Corporate Social Responsibility: The Tobacco Companies and Product Safety - Essay Example

Student Name: Tutor: Title: The Tobacco Companies and Product Safety Course: Introduction The idea of corporate social responsibility proposes that a company does not only have legal and economic considerations but it must also undertake certain responsibilities to the public that extend beyond the legal and economic responsibilities. The company takes action that is aimed at protecting and improving the wellbeing of the society in addition to the company’s interests. Different viewpoints have been developed over time on corporate social responsibility. This paper will discuss the case of the tobacco companies and product safety in relation to three viewpoints on corporate responsibility. These are; Friedman’s economic vie, the Kew Garden Principles socio-economic view and the broad social view within the Kew Garden Principles. Corporate social responsibility: tobacco companies and product safety The department of justice took tobacco giant company Philip Morris and eight other companies to court for failing to be forthcoming about the effects of smoking. The department accused the cigarette companies of running misleading advertising campaigns to try to ensnare more smokers including children. The department of justice provided evidence linking the cigarette companies to suppression of research linking cigarettes to all manner of diseases including lung cancer. They also posted adverts showing that nicotine was not addictive while they were fully aware of the addictive effects of nicotine and had even put production measures in practice to addict more users to cigarettes. This whole scheme by Philip Morris and other tobacco was solely aimed at maximizing profit as suggested by economist Milton Friedman (Velasquez, 2012). Milton Friedman was a renowned defender of capitalism who followed Adam Smith’s views of capitalism. Friedman argued that a business organization had only one social responsibility. He pointed out that this responsibility was to utilize its business resources to participate in activities that would enable it to increase its profit margins while within the legal boundaries. Friedman believed that the corporate executive’s responsibility is to run the business organization in accordance with the desires and wishes of the owner. He believed that generally, these desires would encompass making the greatest amount of money while conforming to both legal laws and societal ethical customs. Friedman also viewed actions and dealings that could be anticompetitive in nature as reprehensible (Schwartz and Saila, 2012; Cooney, 2012). From whichever angle Friedmans argument is looked at and interpreted, three conclusions are drawn from his views. The first conclusion is that in as much as the company should work towards maximizing profits, they should also obey the law. In addition, the business organization should also conform or follow the set ethical customs which are inclusive of the business norms under which the organization operates. The third conclusion from Friedman’s argument is that the company should work without employing deception or fraud for that matter. Considering Friedman’s arguments, the dealings and decisions made by Philip Morris and the eight other companies were significantly wrong. Even though the companies made their decisions to maximize the amount of profit they could get from the business, they went against three of freedman’s core principles. When the companies agreed to deceive the public about the negative effects of smoking in addition to hiding research about its addictive nature, the companies had employed use of deception in marketing their product. When the companies claimed that there was no conclusive research that proved the relationship between cancer and cigarette smoking and yet had the research in their safes, they were going freedman’s view of deception as well as unethical behavior. To top it off, Philip Morris et al went as far as building a campaign aimed at getting more minors to smoke and get addicted to a habit whose risks they did not fully comprehend. Even though Friedman was a true capitalist in nature who pushed for the maximization of profit, the use of these tactics went against most of his views and what he believed in. The kew gardens principles were developed after the stabbing and death of a woman named Kitty Genovese in New city in the Kew Gardens. The stabbing happened in the full view of thirty eight citizens who looked on without trying to help the woman in need. The Kew garden principles argue that there is a moral obligation or responsibility to provide support when four features are there. These features include a critical need, the propinquity of potential actors, the capacity to assist from those knowing and the lack of those who might be willing to act. Corporate social responsibility as a social and economic function does not fall far from these principles. Corporate social responsibility integrates social, economic, environmental and ethical considerations in consideration of the customers which make up its core stakeholders. The Kew garden principles therefore promote a view of harm prevention to the customer and the public. Just like Kitty Genovese was in need of help from the bystanders on that fateful day in New York, the unknowing masses who smoked were also in need of information on the research on cigarette smoking. When the companies decided to withhold information from the public on the consequences of smoking, they did so in violation of the first Kew garden principle of need. This is because the general population needed to make their decisions on whether to smoke or not based on the information available. Making their decisions based on only one side of the truth condemned them as surely as Kitty was condemned by the lack of help from the Kew Gardens bystanders. It cannot be argued by the cigarette companies that they were not in proximity of the needs of the masses. This is because all organizations were credited with having made a substantial amount of research during this period. The business organization was therefore close enough to the masses to understand their needs but choose to ignore them out of selfish interests. Neither did the companies lack the ability to assist. Velasquez (2012) points out that Phillip Morris et al. had in their possession research done that showed the risks associated with smoking. Therefore, the ability to act as presented by the Kew Gardens principles was present, the willingness to act was the only aspect missing. A view held by the international institute for sustainable development (iisd) (2013) is that most consumers hold the business organization responsible for the good it would have done through its corporate social responsibility framework. Therefore consumers can either punish a company or reward its performance based on a broad perception of its social performance. The report further goes further to explain that not only does the general public expect a company to perform under the given legal requirements but also they expect it to contribute to society in as many ways as they possibly can. Even skilled labor prefers those business organizations with better working conditions as well as a marked social side. Even though the first aim of a business entity is to create profit, a business organization also has a duty to contribute to the welfare and wellbeing of society. Society comprises of everybody within the circumference and loci of operation of the company. Just like the bystanders in the Kew Garden had a duty or moral responsibility to intervene to save Kitty, the cigarette companies had a duty to give back to society too. In the case presented by the department of justice against the cigarette companies led by Morris Phillip, the companies are said to have earned profits in the hundreds of billions in a considerably short period of time. But rather than operate in the normal legal and ethical confines placed upon them by society, the companies choose to throw all moral guidelines to the wind and harvest the ignorant public of all it’s worth. According to the Kew Gardens principles, the cigarette companies had a duty to contribute to society. The release of the research the companies had on the addictive nature of nicotine would have been one such service. With the advertising power the companies wielded, it can rightly be assumed that had they so wished, the companies would have reached a large number of people with information regarding the research on cigarette related diseases. In the 1950’s research existed that clearly showed the effects of smoking on the health of individuals. Rather than do the public a service b informing them of this medical development, the cigarette companies went another route. They concentrated their resources on discrediting this research and put forward views of their own that were aimed at convincing the public that there was no clear evidence linking these two phenomena. It would be a safe bet that had they not been forced to inform the audience of the risks of cigarette smoking in their advertisements, these companies would never have started doing so. Conclusion Corporate social responsibility encompasses ethical, economic, social and environmental considerations. Even though a business organization carries out its mandate of getting the most possible profits from its operations, it must operate in such a way that it supports the wellbeing of the general public that contains its customers. Friedman’s social economic view as well as the Kew garden principle promotes a culture of responsibility in business organizations while maximizing the company’s true purpose of maximizing profit. In light of all these developments, it can be argued conclusively that Philip Morris and all the other eight cigarette companies violated the practices of good corporate responsibility with their practices between 1953 and 1969. References Schwartz, M. S. & Saiia, D., 2012, Should Firms Go “Beyond Profits”? Milton Friedman versus Broad CSR, Business and Society Review journal, vol 117(1), Pg. 1–31 Cooney, S., 2012, Adam Smith, Milton Friedman and the Social Responsibility of Business, Available at Velasquez, M.G., 2012, The Tobacco Companies and Product Safety in Business Ethics: Concepts & Cases (7th ed.), New Jersey: Pearson Education Inc. (p316). IISD, 2013, Corporate social responsibility (CSR), Available at < http://www.iisd.org/business/issues/sr.aspx > responsibility (CSR) Read More