Corporate Responsibility

Corporations do not generally have to make a choice between their responsibility to shareholders and others in society because the two are linked. For instance, corporations also have a responsibility to their customers for two reasons: 1) corporations are held responsible for the implied and actual contracts that exist between themselves and their customers; and 2) satisfying customers is one way corporations make a profit and so fulfill their responsibilities to their shareholders. Corporations have a fiduciary responsibility to shareholders and are in effect representing those shareholders in business, producing goods and services, amassing a return on the investment of the shareholders, and then returning a proper share of that return to those shareholders. If the corporation does not act with a sense of responsibility, however, that reflects badly on the corporation and so on the shareholders, reducing their return. This will be considered in terms of the "green" strategy undertaken by many companies to attract customers and to convey a certain image of the company.

Many businesses today are undertaking what might be called a "green" strategy, or a strategy that takes into account environmental issues. For many of these firms, this is an internal matter involving ways in which they conduct business, handle waste, and deal with employees. For others, it is a key part of their business, and this is particularly true for certain advertising agencies which have trie

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s customers and potential customers made their views known and demonstrated that hurting customers would harm shareholders as well. He points to the DDT scare in the early 1960s which led to the banning of the chemical, which harmed shareholders of the company producing it; the improvement of the Alaska pipeline so consumer complaints served the needs of shareholders and added to the value of the pipeline; and automobile companies that responded to consumer complaints and produced cars with better emissions standards, thus serving shareholders by maintaining sales (Rolston 325). However, it is also evident that companies that pretend to be responsible toward their customers and the demands of those customers and that are found not to be have abrogated their responsibility to their shareholders just as they have to consumers. They might have tried to justify such actions by claiming they were being responsible to shareholders by increasing profits, but this is a short-term strategy belied by the long-term reality. Once found out, these companies lose business and leave their shareholders in financial trouble. In discussing the corporate responsibility of Liberty Oil, a company which had an oil spill that was highly damaging,

Category: Business - C