Allstar Brands, headquartered in Cincinnati, is a large, diversified manufacturer with plants located throughout North and South America and the Pacific Rim. The company has a strong commitment to equal opportunity employment and emphasizes this commitment in frequent communications with management and supervisory personnel. In several locations, Allstar has training programs directed at improving the skill levels of minority groups. In addition, to ensure that the corporate policy is implemented, all supervisory personnel must attend seminars on nondiscriminatory personnel practices.
Allstar's Manufacturing Accounting Department (MAD) is located at the Cincinnati headquarters. MAD not only performs the traditional functions of manufacturing accounting, but also designs nonfinancial performance measurement systems and other tools and programs to support Allstar's total quality management (TQM) philosophy. Employment in MAD is considered a management accounting career choice and can also serve as a step to a higher position in another department. Roger Dixon, MAD director, has the authority to hire all department personnel. Dixon delegates the initial screening of all job applications and some preliminary interviews to one of his senior management accountants, Peter Foxworth. Foxworth then recommends candidates to Dixon for further consideration. This arrangement has been in place for two years. Foxworth is concerned that during this time, Dixon has not hired any minority applicants, despite the fact that many were qualified. Several minority candidates recommended by Foxworth were not even interviewed by Dixon. When asked about these conditions, Dixon told Foxworth to pay attention to his own responsibilities.
Foxworth believes Dixon has intentionally discriminated against minority applicants and that Dixon's behavior must be corrected. Foxworth is uncertain how he should proceed because Allstar Brands does not have an established policy on how to resolve such issues. Foxworth is considering taking one of the three following alternative courses of action:
(a) Discuss Dixon's behavior with the director of Personnel, who is a management peer of Dixon.
(b) Informally discuss Dixon's behavior and ways to change it with a group of MAD senior management accountants.
(c) Discuss Dixon's behavior privately with the chief financial officer, Dixon's supervisor.
Required:
(1) Which of the 15 responsibilities in Standards of Ethical Conduct apply to Dixon's behavior?
(2) Which of the 15 responsibilities in Standards of Ethical Conduct apply to Foxworth's situation?
(3) For each of the three alternative courses of action Foxworth is considering, explain whether or not the action is appropriate.
(4) Identify the steps that Foxworth should take in attempting to resolve this situation.