MANAGMNT 260 Lecture Notes - Lecture 3: Corporate Social Responsibility, Conscious Business, Profit Maximization
16 Sep 2016
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Give shareholders power over directors and binding resolutions. Shareholders may too focused on profits, may lack the information they need and may not make decisions that reflect society"s value. Involvement of outside directors could serve as a check on management. Sarbanes oxley provides incentive for directors to prevent lawbreaking. Directors may have limited time/limited involvement in corporate affairs. Create specified offices within corporations such as offices safety or offices to ensure external information is received. Profit maximizers may focus too much on short-term profits rather than long-term efficiency. Salaries, bonuses, and promotion decisions create incentive for short-term gains not the long- term future of the company. Business is good because it creates economic value. Business is ethical because it derives strength from voluntary exchange that benefits all of society. Tap into both a profit motive and a desire to benefit society and produce something of value. The guidelines don"t guarantee happy endings to all moral dilemmas.
