REPORT ON UNETHICAL ISSUES OR

BEHAVIOR OF KFC

SUBMITTED BY:UMAR ALI 135\

SUBMITTED TO:MAM RABIA SARFARZ

STUDENT OF BBA 5TH SEMESTER

BANKING & FINANCE

GOVERNMENT COLLEGE UNIVERSITY FAISALABAD

DATE OF SUBMISSION: 5TH NOVEMBER 2010

In the name of Allah,Most Benevolent Ever-Merciful.

All prays be to Allah,Lord of all the worlds,

Most Beneficent, Ever-Merciful,King of the day of Judgment,

You alone we worship, and to you.Alone we turn for help.

Guide us (O’ Allah) to the path that is straight,

The path of those you have blessed,Not of those who have earned your anger,

Nor those who gone astray

Acknowledgment

All acclamation to Allah who has empowered and enabled us to accomplish the task successfully. First of all we would like to thank our Allah Almighty who really helps us in every problem during the preparing this report. We would like to express our sincere and humble gratitude to Almighty who’s Blessings, help and guidance has been a real source of all our achievements in our life.We would like to admit that we completed this report due to parents who pray for our success.We also wish to express our appreciation to our supervisor MAM RABIA SARFAZ who helps us and introduce us to new dimensions of knowledge.

INTRODUCTION

The company chosen for analysis is Kentucky Fried Chicken (KFC) fast food restaurants. The company's headquarters are found at Kentucky in the US. Additionally, it is one of the most well known restaurant chains in the world especially with reference to chicken. It boasts of over eleven thousand restaurants located in over eighty countries of the world. Examples here include, UK, China, Thailand, Kuwait, Spain and Barbados, Puerto Rico, Pakistan and many more. The company's jar maproduct is chicken. These are served in various forms such a Chunky chicken hot pie, chicken fillets, chicken sandwiches among others. On top of these, the company also serves a variety of burgers and other non-chicken related foods. In total, there are three hundred products that the company offers the public. KFC is part of a global restaurant system known as Yum! This is the reason why the company normally teams up with other restaurants under the Yum! Brand like Taco Bell and Pizza Hut.

KFC UNETHICAL ISSUES OR BEHAVIORS

KFC is responsible for the suffering and brutal slaughter of over 800,000,000 chickens a year. This is well known, and well documented fact.

KFC employs harsh conditions for their chickens throughout their entire lives, from being trapped in an extremely small cage(smaller than all legal cages in Europe) with up to five other chickens, to being scalded alive at the slaughter house. These are common abuses in KFC factory farms, and even worse abuses, such as chickens being stomped on and having their limbs ripped off, have been documented by animal rights organizations such as PETA, and even KFC's own animal welfare advisers agree that these conditions are unethical and need to be changed.

KFC is an industry leader, and as such is an example for other chicken restaurants. This is why KFC has to change its inhumane treatment of chickens, because if we do not force them to change, it will be matter of time before other restaurant chains change their practices to resemble KFC's in an attempt to reduce costs. The lives of hundreds of millions of chickens (intelligent, sentient beings capable of feeling pain) are more important than corporations like KFC making more money.

The simplest way to show that you don't support KFC is by boycotting them until they change their ways. A more effective and wide reaching approach is to no longer eat meat products all together. Some people find this too much of a stretch, but those who make the change rarely look back.

KFC's Entry in India

Foreign fast food companies were allowed to enter India during the early 1990s due to the economic liberalization policy of the Indian Government. KFC was among the first fast food multinationals to enter India.

On receiving permission to open 30 new outlets across the country, KFC opened its first fast-food outlet in Bangalore in June 1995. Bangalore was chosen as the launch pad because it had a substantial upper middle class population, with a trend of families eating out. It was considered India's fastest growing metropolis in the 1990s. Apart from Bangalore, PepsiCo planned to open 60 KFC and Pizza Hut outlets in the country in the next seven years. However, KFC got embroiled in various controversies even before it started full- fledged business in India. When the issue of granting permission to multinational food giants to set up business in the country came up for discussion in the Indian parliament, some members from the opposition parties were vocal in their

displeasure...

From the very first day of opening its restaurant, KFC faced problems in the form of protests by angry farmers led by the Karnataka Rajya Ryota Sangha (KRRS).The farmers leader, Nanjundaswamy, who led these protests, vehemently condemned KFC's entry into India, saying that it was unethical to promote highly processed 'junk food' in a poor country like India with severe malnutrition problems. Nanjundaswamy expressed concern that the growing number of foreign fast food chains would deplete India's livestock, which would adversely affect its agriculture and the environment. He argued that non-vegetarian fast-food restaurants like KFC would encourage Indian farmers to shift from production of basic crops to more lucrative varieties like animal feed and meat, leaving poorer sections of society with no affordable food. KRRS held a convention on November 01, 1995 to protest the entry of fast food multinationals and the Westernization of local agriculture...

The case highlights the ethical issues involved in Kentucky Fried Chicken's (KFC) business operations in India.The regulatory authorities found that KFC's chickens did not adhere to the Prevention of Food Adulteration Act, 1954. Chickens contained nearly three times more monosodium glutamate (popularly known as MSG, a flavor enhancing ingredient) as allowed by the Act. Since the late 1990s, KFC faced severe protests by People for Ethical Treatment of Animals (PETA), an animal rights protection organization. PETA accused KFC of cruelty towards chickens and released a video tape showing the ill-treatment of birds in KFC's poultry farms.

However, undeterred by the protests by PETA and other animal rights organizations, KFC planned a massive expansion program in India.Issues:

» Understand the significance of cultural, economic, regulatory and ecological issues while establishing business in a foreign country

» Appreciate the need for protecting animal rights in developed and developing countries like India

» Understand the importance of ethics in doing business

» Examine the reasons for protests of PETA

» Identify solutions for KFC's problems in Ind

KFC and Yum Brands sued for false statements

People for the Ethical Treatment of Animals are seeking an injunction to stop "deceptive statements" by KFC and its parent company on animal welfare issues.People for the Ethical Treatment of Animals (PETA) filed a complaint in California Superior Court today, seeking an injunction against the KFC and its parent company, Yum! Brands (Yum), for making "false statements with regard to its animal welfare practices".

The controversial campaign group claims to have proof of grotesque abuses inflicted upon chickens by KFC suppliers.

PETA contends that statements KFC are making about animal welfare mislead animal-friendly consumers and are unlawfully deceptive. They are asking the court for an injunction to stop the defendants from continuing to make such statements.

KFC using oil which contains Tran's fatty acids

Being one of the most popular fast food restaurants and with millions of people patronising the products and foods offered by the company, it is important the company adheres to ethical standards specifically in terms of providing healthy foods. However, it has been observed that Kentucky Fried Chicken is using oil which contains Tran’s fatty acids. This kind of oil is noted to increase cholesterol and even increased the risk of having heart disease. As authorities discovered this, the case was being carried over by the consumer group Center for Science in the Public Interest and told the company to use healthier cooking products than the one they are using.

Tran’s fatty acids have been the topic of much debate among nutrition scientists. They are by-products of hydrogenation of liquid vegetable oils in the manufacture of margarines and hydrogenated fats to formulate commercially prepared baked goods and fried foods (1995) like what have been accused to KFC.

Gram for gram, they are believed to be twice as damaging as saturated fat. The Nutrition Action Health letter, published by the Center for Science in the Public Interest (CSPI), reported in 1997 that in clinical studies Tran’s fat raised people’s blood cholesterol about as much as saturated fat did. Because trans-fatty acids are not listed on food labels, they are invisible to consumers. The CSPI found that the trans-fat content in most chains’ French fries equaled or even exceeded the amount of saturated fat. That means a big order of fries has as much bad fat as a signature burger. With the negative effect of this to the people, KFC has been faced with problems in terms of following business ethics and finding ways to find solutions to these kinds of issue.

KFC does business with facilities that torture chickens

Amounting to about 850 million chickens a year, even though KFC claims to have an animal welfare board. By doing business with inhumane companies, KFC is condoning unnecessary chicken suffering.Before being crammed into dangerous cages resulting in broken body parts, chickens' sensitive beaks are chopped off without any painkillers. They are left suffering in unsanitary conditions reeking of ammonia and feces. Once taken out of the cages, chickens endure further torment by obviously sick individuals who need to prove their so called human superiority by beating, burning and ripping off chickens' heads while they are still alive.

KFC claims on its site that consumers around the world "enjoy more than 300" of its products. I wonder if those same people would enjoy visiting KFC's "Supplier of the Year" slaughterhouse in West Virginia to witness all the violence against defenseless chickens?

Boycott KFC and its affiliates. Show KFC that it must adopt and enforce an animal welfare program if it intends to keep any customers.

Another issue that the company is currently grappling with is firmly tied to the nature of the industry that the company operates in; fast food restaurant. According to health experts and other nutritionists, the type of fats utilised when cooking foods highly affects the nutritional and health value of the food. One particular type of fat that has received so much attention from the corresponding individuals is Trans fats. Trans fats are those types of fats that are emanated from oil during the hardening process. The purpose of these trans fats is to prolong shelf life and to make commodities prepared through baking last longer. Despite these good qualities, trans fats can bring about complicated health diseases that many people in the UK are fighting, these include;

Obesity Diabetes Coronary heart disease Other disorders

Suggestions to improvement

1. According to PETA or another animal right organizations animal should slaughtered in the Islamic way or zibah or don’t cruel with chicken(animal).

2. Indian protest against the KFC is well known so now the KFC needs to acquaint with the environment of country and its culture because Indian has protested against this Junk food which leads to many diseases.

3. KFC take some actions to improve the quality of chicken according to PETA4. it’s a practically experience that KFC( D-ground branch) employees behavior

with customer is not good and customer also claim to their headquarter through web site claim boxes so they should behave properly with customers.

5. KFC must not doing their business to torture the chickens and satisfy their customers according to their needs

Conclusion

As a restaurant operating under the fast food industry, there are some ethical issues that come into play when considering the nature of the industry itself. This is especially since the Health Ministry in the region announced a battle against obesity. Also, KFC also has to deal with different ethical issues in their capacity as a business corporation. Any company worth its salt should have a code of ethics and must be prepared to stick by it KFC has breached a substantial number of their ethics codes. However, one must not assume that the ethical issues facing KFC are one sided. Most times, individuals tend to focus on the negative aspects of ethics and fail to look at things from another angle. The purpose of this report on KFC unethical issues was to provide an in-depth analysis of the fast food industry through two contrary ideas; the moral and legal obligations that KFC has adhered to and also the ethical misgivings that the company has engaged in too.

Reference:www.kfcpakistan.com/www.helium.com/items/433031-kfc-the-torture-of-chickenswww.ethicalcorp.com/content.asp?ContentID=808