In recent years, the prevailing belief among business leaders and educational institutions has followed Milton Friedman’s assertion that a corporation’s primary objective is to increase profits while adhering to the rules of the game. However, as federal regulations in the United States, including those concerning product safety, environmental protections, and workers’ rights, are increasingly weakened, this notion is being challenged. The deterioration of these legal safeguards raises concerns that businesses may prioritize profit over ethics, leading to harmful practices such as pollution and unsafe working conditions.
Furthermore, the current environment has prompted a growing sense of urgency among educators and business leaders to re-evaluate the role of ethics in corporate governance. At Harvard Business School, for instance, the Leadership and Corporate Accountability (LCA) course has been a mandatory part of the MBA program for two decades. The course encourages students to examine business decisions through economic, legal, and ethical lenses, prompting them to confront the complex interplay between legality and morality in corporate actions.
Students often express discomfort with various business scenarios but have difficulty articulating their ethical positions. The course aims to equip them with the language to engage with these dilemmas, even if it does not prescribe specific notions of right or wrong. Exercises include analyzing the implications of financial transactions and their alignment with laws such as the Foreign Corrupt Practices Act, while promoting critical thinking about potential harms to stakeholders.
Overall, this evolution in educational focus underscores the heightened importance of ethical integrity amid a landscape increasingly devoid of robust legal protections.
Why this story matters:
- The weakening of legal safeguards poses risks to consumers and society at large.
Key takeaway:
- Ethical considerations are becoming essential in business education and decision-making.
Opposing viewpoint:
- Some argue that profit maximization remains the primary responsibility of corporations, with ethics being secondary.
