Ethical Considerations

14


Shoshone Strategies & Advisement has conducted an ethical analysis of the major
issues and concerns involved in July at the Multiplex. Our firm has applied the
following theories in addressing the ethical issues involved with the no refund policy of
the Royal 16 Theatre and the advertisement of commercials before films: (1) the
Stakeholder/Utilitarian Theory which asks what decision creates the most good for the
largest number; (2) the Rights Theory which defends an individuals rights to be treated
impartially and without prejudice; (3) the Justice Theory which addresses whether or not
there is a fair distribution of profits and encumbrances; (4) the Categorical Imperative
Theory asks what the repercussions would be if everyone took this action; and (5) the
Front Page Test which asks what the decision maker would feel if the indecision was
posted on the front page of a popular newspaper (Staudt / Coursework Packet 98). These
theories and tests affect both the direct and indirect stakeholders. They have been applied
to the two issues in question: (1) the no refund policy; and (2) the showing of
commercials at the advertised movie show time. The direct stakeholders in this case are
the complainant (Tommy) and Mr. Plex, because the results of this case will have the
greatest impact on them (Staudt / Coursework Packet 98). The indirect stakeholders are
the consortium of movie theatres created by Mr. Plex and the moviegoers.

Shoshone Strategies and Advisement understands that it is the policy of the Royal
16 Theater to offer no refunds to its customers. Our firm considers this policy to be
unethical. The Royal 16 Theatre is only one entity in comparison to their customers, who
are many. Applying the Utilitarian Theory, we see that the policy in question does not
Ethical Considerations

15


offer the most good for the largest number. If the Royal 16 Theatres customers are not
satisfied due to the no refund policy, it would be unethical to ignore their dissatisfaction.
This is because, as the largest number, the customers are being denied the most good.
However, our firm feels the Royal 16 Theatre would be acting ethically by offering
refunds to its unsatisfied customers.

Under the Rights Theory, the theater is encouraged to protect the individual rights
of its patrons. Many retail stores offer refunds to their customers who feel they have
purchased a product that does not meet their standards. The no refund policy of the
Royal 16 Theatre may cause its customers to feel as if they are being treated unfairly.
They may feel the no refund policy rescinds their personal right to the retrieval of their
money, should the movie fail to meet their standards. This may cause harm to the theatre
because of a potential loss of market share and a tainted public image.

In response to Mr. Plexs fifth question, there are several ethical issues that are
involved in showing twenty minutes of commercials before the screening of the movie.
Based on the Stakeholder/Utilitarian Theory, the theater should focus on keeping the
customers happy because they are the largest stakeholders. If the customers are unhappy
with the commercials being shown, then ethically speaking, the theater should put a stop
to it. According to the Stakeholder/Utilitarian Theory, anything less than this would be
considered to be unethical.

Ethical Considerations

16


According to the Rights Theory, each individual has the right to choose what they
would like to watch and what they would not like to watch. This right is exercised in the
purchase of a ticket. The individuals who do not realize that commercials are being
shown prior to the screening of the movie may feel they are being forced to watch these
commercials, when they should be watching the movie. According to the Rights Theory,
the practice of showing commercials prior to the movie is unethical, because customers
may feel their rights to see the movie at the advertised show time are being violated.

In context of the Justice Theory, the showing of commercials prior to the movie
screening does not result in a fair distribution of profit and encumbrances to the
stakeholders involved. Some customers may not mind viewing the commercials, but it is
inevitable that some will. More specifically, according to the survey conducted by our
firm, about six percent of moviegoers do find the showing of commercials prior to the
movie screening to be intolerable. Therefore, the showing of these commercials is not a
fair distribution of benefits to those six percent of moviegoers.

The ethics behind the no refund policy of the Royal 16 Theatre and the showing
of commercials prior to the movie screening should be considered, based on the
aforementioned five ethical theories and tests. Our firm encourages the Royal 16 Theatre
to examine and revise its no refund and commercial broadcast policy in order to satisfy
its customers.