The Ethical Issue in Growth of Greenhouse Gas Emission by Large Companies - Literature review Example

The Ethical Issue In Growth of Greenhouse Gas Emission by Large Companies Name Institution Tutor Date Introduction In a Sydney Morning Herald article, Tom Arup reports that the emission of greenhouse gases in the major Australian companies is continuously rising, with eight out of the largest ten recording significant increases in the past year. The main polluter was the energy company AGL which doubled its greenhouse gas production after purchasing more coal-powered energy production plants. Energy Australia was second and GDF Suez third. Others in the list were Rio Tinto, Origin Energy, Stanwell, Alcoa, Glencore and Woodside. All of them were notably either energy production or mining corporations. In 2014-2015, the country’s total emission level rose by 1.3% and this is projected to be the trend until 2030, considering available policies. Environmental activists from the Australian Conservation Foundation (ACF) are therefore asking the government to close down coal-powered energy producers, beginning with the largest ones then ensure that mining and power production areas are rehabilitated (Arup 2016). A Stakeholder View Climate change is undeniably causing changes in the whole world’s physical, social, moral and intellectual environment (Nelson 2011). The greenhouse emissions have already started causing climate change, and in future there is likely to be more harm in the form of floods, heat-waves, tropical diseases, water shortages and famine (Broome 2008). The large amounts of emission also pose an ethical dilemma because the companies are trying to make profit and therefore contribute to the economy. Because of this reality, companies need to uphold environmental Corporate Social Responsibility (CSR). According to Voegtlin & Pless (2014), they need to adopt CSR principles which require entities to try and self-regulate as they seek to ensure sustainability of their businesses. These particularly require businesses to support precautionary approaches to environment-related challenges, take up initiatives that encourage environmental responsibility and promote adoption of technologies that will help reduce emission. Stakeholder theory provides a connection between day to day operations and the ideal values, thereby creating an explanation why the company should consider ethics (Freeman et al. 2010). CSR is about moral and ethical issues surrounding corporate behavior and decision-making, and has at its centre the decision on whether doing something or avoiding it will either benefit or harm the society (Branco & Rodrigues 2007). This can be easily related with the issue of green house emissions raised in Arup’s article. According to Chalmers (2008), the Stakeholder Perspective especially suggests that any company’s main goal should be an improvement of all its stakeholders. Branco & Rodrigues (2007) explain that the stakeholder perspective is based on the belief that even beyond a company’s shareholders, there are several more agents who have an interest in the business operations. Stakeholders are all individuals and groups which either experience harm or benefit, or whose rights become upheld or violated when a corporate action is taken. They therefore extend to include customers, suppliers, employees, communities and the world in general. According to Shaw & Barry (2015), reducing pollution and global warming will enable the creation of a better society as suggested by the stakeholder approach. The government is especially left with the role of ensuring that companies change their ways. This can be done through formulating and enforcing regulations, offering incentives for cutting emissions, application of pricing mechanisms or giving for them to reduce emissions before being granted permits. Branco & Rodrigues (2007) however points out that basing on these issues and the nature of the Stakeholder approach, the only way in which the environment can be viewed as a stakeholder in itself is by considering the well-being of future generations, who also need to find a habitable climate and planet to live in. From this perspective, much of the response of human beings to the threat of climate change has generally not been morally adequate, as is exemplified by the large Australian companies. This is mainly because existing value systems are not well-equipped to handle the temporal and spatial complexities that arise. Most of the moral responsibility for emissions lies in the developed countries such as Australia because cumulative emissions in them are far more than those in developing countries. The developed country also has a greater responsibility to ensure immediate action not only because it causes bulk of the problem, but also because it has a greater technical and financial capacity to do so (Chalmers 2008). A Utilitarian View In the utilitarian approach, whatever is to be considered right is based on the suffering or happiness that it leads to (Gandjour 2007). The moral worth of any action is based on its consequences, and through measurement, it is possible to evaluate the goodness or badness of any such decision (Parboteeah & Cullen 2013). Utilitarian ethics does not consider the intrinsic value of insentient life-forms, so that it may be difficult for environmental ethics to show that they have values or rights, and that would have required they have value or rights that are comparable to those of other beings that have moral standing for instance people. It might be difficult for instance to show that microorganisms, vegetation or even communities have the kind of moral concern or value which qualify them to be legitimate issues in moral considerations (Wolff 2008). Although it does not recognize the moral right of vegetation and the environment, the utilitarian approach provides a good understanding of the issue in the article. It recommends that solving of ethical dilemmas will require businesses to create a balance which will minimize its harm while maximizing benefits. Mill particularly suggests that the greatest good will need to be created for the largest number of people (Jennings 2015). Considering this, it may be argued that the big Australian energy firms and mines are major employers and support the economy. However, the question arises of whether they benefit the largest possible number of people. They do not. This is because the interest of the Australian economy and population might be taken care of, but the harm created through pollution, global warming and climate change is extended to the whole world. While the economic benefits may be enjoyed, they are not sustainable, and other future generations are likely to continue paying its price through damage to the climate. In a utilitarian perspective, the question of how the responsibility of current generations can be distributed is likely to be unclear. However, it may be said that the big Australian companies have the moral obligation of maximizing utility for everyone, and for this reason there is the rising responsibility of protecting the interests of future generations too. Distribution of responsibility will require maximization of efficiency. Because firms need to maximize utility, the responsibility has to be distributed according to each firm’s ability. Firms that are better placed to avoid releasing excessive emissions should have greater responsibility. Human beings have a role of stewardship over the other parts of their ecology, including the atmosphere. According to Howell (2010), human beings and by extension businesses are responsible for the kind of impact their behavior has on nature. The question arising is whether changes can be made to policy or even approaches by the companies so that everyone appreciates the right of nature to exist, and that it has value which is greater than the service that it currently offers humanity. According to Groenfeldt (2010), this is not easy because ethics and cultural values are usually resistant to change, and solving the problem requires the system to find ways in which the existing value system can be encouraged to support measures that will help to cut emissions. If this is done in the framework of existing values, it is likely that there will be a multiplier effect which will influence values indirectly and gradually, so that the current growth in emission within the large companies will result in change across the industries. Summary of the Ethical Issue Industrialization, as has been shown in this case, is capable of causing pollution and therefore environmental issues. The use of a utilitarian approach in understanding the problem is the best because it is more empirical as it is linked with actual human experiences, in this case the reality that human beings always exist in the world in an interrelationship with plants, animals and nature in general. There is a shared agreement in the two approaches that emissions are a problem. Irrespective of the theoretical approach therefore, businesses appear to have the obligation of protecting the entire environment, at least for the sake of future generations. They are currently not doing enough, hence the increase in emissions. The effect of the emissions from Australian companies is a global issue, considering that the atmosphere is shared worldwide.  Future inhabitants of the world have a right to live well, and considering the article’s insights, the fact that the companies are the ones causing the problem means that it is their duty and also that of all human beings to correct it. Conclusion The Sydney Morning Herald article reveals the challenge of greenhouse emissions as an ethical issue. The stakeholder perspective suggests that the matter concerns more than just the shareholders, and therefore makes environmental awareness a necessary aspect of CSR. The government should especially control the companies if they fail to self-regulate, as Australia owes the world a reduction in emissions. In the utilitarian view, the environment on its own is not a moral entity. Businesses should focus more on what benefits most people. However, if the global nature of the atmosphere is considered, there is more harm than good created by the companies. In both approaches, it is acknowledged that emissions are a significant issue and businesses have a moral duty to reduce them. However, the utilitarian perspective provides a better understanding. Reference List Arup, T., 2016. Greenhouse Gas Emissions from Australia's Biggest Polluters on the Rise. Accessed on 15 august 2016 from Branco, M and Rodrigues, L., 2007. Positioning Stakeholder Theory within the Debate on Corporate Social Responsibility. Electronic Journal of Business Ethics and Oganisational Studies, Vol. 12(1): pp.5-15 Broome, J., 2008. The Ethics of Climate Change. Scientific American, pp.69-73 Chalmers, D., 2008. The Ethics of Climate Change: Right and Wrong in a Warming World. Peace & Conflict Review, Vol. 3(1): pp.1-4 Freeman, R, Harrison, J, Wicks, A and Parmar, B., 2010. Stakeholder Theory: The State of the Art. Cambridge: Cambridge University Press Gandjour, A., 2007. Is it Rational to Pursue Utilitarianism? Ethical Perspectives Journal of the European Ethics Network, Vol. 14 (2): pp.139-158 Groenfeldt, D., 2010. Viewpoint-The Next Nexus? Environmental Ethics, Water Policies and Climate Change. Water Alternatives, Vol. 3(3): pp. 575-586 Howell, R., 2010. Choosing Ethical Theories and Principles and Applying Them to the Question: Should The Seas be Owned? International Journal of Transdisciplinary Research, Vol. 5(1): pp.1-28 Jennings, M., 2015. Business Ethics-Case Studies and Selected Readings. Stamford: Cengage Learning Nelson, J., 2011. Ethics and the Economist: What Climate Change Demands of Us-Working Paper No. 11-02. Medford: The Global Development and Environment Institute Parboteeah, K and Cullen, J., 2013. Business Ethics. New York: Routledge Voegtlin, C.and Pless, N., 2014. Global Governance: CSR and the Role of the UN Global Compact. Journal of Business Ethics, Vol. 122(2): pp.179-191 Wolff, B., 2008. Environmental Studies and Utilitarian Ethics. Bioscene, Vol. 34(2): pp.6-11 Shaw, W and Barry, V., 2015. Moral Issues in Business. Australia: Cengage Learning Read More