What Are the Ethical Issues Henry Chang Confronts in This Case

• What are the ethical issues Henry Chang confronts in this case?

Ethical Issue 1: The Shago Incident [What actions to take against the people

                               related to Shango Claim]

Shango, one distributor of kitchen appliance in Singapore, Malaysia, Thailand and Indonesia. Sango demanded refund and compensation for default order supply.

The claim against Kitchen Best was that the microwaveable tableware was not microwaveable at all.

A subsequent investigation revealed that Hortatio Sze; Purchasing and Production Manager placed microwave tableware order to a factory owned by his Brother in Law.

And in return Sze received free package tour to Europe along with his wife.

Macy Wei ; Quality Control Manager was informed about the relationship between factory owner and Sze but did not inform to the authority because Sze is relative of company partner Li Qinyang.      

Wei informed Sze about the faulty products but no remedial action was taken and Wei decided not to pursue the matter further.

Here, Henry can sack Hoetazio Sze and Macy Wie. Or can amerce both of them for the claim. Or do nothing based Sze’s job performance.

Ethical Issue 2: The Huas de Metro: Testing & Certification Issue [The issue

                                 Is based on a anonymous letter]

Above stated issue is based on a anonymous letter stated that Kitchen Best did not meet the safety requirement for the order of the water disposal of HdM’s.

Kitchen Best subcontracted HdM’s order to a local Foshan based company Qinghua and appointed Keemark Testing Service for inspection.

The letter said that Keemark’s inspection team leader took bribe and let the low quality with hazardous elements pass in quality control checking.

The subcontract factory owner deposited the money into team leader’s wife’s account.

Henry did nothing in a fear to lose customer.

Here, Henry cannot start investigation based on an anonymous letter. If result comes negative then Henry will lose mutual trust. And will be ashamed of such activity.      

Ethical Issue 3: Honghua Appliances; New Management [Wining, Dining

                                 and kickback]

Honghua Appliances was a Macao based group that is a home appliances retail chain in southern China. Kitchen Best generated about 5% sales revenue from Honghua.