examines 'Serving Sizes', May Change Misleading Labels" Wall Street Journal, Nov. 20, 2003

Planin, E. "Congress Drops Fight for Overtime; Acceptance of New Labor Dept. Rule Ends Spending Bill Stalemate" Washington Post, Nov. 22, 2003

Weinraub, J. "Trans fats: The basics" Washington Post, Nov. 12, 2003

Editorial: "Working on Overtime" Washington Post, Nov. 21, 2003