You are the chief executive of ABC Ltd., an automotive component manufacturing company. Until recently, all of your production plants were located in City X. However, the cost of production has risen, causing profits to decline. A number of factors have led to an increase in the production costs. First, the union representing the workers in your plant waged a successful strike resulting in increased salary and benefits. A second factor has been imposition of stringent environmental regulations. Shareholders are concerned about the declining fortunes of the company. Many of the competitors have moved their operations to less-developed cities, where the operating costs are less than in City X. ABC Ltd. is a major employer in the city where it is located, and you know that a plant closure will cause economic dislocation in the city. 20 Given the situation, answer the following questions: (a) What are the ethical issues involved in this case? (b) How can the interests of different stakeholders be reconciled in this case?

(2) Worker who will loss jobs (3) Society at large due to environmental issues (4) Shareholders

(a) Ethical issues involved

• Shifting of location so as to evade law of land (environmental laws).
• Profit motive of company & its social responsibility towards its employees.
• Behaviour of workers & unions to increase wages in such adverse times being a part of company
• Sudden change of environmental law by government... is it just? Should it be fiat or gradual?
• lapse of governance in implementation of environmental laws?

(b) As a CEO of company my primary responsibility is to adress the interest of all stakeholders i.e. Shareholders, trade unions workers etc. without affecting profits of company & simultanously adhering to law of land. Thus my intervention should be in this regard.

Trade Unions/Workers

• Will identify the issues & demands of workers
• Will setup a meeting with union leaders & will highlight them the present issues of company's profitability
• Will highlight the picture of unfortunate events which may appear if company has to shut its operations
• Will persuade/convince them to take back their demands & get back to work & will assure them of good returns once the company gets back to profitability (if demands are just & fair)

Shareholders

• Will identify their concerns
• Will persuade them not to shift as shifting to evade laws following other companies is not a appropriate solution as it is a corrupt practice & also some day same norms if appropriate will be applied there as well (new location)
• Will convince them of finding the best possible solution in interest of company.

With respect to environmental norms

• Will check the desirability of such norms
• Will write a letter to Secretary & Minister highlighting the issue in adhering to such norms & will highlight the issues (if laws is unjust) or will ask him for adequate time frame (if laws are just) to adhere to norms.
• Will also highlight the evasion practices done by other industries - (Act of Probity) & will persuade him to take swift action