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Corporate Ethics and Responsibilities - Essay Example

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In light of the Kantian theory, an action is right and ethical if it is in accordance with a principle that is required by rationality as a categorical imperative. A universal law is involved, that which finds its validity in natural law. In the freedom to export capital for…
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Corporate Ethics and Responsibilities
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CORPORATE ETHICS AND RESPONSIBILITY Required: Discuss the issues and set forth and defend a clear position on whether or not any constraint ought tobe placed on the following freedoms:
1. The freedom to export capital for production abroad – This proposition should operate under minimal constraint, if any at all.
In light of the Kantian theory, an action is right and ethical if it is in accordance with a principle that is required by rationality as a categorical imperative. A universal law is involved, that which finds its validity in natural law. In the freedom to export capital for production abroad, what is involved in the economic principle of free market forces. The behaviour of demand and supply is pursuant according to natural tendencies in economic forces, and will predominate to achieve equilibrium. When one nation has idle capital and another a need for it, the natural tendency is for the excess capital from the first country to find its way to productive economic activity in the second country. The result is efficient employment of resources, and the mutual satisfaction of all parties – essentially the natural behaviour of free market forces.
Viewed from the utilitarian theory, what should prevail is the greatest good for the greater number. In this case, were capital to be exported from a capital-rich to a capital-needy country, then everybody benefits. The destination country and the corporation benefitted will be able to employ the capital in increased production which will increase employment and provision of goods and services. The investing company will earn income on what would otherwise have been idle funds, and the source country will earn through an increase in duties from exports, or taxes from income abroad. Viewed this way, it is a win-win proposition.
Finally, from the libertarian point of view, the choice to export and receive capital to and from other countries is a matter of choice, and the parties involved should be free to choose how to come to terms about the exchange in capital. On the other hand, probably the only drawback to the unconstrained exercise of this freedom is the possible exploitation (e.g., through cheap labour, and so forth) of the destination country and its citizens. As long as proper safeguards are installed, however, this should be susceptible to effective regulation.
The capital dealt with here is legitimate capital. Where the “capital” is in the nature of contraband, or are monies that are subject of control under the anti-money laundering laws, then the above discussion does not apply, and such “capital” should be sequestered.
2. The freedom to export commodities which have been banned from sale in the United States. – This freedom should be exercised under reasonable constraint, depending on the reason for which the ban was imposed. Unfortunately, usually the ban is due to the product’s harmful effects on the physical, social and moral well-being of its citizens.
Under utilitarianism, where the ban on the product was due to an absolute harm, such as the fact that such product induces cancer, then such product will do great harm to the majority of the citizens of the target country, and thus should be absolutely constrained. On the other hand, consider the situation where the reason for the ban is of a relative nature, and due to a socially contextual harm particular to the host country or to certain purposes, such as the possible export of bee or snake toxins (understandably, the commercial export of such products is highly undesirable) from one country to another for medicinal research purposes. Under such circumstances would it be conceivable that limited and controlled “export” be tolerated, under such conditions as would ensure the prevention of any form of malicious use of the product.
One cause of the ban may be that the product may be illegal in the host country but not in the destination country. The argument may be made that the very production of the banned product in the host country is already a violation of the ban, even before export is attempted. That is why in such cases it is important to distinguish whether the ban is a complete and absolute one, or if it is relative and conditional.
In the case where the ban is due to an innate, but not necessarily harmful, defect in the product, then pursuant to libertarianism, export may be conceivably ethically undertaken as long as the destination country is aware of the imperfection and decides to import it anyway. For instance, sugar of a certain appearance or coloration, despite being harmless, may be unfit for sale in a developed country, but considered useful and desirable in another, third world country.
Finally, where the ban is due to a commercial or legal condition such as a franchise or license, then the export should be allowed when it is pursuant to the exercise of such license or franchise. For example, international editions of certain books are banned for sale in the United States (or the United Kingdom or such other country) because another licensee possesses the rights to distribute the American edition within the country. The ban is effective within the United States because it will transgress upon the rights of the licensee within, but there is no impediment at all to exporting the books to other countries.
3. The freedom to export commodities which have the potential for misuse. Specifically, did Nestlé act irresponsibly in marketing infant formula to the third world? – This freedom, again, should be subject to reasonable constraint, depending upon the nature of the product.
This is a situation which may be addressed and put under control by proper policies and implementation. Under the utilitarian theory, where the product is not innately harmful or evil but may simply cause harm due to misuse, then the exportation should be accompanied by a suitable information campaign to ensure that the user uses the product properly and enjoys its maximum benefit. In the specific instance given, the export by Nestlé of infant formula may be misused when uneducated mothers do not reconstitute it properly, do not follow sanitary practices, do not give the infant the milk at the proper time or with the proper frequency, or otherwise do not apply it according to its intended use. Also, there could be relative disadvantage when the mother could have otherwise breastfed her infant, but due to intense advertising is made to believe it is more socially sophisticated to feed her child milk from the shiny tin cans. These cases are best addressed through the proper education campaign to stress the positive and negative aspects of the product. This would fulfil the requirements of the libertarian theory that allows freedom of choice.
On the other hand, Nestlé’s infant formula may even be a boon to infants whose mothers do not lactate properly, or infants who are deprived of their mothers’ care (such as babies orphaned of their mother, or whose mothers are not suitable care givers such as the insane). In which case, the infant formula is indeed of great benefit, and pursuant to the utilitarian theory may be ethically exported.
Conclusion:
As a generalization, when a product is exported that may either cause potential harm or is not innately harmful or disadvantageous to the user, it is incumbent upon the business to ensure that importers are thoroughly informed and trained on the proper use of the product, and for the proper regulations to be implemented through international cooperation. Where the product is banned because of an intrinsic and absolute defect or evil, then it should not be exported at all.
References
Utilitarian Philosophers as seen in http://www.utilitarian.net/.
Ethics Matters as seen in http://ethics.sandiego.edu/theories/Utilitarianism/index.asp
What Is Libertarianism? as seen in http://www.libertarianism.com/what-it-is.htm.
Rawisianism as seen in http://72.14.235.132/search?q=cache:LYULRQyA0s8J:
www.ssc.wisc.edu/~mbrown/20_4E.ppt+Rawlsianism&hl=en&ct=clnk&cd=2&gl=ph
[All above material referred to on February 28, 2009] Read More
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