- 20 Marks
Question
An indigenous company wants to set up a retail mega store in Ibadan, chosen for its population density and lower overhead costs compared to Lagos. In Ibadan, electricity supply is more consistent, and operational costs, including salaries, rent, and transportation, are significantly lower. The move would also result in less environmental impact due to reduced diesel generator use. The local government has approved the project, which will create jobs both during construction and after the store’s completion.
Required:
Using Tucker’s five-question model for ethical decision-making, determine whether the decision to build the store in Ibadan rather than Lagos is ethical. (20 Marks)
Answer
Tucker’s five-question model
Tucker’s five-question model for ethical decision-making in business holds that the purpose of decision-making in business is to ensure that profit is made in an ethical way. The model identifies five questions to be asked before making an ethical business decision. If the answers to all five questions are ‘Yes’, the decision is ethically sound. The five questions to be asked are:
a) Is it profitable?
b) Is it legal?
c) Is it fair?
d) Is it right?
e) Is it sustainable or environmentally sound?
Application of the model to the scenario
- Question a: Is the decision to locate the business in Ibadan profitable?
Answer: Yes, as the city of Ibadan was chosen because of its low overhead cost. - Question b: Is the decision to locate the business in Ibadan legal?
Answer: Yes, because the government has given permission for the store to be built. - Question c: Is the decision fair?
Answer: There is no reason to suppose that it is not fair. All the stakeholders referred to in the case study, including the government and the local population, will benefit from the store and are in support of its establishment. This suggests that the project is fair. - Question d: Is the decision right?
Answer: Yes, as the project will bring jobs, thereby generating income for people and also revenue for the government. It will also facilitate overall economic growth. As such, there are no obvious reasons to say that the project is ‘not right’. - Question e: Is the decision sustainable or environmentally sound?
Answer: Yes, because the location of the store in Ibadan is based on considerations that it would be more environmentally friendly in Ibadan than in Lagos.
- Topic: Ethics in Business
- Series: NOV 2016
- Uploader: Kwame Aikins