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The Ethical Issues of Aviation Business in Indonesia

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The Ethical Issues of Aviation Business in Indonesia ISSN 2355-4721 The Ethical Issues Of Aviation Business In Indonesia The Ethical Issues of Aviation Business in Indonesia Dinar Dewi Kania1* 1Institut Transportasi dan Logistik Trisakti, Jakarta, Indonesia e-mail: [email protected] ABSTRACT Aviation business in Indonesia still has a bad image in the international community because of some ethical cases involving the airline companies. The purpose of this study is to explore the ethical issues of aviation business in Indonesia and to find out how to improve the application of business ethics. This research is an explorative study. Data is obtained through observation, literature study and in-depth interviews with key- informants regarding the ethical issues of aviation business in Indonesia. The results show that the critical issues in aviation business ethics in Indonesia has been identified: 1) the issue of flight safety, 2) environmental issues, and 3) the issue of professional ethics, specifically drug abuse by pilots and crew. The efforts that should be made to improve the application of business ethics in aviation services are to build a corporate culture that has philanthropic responsibility and to make public policy based on moral values, religion and Indonesian culture. Keywords: business ethics; aviation business; flight safety; environmental issues; professional ethics 1 Jurnal Manajemen Transportasi & Logistik - Vol. 05 No. 01, Maret 2018 http://ejournal.stmt-trisakti.ac.id/index.php/jmtranslog Dinar Dewi Kania ISSN 2355-4721 INTRODUCTION such an environmental issue will directly influence the flight safety in Indonesia (The The aviation service in Indonesia Global Risk Report, 2016). according to Indonesia National Air Carri- The aim of this study is to explore ers Association (INACA) has experienced the ethical issues related to aviation busi- a very significant growth in the last one ness in Indonesia and the efforts that have decade. The increasing number of avia- been made to improve the business ethics. tion service passengers which reached 16 Any industry or business must be able to percent until the mid of 2016 has caused identify the ethical issues which are poten- a tight competition among airline compa- tial to happen in that industry, including nies to grab domestic and regional markets. aviation business, although this identifica- International Air Transport Association tion can not be easily practiced. However, (IATA) predicts the number of national air according to (Ferrell, 2011) the failure of transport passengers will increase 300%, identifying the ethical issues is a big dan- reaching around 270 million passengers in ger for any organization, especially if busi- 2034, whereas in 2014 the number of pas- ness is regarded as a “game” where rules sengers is only around 90 million (INACA, and sportivity are not applied. Sometimes, 2016). those who have such a perception can do Indonesia is a potential market for unethical things or even illegal in order to aviation business investors. However, the maximize their position and reap profits for aviation world in Indonesia is never desert- their organization. ed from cases of ethics violation. This has Ethics is a branch of philosophy that made an airline rating institute puts some discusses about what is good and bad, or Indonesia’s national airline companies in right and wrong. According Bertens, ethics the lowest ranks. A number of cases related is the science of morality or science which to professional ethics violation influencing investigate moral behavior (Bertens, 1993). the flight safety have occured in the recent Ethics is often termed as a practical philos- years. For example, the arrest of pilot and ophy. Ethical theories consists of three (3) cabin crew who hold a drug party by the major theories, namely Utilitarianism, De- officers of National Narcotics Agency or ontology and Virtue Theory (virtue). Since Badan Narkotika Nasional (BNN), involv- 1960, ethics began to open up in a concrete ing a number of national airline companies. and actual topics as the object of investiga- Such occurences are only a few ex- tion. The first applied ethics appeared is amples of issues related to aviation busi- ethics in the biomedical sciences. Business ness ethics in Indonesia. There are still oth- ethics is a field of specialization of applied er cases, both are exposed by media or do ethics (Bertens, 2013). not appear on the surface for some reasons. There are four things which are The other issues of aviation business eth- viewed as a source of ethical values, name- ics are related to flight safety and environ- ly religion, philosophy, culture, and law mental issues. The number of accidents and (Rudito & Famiola, 2007). In the past, a serious incidents investigated by National business ethics- as good-bad teachings in Transportation Safety Committee (KNKT) business activities - has deep rooted in reli- increased sharply in 2016. In the report of gion value. It can be proved that the West’s Global Risk 2016 published by World Eco- economic book referred to the Bible, Jew- nomic Forum, it is mentioned that the issues ish economic ethics took from their holy of climate and extreme condition as well as book, as well as the Muslim, they used val- the failure of mitigating and adapting the ue in al-Qur’an and Sunnah as the Islamic climate change are the challenges to face economic principles (Hashim, 2012). But worldwidely in the next 10 years. Surely, in today’s modern business, many of busi- 2 Jurnal Manajemen Transportasi & Logistik - Vol. 05 No. 01, Maret 2018 http://ejournal.stmt-trisakti.ac.id/index.php/jmtranslog ISSN 2355-4721 The Ethical Issues Of Aviation Business In Indonesia nessman believes that utilitarianism eth- responding relationships with other sup- ics can provide more benefits to society, plier companies, especially with the airport both sellers and buyers, and often ignore (Ravinder, 2007), multi-level ethical man- the value from religion and culture of the agement, a case study of airline and hotel people. Utilitarianism basic principles (Paek & Chathoth, 2017). apply not only on one’s own actions, but applies to the moral rules accepted by the community as the community’s behavior METHODOLOGY standard. In this theory, the moral rules will be considered as valid and correct, if This study uses a qualitative re- time-tested against the utilitarian principle search design and the explanation is de- (Bertens, 2013). The weakness Utilitarian- scriptive. Whereas viewed from its objec- ime theory is because it focus on the conse- tives, this study is an explorative research. quences thoroughly, therefore can sacrifice Explorative research is employed if the the interests of individuals for the benefit subject is very new and very few or no one of which is considered greater (Desjardins, has investigated it. Data is obtained through 2009). observation, literature study and in-depth The people of society have ex- interviews with 4 (four) key-informants of pectations towards business and business the aviation industry as well as business leaders. According to Davis, the society ethics in the year 2016 and 2017. gives legitimacy and strength for business. In the long run, those who do not use the power which the people consider it as a RESULTS AND DISCUSSION form of responsibility, it will lose legitima- The Issue of Flight Safety cy and strength (Svensson & Wood, 2008). Culture can affect what is perceived as the Indonesia has succeeded to get in maximands of corporate governance; for the category I in the International Avia- example, a conflict between the interests tion Safety Assessment (IASA) program of shareholders and stakeholders as the in 2016. This result of IASA audit is the highest goal of the company. Therefore, achievement of all stakeholders of aviation the leaders in the company should be able circle in Indonesia, because since 2007 all to define or identify the problems or ethi- airline companies certified by the aviation cal issues related to business or industry, authority in Indonesia have been prevented- including aviation business. Ethical issues and-prohibited by European Community. according to Ferrel is an ethical issue is Nevertheless, the number of accidents and simply a situation, a problem, or even an serious incidents investigated by National opportunity that requires thought, discus- Transportation Safety Committee (KNKT) sion, or investigation to make a decision increased sharply in 2016. Based on the (Ferrell, 2011). investigation data on the flight accidents There are several studies have been and incidents in Indonesia from 2010, ac- published related to aviation business eth- cording to KNKT, the highest rate of flight ics : 1) research on Corporate Social Re- accident and serious incident in Indonesia sponsibility (CSR), which aims to explore happened in 2016 numbering 41 cases, fol- the CSR issues that were reported by 12 lowed by 34 cases in 2013 and 32 cases in (twelve) airline in Asia (Chen & Chia, 2011. If compared to the flight hour pro- 2011); and 2) research on ethical issues in duction, the highest rate of serious incident cooperation on flight industry. This study and accident happened in 2011 with 2.51, evaluated the competitive activity in the followed by 1.19 in 2010. Whereas the ac- industry of aviation services and the cor- cident rate in 2016 has not been found yet 3 Jurnal Manajemen Transportasi & Logistik - Vol. 05 No. 01, Maret 2018 http://ejournal.stmt-trisakti.ac.id/index.php/jmtranslog Dinar Dewi Kania ISSN 2355-4721 because the data on total flight hour pro- ground handling and airport will always be duction has not been obtained. The data related to the performance of airline com- on total flight hour production is shown in panies. Today, what becomes obstacles re- Table 1. lated to safety issue in Indonesia are: first, The flight accidents and incidents in the heterogenous behaviour of consumers Indonesia, according to KNKT report, are in Indonesia.
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