Sauder Blog

After finish reading and understanding both Friedman and Freeman’s argument toward business ethics, I personally favor the latter while I possess a strong doubt over Friedman’s static interpretation on Capitalism. In Friedman’s six-page essay on the social responsibility of business, he argues that in acting social responsible outcome, the CEO violate the contract to their shareholder, undermines the work of government (taxation without representation), and might not even have a clear picture of how to contribute back to the society. To attack Friedman’s argument, I think today’s business does not follow a singular direction, what if the CEO discusses his socially responsible project with the shareholders? In fact, a business operates on the basis of this process. Moreover, I believe the work of Corporate Social Responsibility is not even a political one. If we are to speak of the air we breathe or the water drink, it is essentially the welfare of the people. Even though Friedman’s argument may be true in many cases, I feel pure capitalism might not be sustained only from the angle of maximizing profit. Instead, my understanding of Corporate Social Responsibility is that it is not an act of the socialist, but in fact, a necessary and feasible action that may make business more profitable in the contemporary society. So in this blog, I would like to ask the question, can ethics be a part of a business model?

Upon researching on Toms Shoes, a for-profit company based in California that focuses on Shoes and Clothing, I found out that a company’s business model can be indeed installed with ethics. Toms Shoes is famous for its “One for One” model, which for every one shoe sold the company would deliver a pair of free shoe to children who are in need. So far Toms Shoes has already given away 60 million shoes worldwide and has also expanded its mission to provide free water and restore eyesight for people in need in the developing countries. (Shana Lebowitz) In this context, the importance of ethics in regard to attracting consumer and leveraging brand image is obvious: it provides the consumer strong incentives to purchase their product. As the awareness of the role of ethics spreads in today’s world, more and more people are increasingly attracted to this kind of promotion. The consumer is now part of something that is more than a transaction, or as the most would call it as the “caring capitalism”. (Shana Lebowitz) Linking this example back to the stakeholder theory, with the rise of information technology, businesses are assessed from multiple aspects: especially their contribution toward Corporate Social Responsibility. If any business wants to be successful, it must start with ethics.

443 Words.

Bibliography

Lebowitz, Shana. “On the 10th Anniversary of TOMS, Its Founder Talks Stepping down, Bringing in Private Equity, and Why Giving Away Shoes Provides a Competitive Advantage.” Business Insider, Business Insider, 15 June 2016, www.businessinsider.com/toms-blake-mycoskie-talks-growing-a-business-while-balancing-profit-with-purpose-2016-6.

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http://blog.hennaart.ca/2012/11/toms-one-for-one.html

https://www.linkedin.com/pulse/20140324130510-6418773-expanding-one-for-one-to-coffee/