Identify the Ethical Issues. Is H. B. Fuller morally responsible for the addiction of the street children to the Resistol Product?

H. B. Fuller Company was found in 1887, and is now a global manufacturer of Adhesives, sealants and other specialty chemicals. It has Operation in over 40 countries in the North America, Europe, Asia and Latin America. It was brought to the attention of the company, by newspaper articles, that children were abusing their products by inhaling. The glue contains TOLUENE, a sweet smelling chemical that destroys the inner organs and can result in death. Homeless children throughout Latin America had become addicted to inhaling the glue.

Company received total revenues of $1,243 billion in 1995 up from $1,097 billion in 1994. (Increase of $146 billion). They also had a thirty eight (38) million increase in profits between 1994 – 1995. Fifteen percent (15 %) of sales revenue came from its Latin America operations, which accounted for 27% of its profits. $450,000 profits a year from glue sales in Central America.

There was a suggestion to use Mustard seed oils was recommended, but was not implemented because it would not have shelf life required. In March 1989, legislation was passed which banned the product, but was later revoked.

Certain steps were taken to correct the problem, such as:

Employing social workers
Discontinued selling in small jars.
Providing information to distributors

Identify the Ethical Issues. Is H. B. Fuller morally responsible for the addiction of the street children to the Resistol Product?

The rights theory suggests that the consumers and society have a right to a safe product. It would then extend to suggest that H. B. Fuller had a duty to provide a safe product. The product when used correctly was “safe” however the firm failed to effectively educate persons on the correct use of the product.

In addition the firm in their rational not to exit the market applied the Utilitarian Theory. They sated that they had to remain in the market because of their contribution to the economic viability to the society. However this integral role is questionable because the firm decided to confine the sale of the product to industrial firms who buy in bulk therefore excluding the small businesses. This is a blatant contradiction to their story of developing small businesses in the economy.

The underlying ethical concern in the case is that of corporate responsibility. There are however several specific ethical issues, these include:

Infringing on individuals and society’s right to a safe product
Pulling the product for personal gain as opposed to the benefit of society and consumers as was stated by H. B. Fuller
H. B. Fuller’s attempt to extricate them selves from any responsibility in the crisis by laying blame on the Parent Company without any mitigating circumstances.

In order to decide whether HB Fuller was responsible morally for the addiction of the street children to the Resistol ...

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The underlying ethical concern in the case is that of corporate responsibility. There are however several specific ethical issues, these include:

Infringing on individuals and society’s right to a safe product
Pulling the product for personal gain as opposed to the benefit of society and consumers as was stated by H. B. Fuller
H. B. Fuller’s attempt to extricate them selves from any responsibility in the crisis by laying blame on the Parent Company without any mitigating circumstances.

In order to decide whether HB Fuller was responsible morally for the addiction of the street children to the Resistol product let us examine the actions of the company.

The firm did:

Urged government to prohibit the sale of the product to children
Discontinued the sale of the product in small jars
Paid for the support of several social workers to work with street children
Circulated information to distributors about the dangers of Resistol addiction
After stating they were to remove the brand from the market the parent company decided to confined the sale of the product to large industrial firms.
Changed the chemical formula of the glue to less pungent formula however lethal just the same to deter abuse.
Increased the price of the glue by 30%
stated they were not responsible for the catastrophic effects of the Resistol brand on the children of the Central American Countries

Let us apply some tests to these actions:

The Law Test: H.B. Fuller did not commit any illegal act in their approach to the situation. Their control measures, which included, rendering assistance to the social workers and reducing availability of the product were well within the confines of the law.
The Harm Test: The availability of the product did result in harm to children and others who used the product properly and improperly. The firm argued that the government’s failure to provide a comfortable social environment was a major factor in the children’s abuse of the product. The fact is however that the product was harmful and inadequate measures where taken by the firm to address the issue. In addition HB Fuller failed to compensate the victims instead they attempted to pass on the responsibility for compensation, etc to the parent company as well as the government.
The Newspaper Test: The actions or lack thereof when publicized was very embarrassing to the firm. In essence the credibility of the firm was brought into question. This suggests a bit of ethical concern from consumers who in part argued that ethical impropriety was a feature of the HB Fuller organization.
The Child Test: The case does not speak to the information for this test however I do believe that if the management team of HB Fuller were not in those positions and there children were affected they would seek retribution in addiction they would very likely council their children against the very actions or rather stance they have taken.
The Smell Test: The management team of the firm did question the suitability of their actions in light of the rampant abuse. This is illustrated in the decision to withdraw the product from the market. This and other actions suggest that theses individuals were concerned about the correctness of their operation.

H. B. Fuller despite several pleas from children’s advocates failed to implement measures to prevent abuse of the product by street children in Honduras and Guatemala Even though they were aware that the retailers were selling the products to minors
The firm failed to do adequate research to ensure the suggested preventative measure was suitable.
The firm made a promise to remove the brand from the market and failed to effect the promise
Failed to investigate the surge in profits amidst allegation of product abuse by minors. This could have assisted the authorities to identify the retailers ho were engaged in this sort of activities.

In your judgement did H. B. Fuller conduct itself in a morally appropriate manner? Comment on H. B. Fuller as a socially responsible corporation.

A firm must satisfy society concept of social responsibility by ensuring they are fulfilling the basic requirements which include the economic, legal, and philanthropic and ethical aspect of social Responsibility however the failed to adequately effect their ethical responsibility to the society.

Let us examine some contributing factors to the abuse of Resistol by the children.

The Government

Failed to provide a stable economic and social Environment
Failed to sustain an education system that served the needs of the society because the children and some business persons were at a disadvantage they were unable to read labels
Medical services were suspended and as a result the children were unable to assess the treatment needed. As a result many sicknesses were exacerbated.
The Abuse of glue led to other abuses such a police brutality and crime increase and the authorities failed to adequately address these issues.

The Society

Failed to protect the children from the exposure to these products
Retailers sold the product to minors

The social conditions drove the children to the edge however the availability of the product contributed to the children’s abuse. The nature of the product dictates that measures are taken to ensure proper use of the product and this was not done. In addition the abuse of the product was made know and no action was taken initially to curtail such abuse. The company has a responsibility to ensure that most properties of the product are known, how then will they know that the product is safe. Once the properties of the product are known they must ensure that consumers are educated about the product and this was not done initially. Even when the scandal broke the firm sent information, about the dangers of Resistol abuse, to retailers and not the small businesspersons who are the ultimate end users.

The Responsibilities of the firm

To the society

To assist in the maintenance of the country’s economic and social stability by obeying the laws and contributing to he GDP.
To produce a product that is safe to the environment and consumers
To contribute to the development of the society

To Consumers

To provide a safe product
To educate consumers on proper use of the product
To ensure safe distribution of the product

Firm Rational for maintaining the product in the market: The sale of the brand in the market place contributed to the GDP of the country and assisted in maintaining stability in the society by fueling small businesses. However they continued to sell the product to huge industrial companies at very high costs, eliminating the small business segments. Therefore the rational for staying in the company was discredited by their own actions.

In evaluating the firm for their responsibility in the crisis we note that HB Fuller Failed to do some fundamental things which exposes them to assuming liability for these actions are inactions.

The Firm failed:

To provide a safe product
To educate consumers on proper use of the product
To ensure safe distribution of the product

H. B. Fuller despite several pleas from children’s advocates failed to implement measures to prevent abuse of the product by street children in Honduras and Guatemala Even though they were aware that the retailers were selling the products to minors
The firm failed to do adequate research to ensure the suggested preventative measure was suitable.
The firm made a promise to remove the brand from the market and failed to effect the promise
Failed to investigate the surge in profits amidst allegation of product abuse by minors. This could have assisted the authorities to identify the retailers who were engaged in this sort of activities.

The firms attempt to pass on the responsibility of the crisis stemming from the use of the product to the parent company is also cause for ethical concern. H. B. Fuller was a large corporation with several shareholders. The holding company has a responsibility to shareholders to ensure that the subsidiaries are operating the way they ought to operate. In fact it was directors of the parent company that decided to pull the product from the market initially. However the subsidiary was operating with some amount of autonomy and must be held accountable for the manner in which they operated.

In concluding based on the actions of the firm in this situation the firm has not satisfied all aspects of behaving socially responsible.