THE ETHICS OF CONSUMER

PRODUCTION AND MARKETING

(SELLING PERSONALIZED GENETICS)
PRESENTED BY:

AINDRA BUDIAR
YOSOA
OUTLINE
Is the Relationship between a business
How far must manufacturer go to make
and its customer merely a contract, or is
their products safe?
there more to it than that?

Does the fact that companies know more

What responsibility do businesses have
about their products than customers
for customer injuries no one could
impose on them a duty to protect
reasonbly have foreseen or prevented?
customer from injury or harm?

On the whole, does advertising help or Do companies have a duty to protect

harm customer? their customer privacy?
 Is the Relationship between a business
How far must manufacturer go to make
and its customer merely a contract, or is
their products safe?
there more to it than that?

Doen the fact that companies know more

What responsibility do businesses have about their products than customers
for customer injuries no one could impose on them a duty to protect
reasonbly have foreseen or prevented? customer from injury or harm?

On the whole, does advertising help or Do companies have a duty to protect

harm customer? thier customer privacy?
MARKET AND CONSUMER PROTECTION

• Problems consumer face:

• Dangerous and risky products
• Deceptive Selling Pracites
• Poorly constructed Products
• Failure to honor Warranties
• Deceptive and Unpleasant advertising
MARKET AND CONSUMER PROTECTION

• Market Approach to Consumer Protection:

• Claims safety is a commodity that should not be mandated by goverment
• Safety Should instead be provided through the market
• In a market, sellers will provide safety if consumer demand it
• In a market, the price of safety and the amount seller provide will be dermined by costs
of providing it and the value consumers place on it
• Goverment intervention in consumer markets makes them unfair, infefficient and coercive
MARKET AND CONSUMER PROTECTION

• Problems with the market approach

• Buyers do not have adequete information when products are complex and information is
costly and hard to find
• Buyer are often not rational about product lrisk or probabilities and are often inconsistent
• Many consumer market are monopolies or oligopolies
 Is the Relationship between a business
How far must manufacturer go to make
and its customer merely a contract, or is
their products safe?
there more to it than that?

Doen the fact that companies know more

What responsibility do businesses have
about their products than customers
for customer injuries no one could
impose on them a duty to protect
reasonbly have foreseen or prevented?
customer from injury or harm?

On the whole, does advertising help or Do companies have a duty to protect

harm customer? thier customer privacy?
THE CONTRACT VIEW OF BUSINESS FIRM’S DUTIES
TO CONSUMERS
• The view that the relationship between a business firm and its customersis
essentially a contractual relationship, and the tirm’s moral duties to the
customer are those created by this contractual relationship

• Moral Duties to consumers under contractual theory

• Duty to comply with express and implied claims of reliability, service life maintainability
and safety
• Duty to disclosure
• Duty not to misrepresent
• Duty not to coerce
THE CONTRACT VIEW OF BUSINESS FIRM’S DUTIES
TO CONSUMERS
• Problems with contractual Theory
• Assumes makers of products deal directly with consumers but they do not; however
manufacturer’s advertisements do form a kond of direct promise to consumers
• Seller can remove al their duties to buyers by getting them to agree to disclaimners of
responsibility
• Assumes consumer and seller meet as equals, but seller has more knowledge so consumer
must rely on the seller
 Is the Relationship between a business
How far must manufacturer go to make
and its customer merely a contract, or is
their products safe?
there more to it than that?

Does the fact that companies know more

What responsibility do businesses have
about their products than customers
for customer injuries no one could
impose on them a duty to protect
reasonbly have foreseen or prevented?
customer from injury or harm?

On the whole, does advertising help or Do companies have a duty to protect

harm customer? thier customer privacy?
THE DUE CARE THEORY

• The view that because manufacturers are in a more advantaged position and
consumers must rely on them, they have a duty to take special care to ensure
that consumers interest are not harmed by the products that they offer them
• Manufacturer duties in Due Care Theory:
• When Designing product, Research its risks in conditions of use, design it so risks are
minimized, take capacities of users into account
• In production, use strict quality control to eliminate defects and manafacturing do not add
defects or risks
• When marketing provide users with information about using product safely. Warn of all
dangers, do not market to those unable to avoid risk
THE DUE CARE THEORY

• Problems with due care theory:

• Does not limit what producer must spend to eliminate risk
• Does not indicate who should pay fot poduct injuries that cannot be foreseen
• Put manufacturer in paternalistic position of deciding how much risk is best of consumers
 Is the Relationship between a business
How far must manufacturer go to make
and its customer merely a contract, or is
their products safe?
there more to it than that?

Does the fact that companies know more

What responsibility do businesses have
about their products than customers
for customer injuries no one could
impose on them a duty to protect
reasonbly have foreseen or prevented?
customer from injury or harm?

On the whole, does advertising help or Do companies have a duty to protect

harm customer? thier customer privacy?
THE SOCIAL COSTS VIEW OF THE
MANUFACTURER’S DUTIES
• The view that a manufacturer should pay the costs of any injuries caused by
defects in the product, even if the manufacturer exercised all due care in
designing, making, and marketing it, and injury could not have been foreseen
• The Social Costs View
• Claims manufacturer should pay the costs of all injuries caused by defects in a product
even if the manufacturer exercised all due care and the injury could not have been
foreseen
• Argues product injuries are external costs that should be internalized as a cost of
bringing the product to market, this maximizes utility and distributes costs more fairly
THE SOCIAL COSTS VIEW OF THE
MANUFACTURER’S DUTIES
• Criticisms of the social Cost View
• Unjust to manufacturers since compensatory justice says one should compensate injured
parties only if the injury was foreseeable and preventable
• Falsely aassumes that the social cost view prevents accidents; instead encourages
consumer carelessness by relieving them of responsibility for their injuries
• Has increased the number of successful consumer lawsuits which imposes heavy losses on
insurance companies, and makes infurance too expensive fot many firms; however studies
shows only small increase in lawsuits and insurance firms remain profitable
 Is the Relationship between a business
How far must manufacturer go to make
and its customer merely a contract, or is
their products safe?
there more to it than that?

Does the fact that companies know more

What responsibility do businesses have
about their products than customers
for customer injuries no one could
impose on them a duty to protect
reasonbly have foreseen or prevented?
customer from injury or harm?

On the whole, does advertising help or Do companies have a duty to protect

harm customer? thier customer privacy?
ADVERTISING ETHICS

• Commercial Advertising => Communication between a seller and potential

buyer that is publicly addressed to a mass audience and is intended to induce
members of this audience to buy the seller’s products
• 2 features of commerical advertising:
• It is publicly addresed to mass audience as distinct from a private message to a specific
individual
• Intended to induce members of its audience to buy the seller products.
ADVERTISING ETHICS

• Critics on Commercial Advertising:

• Social Effects
• What does advertiser intend the effect of the advertisement to be?
• What are the actual effects of the advertisement on individuals and on socienty as a whole?
• Effect in Desire
• Does the Advertisement inform of does it also seek to persuade?
• If it is persuasive, does it attempt to create an irrational and possiby injurious desire?
• Effect in Belief
• Is the content of the advertisement truthful?
• Does the advertisement have a tendency to mislead those to whom it is directed?
 Is the Relationship between a business
How far must manufacturer go to make
and its customer merely a contract, or is
their products safe?
there more to it than that?

Does the fact that companies know more

What responsibility do businesses have
about their products than customers
for customer injuries no one could
impose on them a duty to protect
reasonbly have foreseen or prevented?
customer from injury or harm?

On the whole, does advertising help or Do companies have a duty to protect

harm customer? thier customer privacy?
CONSUMER PRIVACY

• Right to Privacy => The right of persons to determine what, to whom, and
how much information about themselves will be disclosed to other parties
• Importance of privacy:
• Protects individuals from disclosures that can shame, can encourage interference in one’s
private life, hurt loved ones, and lead to self incrimination
• Enables the intimacy that develops personal relationships, the trust and confidentiality
that underlies client professional relationships, the ability to maintain distinct social roles,
and the ability to determine how others will see us
CONSUMER PRIVACY

• Balancing Right to Privacy and Business Needs:

• Is the purpose of collecting information a legitimate business need that benefit the
consumer
• Is the information that is collected relevant to the business need?
• Is the information is being collected and the purpose?
• Did the consumer consent to the information accurate?
• Is the information accurate?
• Is the information secure and not disclosed to recipients or used in ways to which the
consumer did not consent?
SUMMARY
• Becton Dickinson adalah perusahaan yang bergerak dalam bidang kesehatan
seperti, alat – alat kesehatan, perlengkapan dan serum kesehatan. Group
Purchasing organization telah menjalin kontrak dengan Becton Dickinson selama 6
tahun, dalam kurun waktu tahun – tahun inilah seluruh kebutuhan kesehatan di supply
secara keseluruhan oleh Becton Dickinson sehingga supplier lain tidak bisa untuk
memasok alat – alat serta kebutuhan kesehatan lainnya ke rumah sakit.
• Hal yang menghebohkan adalah ketika ribuan pekerja kesehatan dan konsumen
terinfeksi jarum suntik, Becton Dickinson ternyata lalai dalam memenuhi standarisasi
kesehatan yang diterapkan oleh pemerintah dan FDA. Mengetahui akan kejadian ini,
pihak Becton Dickinson selanjutnya menyuap pihak GPO dan FDA agar supaya
masalah tersebut tidak menjadi penghalang dan produknya tetap digunakan di
rumah sakit.
PEMBAHASAN KASUS
• Becton Dickinson tidak memliki kewajiban untuk membuat jarum suntik yang dilengkapi
oleh pengaman pada semua variannya agar mampu bersaing dengan merek lain
• Perusahaan ini memutuskan untuk membuat jarum suntik yang dilengkapi oleh
pengaman hanya pada varian 3cc selama 5 tahun
• Berdasarkan teori utilitarian, analisis cost-benefit sebagai dasar untuk menentukan hal
apa boleh yang dilakukan dan apa yang tidak boleh dilakukan.
• Rights => Secara hukum, Becton Dickinson tidak diwajibkan untuk menyediakan jarum
suntik yang dilengkapi oleh pengaman, tapi secara moral mereka diwajibkan untuk
menyediakan jarum suntik tersebut
• Justice => kewajiban untuk memproduksi berbagai macam variasi jarum suntik
• Caring => kebutuhan untuk memproduksi berbagai variasi ukuran jarum suntik untuk
konsumen
PEMBAHASAN KASUS

• Menurut kelompok kami, Becton Dickinson harus bertanggung jawab kepada

konsumennya. Karena berdasarkan teori due care Produsen memiliki informasi
yang lebih banyak dari konsumennya sehingga Produsen mempunyai tugas
untuk menjaga dan memastikan bahwa produk yang mereka tawarkan tidak
akan mencederai Konsumennya.
PEMBAHASAN KASUS

• Becton Dickinson tidak etis dalam menggunakan GPO system, karena:

• Mereka mempertahankan bisnis dengan mengendalikan dan mengekspoitasi pasar
• Mencoba memonopoli pasar dengan hanya memproduksi jarum suntik ukuran 3 cc
• Mencegah penciptaan jarum suntik aman lainnya untuk masuk ke pasar yang
menyebabkan bahaya pada konsumen
• GPO tidak melakukan monopoli pasar, tetapi:
• Mengambil keuntungan sebagai pihak ketiga antara rumah sakit dan produsen
• GPO tidak mementingkan standar kualitas dan keamanan produk jarum suntik
yang digunakan oleh rumah sakit