A Case Study of 2008 Melamine Milk Scandal

There are many definitions for business ethics. One of them refers to the moral rules and regulations governing the business world1. In other words, these moral rules and regulations determine the difference between good and bad decision making behavior. Although the meaning of "ethical" is blurred and the line between right and wrong may be difficult to judge in different situations, we still need these rules and regulations to govern the business world.

The way that people perceive and react to the environment can be understood on 4 vertically integrated levels: behavior, norm, attitude and value2. That means how people behave is actually influenced by the norm of society, their attitude towards the issue as well as the values of their own and other people. This model would help explain why people have unethical behavior and what should be done to improve the situation.

In the melamine incident, a number of weaknesses concerning business ethics are identified. These weaknesses caused unrecoverable harm to thousands of babies and their families.

Regulations

To avoid similar incident from happening, implementing new measures and regulations is necessary. For example, AQSIQ should have regular and sudden inspection on the quality of products.

Laws and ethics

Nonetheless, even with laws, it is not sufficient. There are many acts that are legal but unethical. As in the above case, the use of melamine was legal because at that time, there was no regulation on it. It is clear that laws cannot fully control human behavior, as law is only the bottom line that society can accept how people behave.

However, for business ethics, the standard is much higher than that of laws. Ethics is not concerned only with people's behavior. It is a standard for our core values. As an individual or a company, in addition to being legal, being ethical is the key which shows that their values are of higher standard rather than meeting the minimum requirement only.

Education

As mentioned by Professor Liu, people's behavior is actually influenced by norm, attitude and values. Changes in norm, attitude and values are of vital importance for improving business ethics. Hence, on top of implementation of measures and regulations, education on both top management and employees would be the most fundamental way to do so.

i. Business courses

In a survey by the Shanghai Jiao Tong University, program administrators and ethics professors of Chinese MBA programs from 80 of the 126 business schools in China accredited by the Ministry of Education were surveyed25. They found that fewer than half of the schools offered business ethics courses during 2006 and 2007.

The result showed that business ethics somehow