Ethical Dimensions: Free Will, Society, and Business Accountability
Understanding Free Will: Debates and Perspectives
Free will controls our own decisions, meaning we can choose what we do without being forced. Philosopher Sam Harris, however, argues that free will is an illusion.
The concept of free will is often based on two premises:
- We are free to behave differently than in the past.
- We consciously control our thoughts and actions.
Harris contends that the choices we make stem from prior causes we cannot see or control. He suggests that understanding this can shift our perspective from hate to empathy.
Amartya Sen’s Perspective on Free Will
Amartya Sen proposes that free will is subject to aspiration and feasibility. Aspirations guide actions but are shaped by background, power dynamics, and societal norms.
People often adjust their preferences to what they believe they can achieve. Sen highlights that individuals in deprivation frequently adapt their preferences based on their limited circumstances.
The Role of Emotions in Decision-Making and Society
Emotions are not just personal; they profoundly influence our decision-making and societal functioning. They are essential for rational decision-making.
Individuals with brain damage in emotion-controlling areas often struggle to make rational decisions. While decisions based solely on logic (intellectual reasoning) might seem ideal, practical reasoning requires more. Emotions provide a deeper understanding of complex situations.
A problematic human disposition is the tendency to admire the rich and powerful while neglecting the poor, which can lead to moral corruption.
Conflicting Emotions and Social Impact
Conflicting emotions often compete within us. While ambition and the pursuit of success can foster selfishness, cultivating virtues like kindness and fairness strengthens our moral compass.
Some emotions can powerfully drive social change. Positive emotions such as joy, love, compassion, and respect contribute to a better society. Conversely, negative emotions like shame or disgust can fuel discrimination and division.
Empirical Evidence: Micro and Macro Impacts
Empirical evidence refers to information gained through direct observation, hearing, or experience, not based on opinions, ideas, or beliefs.
Micro-Level Impacts on Well-being
- Studies show links between anger and heart disease.
- Positive emotions correlate with better health.
- Aspirations, whether intrinsic or extrinsic, significantly impact well-being.
Macro-Level Societal Impacts
- Strong social ties lead to lower mortality rates.
- Economic inequality increases stress and worsens health.
- More equal societies tend to have better overall health outcomes.
Global Environmental Challenges and Climate Action
Key Environmental Threats
- Deforestation
- Soil erosion
- Air pollution
- Water pollution
- Ocean acidification
- The ozone hole
- Loss of biodiversity
Climate Change: Consequences and Denial
Climate change is evidenced by temperature anomalies. However, some groups reject scientific evidence regarding its existence and causes.
Addressing Climate Change: The Paris Agreement
The Paris Agreement represents a global effort to reduce emissions and limit global warming.
Economic Impacts and Climate Injustice
Predicted economic consequences of climate change include:
- A 19% reduction in global income by 2050.
- Lower-income countries will suffer 61% greater income loss.
- Countries with lower emissions will suffer 40% greater losses.
This highlights climate injustice, where those least responsible for climate change often suffer the most.
Measuring Environmental Impact: Ecological Footprint
The ecological footprint measures the environmental impact of human consumption.
Navigating Global Supply Chains: Management and Ethics
A global supply chain encompasses all steps from producing to delivering a product or service across multiple countries, often leading to stakeholder invisibility.
Supply chain management involves coordinating an entire production flow by monitoring and optimizing its production and delivery.
Goals of Supply Chain Management
- Reduce costs and avoid supply shortages.
- Achieve efficiency as a competitive advantage in the market.
- Comply with fair employment conditions.
- Consider environmental protection and societal well-being.
Key Stages of a Supply Chain
- Operational strategy
- Sourcing
- Making
- Delivery
- Returns
Challenges in Global Supply Chains
- Corruption
- Child labor
- Different organizational cultures and regulatory changes
- Cyber threats
- Rapid speed of disruptive innovations
- Volatility in global financial markets
Ethical Strategies and Standards
- UN Global Compact / Global Reporting Initiative (GRI)
- ISO standards for ethical compliance
- Anti-corruption laws
- The Sullivan Principles: Initially established in 1977 to promote racial equality, fair wages, and improved quality of life for disadvantaged groups. Expanded in 1999 to include human rights, worker conditions, environmental sustainability, and fair business practices.
Addressing Discrimination: Bias, Pay Gaps, Harassment
Understanding Discrimination and Bias
Discrimination is the unfair treatment of one or more members of a specified group compared to others, often based on prejudices.
Unconscious bias and implicit stereotypes are biases we may not be aware of, but which significantly influence our actions. Bias can originate from those in power and affect those receiving it. Concepts like intersectionality and chain reactions highlight its complex nature, impacting corporate and workplace values.
The Gender Pay Gap
The gender pay gap refers to the difference between the average gross hourly earnings of working men and women. Women typically earn 18% less than men. This disparity persists regardless of educational level, even though women often live longer and study more than men.
Combating Sexual Harassment
Sexual harassment involves persistent unwelcome sexual remarks, looks, or advances, particularly from a senior colleague in the workplace. The #MeToo movement has highlighted that it occurs on a spectrum, from subtle to severe, often affecting young people. Perpetrators may not always realize their actions are harmful. This issue leads to significant health problems for victims and financial losses for companies. Overcoming the gender pay gap and sexual harassment requires fostering inclusive workplaces.
Stakeholder Invisibility and Human Rights in Business
Understanding Stakeholder Invisibility
Stakeholder invisibility occurs when the strategic value of certain stakeholders is overlooked due to ignorance or moral disengagement, where individuals disconnect morally to avoid guilt, often to save money.
An invisible workforce refers to workers who become invisible due to factors like migration, night shifts, or geographical distance.
Moral Intensity: Assessing Ethical Issues
Moral intensity describes how serious a moral issue feels in a given situation. It depends on several factors:
- Proximity: How close we feel to the people affected.
- Magnitude: How big the impact is.
- Probability: The likelihood of harm occurring.
- Social Consensus: If society generally agrees the action is wrong.
- Temporal Immediacy: How soon the harm happens.
- Concentration of Effect: How focused or spread out the harm is.
Invisible workers are often more vulnerable, leading to exploitation and human rights violations.
Challenges in Upholding Human Rights
Implementing human rights protections faces significant challenges:
- Jurisdictional Complexity: It is difficult to regulate companies globally.
- Corporate Economic Power: Corporations often wield more economic power than states in many regions.
- State-Business Complexity: Governments frequently avoid regulating companies to attract investment.
Types of Human Rights Violations
Human rights violations can be direct or indirect:
- Direct Violations: Discrimination, unsafe work conditions, environmental damage.
- Indirect Violations: Suppliers using forced labor, security forces suppressing protests, investment in oppressive regimes.
The Three Pillars of Human Rights Protection
The UN Guiding Principles on Business and Human Rights are built on three pillars:
- The state duty to PROTECT human rights.
- The corporate responsibility to RESPECT human rights.
- Access to REMEDY: Victims must have access to justice.
Fostering Future Accountability
To ensure visible stakeholders, empathy must be cultivated through awareness and training. For invisible stakeholders, their voices need to be amplified through awareness, social movements, and active participation.
Corporate Social Responsibility and ESG Performance
Corporate Social Responsibility (CSR)
Corporate Social Responsibility (CSR): While some companies claim sustainability, they may still be significant polluters. Tools like codes of conduct, product labels (visual signs to help customers), and certifications aim to guide consumers and ensure ethical practices.
Environmental, Social, and Governance (ESG)
Environmental, Social, and Governance (ESG) Criteria: ESG frameworks assess a company’s performance in these areas. A key challenge is the lack of standardized methodologies across different companies.
The ESGC Score: Integrating Controversy
The ESGC Score is a metric that combines the ESG score with a “Controversy Score” (CS), which accounts for scandals or issues. If the controversy score is positive (indicating worse performance), the ESGC score equals the ESG score. If the controversy score is negative (indicating better performance), the ESGC score is an average of the ESG and controversy scores.