Ethics: Business and Professions - Class Notes
Ethics: Business and Professions - Class Notes PHIL 2135
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This 3 page One Day of Notes was uploaded by Tony Ibrahim on Sunday September 14, 2014. The One Day of Notes belongs to PHIL 2135 at a university taught by a professor in Fall. Since its upload, it has received 292 views.
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Date Created: 09/14/14
Ethics Business and Professions Class Notes Chapter 5 Corporations What is the definition of a corporation 0 A corporation is a thing that 1 can endure beyond the natural lives of its members and that 2 has incorporators who may sue and be sued as a unit and 3 who are able to consign part of their property to the corporation for 4 ventures of limited liability Shaw amp Barry p 200 Can corporations be moral agents 0 Corporations are made up of people and have a corporate internal decision CID structure that decides what the corporation should and or will do 0 No A corporation39s CID structure causes it to be like a machine eg like your car Your car is not ethically responsible if the brakes fail and it thus kills a pedestrian 0 Yes The CID structure operates like an individual person in gathering information and making decisions Thus analogous to an individual s ethical decisions and ethical responsibility a corporation is and can be an ethical agent and is thus ethically responsible for its decisions and actions Differing views of corporate social responsibility 0 Narrow view espoused by Milton Friedman Profit maximization The sole social responsibility of a corporation and corporate managers and officials is to make as much money for their stockholders as possible so long as the corporation stays within the rules of the game ie it can39t do illegal or unethical things to make that profit What is a fiduciary relationship 0 Entity A gives part of its property into the hands of Entity B but Entity B must exercise its control for the benefit of the giver Entity A not for itself 0 When you go to the doctor you are entrusting your health with him or her the health is yours and the doctor is supposed to do what39s best for your health not what39s best for the doctor Broad view espoused by most commentators on business ethics Because of its social power social role and social footprint in addition to making a profit for its shareholders a corporation has a larger social responsibility Problems with corporate social responsibility 0 Although most business ethicists and commentators as well as most people hold to some version of the broad view difficult problems arise for this stance Who controls the corporation In theory it39s supposed to be the stockholders but actual practice is different How can a corporation be punished for ethical lapses 0 There is a diffusion of responsibility 0 This leads to a vanishing individual responsibility 0 There is also the problem of externalities Objections to corporate social responsibility 0 The invisible hand argument of Adam Smith 0 The let government do it argument It39s the role of government to handle social issues not corporations 0 Business can39t handle social responsibility because corporations and business people lack the expertise and training needed for this 0 If corporations are entrusted with a social role they will change and mold society to conform with the interests of the business What should corporations do to institutionalize ethics within the corporation 0 Acknowledge the importance even necessity of conducting business ethically 0 Make a real effort to encourage their members to take ethics seriously End retaliation for those who buck the system and reward employees for evaluating corporate decisions in broader ethical and social contexts 0 End defensiveness in the face of public discussion and criticism Actively solicit views of stockholders managers employees suppliers customers local communities and society as a whole Invite outside opinions Be candid 0 Recognize the pluralistic nature of social systems Society consists of diverse but interconnected people and groups all seeking to maintain their autonomy and advance their interests Actions of any one group invariably affect other groups and individuals Other important considerations 0 There are limits to what the law can do 0 Corporate moral codes are valuable and should set reasonable goals but codes and rules by themselves do not solve ethical issues the point made by the existentialists 0 Corporate culture is near paramount and the tone for the culture is set at the top 0 Contrast Tylenol case with Ford Pinto case Conclusion of Notes Chapter 5 Corporations