Business ethics is a controversial concept ever since public and cooperations pay attention to ethics in business rather than entity. According to Milton Friedman, “the social responsibility of a business is to increase its profits”, which means the end of the business is all about maximize the company’s net benefit. On the other hand, Freeman’s Stakeholders’s Theory reveals another essential part of business is following the basic ethics beyond just abiding by the law.
“Drug company Turing Pharmaceuticals jacks up the price of a lifesaving drug used by AIDS and cancer patients by nearly 5,000 per cent, and then defends the move as capitalism at work.”
“German auto maker Volkswagen AG admits that it rigged as many as 11 million diesel vehicles to fudge emission tests, apparently turning a blind eye to the environmental and health effects.”
However, these two cases show us there is always a price to pay if a cooperation operate itself in a short-sighted way. Volkswagen’s stock price slump to the bottom line, not only damage the shareholders’ direct profit but also leave bad impact on society. Both companies become the ridicule of public and social media stream. Up to this day, Turing Pharmaceuticals need to compensate more money by pledging to subsidize patients’ extra costs and even free drugs. Thus, business ethics is not windbaggery of capitalism but a smart choice made from struggle tradeoffs of long-term goals and short-term sweet.
Sources:
http://blogs.courant.com/travel_columnists_leblanc/2009/04/
http://in.reuters.com/article/2015/09/25/volkswagen-emissions-strategy-idINKCN0RP23G20150925
http://www.theglobeandmail.com/report-on-business/rob-commentary/the-vw-emissions-scandala-case-study-in-what-not-to-do/article26550100/
