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Corporate Governance & Ethics Assignment

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Added on  2020-04-29

Corporate Governance & Ethics Assignment

   Added on 2020-04-29

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Corporate Governance &
Ethics
Report
19-Oct-17
(Student Details: )
Corporate Governance & Ethics  Assignment_1
REPORT Page 2 of 16
Executive Summary
Stakeholders form an important part of any company and contribute in one
or another way towards the success of the company. This is the reason why
a number of scholars support the notion that the business of the company
has to be undertaken based on the interests of the stakeholder groups.
However, there are some scholars who support the notion that the
businesses only need to be conducted for earning profits and not for
undertaking social work. However, both these approaches are quite stringent
and even extreme. Hence, there is a need to take a middle route, where
these two approaches are adopted in a harmony.
Through this report, the different views of scholars in this aspect, has been
highlighted, with a particular reference to the work of Friedman and
Freeman, apart from more unified approaches of Jensen and Boatright. This
has been covered in the literature review segment, following which, the
ethical theories, apart from the theories of CSR and CSV have been
elucidated, where again, a unified approach proves to be the best option for
both the business and its stakeholders.
Corporate Governance & Ethics  Assignment_2
REPORT Page 3 of 16
Contents
Introduction.....................................................................................................4
Literature Review.............................................................................................4
Benefits to the Society.....................................................................................7
Justice and Normative Morality Theories.......................................................10
CSR and CSV Theories...................................................................................12
Conclusion and Recommendations................................................................13
Corporate Governance & Ethics  Assignment_3
REPORT Page 4 of 16
Introduction
There is a growing move of the business entities towards ethics, which are
deemed as the values and morality of the organization and of the people
held by it (Dewey, 2016). The ethics of the company are created from the
people who work towards the company and where the ethical policies are
drawn keeping in mind, the interests of the stakeholders (Grant, 2016). The
race horse metaphor is often applied to the companies, which had resulted in
different views being garnered from the academician. There is Friedman on
one side, and he provides that the businesses do and should only work
towards earning profits for the shareholders. And then there is Freeman on
the other side, where he states that the business has to operate in a manner
which has ethics at its foundations. The following report covers an analysis of
the need for adopting a unified approach of these contrasting views.
Literature Review
Freeman (2010) provides that in the matter of business ethics, the
stakeholders are considered as being the prominent contributor in the
manner in which the business evolves. However, there are different views
which are adopted by different scholars, where one set states that the
businesses should only focus on wealth creation and the other supports the
stakeholder interests. Friedman (1970) supports the former view where he
deems the social reasonability of the company as only working towards
increase in company profits. The idea that the business has to work towards
promotion of desirable social ends has been discarded by him. He further
puts forward that the business only has a social conscience which relates to
earning profits. This is supported by the hardcore truth of the businesses
only working towards profit earning motive. Hence, as per him, the work of
company is not undertaken for eliminating discrimination, for avoiding
pollution, for increasing employment opportunities, which are just some
Corporate Governance & Ethics  Assignment_4

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