MATTEL’S COMMITMENT TO ETHICS AND SOCIAL RESPONSIBILITY Because the company’s products are designed mainly for children, sometimes it must be sensitive to social concerns about children
Trang 1TRƯỜNG ĐẠI HỌC KINH TẾ QUỐC DÂN VIỆN ĐÀO TẠO TIÊN TIẾN , CHẤT LƯỢNG CAO VÀ POHE
_ _
BÀI TẬP
Môn: Đạo đức kinh doanh
CHALLENGES
Sinh viên th c hi n: ự ệ
Mã sinh viên:
Chuyên ngành:
L p: ớ Giáo viên h ướ ng dẫẫn:
Nguyêẫn Nh Ng c ư ọ 11214350
Kinh doanh quốốc têố clc 63D
Nguyêẫn Bích Ng c ọ
Hà Nội – 2022
Table of Contents
Trang 2A SUMMARY 3
I INTRODUCTION 3
II COMPANY HISTORY 3
III MATTEL’S COMMITMENT TO ETHICS AND SOCIAL RESPONSIBILITY 4
IV MATTEL’S RESPONSE TO ETHICAL CHALLENGES 7
V CONCLUSION 9
B QUESTION 9
Trang 3A SUMMARY
I INTRODUCTION
Mattel, Inc is a global leader in designing and manufacturing toys and family products Well-known for brands such as Barbie, Fisher-Price, Disney, Hot Wheels, Matchbox, Cabbage Patch Dolls, and board games, the company boasts nearly $ 6.27 billion in annual revenue Headquartered in El Segundo, California, with offices across the world, Mattel markets its products in over 150 countries Being a multinational company majoring in the sale of children's toys, the
company is easily plagued with various ethical challenges that are associated with the company’s products at various levels of the supply chain
Despite having faced a series of difficult and potentially crippling challenges, the company still handled it well After those tough times, Mattel still looks toward the future and appears to be steadfast in its commitment to restoring its reputation
II COMPANY HISTORY
It all began in a California garage workshop when Ruth and Elliot Handler and Matt Matson founded Mattel in 1945 The company started out making picture frames, but the founders soon recognized the profitability of the toy industry and changed their emphasis to toys Mattel became a publicly owned company in 1960, with sales exceeding $ 100 million by 1965 Over the next forty years, Mattel went
on to become the world’s largest toy company in terms of revenue
Barbie and American girl
In 1959, Mattel introduced a product that changed its future forever: the Barbie doll After one of the founders had noticed how her daughter loved playing with paper cutout dolls, she decided to create dolls based on an adult rather than on a baby Barbie has had 40 different nationalities and many outfits made by 75 different fashion designers throughout the years The popularity of Barbie allowed Mattel to introduce many different versions of the iconic doll Apart from
manufacturing dolls for children, Mattel often releases limited edition dolls at a more expensive price geared toward adult collectors
This is a preview
Do you want full access? Go Premium and unlock all 13 pages
Access to all documents Get Unlimited Downloads Improve your grades
Already Premium?
Upload
Share your documents to unlock
Free Trial
Get 30 days of free Premium
Log in
Trang 4Barbie took off to become one of Mattel’s critical product lines and the number one girls’ brand in the world Annual sales of Barbie net approximately $ 2 billion, and one doll is sold approximately every 3 seconds The Barbie line today includes dolls, accessories, Barbie software, and a broad assortment of licensed products such as books, apparel, food, home furnishings, home electronics, and movies
Hot Wheel
Hot Wheels roared into the toy world in 1968 Co-founder Elliot Handler
recognized the potential demand for die-cast cars among boys and decided to create a toy to compete with British company Lesney’s Matchbox toys
Much like Barbie, the brand is hotter than ever and includes high-end collectibles, NASCAR (National Association for Stock Car Auto Racing) and Formula One models for adults, high-performance cars, track sets, and play sets for children of all ages It is even connected with racing circuits wolrdwide and have a huge amount of adult collectors As reported, more than 15 million boys aged five to 15 are avid collectors, each owning forty-one cars on average; and 1,550 cars on average for adults Two Hot Wheels cars are sold every second of every day, and annual sales total approximately $ 1 billion The brand began with cars designed to run on a track and evolved into a “lifestyle” brand with licensed Hot Wheels shirts, caps, lunch boxes, backpacks, and more
Cabbage Patch Kids
Since the introduction of mass-produced Cabbage Patch Kids in 1982, more than
90 million dolls have been sold worldwide Although new line of product, called Snacktime Kids was expectd to meet with immense success, the product backfired due to reports of children getting into troubles by its new feature Fortunately, Mattel effectively handled the situation that could easily have created bad publicity
or a crisis and finally stopped producing Cabbage Patch Kids in 2000
III MATTEL’S COMMITMENT TO ETHICS AND SOCIAL
RESPONSIBILITY
Because the company’s products are designed mainly for children, sometimes it must be sensitive to social concerns about children’s rights Recognizing these
Trang 5potential issues, Mattel takes steps to strengthen its commitment to business ethics Not only that, the company also purports to take a stand on social responsibility, encouraging its employees and consumers to do the same
Privacy and marketing technology
Respect for privacy could be noticed in the company’s online marketing policy because Mattel has repeatedly addressed children’s privacy with regard to the use
of technology in marketing their products The business understands that it must consult with parents about its corporate marketing plan since it markets to their children, so Mattel has taken steps to inform both children and adults about its philosophy regarding Internetbased marketing tools, such as the Hot Wheels website In 2013, Mattel updated their website's privacy to make it more detailed; and even developed answers for the most frequently asked Internet privacy questions to increase understanding By assuring parents their children’s privacy is respected, Mattel demonstrates that it takes its responsibility of marketing to children seriously
Legal and ethical business practices
Mattel, Inc makes a serious commitment to business ethics in manufacturing itself and in its dealings with other industries as well As a testament to that, in the late
1997, the company conducted its first full ethics audit of each of its manufacturing sites as well as the facilities of its primary contractors Now, an independent monitoring council audit in manufacturing facilities still is conducted every three years
Moreover, Mattel instituted a code of conduct titled Global Manufacturing Principles in 1997, as an effort to continue its strong record on human rights and related ethical standards These principles require all Mattel-owned and contracted manufacturing facilities to favor business partners committed to ethical standards comparable with those of Mattel and other principles relate to safety, wages, and adherence to local laws
Mattel’s concern for relationships between and with employee and business partners is also a bright spot of the company It cares deeply about increasing its employees’ skill sets and providing opportunities to excel, that gives it more
Trang 6productivity and opportunities The company’s code is a signal to potential partners, customers, and other stakeholders that Mattel made a commitment to fostering and upholding ethical values, and creating and encouraging responsible business practices throughout the world
Expectations of Mattel business partners
Mattel prefers to partner with businesses similarly committed to high ethical standards; which must comply with the local and national laws of the countries where they operate, respect the intellectual property of the company, and support Mattel in the protection of assets such as patents, trademarks, or copyrights They should be responsible for product safety and quality, protecting the environment, customs, evaluation and monitoring, and compliance
Mattel’s business partners must have high standards for product safety and quality, adhering to practices that meet Mattel’s safety and quality standards In their assistance to compliance, Mattel maintains that all manufacturing facilities should provide explicit access for on-site inspection by either a party assigned by Mattel
or by Mattel itself Besides, quality assurance requires that such partners should give full access to records and annual compliance statement
Mattel having created an independent monitoring body (MIMCO) emerged to have positive global branding The company expects to keep this body for continuous checks and balances for achievement of high standard products If some elements
of quality and standard products are not being met by a partner, Mattel is ready to work with them so that they fix the problem together This is an indication of team work However, the business will be broken if the partner does not observe recommended corrective measures, and this is recognized as party of business improvement process
Philanthropy and Community Development
It can be deduced that Mattel values philanthropy and community development through the children foundation Established in 1978, through the Mattel
Children’s Foundation, the company encourage its employees to support children
in need through personal contributions that runs on annual basis
This is a preview
Do you want full access? Go Premium and unlock all 13 pages
Access to all documents Get Unlimited Downloads Improve your grades
Already Premium?
Upload
Share your documents to unlock
Free Trial
Get 30 days of free Premium
Log in
Trang 7Funding priorities include building a new Mattel Children’s Hospital at the University of California, Los Angeles (UCLA), sustaining the Mattel Family Learning Program, and promoting giving among Mattel employees In November
1998, Mattel donated a multiyear, $ 25 million gift to the UCLA Children’s Hospital; and the Mattel Family Learning Program uses computer learning labs as
a way to advance children’s basic skills, that offer software and technology designed to help children with special needs or limited English proficiency
International manufacturing principles
As a U.S.-based multinational company owning and operating facilities and contracting worldwide, the company’s Global Manufacturing Principles reflects the company respects cultural, philosophical, and ethical differences of the countries of their operation These principles also set uniform standards on the company’s manufacturers hencebenefiting both consumers and employees
Mattel’s principles cover issues such as wages, work hours, child labor, forced labor, discrimination, freedom of association, and working conditions Mattel refuses to work with facilities using forced or prison labor, or use these types of labor itself The company respects employees’ rights, beliefs, and provides safe working environment to all employees
IV MATTEL’S RESPONSE TO ETHICAL CHALLENGES
Unethical Behaviors in the Case
Despite Mattel’s best efforts, not all overseas manufacturers faithfully adhere to its high standards There was a recall of toys by this company in 2007 due to
discovery of lead on their surface by a European retailer When this problem was traced, it was found that the company’s manufacturer in China, Lee Der was responsible for the mess, that rising labor and raw material costs and the resulting pressure it created likely caused manufacturers to cut corners in order to save money An estimate of 10million personal toys produced in this country was affected Eventually, an estimate of 10million personal toys produced in this country was affected, and Zhang Shuhong, operator of Lee Der, hung himself after paying his 5,000 staff members
Trang 8In a separate incidence later that month, Mattel was compelled to recall many toys because of powerful magnets, which could easily come loose and expose a choking hazard to young children In this regard, it was reasoned that swallowing of one magnet can attract more magnets in the child’s stomach, thus causing fatal complication Hence, this led to several parents filling lawsuits that the toys harmed their children and over 21 million Mattel’s toys were recalled this time
Responsible people in the Unethical Behavior in the case
There are three broad players that could be blamed for the unethical behavior in case These are the Chinese government, Mattel’s business partner, and Mattel Inc The company’s manufacturer in China, Lee Der, could be held responsible for the lead paint issue This is due to the fact that they knew very well how Mattel prohibits contracting third party suppliers but defied this and went ahead to be involved with a contractor, which supplied lead-tainted paint hence leading to the whole problem Lee Der Company seems to have committed this mistake
knowingly on the basis of cutting costs associated with rising costs of labor and raw material Thus, responsible people in this case were procurement manager and human resource manager as well as top level managers of Lee Der Inc
On the other hand, with regard to lead paint that was discovered on the toy surface, and loose magnet, the Mattel Inc could be held responsible for failing to
implement effective inspection and monitoring in the entire supply chain In response to the claims, it could be noted that Mattel had poor product design and supervision on product quality Thus, Mattel’s design engineers and quality assurance managers should be held responsible for this
The government of China is held responsible for the unethical behavior given that they failed to properly protect citizens Thus, in their bid to strengthen supervision
of export goods, it suggests that her international trade minister contributed to not only the lead issue but also the loosemagnet problem in the toys
Intellectual property right battle with former employee and MGA
Carter Bryant, an on-again/off-again Mattel employee, designed the Bratz dolls and pitched them to MGA while employed with Mattel After two years of
investigation, Mattel sued Bryant A year later MGA fired off a suit of its own,
Trang 9claiming Mattel created Barbies with looks similar to those of Bratz in an effort to eliminate the competition Mattel answered by expanding its own suit to include MGA and its CEO, Isaac Larian ycle Four years after the initial suit was filed, Bryant settled with Mattel under an undisclosed set of terms In July 2008, a jury deemed MGA and its CEO liable for what it termed “intentional interference” regarding Bryant’s contract with Mattel In December 2008, Mattel won another victory when a California judge banned MGA from issuing or selling any more Bratz dolls In April 2011, a California federal jury rejected Mattel’s claims to ownership of Bryant’s ideas under the contract he had with the company
In another blow to Mattel, the jury ruled the company stole trade secrets from MGA, that Mattel employees used fake business cards to get into MGA
showrooms during toy fairs; and MGA CEO Isaac Larian also announced he was filing an antitrust case against Mattel Although the antitrust suit against Mattel was dismissed, and in January 2013 the U.S Court of Appeals overturned MGA’s victory over Mattel concerning the theft of trade secrets However, the court maintains Mattel is responsible for paying MGA’s legal fines totaling $ 137.2 million MGA CEO Isaac Larian is determined to contest this issue in court again
in the near future
V CONCLUSION
Although the company faced a series of difficult and potentially crippling
challenges, including the lawsuits with MGA regarding ownership of the Bratz dolls due to poorly handling affairs, the company still has some core values and it
is attempting to rectify its mistakes and to prevent future mistakes as well Maybe
it is hard at work restoring goodwill and faith in its brands, even Mattel continues
to be plagued with residual distrust over the lead paint scandal and its alleged theft
of trade secrets but Mattel appears to be steadfast in its commitment to restoring its reputation
This is a preview
Do you want full access? Go Premium and unlock all 13 pages
Access to all documents Get Unlimited Downloads Improve your grades
Already Premium?
Upload
Share your documents to unlock
Free Trial
Get 30 days of free Premium
Log in
Trang 10B QUESTION
Q1: Do manufacturers of products for children have special obligations to consumers and society? If so, what are these responsibilities?
Customer protection and product responsibility are core issues when discussing the manufacturing industry In the profoundly aggressive business, corporate social obligation (CSR) concentrates on making the organizations in charge of their exercises on investors, providers, clients, workers, groups and condition all in all, it assumes a noteworthy part in building an expansive client base, so manufacturing companies must acknowledge and understand the expected compliance regulations
in manufacturing products and their obligations to consumers and society
Some of these obligations of the producers towards kids are:
1 The safety and quality of the product: children are the most vulnerable
citizens During the hour of playing, they tend to lick the toys, toss the toys, and open their parts; so it’s necessary for the manufacturers to satisfy the worldwide legitimate guidelines for security during the assembling and planning of the toys They ought not to utilize hazardous mechanical assembly in the toys with the goal that the youngsters would not be hurt by these risky instruments and types of gear
of toys, just as not utilize unsafe synthetics, electronic wires They should all of the injurious chemical and toxic substamce such as lead paint while producing merchandise as well It is responsibility of them to ensure that no damage is made
2 Confidentiality of customer: Manufacturers should not just make safe toys, but
they should also be aware of societal concerns about children's rights and privacy because the toy manufacturer products are also sold online Normally online marketers use cookies and other means to track consumers online, to collect customer data and analyze it for product marketing purpose And those
informations may be wrongly used to harass children So all companies should be clear in informing their privacy policy and philosophy regarding Internet-based marketing tools They have to reassure the parents or caregivers that the
information collected about the children would not be used wrongly such as commiting not collect online information from children under the age of 13 without parental consent; trade, share or sell any pertional data, etc