Chapter Ten

Business’s Environmental
Responsibilities

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 Classic View of Ethics in Business
Environment
• Maximize profit within the law
• Utilitarian
– Greater overall good of optimally satisfying
consumer preference

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 William Baxter
• Search for optimal level of pollution that
would best serve society’s interests.
– Caveat Emptor (protect consumer safety and allow
for individual bargaining
– No perfect “state of health”
– Allow market to balance risk and benefits
• Air safe enough to breath water safe to drink without
costing to much

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 Julian Simon
• Allow for human ingenuity and incentives to work
• Allow the market to work to balance supply and
demand for resources
• Natural objects have no value but that placed on
them by humans. The term “nature” has no
normative connotation
• Preserving biological diversity is appropriate if it
satisfies more consumer preference than the
alternative
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 Market serves four environmental
goals
• Reducing pollution
• Conserve resources
• Preserve natural areas
• Support biological diversity

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 Market Failures
• Cost of such things as pollution are borne by third
parties
• No market exists to create a price for important
social goods (protection of animals versus using
threatened animals – Rhinoceros, tigers,
elephants
• Buying is an individual decision consequences are
borne by group
• Market does not respond until there is a major
screw up
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 Mark Sagoff – The Economy of the
Earth
• Environmental issues not economic issues
– Confusion between wants/preferences:
• What one is willing to pay handled through a cost-
benefit analysis
– Beliefs and Values
• Purely personal and subject
• Conflict resolved non-rational means
– Dialog and democratic processes
• Ignores the individual role of being both a
consumer and a citizen

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 What is business to do?
• Business needs to meet “Moral minimum”
• Bowie – cause no harm to humans, obey the
law and refrain from unduly influencing
environmental legislation
– Citizen are free to create laws and exercise
consumer preference

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 Issue with this Rx
• Underestimate business ability to influence
law making
• Underestimates business ability to influence
consumers
• Law is a crude tool
• Models used to deal with corporate social
responsibility underestimates managerial
discretion

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• Critical flow model ignores the cost of resources
and waste generation
• Daly’s model
– Recognizes business is part of a subsystem with
Earth’s biosphere
– Recommends long-term consumption of resouces
– Manage waste
– Manage energy and recognize the losses we are now
generating
– Limit grow using a biophysical perspective

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Pillars of Sustainable Development
• Economically, environmentally and socially satisfactory
• Meet the needs of those future generations
• Meet the needs of those who lack food, water, and
other necessities
• Hawken, Lovins – Natural Capitalism
– Productivity of natural resources
– Redesign to utilize a model biological process (cradle to
grave
– Model business as a provider of services (light, floor
covering)
– Invest in natural captial

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Diversity and Discrimination
Chapter 11

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 Positive and Negative Aspects of a
Diverse Workforce
• Positive • Negative
– Assumption that the – What is acceptable and
wider the range of normal for some is
talent, experiences and highly objectionable for
abilities the greater the others
competitive advantage – If open system you bring
in societies concerns
with equality and
discrimination

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 Persistent Trends
• Women tend to make about 75% of what men
in similar positions make
• Unemployment in among young black men is
high (25 – 30 percent)

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 Role of business in addressing
discrimination
• “Passive Nondiscrimination”
– Obey the law
– Utilitarian
• Make decisions based on job efficiency and skill
– Libertarian
• Jobs as property rights and therefore management should
have a great deal of lattitude
• Affirmative Action
– Positive action to prevent or remedy discrimination
– People need an equal change to in a position to be
hired
• We do no choose our race, gender or ethnic background

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 Affirmative Action in detail
• Any policy or action, aimed at securing a more
equal workplace, that goes beyond simple
legal access or passive nondiscrimination, but
that does not alter the standards or
qualifications for employment

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 Some Value Laden Terms
• Equal Opportunity- Provide legal access regardless of
gender, race, or ethnic background
• Affirmative action – positive steps to alleviate unequal
treatment. Focus on recruitment
– Hiring AA managers
• Preferential Treatment
– Giving preference to previously disadvantaged person
– Form of addressing social inequality
– Selecting disadvantaged person over more qualified
person
– Hiring disadvantaged person with only minimal attention
to qualifications

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 Preference in action
• University of Michigan Law School
• University of Michigan Undergraduate
• General Motors

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 Some Validity Tests
• Is the action reasonable
• Are qualifications fair and open
• Can we measure qualifications
• Does the persons background add to or serve
as a job qualification

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 Concerns with preference
• Jobs are viewed as a social good rather than
private property
• The process is backward looking not forward
looking
• Violates a prima facie case that most qualified
have a legitimate claim to employment

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Compelling arguments for preference
• Compensatory Justice
– People are paid in proportion to harm done
– People paying the claim are responsible for the
harm done
– True victims or the actual victim is the one
receiving compensation
• Are payments made to groups or individuals?

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 Sexual Harassment
• Quid Pro Quo
• Hostile Work Place
• Judge
– Reasonable Man
– Reasonable Person
– Reasonable Woman

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 What about --
• Collegiality
• “fit in”
• Connections
• Strong institutional discrimination that results
in a negative effect on a group (women and
salaries)
• Effects on those we are trying to provide for

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 Pure definition of discrimination
• The ability to make distinctions

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