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Essay on Moral Issue in Business
Corporations dominate advanced economies. Corporations are legal agents, and also moral agents with social and moral responsibilities. There are three meanings of moral responsibility:
- Refers to people being morally accountable for some past action.
- Refers to a person’s accountability for the care, welfare or treatment of others according to social conventions.
- Refers to a person’s own capacity to make moral and rational decisions.
Can corporations make moral decisions? Yes, corporate internal decision structure establishes lines of authority and corporate procedures and objectives. In addition, corporate decision-making structure acts intentionally and with a purpose (Snell, 2003). Therefore, corporation makes informed and rational moral decisions, and carries out actions in order to realize its intentions. There are two views on what responsibilities a corporation has.
Narrow view:
According to Milton Friedman, a business has no social responsibilities other than to maximize profits. Corporate officials have a sole responsibility to serve the interests of their shareholders within the rules of the game: open and free competition without deception and fraud. Corporate managers must obey civility and to seek material gain. To have other social responsibilities means that managers must subordinate owners’ interests to some social objectives, such as controlling pollution or fighting sexual discrimination. But such issues are the roles of government agencies, not corporations. Friedman believes there is nothing immoral about the pursuit of profits and doesn’t require external controls (Snell, 2003).
Broader view:
A business has other obligations in addition to pursuing profits. Because of their great social and economic power, corporations must carry social responsibility. Businesses cannot make decisions that are solely economic decisions, because they are interrelated with the whole social system – business activities have profound implications for society. As a result, society expects business to pursue other responsibilities as well (Snell, 2003)........
