Ethics and Social Responsibility in Business and Society

¶ … divergent decisions when it comes to acting according to business ethics. For instance, if on maintains that ethics are universal then he or she would make the same decision not taking into account the particularities of the culture that is affected by the decision. If a particular type of action is wrong in one place then it is wrong everywhere; therefore, rendering such a decision inappropriate regardless of where the decision is to be implemented.

On the other hand, somebody who subscribes to moral relativism will feel as though he or she should not interfere in the indigenous practices of the culture because it would be a form of cultural imperialism for the business manager to impose his or her ethical will, which is a reflection of the agent's own cultural background and prejudices, which he or she has been socialized to possess according to his own unique background, which differs from the society in question. However, when the developing country lacks the same moral codes as the society from where the business manager has be socialized to possess certain ethics and morals, it is possible to argue -- under the pretext of moral relativism -- that the action on the part of the business manager is justified since he or she is not actually violating the cultural rules of the country's domestic ethical imperatives (Donaldson, 1996). Therefore, cultural relativism can act as a pretense for ignoring what appear to be blatant ethical and moral violations simply because the native country fails to enforce such standards, and it would be a form of cultural imperialism for the business manager to insist upon the country adopting the ethics and morals of his or her more 'advanced' society. Various countries are at different developmental levels. Some of these countries, which are poor by international standards, have an incentive to attract industry. In doing so, they might make environmental concessions, for instance; or they might attempt to attract industry by not protecting the wage levels or working conditions of the indigenous laborers.

It what follows, I will attempt to demonstrate that there is a middle ground to be taken for the purpose of considering what ethical decision is appropriate in a given circumstance when conducting business practices. Donaldson (1996) has formulated a calculus that can be performed by the business manager in order to render ethical decisions in scenarios where the business decision affects a developing country that lacks the same ethical standards as the more advanced country in which the business manager has been socialized to possess ethical codes of conduct:

To resolve a conflict a relative development, a manager must ask the following question: Would the practice be acceptable at home if my country were in a similar stage of economic development (Donaldson, p. 11).

As an example, Donaldson uses the hypothetical of Angola and an American petroleum company, which wants to invest in the developing, African country. Of course, the wage levels for the Angolans would be lower than they would be if they were United States workers. However, since Angola is a developing country that is in desperate need of foreign investment, the decision on the part of the manager is not difficult. One would surely think it appropriate to invest in Angola and exploit the cheaper labor, because if America was in a similar stage of industrial development, it would be advantageous for America to procure the same foreign investment despite the disparities in compensation for laborers.