Proximity of stakeholders and cultural/national biases

I just finished the ETP Salon – an short executive education program exclusively for alumni of ESMT‘s Executive Transition Program. We discussed the broad topic of “Learning from crisis” from various different perspectives. During our discussions we touched a topic with interesting ethical questions:

After the earthquake, tsunami and subsequent problems with the Fukushima nuclear power plant, many international corporations immediately offered their expatriates to return to their home countries (see e.g. the German online portal “SPIEGEL Online“).

On the first sight, this seems to be the right thing to do: After sending their employees to Japan, companies can be understood to have an obligation to ensure their physical well being (see also here). Most of these expatriate employees will have been based in the greater area around Tokyo. The nuclear emission might not have passed the thresholds yet, but the threat was imminent.

So where is the ethical issue when companies act as they ought to do?

The issue lies in the scope / limitation of the target group of such rescue programs: Large international companies (such as Siemens, GE, DHL, Starbucks, McDonald’s etc.) certainly employ more Japanese people in Japan than expatriates. Is it fair just to help the expatriates? Why?

  • What are the limits of a company’s obligation to help it’s employees?
  • Is this just a question of numbers, i.e. the argument that even the large multinational companies just cannot afford/manage to bring all their employees out of the country and therefore have to limit their effort so a small number?
  • Or is the difference only driven by demand? The Japanese employees just might not have wanted to leave the country and/or they might not have been able to relocate to another country e.g. because they didn’t have the necessary visas or financial resources.
  • Is there a bias towards the people from the “own” country? (Which anyway is getting less and less clear: As employees, customers and investors of multinational companies nowadays usually do not come mainly from only one country, we know less clearly what the “own” country of a company is.) Are the expatriates closer to the company than the Japanese employees?
  • Is there a certain element of nationalism, e.g. the assumption that at the end of the day people should end up in their “own” country – so let’s bring back the Germans to Germany, the French to France etc. and sort everything
  • To see how messy it quickly gets, let’s just take the fictitious example of Hans. Hans was born in Japan as son of German parents that worked for Toyota. He spent most of his life in Japan. ┬áBut after his studies in Japan he was hired by Volkswagen in Germany. He went to Wolfsburg. But after two years Volkswagen decided to send him as an expatriate (due to his passport and German work contract) to Japan. Compare this situation to Hiroki: Hiroki was born as son of a Japanese couple that lived and worked for Volkswagen in Germany. After his studies in Germany he decided to get to know the country of his parents. There he joined Volkswagen on basis of a local contract. What is the difference in Volkswagen’s obligations to help Hans or Hiroki?

And then you can change the question one more time: How about the large Japanese companies that employ international staff in their headquarters? How about the French, English, American, Indian or South African employees of Sony in Minato, Tokyo? Should they be sent “back” while their colleagues stay in Japan?

A question of life and death

When teaching business ethics to managers and MBA students most of the topics and cases we discuss are serious issues. We even often discuss dilemmas that (potentially) have heavy consequences for involved parties. When talking about damages to the environment, the effects of poverty and inequality or the potentially damaging side effects of products on consumers and others (e.g. tabacco), we even occasionally touch questions of health and life.

However in most settings, managers don’t have to decide about life and death directly and personally. Usually there are intermediate actors that seemingly reduce the individual responsibility. And this is a certain contrast to many of the most famous dilemmas (such as the trolley car dilemma) that are discussed in the ethical literature for decades and centuries.

But right now there is such an issue of life and death in a business setting. It is going on for more than three months now and was brought back to our attention today:

According to news reports, TEPCO, the Japanese company operating the nuclear power plants in Fukushima, made public that a melt-down did not only occur in reactor 1 but also in 2 and 3. And as the situation is still very serious, we have to ask about the moral implication of having employees work in an environment that violates the normal thresholds for nuclear contamination.

Most of us will highly appreciate the fact that several workers fight hard to limit the disastrous effects of the earthquake, tsunami and subsequent melt down. But they are at the same time employees of TEPCO. Is is / can it be legitimate for a company to asks its employees to risk their lives? Can managers be justified to send employees into contaminated workplaces – even if the employees agree to do so on a voluntary basis? Is this only justified when the employees try to prevent bigger harm to society or can companies also look for volunteers that risk their lives/health just for the commercial success of the company?