This site is 100% ad supported. Please add an exception to adblock for this site.

Business Law Chapter 2 2


undefined, object
copy deck
Study of what is right or good for human beings
Business Ethics
Study of what is right and good in a business setting;includes the moral issues that arise from business practices, institutions, and decision making
Ethical Fundamentalism
Individuals look to a central authority or set of rules to guide them in ethical decision making
Ethical Relativism
Actions must be judged by what individuals subjectively feel is right or wrong for themselves
Situational Ethics
Judging a person's actions by first putting oneself in the actor's situation
Moral actions are those that produce the greatest net pleasure compared to net pain
Act Utilitarianism
Each separate act must be assessed according to whether it minimizes pleasure over pain
Rule Utilitarianism
Supports rules that on balance produce greatest good
Cost-Benefit Analysis
Quantifies in monetary terms the benefits and costs of alternatives
Holds that actions must be judged by their motives and means as well as their results
Social Ethical Theories
Focus on a person's obligations to other members in society and on the individual's rights and obligations
Social Egalitarians
Believe that society should provide all members with equal amounts of goods and services irrespective of their relative contributions
Distributive Justice
Stresses equality of opportunity rather than of results
Stress market outcomes as the basis for distributing society's rewards
A rational person possesses inherent powers to assess the correctness of actions
Good Person Philosophy
Holds that individuals seek out and emulate good role models
Kohlberg's Stages of Moral Development
Emphasis on self, then emphasis on group, then emphasis on universe as a whole
Corporations as Moral Agents
Because a corporation is a statutory entity, it is difficult to resolve whether it should be morally accountable
Regulation of Business
Governmental regulation is necessary because all the conditions for perfect competition have not been satisfied and free competition cannot by itself achieve other social goals
Corporate Governance
Vast amounts of wealth and power have become concentrated in a small number of corporations which are in turn controlled by a small group of people and it is argued that they therefore have a responsibility to undertake projects to benefit society
The business of business should be to return as much money as possible to shareholders
Whenever corporations engage in social activities they divert funds rightfully belonging to shareholders and/or employees
A corporation is subject to less public accountablity than public bodies
Although a corporation may have a high level or expertise in selling its goods and services there is absolutely no guarantee that any promotion of social activities will be carried on with the same degree of competence
The Social Contract
Because society allows for the creation of corporations and gives them special rights, including a grant of limited liability, corporations owe a responsibility to society
Stakeholder Model
Corporations have fiduciary duty to all of their stakeholders, not just their stockholders
Less Government Regulation
By taking a more proactive role in addressing society's problems, corporations create a climate of trust and respect that has the effect of reducing government regulation
Long-Run Profits
Corporate involvement in social causes creates goodwill, which simply makes good business sense

Deck Info