2 business ethics Flashcards
what is corporate social responsibility
the idea that businesses have responsibilities that go further than profits eg social and environmental duties.
this argues that businesses have a duty to act in the interests of stakeholders as well as profit.
examples of stakeholders
-local community (reduce pollution and noise, provide employment opportunities.
-government (ensure taxes are paid, ensure employment)
-competitors
-employees
milton friedman quote about CSR
- ‘do corporate executives have responsibilities other than to make as much money for their stockholders as possible? my answer is no.’
robert c. solomon quote about CSR
you shouldnt pretend ‘that the virtues of business stand isolated from the virtues of the rest of our lives’
aristotle’s view on CSR
he emphasized communal aspects of ethics - the good of the individual was for the good of the community.
he emphasized polis (ancient greek society based on civic friendship and mutual dependency) and the place of work should be considered polis according to aristotle.
what are solomon’s 6 points
-community
-excellence
-role identity
-holism
-integrity
-judgement
crane and matten on business ethics
-economic responsibility: to ensure there are reserves as a duty to shareholders.
-legal responsibility: to obey the law (pay taxes, no price fixing etc)
-ethical responsibility: go go beyond the law (as the firm’s reputation is at stake)
-philanthropic responsibility: the love of one’s fellow human being (eg cadbury)
microsoft fine for abusing monopolistic position
£280.5 million
cadbury in favour of CSR
they were quakers and in the 19th century built schools, hospitals and decent housing for their employees and community as it was their christian duty to do so.
cardinal vincent nichols
7 principles of good business ‘blueprint for better business’ in 2012 based on catholic social teaching.
1. human dignity - links to the sanctity of life and links with kantian ethics. never a means to an end - are a means in themselves.
2. the common good - should work for the interests of all people. catholics regard humans as the stewards of the earth form genesis so it is important to care for it
3. solidarity - be in touch with the needs of the community
crane and matten names CSR
economic, legal, ethical, philanthropic.
example of hypocritical window dressing
2019 Plus size clothes activists Simply Be campaigned in London Fashion week for more inclusive clothing sizes. hundreds of brands have adopted larger sizes however, there is a £24 million market potential. why would a business make an ethical decision if it didnt benefit them?
examples of good csr
patagonia - all profits will be given to save the planet.
98% of the company’s stock will go to a non-profit called Holdfast Collective which fights the environmental crisis.
milton friedman about hypocritical window dressing
he says such programs reveal a ‘suicidal impulse’ and it is ‘pure an unadultered socialism’ (if you go above and beyond to lower prices or achieve a hiring quote - this has nothing to do with your business and will only damage sales)
example lush
one could argue that they are a great example of CSR
90% of packaging material was recycled
BUT they have made this their USP and so therefore using it to target environmentally conscious customers to make money.
julian baggini - is good ethics good business, how is good ethics not sufficient for a good business
gives the example of running an ethical cafe on a deserted moor. they correlate but arent a guarantee you will have a good business.
counter that badethics is good business (example of industries)
pornography, british american tobacco promise to be carbon neutral by 2030, drug businesses, fashion involving sweatshops.
stats that good ethics is not good business FTSE
FTSE4good uk index of top 50% companies risen by 32.8%
FTSE (general) rose by 35.4%
Adam Smith on symbiotic relationships
a business owner relies on customers for profit, employees rely on a business owner for wages etc.
gordon gecko on CSR
he believes ‘greed is good’ and that greed has marked an upward surge of mankind = more productivity, innovation and progression
solomon quote about profits
‘serving the public and taking care of one’s employees is the very essence. the profits will come as a consequence’
is good ethics good business in globalisation?
probably not - as it is unfortunately easy to oppress and exploit foreign workers when abroad, if a business has the opportunity to lower costs, this will grant them more profits that can be used to expand the business. workers in lesser developed countries may have less job opportunity, deterring them from rebelling due to exploitation.
globalisation definition
the integration of economies, industries and markets around the world.
positives of globalisation
china+joan
+ consumers can purchase cheaper products = fuels consumer culture and helping the economy
+advances technology, knowledge adn job opportunity where it may be scarce.
+some MNCs can do the right thing - eg a fund was set up to aid Rana Plaza victims and compensate = $30 million
+800 million chinese lifted out of poverty since china opened up the economy in 1978
+joan robinson quote: “The misery of being exploited by capitalists is nothing compared to the misery of not being exploited at all.”
