CH2O is a company that blends chemicals to create products such as acid cleaners, and then ships the blended chemicals in drums to the customers. After the drums containing the chemicals reaches the customer, CH2O asked that the customer returned the drums to be reused. Once the drums were returned, the company cleaned the drums themselves, and wastewater was produced in the process. Because the local sewer authority would not accept the wastewater, CH2O discharged the wastewater illegally by means of an apartment complex drain and a warehouse owned by the company.
CH2O continued to dispose of the produced wastewater by these means until 1995, when investigations emerged on CH2O for discharging pollutants into the sewer. Iverson, the founder, president, and chairmen of the board for CH2O, was charged with four counts of violating the Clean Water Act (CWA), the Washington Administrative Code (WAC), and the City of Olympia’s Municipal Code (Olympia Code), and was found guilty. Iverson then appealed the case, but his arguments were found to be invalid. Businesses should be run using a set of simple ethical guidelines that will help ensure the cases like Iverson’s do no happen to them.
If Iverson had followed the practical steps of the WPH Framework for Business Ethics, he would not be in his current predicament. When making an ethical decision for the company, the managers should consider three groups outlined in the WPH Framework for Business Ethics: Who the decision will affect, what purpose the company is pursuing, and how the business will meet the action-oriented business behavior. When the local sewer authority refused to accept CH2O’s wastewater, Iverson instructed the wastewater to be disposed of through the sewers of buildings other than the one in which CH2O operated.
This process released many foreign pollutants into the city’s water and may have caused damage or harm. If Iverson had considered the first step in the WPH framework, he would have asked how the decision to dump wastewater illegally would affect the stakeholders, including shareholders, customers, the community, etc. The community must now deal with polluted water in the sewage systems, the shareholders have lost money due to the charges, and the customers may no longer want to do business with CH2O.
When making a decision for the company, managers should also take the second step of the WPH Framework for Business Ethics into consideration. Decision makers need to consider what purpose they are trying to pursue. The basic element of decision making is values. Values are positive abstractions that capture our sense of what is good and desirable. Iverson did not consider his or the companies values when he allowed wastewater to be disposed of in the sewer. Polluting the water is not considered good or desirable. Iverson also violated the stakeholder’s trust, which is a topmost value.
Lastly, the managers of a business should consider how to make ethical decisions. If CH2O’s business decisions had been made after this step had been considered, the company might still be successful. Three guidelines help managers answer the question of how. First is the golden rule, which states “do to others as you would want them to gratify you. ” Second is the public discloser test, a method of behaving as if your actions are being broadcast over television. And third is the universalization test, which one must ask themselves what the world would be like if every person copied the decision made by the company.
Overall, the WPH Framework for Business Ethics is a reliable set of guidelines to help the owners or managers of a company to make difficult ethical decisions. The steps of Who, Purpose, and How allow decision makers to visualize how the decision may affect the company and others. If Iverson and CH2O had followed these guidelines, they could have avoided the investigations and trial they endured. Iverson would be running a successful and ethically sound business instead of being found guilty of federal crimes.
