Read the story regarding PPG and assist me in answering the question illustrated below:
Question 1: Based on the ethics climates presented in chapter, which climate best describes PPG Industries? Is this climate type best for promoting ethics in the workplace? Explain why or why not.
Question 2: There is a section in the book entitled Ethical Climates where it talks about what ethical climates are and goes on to say, "three different types of ethical yardsticks are egoism (self-centeredness), benevolence (concern for others), and principle (respect for one's own integrity, for group norms, and for society's laws). These ethical yardsticks can be applied to dilemmas concerning individuals, a company, or society at all.
Scenario:
Founded in 1883, PPG industries is a major global supplier of coatings, glass, fiberglass, and chemicals. In 2005, this Pittsburgh-based multinational operated more than 110 manufacturing facilities and equity affiliates in over 20 countries and had global sales of $10.2 billion.
In keeping with its reputation as an honest, fair, and capable firm, PPG Industries had developed a multifaceted ethics program. At its core was the PPG Industries Blueprint, describing the company’s values, statement of mission, and objectives. This document identified the company’s critical values as dedicated to the customer; respect for the dignity, rights, and contribution of employees; recognition of the concerns and needs of society; commitment to integrity and high ethical standards; supplier relationships focusing on continuous improvement and shared responsibility; and responsibility to shareholders.
To put these values into practice through policies and programs, PPG management implemented a number of ethical safeguards and called on its employees to implement them through their personal conduct. Over a period of several years, PPG began issuing its Business Conduct Policies, which defined possible ethical issues encountered by PPG employees, as well as guidelines for handling their ethical issues. The policies concluded by stating, “It is the policy of PPG and its subsidiaries, its agents and employees, to make every effort to operate as good, responsible, and ethical corporate citizens and to comply with all applicable laws of the jurisdiction in which they are present operating.”
Although the Business Conduct Policies clearly set the ethical tone for PPG’s operations, PPG management felt a need to include an explicit global focus since the firm had acquired several overseas businesses with cultures and histories that differed from PPG operations in Europe, Asia, and South and North America. It was charged with advising top management on ethical issues, making recommendations concerning company policies and codes of conduct, developing an ethics training program, and providing a forum for the review of ethical issues. In addition, it assured the role of the compliance committee after passage of the U.S. Federal Sentencing Guidelines in 1991.
One of the most significant actions taken by the Global Ethics Committee was drafting PPG’s initial Global Code of Ethics (GCOE) in 1898. In 2004, the Committee combined PPG’s compliance-based Business Conduct Policies with the GCOE, creating a single unambiguous document that reaffirmed the importance of the company’s ethical tradition and the high standards introduced new and prospective employees to the company’s ethical tradition and the high standards to which PPG hold its people, and served as a primary reference document by drawing together main elements of PPG’s ethical convictions. The global code covered PPG’s relationship with customers, suppliers, and competitors (issues such as gifts, inappropriate entertainment, and product safety) and responsibility to PPG people (such as health and safety and diversity issues). It also discussed protecting corporate assets (such as security of information and intellectual property) and company responsibilities to the public and public officials (ranging from corporate lobbying to environmental responsibility). Finally, the global code addressed differences in local laws and customers and reporting violations or workplace misconduct.
Foe example, the revised GCOE began with a letter of commitment from PPG Industries chairman and chief executive officer: “Our reputation rests not only on our ability to be a provider of quality goods and services but also on our integrity and high ethical standards. Our continuing business success rests, in large part, on the work of every PPG employee to preserve and enhance our reputation with customers, suppliers, government officials, and the public in general…” The GCOE defined possible ethical issues encountered by PPG employees, as well as guidelines for handling their ethical issues.
To ensure that any instances of ethical misconduct were reported, PPG instituted the PPG ethics hotline in 1999, a toll-free telephone number maintained by an independent company located in another state, which assured callers it, would protect their anonymity. Calls from PPG employees ranged from questions about employee relations to report fraud, discrimination, conflict of interest, or the release of proprietary information. On the basis of communications through the ethics hotline, PPG Industries improved communication channels within the firm, changed policies, and prosecuted violators as necessary.
PPG’s multifaceted corporate ethics program is one example of a business seeking to maintain am ethical culture while honoring its economic responsibilities.