SOCB58 SEPT 18/2012
FRIEDMAN :THE SOCIAL RESPONSIBILITY OF BUSINESS TO INCREASE ITS PROFITS
1. First Claim by Friedman: Social ends are indistinguishable from socialism.
o Problem of equivocation: you cannot equate social ends with socialism
the political has to do with power and how its balanced within society; power
imbalances. Social ends; refers to taking care of the ppl who have less power.
who holds more power, in this case corporations. Because they have so much
power they are able to affect government; through lobbying. While socialism
refers to the privatization of resources.
o problem of unsupported claim of influence which holds that corporation don't influence
government when in fact through lobbying they are able to influence the gov' to abide by
certain legislations that allow them to make profit while harming humans, animals and
the environment. Example:
Canada is at the forefront of GM foods. ex. Peanuts were modified with monkey
protein in order to have it have longer shelf life. Government refused to stop this
even though the increased number of peanut allergies cannot be denied.
2. Second Claim by Friedman: only ppl have responsibilities (ethical in this case)
o problem of corporations having legal status of person; they have all kinds of rights ex.
Right to buy other corporations, right to buy/own assets, to sue and be sued. Fact is that
the corporations do have the legal rights of a person therefor they SHOULD have the
responsibilities of a person.
3. Third Claim by Friedman : corporate executives not free to act except in terms of serving aims
of owners/and shareholders.
o The owners give the orders down to the CEO; they have responsibility to their
shareholders and owner.
Here there is a problem of passing the buck/problem/responsibility to someone
else just like that of the Nazi's who said “i was just following orders”
4. Fourth Claim by Friedman: has a social responsibility to fulfil the orders of the owner.
o A. There is a problem of shareholders vs stakeholder
Shareholder: is anyone who owns a piece of the corporation. They are interested
in seeing their investment/profits grow. Most shares are not owned by the
average citizen, 60% of the shares maybe owned by huge entities. Who ever has
the biggest shares gets the most say. The Executives tend to own the most
Stakeholder: anyone other than the share-owner affected by the decisions of the
business. ex. The ppl living near a river that is being polluted, are the
stakeholders. The environment could be a stakeholder.
5. Fifth Claim by Friedman : if the executives act otherwise from the owners policy, they would be
involved in government functions in terms of taxes and their expenditures.
o If you have a GM wheat field next to an organic field cannot work because it gets
contaminated. If the Executives gives money to the ppl than they are acting like a
o The corporation has no business deciding to compensate ppl who they have caused
damage to, or take money (like tax) from ppl and use it for the good of ppl.
o Dr.Agnell; editor of medical journal. Many of the clinical trials are skewed to help the
market of the economy.
o Taxation without representation: we tax payers have little to say about where our tax
money is invested. They tax you without representing your needs/wants/interests. 6. Sixth Claim by Friedman: we need to make sure that the corporation does not get involved in the
political process, making political decision, political policy. Social responsibility view makes
government, not business, responsible for allocation of resources.
o If the gov is the only one to protect the ppl. However the corporation is affecting the
decision of the government through lobbying.
o The advertising industry, television programming has been set up for children from any
age which are full of adds which are attacking the early human mind, these children
exposed from such a young age have been shown to have trouble focusing on later years.
Finding it painful to live in the real world. These companies want to create life long
• William Davis: noticed that pts are all accumulating weight. Due to GMO in wheat, hibertised
wheat. Body cannot handle these carbohydrates. Carbs that your body cannot handle cause
Christopher STONE: WHY SHOULDN'T CORPORATIONS BE SOCIALLY RESPONSIBIL?
• few if any american/canadians buy shares. Only like 30% of the population. Because they do not
have enough after tax income.
• Sometimes promises need to be broken for a higher moral aim. Even if a promise were made the
shareholders should know the promise can be broken for a higher cause.
• Maximization: although the corporation does have the responsibility to “make” profit for tis
shareholders. There is a difference between making and “maximizing” profit.
• the directors have this notion that the stakeholders are less important and are distracted by the
needs of the shareholders who's needs matter much more.
• Dow chemical company : responsible napalm for deforestation in Vietnam. Dow did not let its
shareholders even vote whether they wanted napalm produced. This goes to show that
corporations are not even concerned about share-holders (forget stakeholders) they will do as they
• stone uses the roles expectation comparing fathers and children. This analogy demonstrates that a
corporation has this moral role to its shareholders.
• this is extremely paternalistic; stating that my expertise means that i know better for you. Ex.
Medicine “doctors know best”.
• Trickle down effect: the idea that if you allow ppl to make money in a free market and not
legislate them, than the wealth made on top will trickle down to everyone.
• Stone is saying, that paternalism ...
Stakeholder Theory of Modernism Corporation by Freeman:
Freemans arguing that we should codify into law the system that we already seem to have: instead of
arguing that there should not be governmental regulations of business practices , we should come up with
an ethical approach to business practices that accommodates and justifies the governmental regulations that
we already have.
SOCB58 SEPT 25/2012
Bornstein argues managers must implement the following four practices to stimulate
organizational entrepreneurship: 1. Institutionalize Listening: The best, most constructive input for both social and
traditional entrepreneurs is from the people they serve and their employees.
Childline in India, for example, has been subject to repeated changes because of
new advice and recommendations. Consequently, there must be an
organizationally-defined way for a business to listen.
2. PayAttention to the Exceptional: Unexpected successes need to be investigated
by the entrepreneurial firm to uncover insights that lead to organizational
innovation. Part of this practice, as the success of the Grameen Bank shows, is
challenging norms and expectations.
3. Design Real Solutions for Real People: Will people use my service or product?
How often will they use it and at what cost? Whose consent will I need to develop
this organization? What legal or political obstacles must I address? How can I
encourage employee and customer feedback to stimulate new ideas or
improvements? These are the questions stirring in the organizational mind of an
innovative business.ex. Gapa-Bahia a foundation founded for educating and
protecting and helping communities be aware and deal withAIDS/HIV in Brazil
4. Focus on the Human Qualities: Oftentimes, the most innovative, creative
intrapreneurs are not those with the highestACT scores or the most degrees next
to their names. Organizations must concentrate on the undefinable � that is,
ethics, flexibility, empathy, etc. There are no numerical measures for these
“the corporation” 2008
“the pathology of commerce” Volume 1
2. Bad apples
3. corporations part of the jigsaw
4. what is a corporation? Common purpose to succeed for a common end. Transforms lives of ppl.
Corporation is a collection of ppl all pulling in the same direction. Corporation exists as a
paradox although creating a great deal of wealth, it also causes damages that are sometimes
5. Birth of a corporation
6. a legal person: corporation got the rights of a “person” at the same time as black slaves got the
legal right to be a person. This entity has the right to sue and be sued. Special kind of person to
only be concerned about their stock holders.
7. Profit is the bottom line. They calculate the cost-benefits by seeing how much the fine would be
and how much the profit it could potentially could make. By doing this they would choose to
break the law anyway and the fine after they have already made their profits (which exceeds the
9. harm to workers
10. harm to human health
11. harm to animals
12. harm to the biosphere
13. corporate criminals 14. diagnosis psychopath
16. taking from the earth
Corporation D iagnosed as a:
• Insensitive unconcern for the feeling of others
• incapacity to maintain enduring relationships
• reckless disregard for the safety of others
• deceitfulness (continual lying to deceive for profit)
• the incapacity to experience guilt,
• failure to conform to social norms and respect the law
• Majority of corporations are run by rich white guys but majority of the world is not rich white
guys but rather, poor, coloured and women.
SOCB58 OCT 2.2012
Solomon; talked about MBA students from harvard and how only 6 months after graduation they were
unhappy and felt they were doing the wrong thing. Discontent with their positionality.
Aristotle “ On the Good Life”
• Ancient philosophy
1. Experience (in either chronological or psychological maturity) is necessary to understand
happiness (eudaimonia; greek word for happiness)
o notion that happiness is the ultimate aim of life.
o Everything that we seek is to give us happiness. Ex family, friends, accomplishments are
all things we want/need for happiness
o says that young ppl, do not know what happiness really is because they relate it to
2. The highest of all goods by action, not necessarily contemplation, is happiness. Is this
happiness just based on pleasure, wealth or honour?
o the highest of happiness be sensory pleasures: such as sexual, eating, drinking
o Having wealth not in terms of money or abundance/ enrichment in a talent is that
happiness; could be money or could be art for ex.
o Honour; in aristotle's time it was a participatory democracy; women and slaves were not
allowed to vote, neither could ppl who were not born inAthens because they were
considered Barbarians. There were no professionals, there were no army; everyone was
an army. Everyone had to participate 100% in public life; this means that giving up their
life if their beliefs were questioned. What honour meant to aristotle: was to put down
your life to uphold your beliefs/ ideals.
3. There are 3 types of life saysAristotle;
a) Pleasure; majority of ppl understand life of happiness as pleasures. Reason,
o Plato argued that when we are embodied we have to honour ourselves in 3 ways
Appetites; anything that feeds our senses. He says it is not to be denied or cut
out of our lives. Plato said you cannot deny yourself pleasure. Action (Spirit); he meant we also have emotion.Akind of anger/something that
mobilizes us to act. Its conscious like a drive.
Reason; our ability to be self reflexive. Ability to be aware of our awareness.
And that awareness t.... Our ability to synthesize the world, predict and we do
this to “control”. We learn for the sake of controlling the world. Reason is the
one that guides the other 2. Because appetite could lead to addiction without
o Honour; standing up for your ideals
o The word “political” : has to do with Power and Imbalances of it.
o Political Engagement; would give the highest level of happiness.
o Aristotle ; if you have no friends, you might as well commit suicide. Afriend is not just a
friend. There are 3 kinds