Ethical Leadership

Case 13.2 How Safe is Safe?

Perfect Plastics Incorporated (PPI) is a small injection molding plastics company that employs 50 people. The company is 10 years old, has a healthy balance sheet, and does about $4 million a year in sales. the company has a good safety record, and the insurance company that has PPI’s liability policy has not had to pay any claims to employees for several years. There have been no major injuries of any kind since the company began.

Tom Griffin, the owner, takes great pride in the interior design and working conditions at PPI. He describes the interior of the plant as being like a hospital compared with his competitors. Order, efficiency, and cleanliness are top priorities at PPI. It is a remarkably well-organized manufacturing company.

PPI has a unique approach to guaranteeing safe working conditions. Each year, management brings in outside consultants from the insurance industry and the Occupational Safety and Health Administration (OSHA) to audit the plant for unsafe conditions. Each year, the inspections reveal a variety of concerns, which are then addressed through new equipment, repairs, and changed work-flow designs. Although the inspectors continue to find opportunities for improvement, the overall safety improves each year.

the attorneys for PPI are very opposed to the company’s approach to safety. The lawyers are vehemently against the procedures of having outside auditors. If a lawsuit were to be brought against PPI, the attorneys argue that any previous issues could be used as evidence of a historical pattern and knowledge of unsafe conditions. In effect, the audits that PPI conducts voluntarily could be used by plaintiffs to strengthen a case against the company. The President and management recognize the potential downside of outside audits, but they point out that the periodic reviews are critical to the ongoing improvement of the safety of everyone in the plant. The purpose of the audits is to make the shop a secure place, and that is what has occurred. Management also points out that PPI employees have responded positively to the audits and to the changes that result.

Questions

1. As a company, would you describe PPI as having an identifiable philosophy of moral values? How do its policies contribute to this philosophy?

2. Which ethical perspective best describes PPI’s approach to safety issues? would you say PPI takes a utilitarian-, duty-, or virtue-based approach?

3. Regarding safety issues, how does management see its responsibilities toward its employees? How do the attorneys see their responsibilities toward PPI?

4. Why does it appear that the ethics of PPI and its attorneys are in conflict?

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