Ethics: Business Ethics and Corporate Social Responsibility Essay

Submitted By ArpitDhruv1
Words: 496
Pages: 2

Business ethics reflects the philosophy of business, one of whose aims is to determine the fundamental purposes of a company. If a company's purpose is to maximize shareholder returns, then sacrificing profits to other concerns is a violation of its fiduciary responsibility. Corporate entities are legally considered as persons in USA and in most nations. The 'corporate persons' are legally entitled to the rights and liabilities due to citizens as persons.
Economist Milton Friedman writes that corporate executives' "responsibility... generally will be to make as much money as possible while conforming to their basic rules of the society, both those embodied in law and those embodied in ethical custom".[23] Friedman also said, "the only entities who can have responsibilities are individuals ... A business cannot have responsibilities. So the question is, do corporate executives, provided they stay within the law, have responsibilities in their business activities other than to make as much money for their stockholders as possible? And my answer to that is, no, they do not."[23][24][25] A multi-country 2011 survey found support for this view among the "informed public" ranging from 30 to 80%.[26] Ronald Duska views Friedman's argument as consequentialist rather than pragmatic, implying that unrestrained corporate freedom would benefit the most in long term.[27][28] Similarly author business consultant Peter Drucker observed, "There is neither a separate ethics of business nor is one needed", implying that standards of personal ethics cover all business situations.[29] However, Peter Drucker in another instance observed that the ultimate responsibility of company directors is not to harm—primum non nocere.[30] Another view of business is that it must exhibit corporate social responsibility (CSR): an umbrella term indicating that an ethical business must act as a responsible citizen of the communities in which it operates even at the cost of profits or other goals.[31][32][33][34][35] In the US and most other nations corporate entities are legally treated as persons in some respects. For example, they can hold title to property, sue…