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Business Ethics: Case 1 – Monsanto Attempts to Balance Stakeholder Interests Melanie Brown Liberty University: BUSI 472– B02 February 15, 2021

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The Monsanto Company is the largest seed company in the world, with sales over $15.9 billion (Ferrell & Fraedrich, pg. 382, 2016). The company’s area of expertise is in genetically modifying organisms, or use of biotechnology. Their seeds are genetically modified (GM) to survive weeks of drought, ward off weeds, and kill invasive insects. Monsanto’s GM seeds have supported an increase in the quantity and availability of crops, thus helping farmers increase food product and revenues (Ferrell & Fraedrich, pg. 382, 2016). While the outcomes seem positive, review of Monsanto’s ethical culture to various stakeholders will be addressed. Next, identification of both the pros and cons of growing GM seeds. Last, review on how Monsanto should manage the potential harm to plant and animal life from using products like, their Roundup. Efficacy of Monsanto’s Ethical Culture Prior to 2003 the Monsanto Company had earned the reputation of being a dishonest company that left various stakeholders feeling uneasy. During the 1970s the company engineered a chemical known as Agent Orange, which was used during the Vietnam War in effort to quickly strip the jungles. Agent Orange contained a chemical, called dioxin, which was found to be extremely carcinogenic. In 1979 a lawsuit was filed by hundreds of veterans who claimed harm due to exposure. Monsanto will endure this repercussion for years to come (Ferrell & Fraedrich, pg. 383, 2016). In the early 2000s it was revealed the company had been disposing of polychlorinated biphenyls in the land field. This chemical was linked to deformed fish and elevated levels being seen in the community. Unfortunately, this had been going on since the 1960s and was covered up by the company (Ferrell & Fraedrich, pg. 383, 2016). Yet again, proving they were dishonest and not doing their due diligence in protecting the public. Additionally, in 2002 an incident occurred in which an employee paid an Indonesian government

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official $50,000 towards a bid. The bid was to change a law in that country, that would require an environmental impact study before planting modified crops. Going against the anti-bribery law, worldwide (Thisdell, 2005). In 2003, CEO Grant Hugh took over the business. The company was focused on fostering an image and product line that reinforce new direction (Lamphere & East, 2017). About this time, many global issues were on the rise about biotechnology. Monsanto quickly reacted with change in documents to address these concerns worldwide (Lamphere & East, 2017). During this time period, Monsanto implemented a new set of commitments and addressed them in their ‘Monsanto Pledge’. Negative environmental claims against the company receive a counterclaim from Monsanto to question methodology being used. Any allegation of cross contamination of crops from non-GMO farmers is being addressed through collaboration with Dow Chemical to support crops being able to coexist. Monsanto has shown that they take action in addressing all environmental and health concerns through maintaining their products are studied by the EPA and approved (Ferrell & Fraedrich, pg. 386-387, 2016). In 2006 Monsanto revised their pledge to ‘Our Pledge’ which now reflects a human rights section (Lamphere & East, 2017). Over the last 18 years Monsanto has had a global discursive shift that has aligned with the changes in social acceptance (Lamphere & East, 2017). These changes have allowed the company to maintain an ethically driven culture that responds effectively to various stakeholders. Costs and Benefits of Growing GMO Seed Synthetic herbicides and pesticides were invented to ward off pest. Applying this process to all crops was time consuming and costly. Through biotechnology, the Monsanto scientist were able to implant these seeds with the genes that would have the same outcome farmers were looking for. In addition, the company provides seeds that can upturn productivity by increasing

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crop yields without taking up more land (Ferrell & Fraedrich, pg. 384-385, 2016). Which, in return, means more revenue for the farmer. A meta-analysis that was conducted on 147 agronomical studies showed farmer’s profits increase by an average of 68 percent, crop yields rose by 22 percent, and expenses for pesticides declined by 39 percent when using GM seeds (Lucht, 2017). In addition, it showed that farmers also reaped non-monetary benefits like time savings, ease of use, and more flexibility in planning (Lucht, 2017). Some negative outcomes stems from consumers with wanting awareness and knowledge about GM food due to it currently being superficial through government regulations (Lucht, 2017). In other countries, like Europe, more stringent regulations have been put in place that offer labels for more awareness to consumers. Nongovernmental organizations, outside of the U.S., raise concerns to the threat GMO products bring to biodiversity, farmer autonomy, and food safety. European consumers lean towards a lower intention to purchase GM food compared to North American consumers (Lucht, 2017). Consumers also worry about unexpected nutritional quality or allergenicity. Since consumers do not have awareness or perceived direct advantage, the public will focus on the risk side of the risk-benefit question (Buiatti & Christou, 2013). Management of Harm to Plants and Animals Monsanto’s product stewardship segment reflects their moral responsibility on potential harm to plant and animal life. Safety measures like testing products to ensure they are compliant with official regulations and performing extensive risk assessments are being completed. In addition, they observe the import regulations and acquire the product approvals that are needed in countries where products are being marketed. Their principals follow international recognized standards through Food and Agriculture Organization of United Nations, CropLife International specifications, and guidelines of the industry initiative Excellence through Stewardship (Bayer,

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2021). They are also committed to providing transparency about products to stakeholders and customers to strengthen confidence in their products. Effects to bees are continuously undergoing laboratory studies to confirm there is no risks being posed to bees, or other pollinators. In addition, the company offers targeted training courses to teach farmers and dealers how to safely handle their products in regard to human health and the environment. In the last couple decades Monsanto has reshaped their ethical culture and maintained it through their response from various stakeholders. There are many positives that GM seeds provide that can outweigh the negatives of using them. Monsanto must continue to maintain their sustainability efforts towards doing what is morally right in protecting plant and animal life from potential harm of their products. Furthermore, God gave Adam and Eve a garden that was perfect. Once Adam and Eve disobeyed, God told Adam in Genesis 3:17-18 that the ground beneath him was cursed because of his choices. That the ground would bring thorns and thistles. Today, plants and animals still suffer. GM seeds are one way that the Monsanto Company is trying to counterbalance the effects.

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Bayer. (2021). Product Stewardship in Agriculture. https://www.bayer.com/en/sustainability/product-stewardship-agriculture-farming.

Buiatti, M., Christou, P., & Pastore, G. (2013). The application of GMOs in agriculture and in food production for a better nutrition: two different scientific points of view. Genes & nutrition, 8(3), 255–270. https://doi.org/10.1007/s12263-012-0316-4 Ferrell, O. C., Fraedrich, J., Ferrell, L. (2016). Business Ethics: Ethical Decision Making and Cases (11th ed.). Cengage Learning

Genesis 3:17-18. (2011). In The Holy Bible. NIV. Colorado Springs, CO: Biblica. Lamphere, A. Jenna, & East, A. Elizabeth. (2017) Monsanto’s Biotechnology Politics: Discourses of Legitimation, Environmental Communication, 11:1, 75-89, DOI: 10.1080/17524032.2016.1198823

Lucht, J. M. (2015). Public Acceptance of Plant Biotechnology and GM Crops. Viruses, 7(8), 4254-4281. http://dx.doi.org.ezproxy.liberty.edu/10.3390/v7082819 Thisdell, Glenda. "Time to kill off the bribe: the chemicals industry is not as clued up on anticorruption issues as some industries. This recently cost Monsanto $1.5m." ECNEuropean Chemical News 31 Jan. 2005: 19. Business Insights: Global. Web. 14 Feb. 2021. Article can be used to support unethical issue of bribery & corruption from an employee at Monsanto in 2002.

CASE ASSIGNMENT 1 Bayer. (2021). Product Stewardship in Agriculture. https://www.bayer.com/en/sustainability/product-stewardship-agriculture-farming.

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