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Business ethics asks whether the world of commerce is subject to morality at all, and if so, how the major ethical theories apply to its characteristic problems — the pursuit of profit, the treatment of workers, the honesty of advertising, the conduct of global supply chains, and the relationship between a company and the wider society it affects. The recurring question is whether a business has moral obligations beyond making money, and if so, to whom and how far.
Note on the specification: Business ethics is enrichment / wider reading for AQA A-Level Religious Studies 7062. The AQA Ethics component prescribes the normative theories (natural moral law and double effect, situation ethics, virtue ethics, Bentham and Kant, meta-ethics, conscience, free will) and applies them to issues of human and animal life and death; "business ethics" as a discrete applied topic belongs to other boards (notably OCR Religious Studies). It is included here because it is an excellent, exam-style arena for applying the AQA-named theories — Kant, utilitarianism, natural moral law and virtue ethics — and because the skill of applying a theory to a fresh issue is exactly what AQA's AO2 rewards. Treat it as practice in application, deploying the theories you have already studied, rather than as separately examinable AQA content.
Key term: Business ethics is the application of moral principles to the activities, institutions and decisions of commercial organisations. It asks whether and how moral constraints bear on the pursuit of profit.
The central structural debate concerns corporate social responsibility (CSR) — the claim that businesses owe obligations not only to their owners but to society more broadly: to employees, customers, suppliers, communities, and the environment.
Key term: Corporate social responsibility (CSR) is the principle that a business should take responsibility for the social, ethical and environmental effects of its activities, and not measure its conduct by financial performance alone.
The argument is classically framed as a clash between two models of the firm.
| Model | Associated with | Core claim |
|---|---|---|
| Shareholder theory | Milton Friedman (1912–2006) | In a free society the one social responsibility of business is to use its resources to increase its profits, so long as it stays within the rules of the game — open and free competition without deception or fraud. |
| Stakeholder theory | R. Edward Freeman (b. 1951) | A firm should be managed in the interests of all its stakeholders — anyone who can affect or is affected by it — not the shareholders alone; long-run success depends on sustaining these relationships. |
Friedman's position is widely caricatured and should be stated fairly. In his 1970 New York Times Magazine essay he argued that a corporate executive is an employee of the owners, with a fiduciary duty to run the business as they wish — "generally to make as much money as possible while conforming to the basic rules of the society, both those embodied in law and those embodied in ethical custom." A manager who spends company money on social causes the owners have not chosen is, in effect, levying a tax on shareholders (and on customers and workers) and spending it without a mandate; if society wants those ends pursued, that is the job of government, democratically accountable, not of unelected executives. Note the crucial qualifier: Friedman explicitly excludes "deception or fraud," so his view is not "anything goes." His deeper claim is that the price mechanism and the rule of law already harness self-interest to the common good, so that a business serving its customers profitably is already serving society.
Freeman rejects the separation of business from ethics on which, he thinks, Friedman relies. Companies are embedded in a web of relationships, and a firm that exploits workers, deceives customers or wrecks the environment may post short-run profits but invites boycotts, regulation, litigation and reputational ruin. More fundamentally, Freeman argues, there is no good reason to privilege one stakeholder group (owners) over all the others whose cooperation the firm equally requires. Managing for stakeholders is, on his view, both more ethical and, in the long run, better business.
The debate has real depth on both sides. Friedman's strength is its honesty about the purpose of a business and its warning against unaccountable managerial power; its weakness is that "within the rules of the game" does a lot of quiet work — where law and custom lag behind (in a weakly-regulated economy, say), profit-maximisation can license real harm, and the reduction of all value to shareholder return can crowd out duties most people think genuine. Stakeholder theory's strength is its realism about a firm's wider effects and its moral seriousness; its weakness is indeterminacy — when stakeholders' interests conflict (higher wages versus lower prices versus larger dividends), the theory does not by itself say how to trade them off, and "serve all stakeholders" can become a slogan that excuses almost any decision.
It is also worth distinguishing genuine CSR from its counterfeits, because the distinction matters morally. CSR that is integrated into how a firm operates — safe conditions, honest products, fair treatment of suppliers — is one thing; CSR deployed instrumentally, as public relations, is quite another. The pejorative term greenwashing names the practice of advertising environmental or social virtue a company does not really possess, and a Kantian would observe that such CSR treats the public's moral concern merely as a means to sales, which is exactly the deception Friedman too would condemn. A further subtlety is that Friedman and Freeman may disagree less than it appears: Friedman concedes that behaviour which looks altruistic but in fact serves long-run profit (treating staff well to retain them, say) is perfectly proper, while Freeman concedes that a healthy firm must remain profitable. The sharp disagreement is really about the justification — whether stakeholders matter in themselves (Freeman) or only because attending to them tends to pay (the instrumental reading of Friedman) — and that is a genuinely ethical, not merely commercial, question.
Globalisation — the deepening integration of the world's economies through trade, investment, technology and the movement of people — is the arena in which business-ethics questions become most acute, because it places powerful multinational firms alongside the world's poorest and least protected workers.
Key term: Globalisation is the increasing interconnection and integration of national economies, societies and cultures through cross-border trade, capital flows, technology and migration.
Its characteristic ethical issues include: the exploitation of labour, where corporations locate production where wages are low and protections weak — dramatised by the 2013 Rana Plaza collapse in Bangladesh, in which over 1,100 garment workers died in a building they had been ordered back into despite visible cracks; environmental harm, as production migrates to jurisdictions with lax regulation; cultural homogenisation, as global brands displace local producers and ways of life; and tax avoidance, as multinationals structure their affairs to shift profits away from the countries where value is created, starving public services of revenue. Against this stands a serious defence of globalisation: it has, on most measures, lifted hundreds of millions out of absolute poverty, spread technology and education, and created employment that — however poor by rich-world standards — its workers often prefer to the alternatives. The honest verdict is that globalisation's gains are real but unevenly distributed, and its costs fall hardest on those least able to bear them — which is precisely the kind of distributive problem the ethical theories are needed to adjudicate.
The theories pull in instructive directions here. A defender might run a utilitarian argument that even low-paid factory work raises total welfare if it is preferred to subsistence farming — but the same calculus condemns the practice once unsafe conditions and coercion enter, and a rule utilitarian will favour enforceable global standards. A Kantian is less impressed by aggregate gains: if workers are treated merely as interchangeable, disposable instruments of cost-reduction — herded into a cracked building to keep an order on schedule — then their dignity is violated however much consumers benefit, and the practice is wrong irrespective of the sums. Natural law judges exploitation an apparent good masking real harm. Movements such as Fair Trade can be read as an attempt to operationalise these duties — guaranteeing minimum prices and standards so that the gains of global exchange are shared more justly — though critics question their reach and efficiency. The point for an answer is that "globalisation: good or bad?" is the wrong question; the useful question is which practices, judged by which theory, are defensible.
Whistleblowing — an employee's disclosure of serious wrongdoing within their organisation — concentrates the conflict between loyalty and the public good into a single decision, usually taken at great personal cost.
Key term: Whistleblowing is the disclosure by a member of an organisation (typically an employee) of illegal, dangerous or unethical conduct within it, to those who can act on it — sometimes internally, sometimes to an external authority or the public.
The standard ethical analysis runs along several lines, and you should be able to deploy each. A utilitarian justifies whistleblowing when the harm it prevents (unsafe products, fraud, environmental damage) outweighs the costs to the firm, its workers and the whistleblower — and may even make it obligatory where great harm is at stake. A Kantian stresses a duty of truthfulness and the refusal to be complicit in treating others (consumers, the public) merely as means; staying silent while people are endangered makes one a party to the wrong. A natural-law analysis appeals to the precepts of an ordered society and the preservation of life: concealing serious danger offends both. Virtue ethics reframes the question around character — courage, honesty and justice — and asks what the person of practical wisdom (phronesis) would do, weighing genuine loyalty against the greater claims of the common good. Set against these is the real moral weight of loyalty and confidentiality, and the brute fact that whistleblowers routinely face retaliation, dismissal and ostracism — which is why UK law offers limited protection through the Public Interest Disclosure Act 1998. A mature answer treats whistleblowing not as automatically heroic but as a genuine dilemma in which competing duties must be weighed.
Several conditions are standardly proposed to mark justified whistleblowing, and citing them adds rigour: the wrongdoing must be serious (real harm, not mere disagreement); the disclosure should usually be internal first, exhausting proper channels before going public; the whistleblower should have good evidence rather than rumour; and external disclosure is warranted when internal routes are blocked or complicit and the public interest is at stake. Consider an engineer who discovers that a component her company sells is liable to fail dangerously, and whose managers, told privately, bury the report to protect a contract. Loyalty and her own livelihood counsel silence; but the utilitarian weight of preventable injury, the Kantian refusal to be complicit in endangering customers treated as mere means, the natural-law precept of preserving life, and the virtue of courage all converge on disclosure once internal channels have failed. The example shows why whistleblowing is the paradigm case for applying several theories at once and watching them agree or diverge.
Business does not only produce; it also shapes demand, and that gives rise to a distinct cluster of ethical worries gathered under the heading of consumerism — the cultural and economic prioritising of acquiring and consuming goods.
Key term: Consumerism is the social and economic emphasis on the continual acquisition and consumption of goods and services, often criticised for fostering materialism, waste and unsustainable use of resources.
Three concerns recur. Planned obsolescence — designing products to wear out or become unfashionable so that consumers must replace them — looks, on a Kantian analysis, like manipulating customers as mere means to repeat sales, and on a natural-law analysis like a waste of the goods of creation. Advertising raises the question whether it informs choice or manufactures desire: critics following thinkers such as J. K. Galbraith argue that modern advertising creates "false needs," eroding the very autonomy that the defence of free markets presupposes; defenders reply that consumers are not so easily duped and that advertising conveys genuine information and funds much else (from journalism to sport). And the human and ecological cost of cheap goods ties consumerism back to globalisation: a culture that demands ever-cheaper products exerts exactly the downward pressure on wages and conditions that produced Rana Plaza. A virtue ethicist would frame the whole debate around temperance and a clear-eyed account of what genuinely contributes to eudaimonia, noting (with Aristotle, and indeed with much religious teaching) that the unlimited pursuit of material acquisition is unlikely to be where human flourishing actually lies.
Few stakeholders are as easily ignored as the ones who cannot speak for themselves — the natural world and future generations — yet business decisions bear on both through pollution, resource extraction, deforestation and carbon emissions. The underlying question is whether firms have obligations to the environment, and on what these rest.
The answer depends on a prior choice of framework. An anthropocentric (human-centred) view holds that the environment must be protected because its degradation harms human beings, now and in the future; on this reading a utilitarian counts the suffering caused by climate change and biodiversity loss across all affected people (and, for Singer, sentient animals), and natural law extends the precept of preserving life to safeguarding the conditions life requires. An ecocentric view goes further, holding that nature has intrinsic value — worth in its own right, not merely as a resource — so that wrecking an ecosystem is wrong even where no human is measurably harmed. Kant, who restricted direct duties to rational beings, did not develop an environmental ethic, but a Kantian can argue that practices which, if universalised, would render the planet uninhabitable cannot be rationally willed, and that wanton destruction corrodes the moral character of the agent. For business this translates into concrete duties — to count environmental costs rather than externalise them onto society, to weigh the interests of future generations, and to resist the temptation to treat a clean environment as a free good. The recurring difficulty is that environmental harms are diffuse and delayed, falling on people and creatures distant in space and time, which is precisely why they are so easily discounted and why an explicit ethical framework is needed to keep them in view.
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