Business Ethics Are Good for Society and the Economy - Essay Example

Business Ethics Are Good for Society and the Economy Businesses do not act in a socially responsible manner nor should this be an expectation, it will never happen. Only the persons within organizations can choose to accept social responsibilities. A corporation is not made of flesh, blood or brains. It has no emotional ties to its employees, society or the environment. Rather, it is a synthetic entity possessing only an abstract sense of responsibility if the human owners of the business have integrated social responsible behavior into its operation. It has been argued that business owners, or stockholders, have an obligation to in some sense repay the society that allowed it to be. Others suggest that providing jobs and contributing to the tax base is repayment enough. Whichever of these perceptions one subscribes the fact that employees of a company have but a single responsibility, to make money for the owners, is not in question. A chief executive officer may act as the ‘brains’ of the corporation but they are an employee and are bound both by ethical consideration and by federal law to make decisions intended to increase company profits. Of course company employees are expected to obey the law and in act in accordance with customary public ethical guidelines but mainly because this is in the best interest of the company and not because the company itself has a moral obligation. The end result justifies any means by which to achieve it including the destruction of the environment as well as the financial gouging of customers and employees. Corporations do have social responsibilities and society should demand corporate adherence to those responsibilities. Employees cannot simply give away company funds to their favorite charity. That would be irresponsible, unethical and illegal. Certainly, company officials are also individuals whose conscience extends past workplace concerns. The person outside the corporation may feel a duty to voluntarily give their time and money to charities, the church, community and family. In these instances, the individual is not acting as the agent of the giving but the principal. They are spending their own time and money or time and not the resources of a company. “If these are ‘social responsibilities,’ they are the social responsibilities of individuals, not business” (Friedman, 1970). Though the view that business do not have a social responsibility is logical and fits the capitalist ideology on which the country was built, others argue that the self-serving goals of corporate America has created a value system not only separate but in opposition to that of society. This reality is apparent not only in the U.S. but in many other countries as well, both in the developed world and Third World nations. The banking debacle in Mexico escalated its national debt by $80 billion due to the government financially bailing out unscrupulous shareholders who were in league with government officials at the taxpayer’s expense. When Argentina privatized most of the public works departments, corporations stole money from millions of Argentinean citizens. In Europe, the pharmaceutical industries essentially regulated themselves due to their influence within the government. The drug companies did not sufficiently test its products interested only in profits and not the benefits of the drugs for patients. Steps have since been taken to reduce the harm committed by this type of corporate corruption. Many suggest that the situation in the U.S. today involving pharmaceutical company influence and the consequential affects is hauntingly similar. (Borger, 2001) Of course corporate corruption in the U.S. is sadly legendary in scope. The recent banking and Wall Street debacle in the U.S. is expected to cost taxpayers into the trillions of Dollars. The Bernie Madoff scandal, Worldcom, Tyco and Enron are but a few of examples of fraudulent practices by company heads which cost thousands of people millions of dollars including retirement benefits. The long-standing partnership between governments and corporations is well documented but this relationship has served to exploit the public rather than work for the common good. “The common thread is the lack of corporate accountability due to the extreme corruption of governments, which has moved them to abandon their social responsibility for the sake of very private interests, including their own self-interest” (“Corporate Social Responsibility” 2008). One cannot simply view the surface efforts of a corporation as evidence of ethical conduct permeating throughout the entire organization, especially at the highest levels where the decisions are made and the beans counted. Enron was on the ‘100 Best Companies to Work for in America’ for three years, accepted six awards for environmental efforts and boasted of its strict company policies concerning the protection of human rights, safeguarding the environment and its no tolerance stance on corporate corruption. Obviously, corporate policies are not the answer to curbing corruption unless the question becomes how corruption can be publicly acknowledged and the company put on the mask of righteousness while those at the top steal billions of dollars. According to Managing Director & CEO of BP, John Manzoni, “in order to prosper into the future, global companies must contribute to solving the issues that the world faces today. Business must rebuild trust by demonstrating that its interests are aligned with those of society as a whole” (Manzoni, 2006). During the past couple of decades, corporate scandals of the highest magnitude have shocked us all and been the focal point of many debates on many levels of the corporate, governmental, academic and public spectrum. History has repeated itself enough times recently and a society interested in healing a capitalist system that has served it so well should enact measures that would stop the seemingly endless cycle of corruption within corporations. When the people decide they want a moral, decent and ethical society, then maybe they will refocus their efforts. Instead of imposing their morality on individuals in the form of disallowing gay marriages, for example, society should consider uniting in an effort to demand that government and corporation officials act in a moral an ethical manner. The prognosis looks dim however. If history has taught us anything, it is that we don’t learn from history. The ideal would be to establish and maintain a culture that is motivated by profits yet does not accept less than ethical conduct. Leadership is the key to ethical behavioral successes in corporations and though no tactic can assure this outcome based on any defined timeline, a proactive solution such as this will create ever-narrowing parameters for corporate ethical practices (Bataille, 2003). It all goes back to the question, who knows what lurks in the hearts of men? It is minds that must change, additional policies or the strengthening of current corporate laws will do little to solve the problem. What must be understood are the reasons why corporations are locked into the single-minded philosophy of increasing profits at any and all cost. Those in management positions can be well educated in the importance of ethical behavior, companies can develop codes of ethics and environmental concerns can be the priority of every action. One should not assume, though, that these measures alone will influence managers, however well intentioned, to choose the common good of the community approach in every situation while at the same time under enormous pressures to attain their corporation’s financial objectives. To do what is right and good can be embedded deeper into society as it is the inclination of people to do just that. It’s the justifications for deviance which must be modified. If unethical acts by executives of corporations is generally expected and widely tolerated by society, then this type of behavior can be easier justified by someone that has the opportunity to benefit from their unethical actions. Taking away the tolerance of a society, the mind-set, the ability to justify poor ethical choices diminishes even when the opportunity presents itself. References Bataille, Julie Green. “New Report Provides Innovative Approach to Managing Organizational Ethics.” Georgetown University Office of Communications. (October 6, 2003). June 1, 2011 Borger, Julian. “The Pharmaceutical Industry Stalks the Corridors of Power” CorpWatch (February 13, 2001) June 1, 2011 “Corporate Social Responsibility.” The Jus Semper Global Alliance (February 8, 2008). June 1, 2011 Friedman, Milton. “The Social Responsibility of Business is to Increase its Profits.” The New York Times Magazine (September 13, 1970). June 1, 2011 Manzoni, John. “BP and Infosys co-chair inquiry into the role of the global company of tomorrow” Ethical Corporation (August 15, 2006). June 1, 2011 Read More