Essay on Corporate Social Responsibility and Profits

Submitted By sd4798619
Words: 966
Pages: 4

Ethical Issues in “The Corporation” by Mark Achbar and Jennifer Abbott

There is an old saying that the pursuit of money is the root of all evil. Perhaps nothing illustrates the relevance of this observation better than the profit-oriented practices in the corporate sector. Businesses are established with the purpose of making profits. Accordingly, corporate managers and entrepreneurs make decisions that favor the business’s profit potential. They hold as their priority the maximization of profits, and total commitment to shareholder interests. As a result, business decisions are based on and defined by their effect on the company’s profit interests. Consequently, dominant business practices are perceived as lacking in ethical considerations, driven by greed and characterized by the total disregard for the wellbeing of others. Profit-oriented managers regard the interests of other stakeholders like consumers, suppliers, employees and the local community as obstacles to the business’s profit pursuits.The film “The Corporation” examines the nature of large corporations that favor profits above other ethical considerations, and how this obsession for profits influences corporate practices. With reference to the film “The Corporation” this paper argues that corporate and public interests are not the same because corporations seek profits at the expense of public interests. Corporations are cushioned from accountability by the 18th century legal provisions that identified business entities as “a person,” granting them rights that allowed them to get away with business malpractices (Achbar & Abbot, 2005). These legal provisions limit government interference when corporations flaunt regulations to maximize profits. Because the corporation is treated as an individual, it becomes difficulty to hold responsible or deal with the real people within it. Thus, myth of the “person-corporation” is a shield for protecting profit-minded investors and their selfish interests. The boundaries that divide corporate and government roles are characterized by the profit-seeking mindset of corporations and the regulatory function of governments, which limits the extent to which corporations can maximize profits (e.g. through taxes). Governments are obliged by the law to protect the interests of consumers, while corporations focus on self-interests. This is evidenced by the observation of one of the interviewees that “If you really had a free hand, if you really did what you wanted to do that suited your personal thoughts and your personal priorities, you'd act differently" (Achbar & Abbott, 2005). The profit-mindset of corporations means that they have no “built-in limits on what, who, or how much they can exploit for profit” (Achbar & Abbot, 2005). As a result, they breach any social, legal or ethical standards that stand on their way. The film also describes the fate of two journalists who were fired by Fox News for reporting about the side effects of a chemical drug, whereas the company wanted them to report a false version. This further shows that corporations stand for their own interests. Despite investing in corporate social responsibility projects like community development, corporations stand for their self-interests. This is because as Hitt, Ireland and Hoskisson(2010) observe in Strategic Management: Competitiveness and Globalization, “The entrepreneurial mindset of corporate managers encourages them to exploit opportunities and pursue profits” . Investing in community development is one way that corporations market themselves within the community in which they operate. Even the “triple bottom line accounting” approach that integrates profit making with social responsibility and ecological sustainability masks the corporations’ real purpose, maximizing profits. The other two are meant to be public relations tactics for redeeming the image of corporate greed. This tendency of corporations to pursue “entrepreneurial…