The Working Community for the Airport - Assignment Example

Business Ethics-Case Study Question Identify the main stakeholder groups affected by the proposed expansion of Heathrow. What are the main harms and benefits in this case for the stakeholders of the proposed increase in runway capacity In general the activities of a busy airport like Heathrow, affect most of the Britons, together with the general and business passengers of other nations. The fact that Heathrow carries around 70% of the International air traffic across the Atlantic is a pointer towards its role and influence. Some of the key stakeholders in this case can be identified as: The workforce: The working community for the Airport will be in for a shake up if the company faces adversity in functioning from any quarter. If the business goes down and profitability gets affected, this will have a direct impact on the salaries and perks of the workforce. On the other hand if there are more activities on the runway, expansion of the functional areas, addition of another runway, that implies better promotional avenues for the workforce and more job opportunities. The management (top management): The top management can be clubbed with the workforce as well, but this body being a policy making body, is supposed to be answerable to the adverse reactions in the media, NGO's concerns, passengers woes etc. Therefore if the functioning is smooth at the airport, that's a happy situation for the top management as it gets a pat on the back, besides of course, hefty remuneration. The passengers i.e. air travellers: Air travellers are the key customers of the services being offered by an airport. If there are additions in the facilities, it results in reduction of the waiting time in queues, better ambience, more spacious waiting lounges, more facilities at the airport etc. Such additions are bound to delight the customer. If the runway capacity increases, that implies lesser delay in landing and take-offs. This works to the advantage of the air travellers. The investors: Since BAA is a public listed company and thousands of Britons and FIIs hold a stake in the company, fluctuations in company's fortune are bound to affect the stake of these investors. Adding another runway will lead to more activities at the airport, that means more business and more profit earning opportunities. All this certainly helps the investor as better dividend can be expected on the investments. The residents living in the vicinity of the airport: Adding another runway implies more aircrafts landing and taking-off in quick succession. This might lead to more noise pollution in the surrounding areas, which might rob off the area residents from their well-deserved peaceful time with their family members, guests etc. BAA will therefore have to take extra care towards reducing the noise levels, which could imply making some additional investments. The airlines: Airlines will of course be the happiest lot with the addition of another runway, because that results in; Less fuel consumptions, as the aircraft doesn't have to hover over the airport, waiting for its turn to get the landing space. Customer satisfaction, as the carrier is now able to maintain time discipline in landing as well as in take-offs More parking space for the aircrafts near the runway, which saves time and money incurred on towing the aircraft to another corner of the airport. The suppliers and other business associates: More business implies more business activities for the suppliers and business associates of the airport as well as the concerned airlines. The Government: If BAA is able to satisfy its customers, able to maintain international quality standards, earn more profits, that implies a happy situation for the government. But if the airport gets a flak for its functioning, NGOs are up in arms against the policies, the governments has to spend considerable amount on placating those concerns. 1.2. From a utilitarian perspective, would you argue for or against the proposed new runway From the utilitarian perspective I will surely argue for the proposed new runway, because that would imply; i. London becoming a competitive destination. This should be a topmost priority for the country in view of the planned expansion of facilities at airports like Amsterdam and Paris. ii. Ease for air travellers, who can now plan their business trips, holidays etc. in a better way. iii. Better economic prospects for the country, which could reflect positively on the rates of inflation, price of goods and commodities, share market activities, infrastructure development, services sector etc. iv. More job opportunities for Britons. This means lesser rate of unemployment, better paying jobs and more satisfaction for us. v. More industrial activities in the country, which in turn could mean more job opportunities in a number of related industries. 1.3. Whose rights do you consider to be most 'inalienable' in considering the airport's expansion Explain and justify how conflicting 'rights' may be ranked. If we take a general look, all of us enjoy certain rights and privilege as human beings and citizens of the country. This expansion plan is basically being undertaken keeping in mind the air travellers' convenience. The expansion certainly affects the local area residents together with the air-travellers. As a citizen the individual is paying different types of taxes for ensuring a peaceful living and if the noise levels increase, there are more activities in surrounding areas, which might result in some hardship to the area residents. But it must be kept in mind that the air traveller is paying a premium price for the services of the airport, he too is therefore entitled to a better treatment. I therefore consider the rights of the air traveller as the most 'inalienable' in this scenario. The rights of the 'customer' of the airport might appear in conflict with those of the residents, but at the same time it needs to be emphasised that the resultant benefits accruing out of the increased business activities at the airport, will in some way be passed on to the area residents as well. In order to resolve the conflicting situation, technology can be of great use. With the advancement in technology, it is now possible to make use of noise filters, which can be used to minimise the noise. Moreover, the aircraft technology too is in the evolving stage, and soon it might be possible to come out with aircrafts which do not make much noise. We must not forget the case of power generators being used as back up during failure of electricity supply. Today we have noiseless generators. As part of its corporate responsibility and ethical business practices, BAA is certainly required to take into consideration the hardships being faced by the area residents. Carroll's Four Part Definition of corporate social responsibility calls for taking care of the economic, legal, ethical and discretionary (philanthropic) responsibilities. BAA is certainly undertaking the runway expansion within the legal framework and it is bound to serve the economic interests as well, but ethical parameters call for paying due attention the hardship of area residents as well. 1.4. What are the airline carriers' main duties and responsibilities How well do you consider they are fulfilling their duties at present The airline carrier is duty bound towards the needs of i. The customer ii. The society iii. The investors, promoters and suppliers iv. The workers Ethics of duties have been stated in the form of three maxims like; Maxim-1 - Consistency: This implies that the corporation must appear to be reasonably unbiased and consistent in its approach towards the stakeholders. Maxim-2 - Human Dignity: This implies that the organisation must value the contribution of the human associates towards the success of the organisation. Therefore, it becomes duty of the company to value the human dignity. Maxim-3 - Universality: This maxim becomes all the more crucial in today's context when globalisation has started dictating the economies of the nations in different regions. Therefore a reputed organisation will make sure that its policies and actions have accepted levels of universal appeal. Airlines industry in particular is one such industry requiring a universal approach in its strategic policies. Airlines industry is known as one of the most competitive one. With opening up of economies and emerging of smaller air carriers the competition has further intensified. This industry requires huge investments yet the level of competition is such that airlines often keep investing for years together and keep waiting for break even. From the very beginning the industry is investment intensive and requires continuous replenishment throughout the operational activities as well. Fuel costs, addressing the security concerns, maintaining well-paid pleasing personalities on the rolls for various types of services, preparing attractive promotional campaigns, inviting newer customers with loads of discounts, having a decent office and staff etc. some of the recurring costs that the airline carriers are supposed to handle in order to survive. It is worthwhile here to mention that, in order to survive the competition, airline carriers do everything possible to ward off adverse publicity, which might result in affecting their business prospects. Taking care of workers to ward off industrial unrest, offering range of incentives to customers, undertaking philanthropic activities to be known as a responsible organisation, handling investors, suppliers etc. with due diligence are some of the steps which most of the airline carriers have been undertaking in varying degrees. Moreover, the legal frameworks, the international treaties, the UN conventions on different subjects keep the airline carriers on their tenterhooks to adhere to accepted behaviour of business and rules and regulations. Therefore if we take a general look we find that most of the airlines it is found that most of them are indeed fulfilling their duties. I.5.Which other ethical theories help to analyse the conflicting ethical perspectives in this situation The conflicting ethical perspectives in this situation could be supported by some of the widely accepted theories like; i. Normative Ethical Theories: Leading three normative (or prescriptive) theories are described in the form of norms being adopted for fulfilling duties and obligations towards Stockholder: This theory works on the mutually beneficial arrangement between the stockholder and the company management. The stockholder advancing money to the management for carrying out the business which in turn would provide the stockholder a profit (or interest) on the investments. This theory takes recourse to the legal framework in place to protect the interest of stockholders. Stakeholder: This theory calls upon the management to give due consideration to the interests of all the stakeholders in the business. This theory doesn't give undue importance to the profit maximisation theory of stockholders; instead it calls for a coordinated approach to take along all the stockholders. Social Contract: This theory calls upon the business group to work towards the upliftment of the society in general while keeping the interest of the workers and the consumers. This theory is in fact considers the social contract between society, workers and consumers as sacrosanct. ii. Descriptive Ethical Theories: Descriptive ethical theories in fact try to define the logic and terminology behind the stated ethical practices being practiced by the corporate houses. This school of thought relies more on the way different societies take up moral of ethical issues. Question-2: Select a major International air carrier and critically appraise their current approach to Corporate Social Responsibility. Read More