Business ethics and the natural environment

Published: Last Edited:

This essay has been submitted by a student. This is not an example of the work written by our professional essay writers.

The aim of this paper is to examine the importance of global ethical business responsibilities in regard to the natural environment. The recent public scandals of corporate malfeasance have heightened this need and organization face numerous ethical issues. Strategies such as code of conduct, corporate social responsibility (CSR) and sustainability can guild multinational corporations in this effort. This paper will use different ethical theories from both eastern and western thoughts to analyze why it is important for organization and its employees to behave ethically in the global environment context. Those theories include Confucianism, Stakeholders' theories, Universal Rights and Utilitarianism. Last but not least, there are some limits on this research: most findings are based on major corporations, the increasing power of corporations on international environmental policies, the role of government on environmental policies and the importance of public environmental awareness. These limitations should bright some attentions to future researchers.


2.1 Religious views on the environment

Although the Indian and Chinese Buddhist concept of the natural environment is different from Christianity and Islam, but "basically, and the Western tradition of Abraham Judaism, Christianity and Islam have created a view of the world related to human-centered ethics. Because they view of the world largely anthropocentric, nature is considered to be a secondary presence. God Dragon at the top has reinforced this natural sense. "Buddhism on the discussion of relations between man and nature is essentially different from the previous two religions. The environment is rich in Buddhist thought, here only to talk about the Buddhist kind of biological equality and the idea of life.

Buddhists believe that people melt in the nature, are part of nature, and other biological status equivalent to other life forms, like people, should be fully respected and care. Because Buddhists believe that Buddha is the embodiment of goodness and virtue, and he always mercy, the Merciful, the first based on his life and the value of certain features. "Buddhist compassion of all living things from the forest plants, and then all the rivers and mountains, a stone of a wood, including those inanimate nature, are listed in the protection." Mortal beings on earth are mutually connected, all things have a variety of relationships between, love it objects to others is to love yourself.

Buddhism does not recognize the man is conqueror of the earth, nor is it supernatural advanced beings, but all has the same organism. It is the pursuit of harmony between man and nature. All things are equal with my creatures have Buddha nature of things, enjoy equal rights with others.

2.2 Economic point of view on the environment

Environmental sustainability is the ongoing challenge to ensure that current and future generations will have adequate natural resources to survive and thrive. Until the mid 1900s, there did not appear to be many environmental limitations on business growth, but over the past half century scientific evidence of environmental degradation and the contributions of business activity to the decline in environmental quality has become indisputable. In every industrialized nation a complex regulatory regime establishes environmental standards and rules for sources of pollution. Compliance with these rules has yielded much progress for control of the regulated pollutants. But the state of the natural environment continues to concern many people. Because of intractable local issues (such as sufficient availability of clean air and water), uncertainty about environmental impacts (such as the unknown consequences of long-term pesticide use), and newly discovered problems of enormous scope (such as global warming). As the creators of economic activity, firms are often the sources of environmental problems, and they can also be affected negatively by declines in environmental quality. Some organizations have made good environmental performance a priority, expecting to exceed legal requirements by a large margin. These progressive organizations have evolved in their strategic orientation about the natural environment. Post and Altman identified a general developmental model of corporate "greening" in which organizations moved through three phases. The first is an adjustment phase during which the organization makes changes in its current environmental processes on an ad hoc basis in reaction to changing legal and market requirements. The second is adaptation to incorporate environmental goals and policies beyond minimum requirements to accommodate growing environmental awareness. The third phase is innovation to become fully proactive in institutionalizing environmental management in all business decisions. Their developmental model is reflected in Hart's description of the three specific approaches that firms have demonstrated in dealing with environmental issues-that is, a focus on pollution prevention in the 1970s, to the product stewardship approach in the 1980s, and then to sustainable development beginning in the 1990s. According to Hart, these orientations are cumulative in that product stewardship requires effective pollution prevention, and sustainable development incorporates pollution prevention and product stewardship in addition to its higher level of environmental commitment. Empirical research has confirmed that firms that are strategically proactive are also advanced in incorporating better and more comprehensive environmental activities into their operations.

3.0 Ethical theories

3.1 Eastern thoughts on environmental issues

Confucianism advocates that respect of all lives, the laws of nature and promote the harmony between man and nature, in order to maintain friendly and harmonious economical development as the highest moral purpose. "Harmony" requires business to protect the natural environment and develop sustainable strategies in its operation.

There are several ways that enterprises can strengthen its professional ethics, social responsibility. First, enterprises should establish a correct outlook on sustainable development which means that the needs of future generations will not be compromised. Second, enterprises should pay more attention to environmental issues, the courage to shoulder social responsibility and historic mission, adhere to the national interests. Moreover, firms should actively participate in various "green" activities and community activities. Capital gain is a power inherent spirit of capitalism that derived from Weber's Protestant ethic. Daniel Bell said that Weber's Protestant Ethic and the general period of capital accumulation in the capitalist development of productive forces has been an important spiritual power. With the weakening of religious power, the development of secularization and the growth of capitalism, material wealth, "Puritan restraint and the Protestant ethic" will curb the "economic impulse to any act". In addition, the development of capitalist production, it requires out of Puritan restraint, abandon the Protestant ethic. In other words, the capitalist impulse endless profits will be increasingly difficult for the inner and religious sense of "vocation" as it no longer relys on the ultimate meaning of life activities. "When the Protestant ethic, after being abandoned by a capitalist society, and the rest will just hedonism," and completely secularized capitalist society, not leave "God" in the name of activity to be profitable for the all-pervasive. "Kejin vocation" of the class defense, "the cultural justification of capitalism (if not a moral legitimacy of the words) has been replaced by the hedonism, that is happy for life." Thus, the alienation between man and nature, human and social alienation, man and God alienation are the "triple alienation of modern man" in the offing.

 Although the introduction of "total quality management" in modern business that contains the spirit of environmental ethics, the moral dimension is unreasonable and the occurrence of non-environmental moral behavior is unable to use moral language to the appropriate understanding product liability and the need for environmental protection ". There are some reasons behind this situation. First, produce moral forgetfulness; Second, the narrow understanding of moral concepts as corporate managers tend to avoid talking about morality issues, the way they treat these issues as non-moral issues; third, to bring pressure on managers - can not be more balanced, more open expression of the moral (moral talk will indeed increase moral pressure); Fourth, against the moral norms can lead to the production of silence, in turn, ignore the emergence of a moral culture; Fifth, the decline in moral standards - total quality management in the continued presence of moral silence those who insist on ethical standards into the quality requirements of the people may have ironically, often because of moral standards as external intervention.

Enterprise is a member of social community, so that it is bound to a moral obligation to protect environment. In addition, the combination of economic activities and environmental protection can be profitable. Donaldson and Dunfee who generally support the view that every society there is an implicit social contract which contains "macro" contract, reflecting the rational members of a community agreement between the hypothesis; "existing" or "micro" contract, reflecting a common body of an actual contract, which we usually call the state ought to state contracts, and the Real of the contract. For enterprises, should be contingent contract is the government, society, public expectations of economic activities of enterprises or the said social responsibility: Such as CSR broad and narrow sense, broad sense of social responsibility that including financial responsibility, liability, charitable responsibility and ethical responsibility. Stephen P. Robbins defines it as "more than legal and economic requirements , the company is seeking a favorable long-term goal of social responsibilities. Specifically, companies have to bear the moral responsibility of the external environment. On the one hand, the enterprise as a community as a member of the body, and society, there is an inherent permanent "contract." In the social community, it enjoyed the development and use of environmental resources, rights, and must bear the obligations as members of the Community environmental protection, which is the basic rules of contract. Achilles B. Carol said that "the right to put forward a responsible relationship is the foundation of corporate social responsibility." Keith Davis also holds the same views, he believes that due to corporate social responsibility, the right should bear the corresponding responsibilities; in the long run, who can not be considered a social responsible attitude to exercise their rights, whoever will lose the right, which is the "responsibility of the iron law." There is no resource consumption and environmental support, a moment of economic activities of enterprises can not continue. On the other hand, an act of social enterprises as main body, is running in the social environment, like any natural person must adhere to the rules of the system, businesses are "legal persons" must comply with government and industry to develop a variety of relevant legal, institutional, principles, policies and business practice. However, the environment is always very one-sided system, can not express all the requirements of society, the environment does not exist or the system is not entirely the responsibility of corporate ethics. Since the 20th century, sustainable development is considered as most of the country's economic development model, environmental protection is integrated into the social development goals and economic policies, which required business activities promote the sound development of the environment, that is to take reasonable environmental management behavior. At present, due to sharp rise in green demand, environmental movement growing, the government regulation of businesses are becoming increasingly restrictive. Governments in the development of laws, policies and guidance are aimed at forcing companies to be environmentally friendly. Pressure force in such a system, the business managers in order to avoid violation of laws, policies, risks, even if the subjective or not, but it also must be taken in the objective of environmental management behavior. Such as business to meet the social and legal requirements, forced to take environmental costs, purchase and operation of environmental protection equipment, development and purchase of non-polluting technology. The system can fully comply with the requirements of the environment not only reflects the business to win law suits, and a test of the moral spirit.

3.1 Western thoughts on environmental issues

3.1.1 Stakeholder theory

Stakeholders' theories focus on the ethical requirements that cement the relationship between business and society. The main principle is to do the right thing in order to achieve a good society. There are several main approaches we can distinguish the following. First, normative stakeholder theory advocates that management is a way to integrate social demands. Freeman also mentined that ''managers own a fiduciary relationship to stakeholders'' (Freeman, 1984). Precisely, Donaldson and Preston (1995, p. 67) held that the stakeholder theory has a normative core based on two major ideas: stakeholders are persons or groups with legitimate interests in procedural and/or substantive aspects of corporate activity (stakeholders are identified by their interests in the corporation, whether or not the corporation has any corresponding functional interest in them) and the interests of all stakeholders are of intrinsic value (that is, each group of stakeholders merits consideration for its own sake and not merely because of its ability to further the interests of some other group, such as the shareowners). Following this theory, a socially responsible firm requires simultaneous attention to the legitimate interests of all appropriate stakeholders and has to balance such a multiplicity of interests and not only the interests of the firm's stockholders. Supporters of normative stakeholder theory have attempted to justify it through arguments taken from Kantian capitalism (Bowie, 1991; Evan andFreeman, 1988), modern theories of property and distributive justice (Donaldson and Preston, 1995), and also Libertarian theories with its notions of freedom, rights and consent (Freeman and Philips, 2002).A generic formulation of stakeholder theory is not sufficient. In order to point out how corporations have to be governed and how managers ought to act, a normative core of ethical principles is required (Freeman, 1994). To this end, different scholars have proposed differing normative ethical theories. Free-man and Evan (1990) introduced Rawlsian principles. Bowie (1998) proposed a combination of Kantian and Rawlsian grounds. Freeman (1994) proposed the doctrine of fair contracts and Phillip (1997, 2003) suggested introducing the fairness principle based on six of Rawls' characteristics of the principle of fair play: mutual benefit, justice, cooperation, sacrifice, free-rider possibility and voluntary acceptance of the benefits of cooperative schemes Lately, Freeman and Philips (2002) have presented six principles for the guidance of stakeholder theory by combining Libertarian concepts and the Fairnes principle. Some scholars (Burton and Dunn, 1996 Wicks et al., 1994) proposed instead using a ''feminist ethics'' approach. Donaldson and Dunfee (1999) hold their 'Integrative Social Contract Theory'. Argandona (1998) suggested the common good notion and Wijnberg (2000) an Aristotelian approach. Stakeholder normative theory has suffered critical distortions and friendly misinterpretations, which Freeman and co-workers are trying to clarify (Phillips et al., 2003). In practice, this theory has been applied to a variety of business fields, including stakeholder management for the business and society relationship. In short, stakeholder approach grounded in ethical theories presents a different perspective on CSR, in which ethics is central.

3.1.2 Universal rights

Human rights have been taken as a basis for CSR, especially in the global market place (Cassel, 2001). In recent years, some human-rights-based approaches for corporate responsibility have been proposed. One of them is the UN Global Compact, which includes nine principles in the areas of human rights, labor and the environment. It was first presented by the United Nations Secretary- General Kofi Annan in an address to TheWorld Economic Forum in 1999. In 2000 the Global Compact's operational phase was launched at UN Headquarters in New York. Many companies have since adopted it. Another, previously presented and updated in 1999, is The Global Sullivan Principles, which has the objective of supporting economic, social and political justice by companies where they do business. The certification SA8000

( for accreditation of social responsibility is also based on human and labor rights. Despite using different approaches, all are based on the Universal Declaration of Human Rights adopted by the United Nations general assembly in 1948 and on other international declarations of human rights, labor rights and environmental protection. Although for many people universal rights are a question of mere consensus, they have a theoretical grounding, and some moral philosophy theories give them support (Donnelly, 1985). It is worth mentioning the Natural Law tradition (Simon, 1992), which defends the existence of natural human rights (Maritain, 1971). Sustainable development Another values-based concept, which has become popular, is ''sustainable development''. Although this approach was developed at macro level rather than corporate level, it demands a relevant corporate contribution. The term came into widespread use in 1987, when the World Commission on Environment and Development (United Nations) published a report known as ''Brutland Report''. This report stated that ''sustainable development'' seeks to meet the needs of the present without compromising the ability to meet the future generation to meet their own needs'' (World Commission on Environment and Development, 1987, p. 8). Although this report originally only included the environmental factor, the concept of ''sustainable development'' has since expanded to include the consideration of the social dimension as being inseparable from development. In the words of the World Business Council for Sustainable Development (2000, p. 2), sustainable development ''requires the integration of social, environmental, and economic considerations to make balanced judgments for the long term''. Numerous definitions have been proposed for sustainable development (see a review in Gladwin and Kennelly 1995, p. 877). In spite of which, a content analysis of the main definitions suggests that sustainable development is ''a process of achieving

human development in an inclusive, connected, equiparable, prudent and secure manner.'' (Gladwin and Kennelly 1995, p. 876). The problem comes when the corporation has to develop the processes and implement strategies to meet the corporate challenge of corporate sustainable development. As Wheeler et al. (2003, p. 17) have stated, sustainability is ''an ideal toward which society and business can continually strive, the way we strive is by creating value, creating outcomes that are consistent with the ideal of sustainability along social environmental and economic dimensions''. However, some suggestions have been proposed to achieve corporate ecological sustainability (Shrivastava, 1995; Stead and Stead, 2000; among others). A pragmatic proposal is to extend the traditional ''bottom line'' accounting, which shows overall net profitability, to a ''triple bottom line'' that would include economic, social and environmental aspects of corporation. Van Marrewijk and Werre (2003) maintain that corporate sustainability is a custom-made process and each organization should choose its own specific ambition and approach regarding corporate sustainability. This should meet the organization's aims and intentions, and be aligned with the organization strategy, as anappropriate response to the circumstances in which the organization operates.

3.1.3 The common good approach

This third group of approaches, less consolidated than the stakeholder approach but with potential, holds the common good of society as the referential value for CSR (Mahon and McGowan, 1991; Velasquez, 1992). The common good is a classical concept rooted in Aristotelian tradition (Smith, 1999), in Medieval Scholastics (Kempshall, 1999), developed philosophically (Maritain, 1966) and assumed into Catholic social thought (Carey, 2001) as a key reference for business ethics (Alford and Naughton, 2002; Mele ´, 2002; Pope John Paul II, 1991, #43). This approach maintains that business, as with any other socialgroup or individual in society, has to contribute to the common good, because it is a part of society. In this respect, it has been argued that business is a mediating institution (Fort, 1996, 1999). Business should be neither harmful to nor a parasite on society, but purely a positive contributor to the well-being of the society. Business contributes to the common good in different ways, such as creating wealth, providing goods and services in an efficient and fair way, at the same time respecting the dignity and the inalienable and fundamental rights of the individual. Furthermore, it contributes to social well-being and a harmonic way of living together in just, peaceful and friendly conditions, both in the present and in the future (Mele ´, 2002).

To some extent, this approach has a lot in common with both the stakeholder approach (Argandon ˜a, 1998) and sustainable development, but the philosophical base is different. Although there are several ways of understanding the notion of common good (Sulmasy, 2001), the interpretation based on the knowledge of human nature and its fulfillment seems to us particularly convincing. It permits the circum-navigation of cultural relativism, which is frequently embedded in some definitions of sustainable development. The common good notion is also very close to the Japanese concept of Kyosei (Goodpaster, 1999; Kaku, 1997; Yamaji, 1997), understood as ''living and working together for the common good'', which, together with the principle of human dignity, is one of the founding principles of the popular ''The Caux Roundtable Principles for Business'' (