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Economics of the Firm: Moral Issues in Business – Corporations
Corporations dominate advanced economies. Corporations are legal agents, and also moral agents with social and moral responsibilities.
Moral responsibility and Corporations
There are three meanings of moral responsibility:
• refers to people being morally accountable for some past action;
• refers to a person’s accountability for the care, welfare or treatment of others according to social conventions;
• refers to a person’s own capacity to make moral and rational decisions.
Can corporations make moral decisions? ... Therefore, corporation makes informed and rational moral decisions, and carries out actions in order to realise its intentions. ...
Narrow view: Profit maximisation
According to Milton Friedman, a business has no social responsibilities other than to maximise profits. ... But such issues are the roles of government agencies, not corporations. ...
Broader view
A business has other obligations in addition to pursuing profits. Because of their great social and economic power, corporations must carry social responsibility. Businesses cannot make decisions that are solely economic decisions, because they are interrelated with the whole social system – business activities have profound implications for society.
Approximate Word count = 817
Approximate Pages = 3.3
(250 words per page double spaced)
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