The post below has two questions namely;
1.Business and proffesional ethics
1. Read the following article and answer ALL the questions below:
K. E. Goodpaster, ‘Business Ethics and Stakeholder Analysis’, Business Ethics Quarterly, Vol. 1, No. 1. (Jan., 1991), pp. 53-73. (Note: I have uploaded the Article )
a) What does Goodpaster mean by ‘strategic stakeholder synthesis’? Why does he think businesses that operate according to the principles of strategic stakeholder synthesis do not really introduce ethical values into business decision-making?
(See Strategic Stakeholder Synthesis pp.57-59 and Is the Substance Ethical pp. 59-61)
oodpaster argues that we need an approach to business ethics that avoids business without ethics (strategic stakeholder synthesis) and ethics without business (a multifiduciary stakeholder approach). Explain Goodpaster’s nonfiduciary approach to business obligations, making sure you distinguish it from both the multi-fiduciary stakeholder approach and the strategic stakeholder approach.
c) Does Goodpaster’s nonfiduciary account of business obligations provide sufficient protection for the interests of stakeholders other than shareholders? Does it avoid the problem of treating stakeholders as mere means to corporate ends? Given reasons for your answer.
2. Listen to the following radio program or read the transcript: ‘Casualties in the Supermarket Wars’ and answer the following questions:
Goodpaster argues that businesses have significant nonfiduciary duties to stakeholders other than shareholders. These include the duties not to harm, coerce, lie, cheat or steal (1991, p.67).
a) Do you believe, based on the accounts given in the radio program, that the major supermarket chains in Australia violate any of these fundamental moral duties? Provide details to support your answer.
b) What moral duties, if any, do you believe the large supermarkets owe to their suppliers? Use examples from the program to illustrate your points.
3. Read the following news item and answer the related questions.
a) Is Woolworths’ request for ‘Mind the Gap’ payments from suppliers consistent with the narrow view of business ethics? Provide reasons to support your conclusion.
b) Is Woolworths’ request for ‘Mind the Gap’ payments from suppliers consistent with stakeholder theory? Provide reasons to support your conclusion.
Almost any contractual relationship, in which one party (the “agent”)
promises performance to another (the “principal”), is potentially subject
to an agency problem. The core of the difficulty is that, because the agent
commonly has better information than does the principal about the
relevant facts, the principal cannot easily assure himself that the agent’s
performance is precisely what was promised. As a consequence, the agent
has an incentive to act opportunistically, skimping on the quality of his
performance, or even diverting to himself some of what was promised to
the principal.” (Kraakman et al., The Anatomy of Corporate Law, 2017).
Critically discuss the market failures that the agency problem may pose
with particular attention to the phenomenon of information asymmetries.