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Business ethics case study example
Business ethics case study example
Arguments of milton friedman on corporation
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Since the motto “Doing Well By Doing Good” appeared, the number of businesses that have adopted it has increased over time. In order to tell whether this increase is substantial and significant we must first analyze the steps into which this motto has gone through. The implications it has on the market and economy as a whole will also be determinants of whether to adopt the motto or not. In the essay below we will go through the evolution of the meaning of the motto, the concept of social responsibility, the supporters’ argument and their cons. The debate is divided in two camps. The supporters of the first idea claim that by doing good business, the economy as a whole benefits without the need to donate or contribute in distinct ways to the community. The second idea is that businesses should behave in such a way to create an environment where everyone should use its power to help out the community. The very first time I read the topic of the essay, it reminded me of a movie I watched when I was around 13. “When someone does you a big favour don’t pay it back, pay it forward” is what little Trevor says in the movie “Pay it forward”. Being at the age of 13 I took it as a lesson of life and it gave me additional incentives to help who the most needed me. Most of the times I received the satisfaction of seeing a smile in the face of someone else, and half of the times I was let down realizing that I was just used by someone else. But I decided not to care; I wanted to do something that would have changed that conservative community I lived in. That is what most of the people would call “social responsibility” and what Milton Friedman would define as an individual initiative to contribute to the society. As defined by Wikiped... ... middle of paper ... ...ston Publications, August 27, 2007 (also found at http://www.bos.frb.org/economic/wp/index.htm ) Friedman, M. “A Friedman Doctrine – The Social Responsibility of Business is to increase Its Profits”, The New York Times Publications, September 13, 1970 Gates, B. “On Creative Capitalism”, World Economic Forum Realises, http://www.youtube.com/watch?v=Ql-Mtlx31e8 NY Times. January 9, 2009 http://economix.blogs.nytimes.com/2009/01/06/can-business-do-well-and-do-good/ Oxford Publications. “Oxford Dictionary of English (2nd edition revised)” , 1998, ISBN 0198610572 Wikipedia, http://en.wikipedia.org/wiki/Creative_capitalism Wikipedia, http://en.wikipedia.org/wiki/Social_responsibility Hamm, S. “Coke: On Doing Well by Doing Good“, BusinessWeek Publications, http://www.businessweek.com/globalbiz/blog/globespotting/archives/2009/05/coke_on_doing_w.html
...Foundational Considerations in the Corporate Social Responsibility Debate’, Business Horizons, vol. 34, no. 4, pp. 9-18.
Social responsibility can be defined as “the continuing commitment by business to behave ethically and contribute to economic development while improving the quality of life of the workforce and their families as well as of the local community and society at large” (Mallen Baker, 2004). In addition, social responsibility has been defined differently by various corporate leaders that provide guidelines which impacts how one manages the core business. Social responsibility is an essential part of a business. If managed correctly should strengthen the competitive spirit of the company and provide prosperity to society.
Over the past 37 years, The Nike Brand has evolved into a successful multi-billion dollar corporation. It has also grown to be the world's largest marketer of athletic footwear and apparel. The company’s products are sold in over 180 countries worldwide and 20,000 retail stores domestically. Nike also operates retail stores overseas such as Nike Towns and factory outlets. Although Nike is involved in the design, development, and marketing of the product; the products are manufactured independently. In addition to its wide range of athletic shoes and apparel, the company also sells Nike and Bauer brand athletic equipment, Cole Haan brand dress and casual footwear, and the Sports Specialties line of headwear.
To supply the wants and needs of a consumer, society entrusts wealth-producing resources to the business enterprise.” (Santayana, George. Is The Tyranny Of Shareholder Value Finally Ending? So before we go into greater detail on the different perspectives related to social responsibility, one might question the meaning of social responsibility. It is generally agreed that social responsibility is defined as the business obligation to make decisions that benefit society.... ...
Growing up, my parents and other influential figures around me modelled the importance of community service through their continual volunteer work and dedication to improving the world around them. Whether it be participation in a well-attended project or persistent contribution to a helpful organization, those aforementioned individuals were formative in guiding me towards a path filled with opportunities for having an impact on my community.
Finally, my views have changed since the beginning of the term when I initially answered the question of how I would have direction Keurig and why I chose to stand by such claims. The first time I approached this situation, I answered with the overall mindset that is very similar to Friedman in the aspect that the one and only one social responsibility the business has is to use its resources in order to increase profits. Therefore, in my initial mindset, that was all that mattered. I described how the company should be mainly focused on the profits of the company and then worry about the “more current trends” of society as an afterthought – this was when I implied that caring for the environment was a trend that swept across society.
I have always considered myself a very promising student. I have worked extremely hard and received high grades. I have a close knit group of friends and my teachers and I have mutual respect for each other .Although I would consider myself at this present stage ‘fulfilled’ something was missing. I realized it wasn’t a materialistic aspect of my life. Through a tragic incident I finally discovered what fit perfectly in that vacancy. The consecutive hospitalizations of my grandparents evoked great pain and sorrow. However, out of the scorching intensity of this tragedy I was warmed and comforted by realizing what I was devoid of: community service.
Gallagher, S. A. 2005. Strategic response to Friedman’s critique of business ethics. Journal of Business Strategy, 26(6), 55-60.
“There is only one and only one social responsibility of business- to use its resources and engage in activities designated to increase its profits so long as it decides to stays within the rules of the game, which is to say, engages in open and free competition without deception or fraud.”
Friedman, M. (1970). The Social Responsibility of Business is to make Profit. New York Times
Social responsibility allows for the market system to be centrally controlled by forcing shareholders to unwillingly contribute to social responsibility. While this idea of social responsibility may help companies in the short run, it will ultimately hurt them in the long run. Each person has their own values and responsibilities and “society is a collection of individuals and of the various groups they voluntarily form” (55). Businesses, as Friedman understands, are separate from this society since individuals are the only ones who can hold values and responsibilities. Subsequently, businesses are freed of the need to embed social responsibility into their practices and should focus only on creating the largest profit possible for their shareholders
The article “The Social Responsibility of Business is to Increase its Profits” is written by a famous economist Milton Friedman. Friedman in this article implies that shareholders are the main drivers of the corporations and he believes that it is to them corporations must be socially responsible to. The goal of any corporation is to maximize profits and return the portion of these profits to shareholders for investing in the corporation. The shareholders can themselves decide which social causes to take part in rather than assigning a corporate executive to decide on their behalf. Friedman argues that a corporation must have no social responsibility to society because its only concern is the increase profits for itself and its shareholders.
Friedman, M., (2007). The Social Responsibility of Business Is to Increase Its Profits. In W.
Volunteering enables an individual to make a positive impact on his or her community, while empowering the individual to better his or her life. This summer, I had the opportunity to volunteer at many diverse locations. From the hospital to the local library, I truly value my experience and treasure everything it has thought me. Volunteering lets us experience and learn things that we otherwise would not have learned; volunteering opens doors for us that we may not have been able to open before. Volunteering provides us with guidance and tolerance which we may use in the future to aid us in our decisions. At first glance, volunteering may seem to only benefit those who are helped, but on a deeper level, one can realize that volunteering benefits the volunteer as much as, if not more than, those who are helped. Not only does volunteering make a difference in one’s community, but it also helps the volunteer become a smarter, happier, friendlier and more caring individual.
It seems obvious that large corporations have a tendency to ignore the negative effects of their actions in favor of profit. This example, although sensationalized, still says to me that with power comes responsibility. It affirmed my belief that a corporation’s goal cannot be just to provide profit to shareholders, but there must also be an element of social responsibility.