Business Ethics Quarterly 12 (2):113-142 (2002)
AbstractAbstract: Stakeholder theorists have typically offered both a business case and an ethics case for business ethics. I evaluate arguments for both approaches and find them wanting. I then shift the focus from ethics to law and ask: “Why should corporations obey the law?” Contrary to what shareholder theories typically imply, neoclassical or profit maximization theories of the firm can offer answers based only on instrumental justifications. Instrumental justifications for obeying the law, however, are pragmatically and normatively incoherent. This is because the modern corporation is a legal artifact. It exists because communities create the legal framework necessary for its existence. Individual corporations can therefore be said to owe their existence to a partnership (what might be called a social contract) between shareholders and governments, a partnership that is itself built on the shared though often implicit understanding that corporations have an unconditional (categorical) obligation both to obey the law and to treat their stakeholders ethically while generating wealth for their shareholders
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References found in this work
Human Rights and Business Ethics: Fashioning a New Social Contract. [REVIEW]Wesley Cragg - 2000 - Journal of Business Ethics 27 (1-2):205 - 214.
Business Ethics in Canada.Deborah Poff & Wilfrid Waluchow - 1988 - Journal of Business Ethics 7 (9):714-722.
Functional Words, Facts and Values.A. W. Cragg - 1976 - Canadian Journal of Philosophy 6 (1):77 - 94.
Citations of this work
A Framework for Understanding Corporate Social Responsibility Programs as a Continuum: An Exploratory Study.Julie Pirsch, Shruti Gupta & Stacy Landreth Grau - 2007 - Journal of Business Ethics 70 (2):125-140.
Ethics, Enlightened Self-Interest, and the Corporate Responsibility to Respect Human Rights: A Critical Look at the Justificatory Foundations of the UN Framework.Wesley Cragg - 2012 - Business Ethics Quarterly 22 (1):9-36.
Implementing the New UN Corporate Human Rights Framework: Implications for Corporate Law, Governance, and Regulation.Peter Muchlinski - 2012 - Business Ethics Quarterly 22 (1):145-177.
Stakeholder Theory: A Deliberative Perspective.Ulf Henning Richter & Kevin E. Dow - 2017 - Business Ethics: A European Review 26 (4):428-442.
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