Executive summary of the Case

Coca cola (1986), world largest beverage company faced a crisis after 39 Belgian children
became ill after consuming its product. The Belgian government followed by Luxemburg,
Netherland, France and Poland order to recall the product. The investigation reported of no any
toxic contamination, buti they contained tiny traces of carbonyl sulfide. They were also charged
for racial discrimination due to discriminatory practices in payroll. In response, coca cola
created the diversity council and pay US $193 million for claim. Coca cola was also accused
for contaminating the ground water in Varanasi. In response, it partnered with various
organization to collect rain water. Coca cola is investing low calorie sweeteners, offering grants
as a part of the CSR.

Problem within the case

The coca cola company is facing the problem of poor-quality maintenance, racial discrimination
and environmental degradation.

Issues within the case

The issues created within the case are as follows:
1. The Belgian children became ill after consuming the coca cola product.
2. The Belgian, Luxemburg, Netherland, France, Poland ordered the recall of all
coca cola products.
3. The Belgians investigation reported that no any toxic contamination was found
inside coke bottle, but carbonyl sulfide was traced inside the bottle which
produces the rotten smell

Possible Solution

1. The coca cola company should maintain the proper quality checkup or maintenance
facility
2. The coca cola company should make its HRM policies fair and just.

Best Solution
The coca cola company should strictly adopt a code of conduct for the bottling and the
employee’s relation as it facilitates the coca cola company to overcome its quality maintenance
and its HRM policies and also improve its manufacturing process to be environmentally
friendlier as the code of conduct will describes the best way of conducting any activities.

@asim_pokhrel
Recommendation
The coca cola company is seen to solve the problem in a short-term way as it pays a amount to
settle the lawsuit but not solving the roots causes. It partnered with different organization to
collect rain water despite maintaining the contamination of ground water. Hence, it should focus
the root causes of the problem and implement the best solution as prescribed in earlier section.

A. What are the ethical issues that could be raised from above cases?
The ethical issues that could be raised from the above cases are as follows:
1. Thirty-Nine Belgian children became ill after consuming the coca cola product
which created the crisis for the coca cola.
2. It was charged for racial discrimination by fifteen hundred African employees for
discrimination in payroll practice.
3. It was accused of contaminating the ground water with the waste water in Varanasi
which caused temporary dip in sales of the company.
Hence, the coca cola company faced the following ethical issues which effect the coca
cola company sales and eventually the financial performance

B. In the context of the case, Narrate the various ethical duties of a manufacturer (coca
cola) to be remarked the company as an ethical one?
Following ethical duties should be performed by the manufacturer (Coca-Cola) to be
remarked as an ethical one:
1. In response to the Belgian ethical issue, the company should actively take part in the
investigation of the contamination of the coca cola products.
2. The carbonyl sulfide that was traced in coca cola bottles which produces rotten egg
smell, the company should provide a detail information regarding its quality assurance
3. The company should make its HRM policy fair and just. It should address every culture
and diversity. It should address the knowledge, skill and ability for the payroll practices.
4. In response to the case of Varanasi contamination of ground water with waste water, the
company should implant the waste minimization plant or reduce the toxicants in the
waste which will not contaminate the ground water.
Hence the company should address the following ethical issues as mention above as an
ethical duties toward its stake holders.

C. Referring to the above case, explain in brief, how the Coca-Cola has been addressing
ethical issues raised against it?

@asim_pokhrel
 Coca cola has been facing the ethical issues for several times. The coca cola has been
addressing the ethical issues raised against it. They can be described below:
1. The ethical issue of recall of Coca cola product by Belgian government created a crisis
for coca cola. The coca cola company recall all the product as a response for the ethical
issues.
2. In response to the ethical issues of racial discrimination among African employees for
payroll, the coca cola company first denied the allegation and later paid US $ 193
million and created a diversity council to address the issues
3. In response to the ethical issue of contaminating the ground water with waste water,
Coca cola company partnered with the local governments, NGOs and other organization
to establish rain water collection facilities.
4. Coca cola company is conducting various CSR programs for the issues of recycling and
contribution to the climate change.
D. Looking at the case and your academic knowledge about business ethics and CSR, how
do you evaluate the CSR of the business world?
Corporate social responsibility (CSR) is a business approach that contributes to sustainable
development by delivering economic, social and environmental benefits for all
stakeholders.
The Case of contamination of the ground water with the waste water in Varanasi also speaks
the same words. The coca cola company is drilling out much more the underground water
and contaminating the ground water with the waste water. This causes Varanasi dryness and
minimum rainfall. Various protest has been done for this case but despite thinking about
minimization of waste and environmentally friendly, the coca cola company is partnered
with different organization for the collection of rain water facilities. This behavior shows
that the companies are not responsible for their effects on stakeholders and environment,
but they are ready to invest on other activities to benefit public or Stakeholders as a part of
CSR or response for polluting environment.

@asim_pokhrel