Ethics, Sustainability and Culture
Question 1 Discuss the arguments associated with whether a corporation can be held socially responsible.
Answer – The arguments associated with whether a corporation can be held socially responsible can be further examined by looking at the following three different arguments:
The ‘Invisible Hand’ Argument – The invisible hand argument was identified by Adam Smith an 18th century economist. Adam Smith stated that ‘when each of us acts in a free-market environment to promote our own economic interests we are led by an invisible hand to promote the general good’. (Shaw, Barry, Issa, Catley & Muntean, 2016, p. 174). The invisible hand argument focuses on those individuals working on their own self-interest that will ultimately further lead to an overall good to the community which means if individuals are given sufficient amount of inspiration, motivation and guidance for their own personal good then every individual will work hard and because of that society would also benefit as there would be more jobs available in the market, there would be an open competition and also better quality of goods and services. It can be seen that this argument enhances the welfare of the community. This argument has been classified as economically unrealistic and therefor corporations should not be held accountable for non-economic matters.
The ‘let government do it’ argument – As per the narrow view of corporate social responsibility corporations are not considered as moral agents. (Shaw, Barry, Issa, Catley & Muntean, 2016, p. 176). Corporations under this argument are seen as profit oriented organisations and not seen as not for profit organisations. As per this argument it is only the government’s responsibility to make sure that businesses are acting ethically and not unethically.
The ‘business can’t handle it’ argument – Under this argument it can be seen that corporations doesn’t have enough expertise that is required to address non-business issues and by doing it they will be only imposing their own values on to the rest of the society. (Shaw, Barry, Issa, Catley ; Muntean, 2016, p. 177) After acknowledging the above mentioned arguments and also as per my understanding of corporate social responsibility I believe that corporations can be held socially responsible.
2. What is corporate social responsibility (CSR)? To whom does it apply? Compare the broad and narrow views of CSR.
Answer – In the late 1990s in various European countries and USA, corporate social responsibility was the concept of the provided theoretical support for the transformation in business management from striving for quantitative expansion to striving for qualitative expansion. Shaw, Barry, Issa, Catley ; Muntean states that corporate social responsibility is an ethical principle where organisations go beyond their financial and economic obligations to include social and environmental impact of their businesses. (Shaw, Barry, Issa, Catley ; Muntean, 2016, p. 156). After seeing the documentary ‘Blood, Sweat and T-Shirts) and also as per my understanding CSR should be applied to all the corporations as they have the same status and they function in the same way in the society as human beings. It is not only applied to the owners or stockholders but it is also applied to employees, suppliers, clientele, local community, environmental groups.
The primary purpose from an organisation’ perspective is maximising their profit.
In this view organisations believe that only government and not for profit organisations are responsible for caring about the environmental and social problems.
The ‘invisible hand’ argument, ‘let government do it’ argument and the ‘business can’t handle it’ argument favours narrow view of CSR.
Under the narrow view of csr private corporations should not be forced to take public responsibilities that primarily belongs to the government. Broad View
Broader View talks about that organisations have other responsibilities too apart from maximising profit as they can be seeing having great social as well as economic power in the society.
It can be also be called sometimes the social entity model or the stakeholder model. (Shaw, Barry, Issa, Catley & Muntean, 2016, p. 168).
Broader view of csr involves all parties having a stake in what a corporation does and doesn’t including employees, customers, and also the public.
As per the broader view there is nothing wrong in corporation’s profit but they do have responsibilities towards their employees, consumers, contractors and suppliers, the community in general.
3. Discuss the role that the English clothing retailers play in the plight of the factory workers e.g. How much responsibility (if any) should they take?; Do you think the corporations that buy goods from the sweatshops are taking a broad or narrow view? What about the consumers’ role?
4. Assess the argument that if the factories were boycotted, the factory workers’ circumstances would be even worse. HINT: Consider whether there are options other than the two discussed in the programme: maintaining the status quo or boycotting the sweatshops.
Answer – After watching the documentary ‘Blood, Sweat and T-Shirts and also as per my own perspective I believe that if the factories were boycotted the circumstances of the factory workers would be even worse. It can be seen from the documentary that those people who are working in the factories are working hard to earn money so that they can support themselves and also earning livelihood for their families back home. The factory workers have now been accustomed to work 8-10 hours a day and sometimes work 7 days a week. The more the workers do the more they will earn to send back to their families. If the factories were boycotted the circumstances of the factory workers would be even worse as there are so many jobs involved in the factories the workers will lose their jobs and also keeping in mind the problem of unemployment over there. If the workers lose their jobs they will not be able to support themselves as well as support the livelihood for their families. The factory workers only priority is earning. It is believed that there are around 20,000 small scale manufacturing factories among the clusters of beehive hutments. The workers’ lives can be improved by providing access to clean water, improved sanitation, waste management services, a better quality of life, working with the factory owners to release children from work so that they can go to school, better working conditions, a safe and secure working environment, along with providing better infrastructure, wider roads, and better drainage systems, by offering minimum wages. This can be achieved by working with the local authorities and other service providers for the sustainable provision of basic needs, through local people and also municipal authorities to provide them basic needs such as safe water, sanitation etc.
5. Imagine that you are the purchasing manager for a large boutique chain. Your manager has made it very clear that you should buy goods as cheaply as possible. You have seen Blood, Sweat and T-shirts and are aware that the factories that sell the cheapest clothing are similar to the sweatshops in the programme and you do not want to buy from them. Because you believe that everyone should be paid enough to support themselves adequately.
a) Why would this present an ethical dilemma for you?
b) What duty (if any) do you, as a business professional, have to consider the factory workers?
Question 6 – Assess the use of sweatshops using Kant’s theory?
Answer – After going through the documentary ‘Blood, Sweat and T-shirts’ I consider ‘sweatshops’ as an unfavourable term which is solely based on the working conditions that are dangerous. It can be seen clearly from the documentary that workers work very long hours in dangerous conditions and in return they are given a very low pay. Many big corporations in countries such as United States of America and United Kingdom use sweatshops labour in countries such as India, Bangladesh and China so that the corporations can make products at lower price. In order to support themselves and their families workers are forced to work long duration of hours in dangerous conditions. As per the German philosopher Immanuel Kant there was a greatest principle of morality and he referred it as The Categorical Imperative which says we should always act in such a way that we can ‘will’ the maxim of our action to become a universal law. (Shaw, Barry, Issa, Catley ; Muntean, 2016, p. 63). Immanuel Kant believed in the categorical imperative that requires us to act in a manner where we can justify our actions into a universal law.
(Anon, (2015). online Available at: http://Tokoro, N. (2007). Stakeholders and Corporate Social Responsibility (CSR): A New Perspective on the Structure of Relationships. Asian Bus Manage, 6(2), pp.143-162. Accessed 7 Jun. 2015