In their attempt to be considered a responsible company in their society, CVS Caremark announced its plan to stop selling cigarettes and other tobacco products. However, as the company began to offer more miniclinics and health advice in addition to the role assumed by its pharmacists of helping patients deal with chronic problems linked to smoking (The New York Times, 2014), the fact that it was still selling cigarettes was a conflict of interest. As stated in the chapter entitled “Business in Society,” (Corporate Ethics and Corporate Governance, 2007) a company’s survival and reputation are determined in part by societal acceptance. As explained by the Stakeholder Theory, companies operate with a much more complex concept of responsibility, which is linked to the interests of the general society. Ultimately, companies can only operate if they comply with society’s norms. In the case of CVS, chief executive Larry J. Merlo dismisses the estimated $2 billion loss in sales by saying that “cigarettes and providing health care just don’t go together in the same setting.” Not only does this decision have the potential to influence more health-aware consumers to purchase from their company, but also, as said by Kathleen Sebelius, secretary of Health and Human Services, this step taken by the CVS to promote healthy living will potentially have a “considerable impact” on other companies and possibly pressure them to imitate this business decision.
Works Cited:
Strom, Stephanie. “CVS Vows to Quit Selling Tobacco Products.” The New York Times. 05 Feb. 2014. Web. 10 Sept. 2014.
Zimmerli, Walther Ch., Klaus Richter, and Markus Holzinger. Corporate Ethics and Corporate Governance. Berlin/Heidelberg: Springer, 2007. Site.ebrary.com: The University of British Columbia Library. Web. 10 Sep. 2014.