Core Concepts

Question 1

What is the criteria for ethical frameworks?

Answer 1

1. Backed by reasons – Helps us understand why something is right or wrong
2. Tracks intuitions in obvious cases
3. Is action guiding

Question 2

What is the shareholder’s approach?

Answer 2

The responsibility of managers is to conduct business In accordance with the shareholders desires.

Question 3

What are some constraints of the shareholder’s approach?

Answer 3

1. Property rights are not absolute
2. The law is a constraint
3. Managers cannot and should not act instead of governments.

Question 4

Who holds the shareholder approach?

Answer 4

Milton Friedman

Question 5

Who holds the stakeholder approach?

Answer 5

Edward Freeman

Question 6

What is the stakeholder approach?

Answer 6

Manager’s responsibility is to balance the rights and interest of all stakeholders

Question 7

What kind of stakeholder approaches are there?

Answer 7

Ethical and Strategic

Question 8

What is an ethical stakeholder approach?

Answer 8

Managers should balance the interest of all stakeholders in their decision making and they have duties to the all stakeholders beyond what the law requires and should act in a way that the views of all stakeholders are taken into account equally.

Question 9

What is the strategic stakeholder approach?

Answer 9

Devoting resources and paying attention to stakeholders tends to be profitable.

Question 10

What is the Market Failure Approach?

Answer 10

Expects to work in perfect market conditions. The main idea is to have profit-seeking firms establish competition, in order to prove efficiency so the market clears.

Question 11

What is utilitarianism?

Answer 11

Which action would produce the greatest balance of happiness over unhappiness? It can clash with moral principles or laws

Question 12

Contradiction of the MFA?

Answer 12

The thing is that we do not always gain efficiency as we move closer to a perfect market. On the way to perfect conditions ,efficiency might actually go down, which contradicts the thesis.

Question 13

Constraints to the stakeholder approach?

Answer 13

1. What is wrong with making profit for profit’s sake, as long as I am hurting no one?
2. Can a manager balance all affected interests?
3. Should a manager balance all affected interests?

Question 14

What is deontology?

Answer 14

To respect one’s own choice. You can make your own choices as long as you don’t interfere with the choices of others

Good outcomes are NOT all that matter
Autonomy is important

Question 15

What is the utilitarian view on exploitation?

Answer 15

Exploitation is wrong if (and only if) it does not maximize aggregate wellbeing

Question 16

What are our duties of assistance?

Answer 16

To help someone if it’s not too risky/bothersome for us