Further Discussion Analysis

The lesson from this week’s teachings is that moral philosophies and values drive business actions and decisions. To explain the relationship between these concepts, two case studies are reviewed and thoughts shared.

            The first case study ‘Theo Chocolate Company’ highlights the actions by a company founder to promote the well-being of poor farmers by sourcing raw materials at a cost of up to three times the going rate. His actions correlate with the ethical principle of distributive justice which promotes the idea of sharing risks and benefits (Ferrell, Fraedrich & Ferrell, 2015). For instance, company founder Joe Whinney believes that workers deserve decent compensation because of their effort to grow cacao. Not only does this ethical principle ensure fairness but also help employers retain the best talent as demonstrated by Smith, Mazibuko and Mrwebi (2019). The findings originate from a research project to assess outcomes of distributive justice among financial services companies in South Africa. This shows that equity and fairness benefits both the supplier and the manufacturer.

            The second case study ‘CVS: “Fired Up” about Social Responsibility’ highlights an approach by a company to balance the interests of different stakeholders. The issue correlates to the idea that stakeholder interests determine the value a company creates. The more the company serves the needs of different stakeholder the more it proves its usefulness. Even so, this can only be possible when a company has a robust corporate governance system that recognizes stakeholder diversity. Besides, the actions by CVS espouse stakeholder theory mentioned by Gersel and Johnsen (2020). For example, the management team has deliberated a rational approach to ensuring that executives are compensated based on their efforts to meet the needs of both the company and shareholders.

            In sum, personal values and stakeholder theory are useful in guiding the actions of business executives to ensure that they are moral and ethical.            

References

Ferrell, O. C., Fraedrich, J., & Ferrell, L. (2015). Business ethics: Ethical decision making & cases (10th ed.). Nelson Education.

Gersel, J., & Johnsen, R. (2020). Toward a Novel Theory of Rational Managerial Deliberation: Stakeholders, Ethical Values, and Corporate Governance. Academy of Management Learning & Education, 19(3), 269–288. https://doi.org/10.5465/amle.2019.0198