2. Role Of Business In Society

Question 1

Friedman’s concept of a corporation

Answer 1

Managers as agents of shareholders are to maximize profits subject to laws and ethical custom

Question 2

Legal counterpoint to Friedman

Answer 2

Justice Alitos majority opinion stating that modern corporate law does not require for profit corporations to pursue profit at the expense of everything else and many do not do so

Question 3

What is Friedman’s view based on/it’s key assumptions

Answer 3

Market structure
Handling of negative externalities
Functioning of government

Question 4

Why does Friedman have a point

Answer 4

Fiduciary duty is important

Invisible hand/positive externalities

Question 5

Porter and Kramer’s main argument

Answer 5

Due to clack of creativity around car and narrow focus on short term profits corporations have foregone opportunities for long term Pareto improvements

Question 6

What are limitations in porter and Kramer argument

Answer 6

Unrealistic to believe there are tons of win win opportunities sitting around and that corporations have just not understood mechanisms for achieving long term profitability

Still assumes Friedman’s profit maximization and does not consider broader responsibilities

Question 7

Power in Porter and Kramer arguments

Answer 7

IntegratingCSV into core strategy is better than traditional csr

Opportunities to think creatively about business strategy