COCA-COLA: ETHICAL EGOISM

Over the past decade, Coca-Cola has seen comprising values leading to questionable decisions,
irrespective of the prescribed ethics. Coca-Cola is an organization formerly operated under what is
known as egoism. Egoism is an ethic theory following the simple framework of defining right or
acceptable behavior in terms of its consequences for an individual based on one's self-interest or, in this
case, the self-interest of the organization.
Egoists believe that they should make decisions that maximize their self-interest, defined differently by each
individual.
While Coca-Cola possessed a standard code of conduct over the previous decade, nevertheless, its
code of conduct was usurped as leaders of the organization followed egoism. As a result, Coca-Cola
faced at least three crises of ethics.

Earnings Misrepresentation

Coca-Cola faced SEC violations for an act known as channel stuffing. As a result of which, Coca-Cola
was able to inflate earnings, thus misleading investors as to the actual financial position of the
organization. Some material facts concerning Coca-Cola and the condition of its business and
financial results were misrepresented and omitted from various public statements, causing the price
of Coke stock to be inflated artificially. However, leaders of the organization at that time were
looking out for the preservation and self-interest of the organization. Clearly, the leaders followed
the framework of egoism as a rationale for their decidedly perceived unethical behavior.
Egoism fails; Coca-Cola is taken to court by investors and fined by the SEC for securities violations.

Problems with Distributors

In 2006, Coca-Cola, through its subsidiary Coca-Cola Enterprises (CCE), moved to distribute
Powerade drinks directly to Wal-Mart's warehouses in direct violation of territory agreements with
Coca-Cola's other bottlers and distributors. Coca-Cola claims it operated only with the customer's
best interest in mind.

Considering egoism, when a leader is faced with making a business decision, they ultimately side on
self-interest as a basis for right or wrong again. In this case, Coca-Cola chooses to serve its interest
by allowing CCE to deliver Powerade directly to Wal-Mart warehouses. As a result, Coca-Cola find its
way back into court for breach of contract. The lawsuit settled for an undisclosed amount of financial
compensation and a restructuring of the territorial agreements. Again, Coca-Cola's leadership taking
actions believed to serve their best interest (egoism) causes an adverse effect.

Monopolistic practices

The pursuit of self-interest involving Coca-Cola manifests itself once again the way of monopolistic
practices. In 2001 Pepsico, Inc. filed a complaint against Coca-Cola, Inc. for violations of the
Sherman Anti-trust Act. The act was established to prevent monopolies and monopolistic or unfair
trade practices.
While Pepsico lost its suit against Coca-Cola in an appellate court, the case did result in tarnishing
the reputation of Coca-Cola. Coca-Cola and its leadership continued to pursue the self-interest of the
organization without respect for the harm caused to others

However, there is also enlightened egoism.

Enlightened egoists take a long-range perspective and allow for the well-being of others, although
their self-interest remains paramount.
As Coca-Cola is constantly finding new ways to minimize its environmental footprint, tackle climate
change, and inspire others to do the same as part of its social responsibility. Doing so will give their
business an excellent reputation among consumers and increase their profits. Thus, an egoist view
here of corporate social responsibility would approach it for the reason of self-interest of coca-cola
as it's good for business.

The idea would give the Coca -Cola a good reputation and improve their business. The act is morally
right as it promotes the company's best interest.

Coca-Cola still operates inside the framework of egoism and considers its actions justifiable and
ethical. Negative consequences were the monetary damages award in litigation; on the other hand,
a positive consequence is seen by Coca-Cola not only gaining increased market shares but also
increasing economies of scale.