Abstract
Is it legitimate for a business to concentrate on profits under respect for the law and ethical custom? On the one hand, there seems to be good reasons for claiming that a corporation has a duty to act for the benefit of all its stakeholders. On the other hand, this seems to dissolve the notion of a private business; but then again, a private business would appear to be exempted from ethical responsibility. This is what Kenneth Goodpaster has called the stakeholder paradox: either we have ethics without business or we have business without ethics. Through a different route, I reach the same solution to this paradox as Goodpaster, namely that a corporation is the instrument of the shareholders only, but that shareholders still have an obligation to act ethically responsibly. To this, I add discussion of Friedman’s claim that this responsibility consists in increasing profits. I show that most of his arguments fail. Only pragmatic considerations allow to a certain extent that some of the ethical responsibility is left over to democratic regulation.
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Acknowledgements
An earlier version of this paper was presented at the EURSafe conference in Oslo 2006. I am grateful to the audience at this occasion for comments and discussion. Particular thanks are due to Raymond Anthony for very helpful discussion, and to Björn Petersson for very useful written comments. Finally, I should like to thank the referees for pressing me into discussion of stakeholder theory, which led to the paper being more or less rewritten from the ground, but hopefully with a clearer argument as the result.
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Jensen, K.K. Corporate Responsibility: The Stakeholder Paradox Reconsidered. J Agric Environ Ethics 20, 515–532 (2007). https://doi.org/10.1007/s10806-007-9068-3
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DOI: https://doi.org/10.1007/s10806-007-9068-3