In August 3^rd, Fonterra published a report and said they had found bacteria in some products that could cause botulism, a potentially fatal disease that affects the muscles and can cause respiratory problems. This big issue brought a quite serious impact to Fonterra. A piece of news published in CNBC announced that “Shares of the company tumbled as much as 9 percent in Asian morning trade” and “The New Zealand dollar…falling to a one-year low of $0.7670”.

This scandal creates a negative image of Fonterra and decreases clients’ confidence of purchasing their products. Creating and sustaining an ethics corporation is essential and it is also important for firms to establish business ethics. Firms should follow moral principles and shoulder obligation for their customers, employees, stockholders, etc. Companies should apply the highest standard of integrity and balance the contradiction between benefits and business ethics. As we can see, firms cannot gain the trust of clients and public, as well as surviving in competition without business ethics. Once companies get into ethical trouble, the situation they can stage a comeback is quite harsh.

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