PHIL 3310 Lecture Notes - Lecture 5: Limited Liability Company, Profit Maximization, Moral Agency
22 May 2018
School
Department
Course
Professor
Chapter 5
Study Guide 5-(Corporations)
1. What are the implications of limited liability? How do limited liability companies
differ from partnerships or other forms of organization?
a. The members of corporations are financially liable for the debts of the
organization only up to the extent of their investments. Limited liability
companies differ from partnerships because a corporation is not formed
simply by an agreement entered into among its first members. An
organization becomes incorporated by being publicly registered or in some
other way having its existence officially acknowledged by the law. Second,
the shareholder in a corporation is entitled to a dividend from the
company’s profits only when it has been ‘declared’.
2. What are the issues with regard to assigning moral agency to a corporation?
a. The issue with assigning moral agency to a corporation is that corporations
are not human beings. They do not make moral decisions because their
main focus is on maximizing profit no matter what must be done to achieve
that.
3. In what sense does a corporation make moral decisions?
a. A corporate internal decision (CID) structure collects data about the
impacts of its actions. It monitors work conditions, employee efficiency,
productivity, and environmental impacts. By analogy, then, a corporation
can make moral decisions.
4. What are the responsibilities of a corporation?
a. Responsibilities of a corporation include covering the profit maximization
and to include acting morally, refraining from socially undesirable
behavior. Also its responsibility is contributing actively and directly to the
public good.
5. Articulate the narrow view of corporate responsibility as well as the broader view
as discussed in the text.
a. The narrow view of corporate responsibility is that the business has no
social responsibilities other than to maximize profits. From the narrow
view, the only responsibility is to make money for its owners. The broader
view of corporate responsibility states that maximizing profits is not the
only responsibility of a corporation. The have other responsibilities to the
find more resources at oneclass.com
find more resources at oneclass.com
Document Summary
How do limited liability companies differ from partnerships or other forms of organization: the members of corporations are financially liable for the debts of the organization only up to the extent of their investments. Limited liability companies differ from partnerships because a corporation is not formed simply by an agreement entered into among its first members. An organization becomes incorporated by being publicly registered or in some other way having its existence officially acknowledged by the law. It monitors work conditions, employee efficiency, productivity, and environmental impacts. By analogy, then, a corporation can make moral decisions: what are the responsibilities of a corporation, responsibilities of a corporation include covering the profit maximization and to include acting morally, refraining from socially undesirable behavior. From the narrow view, the only responsibility is to make money for its owners. The broader view of corporate responsibility states that maximizing profits is not the only responsibility of a corporation.
