Ethical issues Practice in Coca Cola

Company
 REPORT ON
Ethical issues Practice in Coca Cola Company

SUBMITTED TO:
DR. SEYAMA SULTANA
PROFESSOR
SCHOOL OF BUSINESS AND ECONOMICS
UNITED INTERNATIONAL UNIVERSITY

SUBMITTED BY:
TEAM SYNERGY
SECTION C

NAME ID SERIAL

Sohel Mahamud 111 171 084 30

Abu Sufian Mridul 111 171 054 28

Arifa Hossain 111 171 085 31

Md. Kamrul SSHassan Shuvo 111 151 427 06

Shikha 111 143 179 02

Sourav Sen Gupta 111 171 181 35

Senjuti Mondal 111 171 176 34

DATE: 07th December 2019

United International University
 LETTER OF TRANSMITTAL

07st December, 2019

Dr. Seyama Sultana

Professor
Department of Business Administration
United International University.

Subject: Submission of the report on “Ethical issues practice of Coca cola Company”

Dear Madam,
With due respect, we, the undergraduate students of BBA have prepared the report you have
assigned us as a partial fulfillment of the course on Business Ethics. We have completed our
work respectively and we have given our utmost effort to collect all the necessary information.
Though we are on the learning curve, this report has enabled us to gain insight into the core facts
of real life Ethical issue practices of an organization.

Thank you for your supportive consideration for formulating such a useful term paper. We have
tried our best to avoid any deficiencies and we hope that the analysis that we have completed
will meet your expectations.

Best regards,

SohelMahamud
On behalf of Team Synergy
Department of BBA,
United International University.
 ACKNOWLEDGEMENT

It is not possible to prepare a project report without the assistance and encouragement of other
people. This one is certainly no exception. On the very outset of this report, our group would like
to extend our sincere and heartfelt gratitude towards all the individuals who have helped us in
this endeavor. Without their active guidance, help, and encouragement we would not have made
headway in this project.

Firstly we would like to thank the Almighty Allah for all the gratitude.
We deem it a pleasure to acknowledge our faculty, Dr. Seyama Sultana Madam for her
conscientious direction and support in the accomplishment of this assignment as well as his
valuable teachings in our Business ethics course throughout the trimester.

We also extend our gratitude to United International University to provide us with such a strong
academic atmosphere and positive environment to work towards our success in life.

Finally, we must say that no height is achieved without some sacrifices made at some end and it
is here where we owe our special debt to our parents and our friends who have always showed
their love and care the entire time.

Thank you from all our team members.

 EXECUTIVE SUMMARY

This report deals with the concept of business ethics and the code of conduct of Coca-Cola as
well as the employees of this organization. The purpose of the study is to focus on the ethical
issues faced by Coca Cola in this current market. Coca-Cola is a multinational organization and is
a nonalcoholic beverage company in the world, as well as one of the world's most recognizable
brands. It has its own code of conduct which is practiced internationally. We will look at it's
code of conduct and ethical practices in detail throughout this report as well as Coca cola's
corporate social responsibilities, safety and occupational health in the work place, the whistle
blowing system, Rewards Policy and Corrective Measurements.
 TABLE OF CONTENTS
LETTER OF TRANSMITTAL.............................................................................................................................i
ACKNOWLEDGEMENT..................................................................................................................................ii
EXECUTIVE SUMMARY................................................................................................................................iii
CHAPTER 1:..................................................................................................................................................1
INTRODUCTION...........................................................................................................................................1
1.1 BACKGROUND OF THE REPORT...................................................................2
1.2 OBJECTIVES OF THE REPORT........................................................................2
1.3 LIMITATIONS OF THE REPORT......................................................................2
1.4 SOURCES AND METHODS OF COLLECTING DATA...................................3
1.4.1 PRIMARY DATA COLLECTION...............................................................................................3
1.4.2 SECONDARY DATA COLLECTION..........................................................................................3
2 CHAPTER 2:..........................................................................................................................................4
2.1 Company Profile...................................................................................................5
3 CHAPTER 3:..........................................................................................................................................6
ETHICAL ISSUES IN CERTAIN DIVISION.........................................................................................................6
3.1 Ethics & Compliance............................................................................................7
3.1.1 Code of conduct...................................................................................................................7
3.2 Ethical issue practices...........................................................................................9
3.3 Corporate social responsibility............................................................................10
3.4 Safety & Occupational Health in the workplace.................................................11
3.5 Whistle Blowing System.....................................................................................11
3.6 Rewards Policy...................................................................................................11
3.7 Corrective Measurements...................................................................................13
4 CHAPTER 4:........................................................................................................................................14
RECOMMENDATIONS................................................................................................................................14
4.1.1 RECOMMENDATION ANALYSIS..........................................................................................15
4.1.2 RECOMMENDATIONS........................................................................................................15
5 CHAPTER 5:........................................................................................................................................16
CONCLUSION.............................................................................................................................................16
APPENDIX..................................................................................................................................................18

CHAPTER 1:
INTRODUCTION
1.1 BACKGROUND OF THE REPORT

Ethical dilemma is a common trait found in the business organization and this has the clear
linkage with moral dilemmas. The perfect world of business includes the right thing, but the
ethical dilemmas have become much prominent in this complex world of business. According to
Van Auken (2016), the ethical dilemmas lead the human being to undertake the wrong
decisions due to the difficulties. More specifically, the ethical dilemma arises when a person has
to differentiate between the moral and the immoral act. The personal temptation is one of the
significant ways to improve such ethical dilemmas (Shapiro & Stefkovich, 2016). It is necessary
to find the conscience while undertaking any important decision based on some of the crucial
aspects in business. Many of the organizations face diversified forms of ethical dilemmas, which
create the significant impact on organizational reputation as well as the business practices.

1.2 OBJECTIVES OF THE REPORT

The purpose of the study is to focus on the ethical issues faced by Coca Cola in this current
market. The news of ethical corruptions against the business practices of Coca Cola has created
the buzz both in social life and in the business market. The study will be focusing on such ethical
issues found in the external and the internal organizational scenario of Coca Cola. The study will
also be associated with the theoretical concept based on the ethical issues that has been
influencing the managerial practices in Coca Cola.
1.3 LIMITATIONS OF THE REPORT

The main limitation of the study is lack of information provided by the organization.
Some of the other reason:

 It was quite hard to collect accurate information .

 Large scale research was not possible due to constraints and restrictions posed by the
organization.
 There were a few questions which were tactfully avoided or not exactly answered by the
respondents.
 Time is too short.

1.4 SOURCES AND METHODS OF COLLECTING DATA

Two types of data were collected, both primary and secondary.

1.4.1 PRIMARY DATA COLLECTION

We have used the observational approach and interview approach for collecting our required
data. A questionnaire was prepared to find out the Ethical Issue Practices of Coca Cola Company
of Bangladesh. To do this, we visited the Coca-Cola International Beverages Private Ltd.,
Crystal Palace (11th Floor), Rd 140, Gulshan, Dhaka 1212.

1.4.2 SECONDARY DATA COLLECTION

Secondary data was collected from the review of existing data from Internet, lecture notes, and
from our course textbook. We also visited the official website of the company and other
published information to collect data.
 2 CHAPTER 2:
COMPANY OVERVIEW
2.1 Company Profile

The Coca-Cola is a multinational organization headquartered in Atlanta, Georgia employing over

62000 personnel in the world. Coca Cola is the nonalcoholic beverage company in the world, as
well as one of the world's most recognizable brands. The Coca-Cola Company is home to 15
billion dollar brands, including four of the top five soft drinks: Coca-Cola, Diet Coke, Fanta, and
Sprite. Other top brands include Minute Maid, PowerAde, and vitamin water. All told, it
markets more than 500 beverage brands, mainly sparkling drinks but also waters, juice drinks,
energy, sports drinks, teas and coffees. With the world's largest beverage distribution system,
The Coca-Cola Company reaches consumers in more than 200 countries. Nearly 65% of its sales
come from outside the US. Their mission is to refresh the world, to inspire moments of
optimism and happiness, and to create value and make a difference. They believe that their
success depends on their ability to provide consumers with a wide variety of options to meet
desires, needs, and lifestyle choices. Coca-Cola has four strategic priorities to create long-term
growth: to drive beverage leadership, to accelerate innovation, to leverage their balanced
geographic portfolio, and to lead the Coca-Cola system for growth. The major goal of the
company is to increase the market share in the international market. The Coca-Cola Company is
going to invest more in Bangladesh to expand its footprint, encouraged by growing demand for
beverages and steady economic growth of the country.
 3 CHAPTER 3:
ETHICAL ISSUES IN CERTAIN DIVISION
3.1 Ethics & Compliance

The core of the ethics and compliance program at The Coca Cola Company is our Code of
Business Conduct. The Code guides our business conduct, requiring honesty and integrity in all
matters. All of our associates and directors are required to read and understand the Code and
follow its precepts in the workplace and larger community.

3.1.1 Code of conduct

Code of conduct in an organization is a list of formally binding norms within the organization.
Code of conduct is not just a “unwritten rules” but expected moral behavior and responsibility.
In simple terms, code of conduct can be defined as the way in which the whole company has to
work including its owners, employees, managers, etc.

TO WHOM DOES THE CODE OF BUSINESS CONDUCT APPLY IN COMPANY ?

It applies to everyone working for the company worldwide. This include all employees ,
managers , operating committee members and company directors. We also expect temporary
and contract employees, consultants, agents and any other third party who acts in the name to
follow the principles of the code.

1) DISCRIMINATION AND HARASSMENT

 Discrimination on the basis of caste, color, religion, race on creed is a punishable
offence and the culprit will be dealt with strictly.
 Sexual harassment in any form is strictly prohibited. The person responsible for such
action will be held accountable for same.

2) FINANCE RECORD KEEPING

 All the revenue calculation should be done in the predetermined time and limit, no
one is allowed to modify the period of accounting of revenue in order to meet their
optimal budgetary goals.
  No transactions should be twisted in order to display a different set of scenario.
 Personnel concerned should be accurate in laying company’s detail, however,
honest mistakes could happen and will not be concerned as a violation of code.
3) COMPANY PROPERTY
 Company has the full right of penalizing the employees who will intentionally
damage company’s asset.
 No company asset can be used for a different purpose other than what it is meant
for.
 Theft or intentional replacement of company assets may result in termination or
filing of lawsuit against the personnel involved.
4) COMPANY INFORMATION
 Non public company information should not be disclosed to a third party in any case.
 Sensitive information provided to the employee concerning the company should be
kept undisclosed unless there is a corporate reason.
 No company’s undisclosed information can be used for trading in stocks and
markets.
 Company employees are prohibited to disclose any sensitive information even after
working hours, leaving the organization, or retirement.
5) GIFTS AND FAVOURS
 No employee is allowed to receive any personal favor or gift from a third party in
exchange of doing any particular favor to it.
 No employee is allowed to ask for gift from a third party dealing with the company.
 Gift as a gesture of respect like trophies or t-shirt and of modest value can be
accepted by the employee from a third party
3.2 Ethical issue practices

Ethics refers to society's sense of the right way of living our daily lives. It does this by
establishing rules, principles, and values on which we can base our conduct.

Workplace ethics is important as it enables management to treat all employees as equal and

think from their perspective as well. Employees must have a say in their appraisal system.
Transparency is essential. Management needs to make employees feel secure about their job
and career. There is some positive ethical behavior in Coca-Cola Company.

These are given below:

1. LOYALTY: Ethical executives are worthy of trust, demonstrate fidelity and loyalty to
persons and institutions by friendship in adversity, support and devotion to duty; they
do not use or disclose information learned in confidence for personal advantage. Coca-
Cola Company loyal with their workers and working method. They are loyal to their
companies and colleagues and if they decide to accept other employment, they provide
reasonable notice, respect the proprietary information of their former employer, and
refuse to engage in any activities that take undue advantage of their previous positions.
2. PRAISE POSITIVE BEHAVIOR:  It’s equally important to praise your employees for
following best practices. Coca-Cola company praising there workers positive vibe
behavior. Doing so should serve as positive reinforcement, which can have some long-
term benefits for business.
3. DISCRIMINATION: Coca-Cola Company never discriminates in working place. They are
very much humble everyone so that the company is now world most profitable position.
4. PRIVACY ISSUE: They are highly adjusted their privacy issue with workers.
5. LAW ABIDING: Ethical executives abide by laws, rules and regulations relating to their
business activities. Coca-Cola Company working method is very clear. They’ll respect
their law so that they never out of their law bounding.
6. INTEGRITY: Ethical executives demonstrate personal integrity and the courage of their
convictions by doing what they think is right even when there is great pressure to do
 otherwise; they are principled, honorable and upright; they will fight for their beliefs.
They will not sacrifice principle for expediency, be hypocritical, or unscrupulous.
7. COMMITMENT TO EXCELLENCE: Ethical executives pursue excellence in performing
their duties, are well informed and prepared, and constantly endeavor to increase their
proficiency in all areas of responsibility.
8. REPUTATION AND MORALE: Ethical executives seek to protect and build the company’s
good reputation and the morale of its employees by engaging in no conduct that might
undermine respect and by taking whatever actions are necessary to correct or prevent
inappropriate conduct of others.
9. LEADERSHIP: Ethical executives are conscious of the responsibilities and opportunities
of their position of leadership and seek to be positive ethical role models by their own
conduct and by helping to create an environment in which principled reasoning and
ethical decision making are highly prized. Coca-Cola Companies top management is
highly concerned about their workers. So that they will take extra responsibility for a
positive working situation.
10. ACCOUNTABILITY: Ethical executives acknowledge and accept personal accountability
for the ethical quality of their decisions and omissions to themselves, their colleagues,
their companies, and their communities.
11. PROPER USE OF COMPANY RESOURCES: We protect and preserve the tangible and
intangible assets of the company, and we make an efficient use to contribute to achieve
the business goals and we do not use them for personal gain.
12. PROTECTING INFORMATION: We do not disclose confidential information regarding
processes, methods, strategies, plans, projects, technical or market data, or information
of any other kind.

3.3 Corporate social responsibility

Coca-Cola established Corporate Social Responsibility policy with the concept of ‘Live Positively’,
which include seven core areas: beverage benefits, active healthy living, the community, energy
and climate, sustainable packaging, water stewardship and the workplace.

These core areas were set by firm to fulfill goals and improve sustainability practices. In addition,
‘Coca-Cola has adopted some international Corporate Social Responsibility guidelines, such as

Global Compact, Respect and Remedy Frame work, however, these guidelines do not seem to be
integrated into the code of business conduct. Moreover, Coca-Cola implements more initiatives

to enhance its reputation. For example, after the environmental conflict in India, Coca-Cola
became a member of CEO water Mandate and collaborated with World Wildlife Fund (WWF),

concerning the water issues of firm and the control measure.

3.4 Safety & Occupational Health in the workplace

 We believe that safety and health in the workplace are as important as any other action
or purpose of Coca-Cola.
 We take actions to guarantee that the following safety and health in the workplace are
met:
a) Provide and maintain safe and healthy workplaces.
b) Provide and maintain a suitable work environment.
c) Promotes security awareness among our employees.

3.5 Whistle Blowing System

At Coca-Cola we believe that Values are an essential and vital part of the life and culture of the
corporation, therefore we take seriously any reports regarding illegal practices or inappropriate
conducts observed within our organization. This is accomplished through a Whistle blowing
System, which is a mechanism distinguished by an open communication system to report any
conduct or practice which is not aligned with our business ethics.
3.6 Rewards Policy

 Total Reward Policy

Total reward is a concept where an organization makes an effort of motivating and retaining
employees to get maximum result in return. Coca-cola has a program known as cloud – based
technology whereby, employees are given the freedom to make choices of rewards. The choice
of one may differ from another. For example- some employees may consider trips, holidays and
vacations necessary while others may like allowances and scholarships for their children.

The contribution of total rewards in Coca-cola id fruits bearing. Employees feel motivated and
through that the company can utilize their labor to the fullest. The organization performance is
impacted positively and that is why Coca-cola is currently the best performing beverage
company worldwide.

 Best Practice Policy

Another reward principle is evaluated in the paper is best practice in regards to equitable, fair,
consistent and transparent. Best practice enhances equitability and fair treatment of
employees. The company applies best practice policy through ensuring the undertaken
operations are transparent and can be accounted for. It intends to give back to the society
which enables positive reputation and branding of the company's name. Best practice, policy
and transparency compare through fairness and accountability.

 Role Of Line Managers

Line managers at coca-cola company play a vital role in reward decision. To begin with, the line
manager is responsible for overseeing employees and ensuring that the organization goals are
attained. The manager is a part of decision- makers in the case of determining the employees to
be rewarded and how. Also, the manager decides on the intensity of effort by an employee to
be rewarded setting up standard and goals. The line managers build trust among employees in
that employees feel free to give their grievances to them than to senior managers and human
resource. The manager conducts a performance appraisal and analysis to determine the reward
decision.

Through the given set of roles, line managers at Coca-cola company can contribute to decision
making on a reward. They can determine employee's performance since they are the only part
of management that spends a long time with employees. The managers can be able to get
information from employees about their attitude and conduct. This means that they can
determine a perfect reward for any given employee. Line managers conduct a performance
appraisal to provide feedback to every employee on their performance.

The role mentioned above and contributions have an impact on morale, motivation, the
psychological contract and organization success. To begin with confidence, employees of Coca-
cola will feel appreciated and engaged because of their relationship with the line manager.
Motivation increases productivity and encourages employees to give their best efforts.
Psychological contracts are achieved in that when an employee gives a promise ensuring that
they fulfill it. An organization’s success consists of a satisfied group of employees and satisfied
customers. Healthy communication between subordinates and management and courageous
leadership by line managers of Coca-cola reflect the success of the organization.

3.7 Corrective Measurements

 The breaches against the ethics code coming from any director, officer, collaborator or
third party related to illegal behavior will be subject of an investigation to consideration
and when needed of a corrective measure.
 The corrective measure will depend on the seriousness of violations committed and it
will also depend if the violation come from an involuntary error, willful misconduct and
negligent action. The company believes that not penalizing a violation to this code is
itself a violation of it.
 Corrective measures may range from a written warning, dismissal or to criminal
prosecution by the appropriate authorities if required.
 Once the corresponding investigations are conducted, corrective measures will be
determined and applied by the direct bass of whoever has committed the fault aided by
legal, human resources or internal audit areas.
 In case of doubt about the existence of a violation to this code of conduct before a
penalty is imposed for the alleged violation to the suspected violator, any available
evidence shall be validated and assessed by the Human Resources or Internal Audit
Department, Ethics Committees of the countries or corporate, before imposing
corrective
 4 CHAPTER 4:
RECOMMENDATIONS
 4.1.1 RECOMMENDATION ANALYSIS

4.1.2 RECOMMENDATIONS
 They should start education and environment friendly projects which help in
creating good image in front of their customers and the society.
 If Coke becomes more ethically and social responsible by taking part in such social
activities or doing projects for betterment of the society then this will create their
reputation of ethically responsible and social activate.
 Coke should also include their code of conducts for business in their mission
statements and in their missions. Hence this will help coke to be more ethical
responsible.
 Coca Cola believes that health and safety are as important as any other company
activity or objective.
 They should start their own Non-organization or merger with an Non-organization to
work on for betterment for the society.
5 CHAPTER 5:
CONCLUSION
Conclusion

To be really effective the code of conduct shall be prepared and laid down in the most
comprehensive way possible. It shouldn’t leave out even a single entity within the organization
or without, irrespective of the power or authority of that entity. The code of conduct and
business ethics in an organization are guidelines to work in the interest of their own while also
caring the integrity and welfare of others the employee or the company might effect. Situations
arise when it gets really hard to take any particular decision and/or to work against a
malpractice omnipresent within the business environment concerned, but what should be kept
in mind is the long lasting effect of the actions and the repercussions that might follow because
these guidelines are not only made in the interest of the company or society but all and sundry.
 APPENDIX

QUESTIONNAIRE

Dear Sir/Madam,

We are students of United International University, conducting a survey on “Ethical issue

Practices of coca cola company” as a fulfillment of our Business Ethics course’s trimester report.

You are requested to respond to the questions which will take about 7-10 minutes of your time.
We assure you that the information about your organization will remain strictly confidential and
will be used for academic purposes only.

Name:………………………………………………………………

Designation:………………………………………………………...

Please read and answer the following statements.

1. Does your organization have a written ethics policy?

No/Never Sometimes Usually Yes/Always

2. Does your company require it’s employees to sign a code of conduct statement?

No/Never Sometimes Usually Yes/Always

3. Are ethical behaviors expected out of your leaders?

No/Never Sometimes Usually Yes/Always

4. Are ethical behaviors rewarded?

No/Never Sometimes Usually Yes/Always

5. Do the leaders in your organization act ethically?

No/Never Sometimes Usually Yes/Always

6. Are the leaders in your organization honest?

No/Never Sometimes Usually Yes/Always

7. Is the behavior of your leaders consistent with the stated ethics and values of the
organization?

No/Never Sometimes Usually Yes/Always

8. Does your organization offer training in business ethics?

No/Never Sometimes Usually Yes/Always