Legal and ethical issues

 

ABC Credit Finance is a credit card provider with regional payment processing centers. You are a manager of
one of these centers. You are an at-will employee in a typical at-will jurisdiction. ABC is in competition with
other card companies in a recent interest rate and balance transfer marketing promotion. Concerned about effect
of the competition on its revenues, ABC has instituted the following:
1. Increased late payment penalties
2. Reduced length of billing cycle
3. Immediate reporting of late payment to credit reporting agencies
4. Unilateral review of existing customer interest rates against credit scores with corresponding increase of rates
quarterly to those whose scores fall into “poor” category
5. Payments that arrive on or up to 24-hours before the payment due date are not to be processed until the next
business day following the due date before processing the payment, and late charge applied, on the theory
customers will have difficulty proving timely payment.
ABC has notified its customers about changes 1 through 4. However number 5 is an confidential inhouse
“unofficial” policy change that has been communicated to all regional offices.
RESEARCH AND ADDRESS THE FOLLOWING AND ANY OTHER LEGAL/ETHICAL ISSUES YOU
IDENTIFY IN THIS SCENARIO:
• The legal/regulatory provisions of the law that apply to ABC’s payment processing practices.
• The ethical theory most prominently displayed in ABC’s actions in making these policy changes.
• Will you as manager of the processing center implement policy no. 5? Why or why not? What are your ethical
obligations?
• If you choose not to implement no. 5, what options do you have, if any, for protection of your job as an at-will
employee?
If you are fired for refusal to implement no. 5, what might be a basis for a wrongful discharge action against
ABC?

Sample Solution

In the case of Marimekko, we are introduced to the structure of this company, which Kirsti Paakkanen has reworked. She found incredible success for Marimekko, despite the lack of diversity among the company and the lack of hierarchy within the organization’s structure. Marimekko is a design company that produces different apparel, accessory, and furniture products (Mitchell 8). They pride themselves on their brand image, their mainly female oriented company, and their sense of patriotism for Finland. There is a set structure in the sense that everyone ultimately answers to Paakkanen; she is the heart and the center of the network chain. Paakkanen strives to apply continuous improvement processes by enforcing the designers put their name on the products they personally produce (Mitchell 5). This gives a sense of responsibility to the designers, who then strive to produce their best work. The company is extremely organized and works through methodical processes. Each designer has a role, each designer is accountable for their work, and the design process is very methodical. The designers must complete certain tasks in a certain order to create the whole picture or product. Paakkanen has a mentality of efficiency and high-quality products (CVA 11). Failure is not an option for Paakkanen, which is exactly what the red or control quadrant stands for. She states, “I knew that it would be a tough job to turn Marimekko around, but I knew I would not and could not fail […]” (Mitchell 3). Lastly, the control quadrant is also known as the optimizing quadrant (CVF 1). Marimekko strives to optimize their company by expanding their product line, hiring more designers, and potentially growing internationally (Mitchell 11).

Marimekko is now in a place of wide-spread success after their downfall during Finland’s recession. Paakkanen reworked this company from the ground up and now finds herself at the head of a successful company. The company has created value through their attention to detail along with ability to recognize incremental opportunities. For example, “Paakkanen boosted the role of the individual designers by giving them profit responsibility on their designs, […] emphasizing the profitability of their designs” (Mitchell 5). Clear roles and value is created when a unit connects practices, processes, and systems with growth objectives. She has done trainings with the designers in the

This question has been answered.

Get Answer
WeCreativez WhatsApp Support
Our customer support team is here to answer your questions. Ask us anything!
👋 Hi, Welcome to Compliant Papers.