• Research Paper on:
    Ethical Case Study - A South African Investment

    Number of Pages: 5

     

    Summary of the research paper:

    This 5 page paper is based on a case study supplied by the student. The ethics case study considers whether or not a firm should have withdrawn from South Africa during the apartheid years, or whether staying had a greater utilitarian value for the black population. The companies in the case are Texaco and SoCal, with three different resolutions that were put before the boards to withdraw, to refuse to do business with the government and to adopt Desmond Tutu’s proposals. The paper looks at the different ethical perspectives. The bibliography cites 3 sources.

    Name of Research Paper File: TS14_TEsouthaft.doc

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    Unformatted Sample Text from the Research Paper:
    the plant; Texaco and SoCal, indicate a difficult ethical position. The investment was in South Africa, which at the time was subject to the Apartheid regime, where blacks effectively had  no rights and were treated in an unequal manner, with a government that was committed to maintained white supremacy. The arguments supporting the Interfaith Centre on Corporate Responsibility,  and their calls for the company to withdraw from South Africa were based on the argument that by continuing investment into the country the firm was effectively supporting the apartheid  regime, by bringing money into the country there was support for the government though taxes that were paid and through support for thee existing regime. The argument that it was  wrong to support such as regime and that by withdrawing there would be the immediate commercial effect, which would deprive the government of the finds as well as the supplies  from the firms outputs. This would harm the economy and would have the aim not only of denying support; and ethical stance, but to increase pressure to force political change,  to help to bring in equality. Texaco and SoCal were opposed to the motion. When looking at the ethical issues this become complex, as the firm has a duty  to the shareholders to undertake business to create profit, potential losses and lost opportunities could be seen as breaching this duty, and according to theories such as Friedman, as long  as the firm was operating within the law, priority should be given to shareholder rather than other stakeholder needs (Chyssides and Kaler, 1998). The argument of Texaco and So Cal  was not based on majority shareholder interest, as only 5% voted in favour, but that there was a greater, utilitarian, benefit in the firm retaining an interest in the area. 

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