Can We Rely on Corporations to Be Ethical and Responsible?
Can we rely on corporations to be ethical and responsible?
“Can a building have moral opinions? Can a building have social responsibility? If a building can't have social responsibility, what does it mean to say that a corporation can? A corporation is simply an artificial legal structure. But the people who are engaged in it, whether the stockholders, whether the executives in it, whether the employees, they all have moral responsibilities.” – Milton Friedman
Introduction
In this essay, I am going to argue that we cannot rely on corporations to be ethical and responsible, however, we can always trust them to act in their perceived best interests and in many cases, this is concurrent with acting in an ethically and socially responsible manner. There are two main reasons for this outcome. Primarily, corporations are instruments to be used by typically self-centred individuals – they act predominantly in their own interest and to do so is to maximise the profits of the corporation. As I draw upon Shaw & Barry (2007), I will show that corporations are run by individuals with egoistic objectives, who despite their personal views, are often forced to run corporations with profitability as their primary and sometimes only purpose. Consequently, individuals and consumers are becoming more self-aware of the actions and consequences associated with their behaviour. Indeed, as I invoke upon Parker (2002), I will show that consumers can and often do sanction corporations who choose to engage in unethical activities. These two principles make it imperative for the executives who manage corporations to conduct their operations in an ethical and socially responsible manner if they seek to ensure the financial success of their organisations. I will elaborate on this further throughout the essay by initially explaining the rationale behind corporate decision making, then consequently on how consumers can strongly influence the way in which corporations act, and
“Can a building have moral opinions? Can a building have social responsibility? If a building can't have social responsibility, what does it mean to say that a corporation can? A corporation is simply an artificial legal structure. But the people who are engaged in it, whether the stockholders, whether the executives in it, whether the employees, they all have moral responsibilities.” – Milton Friedman
Introduction
In this essay, I am going to argue that we cannot rely on corporations to be ethical and responsible, however, we can always trust them to act in their perceived best interests and in many cases, this is concurrent with acting in an ethically and socially responsible manner. There are two main reasons for this outcome. Primarily, corporations are instruments to be used by typically self-centred individuals – they act predominantly in their own interest and to do so is to maximise the profits of the corporation. As I draw upon Shaw & Barry (2007), I will show that corporations are run by individuals with egoistic objectives, who despite their personal views, are often forced to run corporations with profitability as their primary and sometimes only purpose. Consequently, individuals and consumers are becoming more self-aware of the actions and consequences associated with their behaviour. Indeed, as I invoke upon Parker (2002), I will show that consumers can and often do sanction corporations who choose to engage in unethical activities. These two principles make it imperative for the executives who manage corporations to conduct their operations in an ethical and socially responsible manner if they seek to ensure the financial success of their organisations. I will elaborate on this further throughout the essay by initially explaining the rationale behind corporate decision making, then consequently on how consumers can strongly influence the way in which corporations act, and