Invariably, there are people in my audiences (fortunately not too many!), who will ask the question: “Who really cares about ethics Chuck?”
They then follow the question with something like “letting the market decide.” Ah, bless those marketing people!
I want to trot out Exhibit “A,” and show what happens when there is no ethical compass and the market is going gang-busters.
In a CNBC article on July 21, 2014 entitled: “China’s food safety reputation takes another blow,” we learn about yet another food scandal that has emerged in the Chinese market, this time with McDonalds and KFC.
I need to make it clear that this scandal cannot be directly linked to anything these two food chains did wrong. However, one of their suppliers, OSI Group is in deep trouble.
According to the article:
“China’s difficult relationship with food safety has spurred another scandal, ensnaring Western fast-food chains which may have been duped into buying tainted meat. OSI Group’s China affiliate, which supplies McDonald’s and Yum Group’s KFC on the mainland, was accused of using expired meat and unhygienic practices in a July 20 report from Shanghai TV, a local television station under SMG Group.”
This is the meat that goes into chicken nuggets. Again, according to article, they processed batches of chicken breast and chicken skin that was 12 days beyond expiration. We know this, because a reporter went undercover to observe the sanitation practices. The reporter asked a factory worker if it was a good to use such bad meat.
Here was the worker’s reply:
“’The rules are dead, and people are alive, that’s simple,’” a worker said in the report. “’Dead rules and alive people’” is commonly used in China to indicate corners have been cut. OSI did not immediately respond to the news report.”
Of course McDonald’s inspectors toured the plant, but the reporter indicated that side conversations among the workers were taking place at the same time as the tour. They were basically saying that the sanitary practices cut corners whenever possible. .
Revisiting the question
So who cares about corporate ethics? Let’s pretend the processing plant was not in China but in this country and you decided to have chicken nuggets for lunch. Would it bother you that the meat they used went two weeks beyond expiration and that it might be contaminated?
I am not a food scientist so I am not going to answer questions about deep frying killing bacteria. I will instead focus on the lack of ethics involved. I also know that people who handle the frozen food may come in contact with bacteria. That doesn’t matter much to this conversation either. What matters is that a supplier to major fast food chains knowingly sold them chicken meat that was going bad. There was no ethical safeguard, and there was no culture of ethical behavior in place.
Of all of McDonald’s markets, it is China that has taken off the most. Whereas fast food sales across the board are marginal, Asia posted a 5 percent gain last year and that is huge. Therefore the market forces are all aligned for success, but what about the comment in regard to “market forces?” In truth they are unrelated to ethics.
Doing the right thing is not contingent on whether McDonald’s was running 5 percent ahead of last year, or 1 percent behind. Here is what could happen, of course, and that is with the news of the chicken nuggets containing tainted meat the sales could plummet. Here is a case where rotten ethics as the result of almost rotten meat, could produce rotten sales. How’s that for market forces?
Ethics matter, especially in food processing or any aspect of manufacturing – and to be honest, most everywhere else in life.
YOUR COMMENTS ARE WELCOME!