CSR Assignment 1

Yunhan Wang

179531347

Stephen Pavelin

MN20445
Company: Amazon

Section 1: Issues

1. Oppressive Work Culture – For large companies that employ large numbers of low-skilled

labour, the desire for growth and maximum output can come at a human cost. Companies may

begin to look at its workforce almost as if they were livestock, neglecting the fact that each

employee, regardless of how low the position, is a person who deserves to be treated with

fairness and respect for well-being. Specifically, they can create oppressive work cultures which

govern based on fear and punishment, rather than create natural motivation in employees.

Examples of doing this are forcing employees to work longer hours, imposing minimal break

times for maximum work time, and setting targets that force employees to work beyond

reasonable limits. In doing so, the company violates basic ethics, forgoing its responsibility to

ensure that its employees are treated with decency. This is relevant to Amazon, as it employs

hundreds of thousands of low-skilled workers in its warehouses around the world, creating a

potential for oppressive work environments, especially as the company is so focused on

efficiency and low prices.

2. Environmental Costs of rush shipping – Express shipping (1 or 2 day shipping) is a shipping

innovation that has become popular in recent years. Though it is logistically impressive that a

company can consistently deliver their stock within a day or two, the issue lies in the

environmental impact that this type of shipping incurs. According to MIT, online shopping has a

lower carbon footprint than traditional (brick-and-mortar) shopping, but when rush shipping is

added to the equation, online shopping actually has a higher carbon footprint than traditional
shopping (Murdock, A., 2017). Rush shipping causes a variety of changes in shipping actions.

First of all, more trucks need to be deployed on the road, causing an increase in greenhouse

gasses. As well, rush shipping offers less flexibility to the shipper, so oftentimes, each item

ordered will be delivered in separate packages to the same location, causing an increase in the

amount of deliveries, and therefore an increase in emissions. As well, because time is so

constrained in rush shipping, shipping companies will send out their trucks half full, resulting in

a waste of potential space that could be filled. This can be contrasted to traditional shipping,

which offers more flexibility in timing, allowing trucks to be sent out at full capacity. For

example, a 5-day shipping window allows the shipping company to wait for many more

shipments to come in before consolidating the shipment into a delivery truck compared to a 2-

day shipping window. As well, with a longer window, the shipping company is allowed greater

leeway to determine the most efficient way of delivering their consolidation of packages

(Murdock, A., 2017). This issue is relevant to Amazon, as the company is well known for its free

express shipping, and thus has the potential to cause high environmental harm.

3. Anti-Competitive Practices (Removal of Competitor Products from marketplace) – In markets

around the world, anti-trust laws are set into place to promote fair competition between

businesses. These laws exist so that no companies can establish monopolies, and are ultimately

for the benefit of the customer (Federal Trade Comission, n.d). However, there exist companies

in industry who are large and powerful enough to take its competitor’s products off its

marketplace not through traditional means of competition and innovation, but by banning and

removing. This can be tempting to companies who do hold the power to so, as it means their

product can go unfettered on the marketplace, free from the pressure of competing products.
However, the consequence of this is that a state of unfair competition is created, potentially

violating moral and ethical boundaries, creating a CSR issue. Furthermore, in a modern world

with regulations set into place, the company can face negative repercussions that hinder them in

the long run, This issue is relevant to Amazon, because as the dominant online retailer, it holds

the power to bury or even make obsolete a product or even company if a specific product is

banned and removed from its marketplace.

Section 2: Analysis

1. Stakeholder theory will be used to analyse the issue of an oppressive work culture, and

specifically, the company’s relationship with an employees. This theory states that “the

willingness of employees to join, be retained by and work hard for the firm [will affect] the

firm’s productivity” (Pavelin, S. 2018). Though an oppressive work culture can artificially

generate productivity by setting targets that are near unfeasible and force employees to work

through the threat of being sacked, it is unsustainable, and will ultimately cause burnout among

employees and an unhealthy workforce. Therefore, this type of work culture will ultimately

cause a weakened company, as it erodes one of its most important stakeholders, its employees.

As a result, employees will develop negative attitudes and resentment towards the company,

turnover will potentially increase, and the outcome will be a less productive and less financially

successful company. Thus, the responsibility of the company should be to treat and compensate

its employees fairly, to provide reasonable hours of work, and to allocate an adequate amount of

time for breaks for using the washroom and eating. In doing so, a company will generate a

healthy work environment, and in extension uplift and motivate its employees to work. Then, in
accordance with stakeholder theory, because the relationship with its employees has been

properly managed, the company will achieve a maximization of profits.

2. Teleological theories will be used to analyse the CSR issue of express shipping. These theories

are consequentialist, and use the outcome of an action to determine its “rightness” or

“wrongness”. The action itself is irrelevant in this evaluation (Kaplan Financial Knowledge

Bank, n.d). When applied to the issue of a company offering express shipping, it can be seen that

the action itself is not a “wrong” action; in fact, it can be beneficial to the consumers who decide

to use it. If given the choice, it would be difficult to find a consumer who would prefer to receive

their purchased merchandise later rather than sooner, showing that if viewed from a stakeholder

perspective, the action is positive. However, the issue lies in the end consequence of this express

shipping, and this is where the teleological theory comes into play. There is a heavy

environmental cost associated with rush shipping, and in a modern world where environmental

consciousness is so important, it would seem then that the harms of rush shipping outweigh the

pros. From a utilitarian standpoint, the outcome of the action negatively affects everyone,

regardless of whether they are a customer, as it is related to the health of the environment,

whereas the benefits only apply to the specific group of customers, and it is marginal at best, for

the most part (Kaplan Financial Knowledge Bank, n.d). Therefore, in regards to express

shipping, companies should create a distinction between it and traditional shipping; one which

would dissuade consumers from choosing the rush option unless it is necessary. In that way,

environmental impacts can be minimized.

3. Stakeholder theory will be used to analyse the issue regarding anti-competitive practices. This

issue involves three groups of stakeholders: regulators, competitors, and customers. By removing

competitor products from the marketplace, the company runs the risk of creating a market that is

monopolistic and/or break anti-trust laws. Though this can benefit the company in the short term,

they will face consequences from its stakeholders. Regulators hold the power to affect the

company’s activities, and if they take issue to the artificial lack of competition created, they can

create regulations and impose them on the company, which in the long run will be a detriment to

the company. Furthermore, customers would be less willing to consume the company’s products

if they knew that they were being taken advantage of through a monopolistic environment.

Ultimately, the company should allow its competitors’ products on the marketplace even if it

holds the power to block them from sale, and look to set itself apart by providing the best

product rather than the only product available. There should be a sense of social responsibility

and a respect for fair competition present in the company’s actions and its relationships with its

stakeholders. In doing so, a fair and ethical sense of competition is created, and in the end the

company benefits through the need to innovate.

Reference List

Federal Trade Comission, n.d. Guide to Antitust Laws [Online]. Federal Trade Commission.

Available from: https://www.ftc.gov/tips-advice/competition-guidance/guide-antitrust-

laws [Accessed 5 May 2018].

Kaplan Financial Knowledge Bank, n.d. Ethical Theories [Online]. Kaplan Financial Knowledge

Bank. Available

from: http://kfknowledgebank.kaplan.co.uk/KFKB/Wiki%20Pages/Ethical%20theories.as

px [Accessed 5 May 2018].

Murdock, A., 2017. The environmental cost of free 2-day shipping [Online]. Vox. Available

from: https://www.vox.com/2017/11/17/16670080/environmental-cost-free-two-day-

shipping [Accessed 5 May 2018].