| Mitsubishi Sex Scandal | Investigative Paper | |

BACKGROUND
During the mid 1990s, a landmark case that dealt with unethical behavior in the workforce hit the United States. The defendant was Mitsubishi, or mainly the managers at the Mitsubishi Motor Manufacturing of America Inc. (MMMA) plant in Normal, Illinois. Equal Employment Opportunity Commission (EEOC) sued Mitsubishi on behalf of the 350 female employees, current and former, who experienced sexual harassment working at the MMMA plant (Treece). The case at the MMMA plant in Normal, Illinois opened up doorways for women to speak up in other states such as Maryland, California, and Michigan (Harassment, Retaliation, Death Threats at Mitsubishi Motors).
The Mitsubishi sex scandal didn’t happen all of a sudden; instead, it started slow and progressed over an eight year period. The EEOC was the first organization that put the spotlight on the unethical behavior depicted at the MMMA factory. The EEOC believed that as early as 1990 there had been cases of sexual harassment going unnoticed in the Mitsubishi factory, after getting complaints from some of the female workers (Cray). The EEOC claimed that the company personal, at Normal, Illinois plant, began having sex parties in 1992. The supervisors from Japan actually requested these parties, and the parties were on company time (Cray).
A couple years after the EEOC made the claims about Mitsubishi’s managers, the EEOC decided to file its commissioner’s charge after it examined the MMMA plant at Normal, Illinois and found that the plant had inadequate sexual harassment policies (Cray). Soon after, the media started noticing what was going on at the Mitsubishi plants. With the EEOC and the media breathing down Mitsubishi back, the company picked up its disciplinary pace in 1995 and 1996 (Cray). However, on April 22, 1996, Mitsubishi funded a “spontaneous” march around the EEOC’s Chicago offices, done by 3,000 employees, as its last act of retaliation (Cray). With the march not yielding any positive fruition, Mitsubishi hired US Labor Secretary Lynn Martin, later that year, to examine the company’s policies. The organization hired Lynn because she had a reputation for promoting women’s rights during her 10 years in congress (Cray). In 1998, the suit finally came to an end and Mitsubishi agreed to pay $34 million to female workers at the Normal, Illinois plant, and it paid out several more millions of dollars in individual suits (Kaminsky).
CAUSES
Many organizational causes and oversight weaknesses attributed to the Mitsubishi scandal. The prime organizational cause, in this case, is the structure of the whole company. The structure is the prime organizational cause because of the generalization that the whole plant and the factory system, with assembly lines, is considered to be a male dominated environment. So in a psychological view, if a female is working in the same factory that’s dominated by males, then she will gain the attention, good or bad, of those males (Chatterjee). The female will be in an environment, knowing that its male dominated, and she will try to make the environment as less hostile as possible by avoiding conflicts.
To add to the huge difference in the number of male workers to female workers in the plant, the male workers also got support from the hierarchy of the company which consisted of all males. In an article by Leon Jaroff, it is stated that although the sexist acts were committed by the American workers, Mitsubishi’s Japanese managers were also charged in the suit because they encouraged the actions of the workers. Due to the support and the encouragement of the managers, the male worker was able to diffuse the responsibility for his unethical actions.
As previously stated the managers were also charged in the suit, and rightfully so, because poor leadership was one of the main causes of the scandal. Executive leaders can create, maintain, or change cultural systems by the things they do and support (Nelson). In the case of the Mitsubishi leaders, the Japanese managers didn’t acknowledge women as equal to men in the work environment (Leon Jaroff). Through internalization, the Japanese managers maintained their Japanese cultural system, in the United States, by passing on the mind frame that women are inferior to men to the American managers. The mind frame that women are inferior to men in the workplace is a cultural norm in Japan. The American managers showed a lack of ethical awareness by adopting this cultural norm and passing it on to the employees. The Japanese also showed a lack of ethical awareness by taking the American managers, who were in Japan for training, to strip clubs, which demonstrated how the managers should spend their free time (Leon Jaroff).
After all the things done by Mitsubishi’s managers, the leadership style emulated by the managers is questionable. Based on the actions described in the articles, the leadership style of Mitsubishi would not fit the moral person and the moral manager dimensions of ethical leadership. In fact, the leadership style was completely the opposite of the dimensions. The leadership didn’t demonstrate the moral person dimension in the form of honest traits, ethical behaviors, and ethical decision making. The managers also didn’t follow the moral manager dimension because they were terrible role models, they didn’t communicate regularly about ethical rules, and they used reward system unethically (Cray).
Poor leadership can result in many bad decisions. A bad decision that results from poor leadership is the misuse of the reward’s system. As previously stated, Mitsubishi paid for a spontaneous march around EEOC’s Chicago offices. It paid more than $30,000 for buses and provided each employee that marched a day’s pay and a free lunch. While the people that didn’t chose to march had to report for work or get his or her day’s pay docked. Even some women went on the bus because the alternative was to stay in the plant and clean (Cray). Through the reward’s system, the company rewarded employees for standing up for the company’s unethical work environment, and the company punished those who opposed the unethical work environment.
As stated earlier, the American managers adopted the group norms of the Japanese managers through internalization. The Japanese cultural norms that were passed on to the American managers were work hard and disregard women as equals. Based on work performance, the company had success in the US. New cars coming out of the MMMA plant in Normal, Illinois, in 1996, were virtually defect free; the cars reflected a good combination of Japanese design and American assembly and engineering skills (Leon Jaroff). However, this success was short lived due to the many sexual harassment cases within that factory. The group norm at the Mitsubishi plant was as long as it gained external success, it would disregard internal failure.
Root causes weren’t the only contributory factors in this scandal, there were also some oversight weakness. One oversight weakness was the Mitsubishi’s corporate headquarters. The corporate headquarters for Mitsubishi is located in Tokyo, Japan, and its chairman, during the scandal, was Hirokazu Nakamura(Leon Jaroff). In the states, the American, non-Japanese, head officials were handling the scandal. The American officials’ goal was to deny the allegations and pay employees to protest for the company. After the American officials kept failing, the corporate headquarters got involved to clean up the mess. In a statement, Nakamura admitted that "there were such cases" of sexual harassment at the Normal plant but insisted that they were dealt with properly (Leon Jaroff).
Another oversight weakness was the labor unions. The female employees first went to the labor unions to complain about their conditions in the workplace but their complains were ignored (Cray). Just like the factories, labor unions mostly consisted of males and those males would not do anything to jeopardize their jobs by exposing the conditions of the plant. Because of the labor unions lack of action, it took longer for the case to get started. The harassed female employees had to go directly to the EEOC to get the case started (Cray).
CONSEQUENCES
This scandal had plenty of consequences that affected different stakeholders. A scandal of this magnitude greatly affected the company itself. The company not only had to pay $34 million for female workers in the plant at Normal, Illinois, but they also had a lot of negative media coverage in the United States (Kaminsky). The scandal was all over the media, and gave the company a bad reputation. Because the company was seen in a negative light, people refused to buy its products and the company lost a lot of profit and future customers due to this scandal (Treece). Mitsubishi had to hire US Labor Secretary Lynn Martin to examine its ethical policies and values. Lynn had a reputation for promoting women’s rights during her 10 years in congress. She began to bring the reputation of the company back up (Cray).
The scandal obviously affected the female employees of the company. Many female employees of the company suffered more harassment after going to the EEOC. Some female employees got death threats and the abuse intensified as a female employee’s house was burned down (Harassment, Retaliation, Death Threats at Mitsubishi Motors). Most other female workers were forced to quit because of these conditions. On the other hand, the company fired the male employees that were involved in sexual harassment, and the male employee’s families lost a source of income.
This scandal also affected the community, which was the last stakeholder. The negative publicity of the MMMA plant also brought the reputation of Normal, Illinois down. This scandal prevented the inflow of people and other businesses into the city, because of the negative reputation that would be inherited with the move. With less people visiting the city and less business ventures taking place in the city, the city’s growth both financially and population wise is limited. Along with negative inflow of people and business, there have been a lot of people fired from his or her job at the factory which also contributes to the poor financial health of the city (Treece).
PREVENTION
The company needs to take actions to prevent another large-scale scandal. By diversifying the staff through incorporating different ethnicities and genders would allow a broader understanding of the different kinds of personnel working under the management team. The management team that led to scandal consisted of all men, (Leon Jaroff). This would be like diversifying the portfolio, in finance. If there are many different forms of assets in a portfolio then there will be less risk. Same with employer-employee relationships, if there is only one type of manager, such as white male, then the manager would be more partial to an employee who is in his own ethnic class.
Another way that this type of scandal can be prevented is by making the company require workplace etiquette training. A training program would allow the employees to see how they are supposed to act in the workplace. Mitsubishi’s headquarters thought the same way after the EEOC and “a plant wide sensitivity-training program was belatedly established (Leon Jaroff).” If everyone goes through the program, he or she will be more aware of how to act in the workplace.
Another method of the future prevention of a huge scandal is by making the company establish a solid rewards system. Pre-scandal and during the scandal, the rewards system was unethically used. Unethical behavior was rewarded while the ethical behavior was ridiculed (Cray). With a solid reward system, employees receive rewards based on conduct and performance in the workplace. This would be like incentives in the business world. The amount of work a person puts in correlates with the reward they will receive. If the incentive (reward) is set high, then every individual will be on top of his or her game to gain that added incentive with his or her salary.

Works Cited
Chatterjee, Camille. "Can Men and WOmen Be Friends?" 20 May 2011. Psychology Today. 17 November 2011 <http://www.psychologytoday.com/articles/200109/can-men-and-women-be-friends>.
Cray, Charlie. "Conducive to SEXUAL HARASSMENT." October 1997. Business Source Premier. 2 November 2011 <http://bblearn.missouri.edu/bbcswebdav/courses/mgmt_3200_sc6/Conducive%20to%20Sexual%20Harassment.htm#db=buh&AN=9712096057>.
"Harassment, Retaliation, Death Threats at Mitsubishi Motors." June 1996. ProQuest. 2 November 2011 <http://bblearn.missouri.edu/bbcswebdav/courses/mgmt_3200_sc6/Harassment%2C%20Retalization%2C%20Death%20Threats.htm>.
Kaminsky, Michelle. "Five Biggest Sexual Harassment Cases." June 2006. LegalZoom. 2 November 2011 <http://bblearn.missouri.edu/bbcswebdav/courses/mgmt_3200_sc6/five-biggest-sexual-harassment-cases.htm>.
Leon Jaroff, James L. Graff, William A. McWhirter, Josph R. Szczesny, and Adam Zagorin. "Aseembly-Line Sexism." 6 May 1996. TIME. 2 November 2011 <http://bblearn.missouri.edu/bbcswebdav/courses/mgmt_3200_sc6/Assembly-Line%20Sexism.html>.
Nelson, Linda K. Trevino and Katherine A. Managing Business Ethics: Fifth Edition. Hoboken, NJ: John Wiley & Sons, Inc, 2007.
Treece, James B. "Normal struggles to be normal." 13 June 2005. Business Source Premier . 2 November 2011 <http://bblearn.missouri.edu/bbcswebdav/courses/mgmt_3200_sc6/Normal%20Struggles%20to%20be%20Normal.htm#db=buh&AN=17381507>.