Question Gareth Business & Management

The Transformation of Manufacturing Firms into Green Producers

While environmentalists applaud the proposed plan of Germany to ban combustion-engine cars by 2030, why might the transformation of manufacturing firms into ‘green’ producers be deemed counter active to social responsibility initiatives?

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Answer Expert #27321

With increased environmental damage and global warming, the present day demands for both governments and businesses alike to focus on the reduction of carbon emissions and resource wastage. Thus, it is likely that a number of stakeholders felt satisfied in the recent announcement of Germany that it plans to stop all production and sale of new combustion-engine cars by 2030 (Taylor, 2016). Whilst this is seen as a socially responsible move, from the perspective of German car producers this could be considered as having a number of ethical implications.

From a workers point of view, this decision is questionable, as the amount of workers needed to construct electric cars is only a tenth of that needed for combustion-engine cars; thus raising questions about the job security of German workers in the automobile production company units (Taylor, 2016). This opposes the aspect of corporate social responsibility (CSR) of being social responsible; how can this move be considered socially responsible by manufacturers when it will cause a number of potentially loyal employees to be unemployed (Gond and Moon, 2011). These employees are likely to have families, and thus although this move may be socially responsible in terms of environmental damage reduction, it is socially irresponsible in terms of employees.

Although production plants may be contributing to CSR by atoning the negative impacts that their combustion-engine cars produce, it will remain to be seen as to whether they will improve their stakeholder relations by the release of electronic cars. Typically, electric cars are associated with a high cost of purchase, not to mention the considerable electricity charge that will be accumulated by the customers in the charging process. Therefore, the full move from manufacturers to electric cars could be viewed as nothing more than a guise to seek higher profits; and from a governmental point of view, demand higher taxes from the producing companies.

References

Gond, J.P. & Moon, J. (2011). ‘Corporate Social Responsibility in Retrospect and Prospect: Exploring the Life-cycle of an Essentially Contested Concept’, ICCSR Research Paper Series, 59, pp.1-40, [Online]. Available at: http://www.nottingham.ac.uk/business/ICCSR/assets/researchpapers/59-2011.pdf

Taylor, E. (2016) ‘German push to ban combustion-engine cars by 2030 wins support.’ Reuters. [Online] 8th October [Accessed on 8 October 2016] http://uk.reuters.com/article/us-autos-emissions-germany-idUKKCN1280G7