Business Purpose & Responsibility Quiz

Alien Tort Statute

- enabled U.S. courts to apply international law to incidents that violated the law of nations or a treaty in the U.S.

- recent: must be a sufficient connection with the U.S., but case law is murky

When did the UN form?

Towards the end of WWII

- shortly after the UN adopted the Declaration of Human Rights

Enforcement:

Governments are obligated to protect and promote human rights

- Federal: U.S. Constitution/Bill of Rights, federal laws

- State: state constitution and laws, Indiana Civil Rights Commission

- Local: Bloomington/Monroe County, each have a Human Rights Ordinance and Council

What if the government is committing human rights violations?

- International bodies (courts of justice)

- Non-Governmental Orgs (NGOs), like Human Rights Watch (NGOs drive accountability)

France's Law:

Binding corporate accountability law that mandates human rights, "due diligence"

UN Global Compact Principles: What are the fundamental responsibilities?

Human rights, labor, environment, anti-corruption

Incorporation:

a legal process by which a business becomes a legal entity of its own

- Ex: corporations, LLCs, some partnerships

Benefits of becoming an incorporation:

limited liability, transferability of shares, continuity of life

How were incorporations originally granted?

only after a state legislature had determined that the business was serving the public good

- this led to cronyism (the appointment of friends and associates to positions of authority, without proper regard to their qualifications)

How available is incorporation now?

Available to all and does not require legislative approval

- now administrative, fill out forms and pay fees to incorporate

What is the Business Roundtable?

a groups of chief executive officers of nearly 200 major corporations

Luugi Zingales opinion on the purpose of business today (from the UChicago commencement speech):

monopolies

- insincerity of the Business Roundtable

What is the purpose of business among the Big 4?

Emphasize a strong purpose aimed at bettering society as a whole

- Ex: KMPG ad

McKinsey Purdue case & Anand Giridharadas

the proposal to pay pharmacies rebates for overdoses

- corporate philanthropy functioning as reputation laundering in situations such as the opioid crisis

Mark Cuban's perspectives:

- build a loyal customer base you should focus on transparency to create trust

- the power of networking in the community

- earning employees' commitment every day, how you treat your employees is how your brand is defined

- one was only having one "knucklehead" on a team because that person can eventually adapt and become less problematic

- long-term value creation over short-term profit maximization

CSR:

the ethical expectations that society has for business (even if it comes with an economic cost)

Corporations have the responsibility to:

- give back

- prevent harm (expected but no strict duty)

- not to cause harm (obligatory)

Cummins case: Mark Sifferlen (former VP Ethics & Compliance)

- Cummins was ranked as worlds most ethical company until 2023

- 2023, accused of installing cheat devices on trucks to bypass environmental laws

Public vs private firefighters

- If a firefighter works for the government (public), they are more likely to qualify for compensation than a firefighter that works for a private company

- Public firefighters have presumptive workers' compensation coverage for certain cancers

- Private firefighters must prove medical causation on a case-by-base basis

- Wildland firefighters have historically been either prevented or dissuaded from wearing masks on the job

- Private are required to pay premiums to maintain workers' compensation insurance through an authorized insurer. Their rates are impacted by the number of successful claims that are filed by their workers