Ethical Management of Levi Strauss & Company

Levi Strauss & Company
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Levi Strauss & Company
Overview
Levi Strauss is a well-known and popular fashion brand that has been around for a long time, and they are fully aware of its success. The company has an old-fashioned perspective and was too combative to open other doors to change their business. They believed in pushing the traditional method of conducting trade, which led to failure and commercial loss. The markets and fashion trends changed every year, putting pressure and high expectations on them to keep up, and they needed to catch up. As soon as their clients began to demand change and grumble, Levi Strauss, opted to ignore it. The CEO adopted an employee leadership style where all decisions focus on community projects and charity financing rather than making money. This case study will look at the company's ethical values and business practices and the influence of ethical management on the owners, investors, customers, employees, and the community. The company's sense of responsibility is a significant aspect of its history and future success (Siegall, 2020).
Levi Strauss & Co.'s ethics and compliance team oversees company ethics globally and provides continuing compliance-related counsel, guidance, resources, training, and communication. A dedicated corporate compliance team and region-specific subject matter specialists manage the global ethics and compliance program. The company's ethical and compliance program is international in scope with a regional focus. Based on industry best practices, benchmarking, and regulatory guidance, the program is anchored by a successful compliance program's widely recognized seven characteristics. Compliance Program Oversight & Leadership, Compliance Operations & Strategic Planning, Policies, Procedures & Guidelines, Investigation & Disciplinary Action, Third-Party Compliance, Risk & Due Diligence, Anti-bribery & Anti-corruption Auditing & Remediation, and Compliance Training & Communication are the seven elements of the compliance program ("Levi Strauss & Co. - Governance - Ethics & Compliance", 2021). Levi Strauss & Co. conducts frequent evaluations, develops annual compliance plans, and reports key compliance metrics to the company’s Board's Audit Committee to ensure that their compliance program continues to improve and be effective ("Levi Strauss & Co. - Governance - Ethics & Compliance," 2021).
The ethical principles of Levi Strauss are the beliefs that establish the ground rules for the company's owners, customers, community, and employees. Levi Strauss & Co.'s ethical principles are:
Honesty: The Company will not say anything misleading, will never intentionally mislead, and be as honest as possible, sharing information openly and freely as suitable to the relationship.
Keeping promises: The organization will go to considerable measures to keep its promises. They will not make promises that they will not honor, even if they are making them on behalf of the company.
Fairness: The company will design and implement a process and produce just, evenhanded, and non-arbitrary.
Respect: Levis Strauss will communicate openly and directly and will be susceptible to persuasion. Levis Strauss will respect and value others' abilities and contributions, accepting responsibility and accountability for the acts of investors, the community, employees, and customers.
Compassion: The Corporation will remain aware of others' needs and act to address those needs as much as feasible, minimize harm as much as possible, and behave incompatible ways with its policies and commitment to social responsibility (Levi Strauss & Co: Ethical Principles, 2014).
Integrity: Even when faced with personal, professional, and social risks, as well as economic constraints, the company will uphold its ethical standards.
With parent business Levi Strauss & Co. reporting revenue of USD 5.8 billion in 2019, it does not take much imagination to visualize the massive, worldwide production machine driving these tremendous earnings (Jacobs, 2020). Large-scale manufacturing is destined to have far-reaching implications. The Terms of Engagement - a Code of Conduct developed by Levi's in 1991 to guide ethical production throughout the denim giant's supply chain. According to Levi's, the document was a watershed moment in the fashion business, inspiring many other apparel firms.
The Aspirations Statement of Levi Strauss describes the values intended to drive both individual and organizational decisions, while the Mission Statement underscores the importance of ethics and social responsibility. Human resource policies and procedures have changed as a result of efforts to take the values seriously. It provides generous domestic partner benefits, promotes flexible employment programs, and has established child-care voucher systems (Gini, 2005). The Aspirations Statement is the focus of a series of classes for senior managers. In dealing with contentious social issues, the firm has also gained a reputation as an industry leader. It was one of the first firms to start AIDS-related programs.
LS&Co. adopted a set of global sourcing criteria in early 1992 to help ensure that the standards of its international contractors align with the company's ideals. The rules were developed over nine months by ten employees from various departments inside the organization. To help construct the regulations, the panel employed an ethical decision-making model that ranked and prioritized all stakeholders (Gini, 2005). The model considers the effects of each activity and recommends a course of action that strikes a balance between ethics and profit. Environmental requirements, ethical standards, worker health and safety, legal requirements, employment practices, and community improvement are included in the following rules (Gini, 2005).
Importance of Ethical Management
Business ethics varies from one industry to the next and from one country to the next. The nature of a company's operations has a significant impact on ethical challenges. An ethical dilemma arises when a client's best decision and money do not align with what gives the brokerage the largest commission. A media firm that produces children's television programming may have a moral obligation to promote positive values and avoid using off-color material in its programs (Horton, 2021). If an energy firm wants to prosper in growing regulations, it needs a strict, well-defined environmental ethics system.
Levi Strauss & Co. spruced up its image, reconnected with a younger generation of customers, and enticed women back into its stores. It ended shaky ties with department stores that sold Levi's jeans on its behalf and launched hundreds of locations across Europe, as well as a foray into China. LS&Co. had to close stores in the United States, Europe, and China, and online sales are not making up the difference. The company has cut salaries, laid-off workers, canceled future garment orders, and borrowed money (Fernandez, 2021).
Customers' expectations are valued in business ethics and management ethics. It encourages higher-quality products and services at a reasonable price. It opposes black marketing and the creation of false scarcity. As a result, it contributes to the firm's goodwill and image. Managerial ethics encourage collaboration and cooperation in the workplace. It also aids in the development of positive relationships with stakeholders, including shareholders, employees, and government officials. Management ethics focuses on a fair wage, appropriate working conditions, and an appealing reward system. It also focuses on the demands of clients and seeks to meet them. As a result, the company's long-term survival is assured.
Levi Strauss & Co. was named a 2016 World's Most Ethical Company® by Ethisphere Institute. This award is given to a select group of firms worldwide that demonstrate that corporate integrity is a fundamental commercial driver alongside operational reasons via their programs, policies, and activities. Members of the organizations were thrilled and humbled to be recognized among some fantastic and inspiring corporate colleagues for the third year in a row.
By prohibiting adulteration, unethical pricing, black marketing, and artificial scarcity, management ethics encourages fair competition in the market. LS&Co's moral behavior necessitates less government control and meddling. It maintains employee health and safety, fosters a sense of equality, and pushes personnel to achieve their objectives. As a result, it contributes to a pleasant working environment. Because of adequate working conditions, customer satisfaction, and a positive image, a company's productivity and profitability can be increased, ensuring consistent growth.
The management team of LS&Co sets the tone for how the company does business daily. When a business's prevailing management philosophy is based on ethical practices and behavior, CEOs may lead by example and guide employees in making decisions that benefit them and the organization (Horton, 2021). Building a company's reputation on ethical behavior provides long-term benefits, such as attracting and retaining highly talented workers and developing and maintaining a positive reputation in the community (Horton, 2021). LS&Co. is not the only company faci...