Reiff There has also been a robust debate about whether workers in sweatshops are paid too little.
They say that sweatshops wages, while low by our standards, are not low by the standards of the countries in which the sweatshops are located. This explains why people choose to work in a sweatshop: it is the best offer they have. Efforts to increase artificially the wages of sweatshop workers, according to these writers, is misguided on two counts.
First, it is an interference with the autonomous choices of employers and workers. Second, it is likely to make workers worse off, since employers will respond by either moving operations to a new location or employing fewer workers in that location. Other writers challenge these claims. While granting that workers choose to work in sweatshops, they deny that their choices are voluntary D. Given their very low wages, this suggests that sweatshop workers are exploited.
Moreover, some argue, appealing to a Kantian duty of beneficence, that firms can and should do more for sweatshop workers Snyder Smith  famously observed that a detailed division of labor greatly increases the productivity of manufacturing processes. To use his example: if one worker performs all of the tasks required to make a pin himself, he can make just a few pins per day. However, if the worker specializes in one or two of these tasks, and combines his efforts with other workers who specialize in one or two of the other tasks, then together they can make thousands of pins per day.
But there is human cost, according to Smith, to the detailed division of labor. Instead, it is a call for labor processes to be arranged so that work is interesting, requires skill, and gives workers substantial decision-making power Arneson ; Michaelson et al. In response, it has been argued that there is a market for labor, and if workers wanted meaningful work, then employers would have an incentive to provide it Maitland ; Nozick This argument assumes, of course, that workers have the financial ability to trade wages for meaningfulness.
The above argument treats meaningful work as a matter of preference: as a job amenity that employers can decline to offer or that workers can trade away. Others resist this understanding. According to Schwartz , employers are required to offer employees meaningful work, and employees are required to perform it, out of respect for autonomy. The thought is: the autonomous persons makes choices for herself; she does not mindlessly follow others' directions.
A difficulty for this argument is that respect for autonomy does not seem to require that we make all choices for ourselves. A person might, it seems, autonomously choose to allow important decisions to be made for her in certain spheres of her life, e. A call for meaningful work may thus be understood as a call for workplaces to be arranged so that this deterioration does not occur Arneson ; S. Arnold In addition to Smith, Marx  was clearly concerned about the effects of work on human flourishing. Formative arguments face two difficulties.
One is establishing the connection between meaningless work and autonomous choice or another intellectual faculty. They assume that it is better for people to have fully developed faculties of autonomous choice etc. Both assumptions may be challenged. Neutralists in political philosophy think that the state should not promote the good, at least when there is reasonable disagreement about what is good see, e. Suppose you discover that your firm is paying bribes to government officials to win contracts.
While different theorists give different definitions of whistleblowing see, e. In the above example, you would be a whistleblower because you are 1 an employee 2 who discloses non-public information 3 about illegal activity in a firm 4 to people outside of it 5 in an effort to stop that activity. Debate about whistleblowing tends to focus on the question of when whistleblowing is justified—in the sense of when it is permissible, or when it is required. This debate assumes that whistleblowing requires justification, or is wrong, other things equal.
Many business ethicists make this assumption on the grounds that employees have a pro tanto duty of loyalty to their firms see, e. Against this, some argue that the relationship between the firm and the employee is purely transactional—an exchange of money for labor Duska —and so is not normatively robust enough to ground a duty of loyalty. For a discussion of this issue, see the entry on loyalty. One prominent justification of whistleblowing is due to DeGeorge According to him, it is permissible for an employee to blow the whistle when his doing so will prevent harm to society. In a similar account, Brenkert  says that the duty to blow the whistle derives from a duty to prevent wrongdoing.
The duty to prevent harm has more weight than the duty of loyalty. To determine whether whistleblowing is not simply permissible but required, DeGeorge says, we must take into account the likely success of the whistleblowing and its effects on the whistleblower himself. Humans are tribal creatures, and whistleblowers are often treated badly by their colleagues.
So if whistleblowing is unlikely to succeed, then it need not be attempted. Another account of whistleblowing is given by Davis Like Brenkert and unlike DeGeorge , Davis focuses on the wrongdoing that the firm engages in not the harm it causes. Whistleblowing picks out a real and important phenomenon. But it does not seem morally distinctive, in the sense that the values and duties involved in it are familiar. Loyalty to an individual or group may require that we give preference to her or their interests, to an extent.
And yet, in general, we should avoid complicity in immoral behavior, and should also make an effort to prevent harm and wrongdoing, especially when our efforts are likely to succeed and are not personally very costly. On the accounts given above, whistleblowing is simply the attempt to act in accordance with these values, and discharge these duties, in the context of the workplace. Businesses as a whole command enormous resources, and as a result can have an enormous impact on society.
One way that businesses impact society, of course, is by producing goods and services and by providing jobs. A famous example of CSR involves the pharmaceutical company Merck.
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In the late s, Merck was developing a drug to treat parasites in livestock, and it was discovered that a version of the drug might be used treat River Blindness, a disease that causes debilitating itching, pain, and eventually blindness. The problem was that the drug would cost millions of dollars to develop, and would generate little or no revenue for Merck, since the people afflicted with River Blindness—millions of sub-Saharan Africans—were too poor to afford it. In the end, Merck decided to develop the drug. As expected, it was effective in treating River Blindness, but Merck made no money from it.
As of this writing in , Merck, now in concert with several nongovernmental organizations, continues to manufacture and distribute the drug for free throughout the developing world. The scholarly literature on CSR is dominated by social scientists. Their question is typically whether, when, and how socially responsible actions benefit firms financially. That is, it is not clear whether prosocial behavior by firms causes them to be rewarded financially e. Since our concern is with normative questions, we will focus on moral reasons for and against CSR.
Some writers connect the debate about CSR with the debate about the ends of corporate governance. Thus Friedman objects to CSR, saying that managers should be maximizing shareholder wealth instead. Stakeholder theory is thought to be more accommodating of prosocial activity by firms, since it permits firms to do things other than increase shareholder wealth. But we do not need to see the debate about CSR as arguments about the proper ends of corporate governance. We can see it as a debate about the means to those ends, with some arguing, and others denying, that certain acts of prosocial behavior are required no matter what ends a firm pursues.
Many writers give broadly consequentialist reasons for CSR. The arguments tend to go as follows: 1 there are serious problems in the world, such as poverty, conflict, environmental degradation, and so on; 2 any agent with the resources and knowledge necessary to ameliorate these problems has a moral responsibility to do so, assuming the costs they incur on themselves are not great; 3 firms have the resources and knowledge necessary to ameliorate these problems without incurring great costs; therefore, 4 firms should ameliorate these problems.
Not only is there an opportunity to increase social welfare by alleviating suffering, suffering people may also have a right to assistance. The controversial issue is who should do something to help, and how much they should do. Thus defenders of the above argument focus most of their attention on establishing that firms have these duties, against those who say that these duties are properly assigned to states or individuals. Strudler legitimates altruistic behavior by firms by undermining the claim that shareholders own them, and so are owed their surplus wealth.
Hsieh says that, even if we concede that firms do not have social obligations, individuals have them, and the best way for many individuals to discharge them is through the activities of their firms see also McMahon Debates about CSR are not just debates about whether specific social ills should be addressed by specific corporations. They are also debates about what sort of society we want to live in. While acknowledging that firms benefit society through CSR, Brenkert b thinks it is a mistake for people to encourage firms to engage in CSR as a practice. When we do so, he says, we cede a portion of the public sphere to private actors.
Instead of deciding together how we want to ameliorate social ills affecting our fellow community members, we leave it up to private organizations to decide what to do. Instead of sharpening our skills of democracy through deliberation, and reaffirming social bonds through mutual aid, we allow our skills and bonds to atrophy through disuse. Many businesses are active participants in the political arena. They support candidates for election, defend positions on issues in public debate, lobby government officials, and more see Stark What does business ethics say about these activities?
This research focuses on such questions as: What forms does CPA take? What are the antecedents of CPA? What are its consequences? CPA raises many normative questions as well. One question is whether firms are the right type of entities to engage in political activity.
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In large states, citizens often find it useful to join associations of like-minded others, the purpose of which is to represent their views in political decision-making. But while organizations like the Republican Party and the Sierra Club are suitable participants in the political arena, it is not clear that organizations like Merck or Wal-Mart are.
Some have criticized the U. Alternatively, we might see firms as legitimate speakers on behalf of certain points of view Stark Scholars have also raised questions about the goals of CPA. One thing a firm might do when it engages in CPA is provide valuable information to government officials. Society has an interest in knowing how proposed economic policies will affect firms; firms themselves are a good source of information on these questions. Questions have been raised about the nature and permissibility of rent-seeking.
According to standard definitions, rent-seeking is socially wasteful economic activity intended to secure benefits from the state rather than from the market. But there is disagreement about what counts as waste. A related issue is whether firms are permitted to engage in rent-seeking behavior.
For example, when the Rana Plaza collapsed in Bangladesh in , killing more than garment industry workers, new building codes and systems of enforcement were put into place. But they were put into place by the multinational corporations that are supplied by factories in Bangladesh, not by the government of Bangladesh. Scherer and Palazzo , are major contributors to this debate. There is little doubt that firms can benefit society through political CSR. The building codes put into place by Western multinationals may well save the lives of many Bangladeshi garment workers.
Unless new forms of corporate governance can be devised, however, these benefits may come at a cost to democratic self-rule. A still more subtle way that firms can engage in political activity is through the exercise of their property rights Christiano A firm might move out of a state in response to the passage of a law it does not favor, or it may threaten to move out of a state if such a law is passed.
As with certain cases of political CSR, we may applaud the results of this kind of political activity. Many applauded when the state of Indiana revised its law permitting discrimination against members of the LGBT community on grounds of religious liberty in response to claims by powerful firms, such as Salesforce. But it is unclear whether such behavior by firms should be encouraged. We may wish to draw a distinction between private individuals influencing political decision-making by exercising their property rights and firms doing the same thing.
Many businesses operate across societal, including national, boundaries. Operating internationally heightens the salience of a number of the ethical issues discussed above, such as CSR, but it also raises new issues, such as relativism and divestment. Two issues often discussed in connection with international business are not treated in this section.
One is wages and working conditions in overseas factories, often called sweatshops. This literature is briefly discussed in section 6. The second issue is corruption. For discussion of this issue, see the entry on corruption. Whether and to what extent firms have a duty to perform socially responsible actions is a question that can and has been asked about firms in a domestic context.
But this question has seemed especially pressing in international contexts, and many of the most famous examples of CSR—including the case of Merck and River Blindness discussed in section 7. There are two reasons for this. One is that social problems, including poverty and environmental degradation, are often worse in the developing world than in the developed world.
The second is that firms are relatively more powerful actors in the developing world than in the developed world. International agencies have also created codes of ethics for business. Perhaps the most famous of these is the United Nations Global Compact, membership in which requires organizations to adhere to a variety of rules in the areas of human rights, labor, environment, and anti-corruption.
Wettstein A striking fact about much of this research is that, while it is focused on international business, and sometimes promulgated by international agencies, the conclusions reached do not apply specifically to firms doing business across national boundaries. The duty to, e. It is simply that the international context is the one in which this duty seems most important to discharge, and in which firms are one of the few agents who can do so. There are issues, however, that arise specifically for firms doing business internationally.
Every introductory ethics student learns that different cultures have different moral codes. This is typically an invitation to think about whether or not morality is relative to culture. For the businessperson, it presents a more immediate challenge: How should cultural differences in moral codes be managed? Donaldson is a leading voice on this question, in work done independently , and with Dunfee Much of this criticism has focused on the nature of hypernorms.
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A complication for the debate about whether to apply home country standards in host countries is that multinational corporations engage in business across national boundaries in different ways. Some MNCs directly employ workers in multiple countries, while others contract with suppliers in multiple countries. Nike, for example, does not directly employ workers to make shoes. Rather, Nike designs shoes, and hires firms in other countries to make them.
Our views about whether an MNC should apply home country standards in a host country may depend on whether the MNC is applying them to its own workers or to those of other firms. The same goes for accountability. Nike was subject to sharp criticism for the labor practices of its suppliers in the s Hartman et al. She may decide that the right course of action is to not do business in the country at all, and if she is invested in the country, to divest from it.
The issue of divestment received substantial attention in the s and s as MNCs were deciding whether or not to divest from South Africa under its Apartheid regime. It may attract renewed attention in the coming years as firms and other organizations contemplate divestment from the fossil fuel industry. Common reasons to divest from a morally problematic society or industry are to avoid complicity in immoral practices, and to put pressure on the society or industry to change its practices.
Some believe that it is better for firms to stay engaged with the society or industry and try to bring about change from within. The field of business ethics, in its current form, grew out of research that moral and political philosophers did in the s and s. It is not hard to see why moral and political philosophers might be interested in business. Business activity raises a host of interesting philosophical issues: of agency, truth, manipulation, exploitation, justice, and more. After a surge of activity 30 years ago, however, philosophers seem to be retreating from the field.
There are hardly any philosophy Ph. This is a missed opportunity. Many businesspeople care about business ethics: they see themselves as good people who want to do the right thing at work. As philosophers have retreated from the field, business schools have turned to management scholars to fill the void. Given their training in the social sciences, management scholars treat ethics largely as a descriptive enterprise, i.
This is an important enterprise, to be sure, but it is no substitute for normative reflection on what is ethical in business. I hope this entry helps to inform philosophers about the richness and value of business ethics, and in doing so, excite greater interest in the field. Sison, and Chris Surprenant.
Thanks also to David Jacobs and especially an anonymous reviewer for the Stanford Encyclopedia for detailed and thoughtful comments on a draft of the entry.
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Thanks finally to Northeastern University for providing a hospitable environment in which to work on this entry. Business Ethics First published Thu Nov 17, Varieties of business ethics 2. Corporate moral agency 3. The ends and means of corporate governance 3. Popular frameworks for business ethics 5. Firms and consumers 5. Firms and workers 6. The firm in society 7. Varieties of business ethics Many people engaged in business activity, including accountants and lawyers, are professionals. Corporate moral agency One way to think about business ethics is in terms of the moral obligations of agents engaged in business activity.
The ends and means of corporate governance There is significant debate about the ends and means of corporate governance, i. Popular frameworks for business ethics Business ethicists seek to understand the ethical contours of, and devise principles of right action for, business activity.
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Firms and consumers The main way that firms interact with consumers is by selling, or attempting to sell, products and services to them. Firms and workers Business ethicists have written much about the relationship between employers and employees. The firm in society Businesses as a whole command enormous resources, and as a result can have an enormous impact on society.
The status of business ethics The field of business ethics, in its current form, grew out of research that moral and political philosophers did in the s and s. Bibliography Alzola, M. Anderson, E. Arneson, R. Arnold, D. Arnold, S. Arrington, R. Attas, D. Bainbridge, S. Bazerman, M. Beadle, R. Beauchamp, T. Bebchuk, L. Bishop, J. Boatright, J. Beauchamp eds. Brenkert, G. Brennan, J. Carr, A. Carson, T. Child, J. Christiano, T. Cohen, J. Coons, C. Weber eds. Copp, D. Crane, A. Crisp, R. Dahl, R. Davis, M. LaFollette ed. DeBow, M. DeGeorge, R.
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Ethical Entrepreneur provides guidance on how the practical application of fine values will greatly enhance the performance of 9 core management functions- relating to how we think, relate to others and act in business. The basic premise is that, in addition to possessing necessary business skills like finance and marketing, the management of a business needs to be guided by fine values like honesty, courage, patience.
If they are put into practice, then then fine business values like credibility, efficiency, innovation will manifest which are the keys to establishing a long term sustainable, responsible business. This will benefit all those involved including employees, clients, suppliers and members of the community When new ventures are built on this strong foundation of fine values, then respect, trust and admiration for business leaders can be restored and business can better serve their important role in society. If I can…CIC want to support such an initiative on a global basis.
There has been a lot talk about values and Ethics in business with many companies offering flowery Mission and CSR statements, but If I can…CIC argue that too few businesses are truly living the values. All new books sold by AwesomeBooks: Will be completely new and unfolded. Wrapped carefully to prevent damage or curling of book edges. Return Policy At AwesomeBooks, we believe our customers should feel free to order any of our products in the knowledge that they can return anything back within 30 days of purchasing an item for any reason.
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