Essay Quiz


1		One of the arguments offered in favor of the takeover of Pacific Lumber was that because its managers were only harvesting 2% of its trees each year, that resource was not being used to the best economic advantage. Do you think that was necessarily true? It was in the corporate raider's interest, of course, to increase the harvest of these trees in order to pay off the debt incurred by the leveraged buyout and provide immediate profits for the new owners. Could Pacific Lumber's original management team have argued that their rate of harvest was really in the long-term interest of the owners because it insured the Company's long-term viability and profitability?



2		If, in the spirit of Adam Smith, the 18^th century economist and moralist, society were to get rid of all rules and regulations governing business activities and allow each business to operate solely in its own interest, do you think those individual efforts would add up to the greatest overall good for the collectivity, for society as a whole?



3		Bowie's Kantian moral minimum theory of corporate social responsibility argues that a business is obliged to do no harm but that its duty to maximize profits for its owners overrides any considerations of doing some good or preventing some harm. Could a utilitarian case be made for society's expecting that in addition to the taxes it pays, business will contribute to community charities, activities, and to other public goods, in short, do good and help prevent harm like unemployment, thus overriding Bowie's interpretation of the Kantian imperative?



4		How might someone argue that the social contract theory of corporate social responsibility is the strongest of the four models discussed in Chapter three?



5		5. The stakeholder theory of corporate social responsibility admits of two interpretations: a wide sense in which a stakeholder could be any group or individual who can affect or be affected by the corporation, and a narrower sense in which the concept of a stakeholder merely includes any group vital to the survival and success of the corporation. Is the narrower sense compatible with utilitarian ethical theory's requirement that the ethical interests of all parties affected by an act must be considered? If not, does utilitarianism demand too much of managers?

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