business ethic
Chapter 2, Beauchamp and Bowie
In addition to Chapter 2, read http://www.bsr.org/CSRResources/ResourcesDocs/BSR_200508_Allen-White_Fade-Transform.pdf
What is the purpose of a Corporation?
• Profits v. social responsibility
• Stockholders v. Stakeholders
Who are stakeholders?
• stockholders
• employees
• customers
• managers
• supplies
• local community
According to Friedman, can a business do anything in the quest for profits?
• No, it must not be deceptive or fraudulent
Who is Theodore Levitt?
• Former professor of marketing at Harvard B-School, Ph.D. in economics, prolific writer, editor of Harvard Business Review, coined the term "globalization" has been referred to as the father of modern marketing
What is meant by a "nonconsequentialist perspective?" (page 49 in textbook)
• Check out definition of consequentialism here
Can there every be agreement between Friedman and advocates of "social responsibility?"
• Yes, if the socially responsible act leads to higher profits.
The Social Responsibility of Business is to Increase Its Profits by Milton Friedman
• Is business social responsibility the same as socialism? (page 50) o Yes, Friedman argues, since political mechanisms, not economic mechanisms, determine the allocation of resources - that is, the corporate CEO decides who should get what, rather than the market
• Corporate executives are agents of the owners, i.e., the stockholders - they should not be spending someone else's money to advance a particular agenda o to do so is equivalent to taxing and the CEO becomes a civil servant of sorts, a public employee
• Only people have responsibilities, corporations do not have responsibilities
• In fact, this kind of thinking can lead to the downfall of capitalism
A Stakeholder Theory of the Modern Corporation by R. Edward Freeman
• Managers do not have a duty to stockholders but they have a fiduciary relationship with stakeholders. o stakeholders have an interest in, and must
In addition to Chapter 2, read http://www.bsr.org/CSRResources/ResourcesDocs/BSR_200508_Allen-White_Fade-Transform.pdf
What is the purpose of a Corporation?
• Profits v. social responsibility
• Stockholders v. Stakeholders
Who are stakeholders?
• stockholders
• employees
• customers
• managers
• supplies
• local community
According to Friedman, can a business do anything in the quest for profits?
• No, it must not be deceptive or fraudulent
Who is Theodore Levitt?
• Former professor of marketing at Harvard B-School, Ph.D. in economics, prolific writer, editor of Harvard Business Review, coined the term "globalization" has been referred to as the father of modern marketing
What is meant by a "nonconsequentialist perspective?" (page 49 in textbook)
• Check out definition of consequentialism here
Can there every be agreement between Friedman and advocates of "social responsibility?"
• Yes, if the socially responsible act leads to higher profits.
The Social Responsibility of Business is to Increase Its Profits by Milton Friedman
• Is business social responsibility the same as socialism? (page 50) o Yes, Friedman argues, since political mechanisms, not economic mechanisms, determine the allocation of resources - that is, the corporate CEO decides who should get what, rather than the market
• Corporate executives are agents of the owners, i.e., the stockholders - they should not be spending someone else's money to advance a particular agenda o to do so is equivalent to taxing and the CEO becomes a civil servant of sorts, a public employee
• Only people have responsibilities, corporations do not have responsibilities
• In fact, this kind of thinking can lead to the downfall of capitalism
A Stakeholder Theory of the Modern Corporation by R. Edward Freeman
• Managers do not have a duty to stockholders but they have a fiduciary relationship with stakeholders. o stakeholders have an interest in, and must