Definitions and Distinctions
Philosophy (Rand): Study of Existence, Of Man, and Man’s Relationship with Existence
Rights (Rand): A moral principle defining and sanctioning a man’s freedom of action in social context
Justice (Rawls): A characteristic set of principles for 1)Assigning basic rights and duties and for 2)determining what they take to be the proper distribution of benefits of social cooperation.
Hypernorms (Donaldson & Dunfee): Moral precepts fundamental to human beings
Price Gouging (Zwolinski): A practice in which prices on certain necessity items are raised in wake of an emergency TO what appear to be unfair and exploitatively high levels
Corporate Social Responsibility (Ryan): Bringing Corporate behavior up to a level that is congruent with prevailing norms and expectations
Corporate Governance (Ryan): Roles, Responsibilities, and Balance of Power among executive, directors, and shareholders
Directors (name and explain 3 types):
Inside-EE’s of the firm
Outside- the non EE’s of the firm
Independent- no connection to the firm besides the board of directors
Shareholder activism (Goranova & Ryan): Actions taken by shareholder with explicit intentions of influencing corporation policies and practices
Two streams of shareholder Activism (Name and Explain):
Financial Activism Stream
Shareholder value focused, financial performance
Social Activism Stream
Stakeholder value focused, environmental social governance
Moral Philosophy: How People Should behave
Moral Psychology: How people do behave in moral situations
Negative rights: The right to pursue something
Positive rights: The right to something
Utilitarian: Maximizes the greater good
Rights justification of capitalism: Capitalism is the economic system that best maximizes the common good
Subjective Egoism: Decide what’s moral based on what’s good for them in the long run and humans are fundamentally the same, so you CAN’T Judge them
Objective Egoism: Decide what’s moral based on what’s good for me in the long run and humans are fundamentally the same, so you CAN Judge them
Absolutism: Some moral rules that stay the same through time and space
Relativism: morality itself changes through time and space
Collectivism: Humans are fundamentally members of groups
Individualism: Humans are fundamentally individuals who can join groups (or not)
Employee rights: Conditions that it would be unethical for any employer to withhold from employees
Employee benefits: Discretionary compensation or conditions that an employer offers to employees voluntarily.
Separation of ownership and control
Pre-IPO the owner has both ownership and control
Post-IPO the control is held by the CEO, and the ownership is held by the shareholders
Benefit Corporation: Legal corporation status and held legally responsible for the social goals and profits
One Share/One Vote: A person who has one share gets one vote in what happens in the company
Unequal Shares: Different classes of shareholder have different numbers of votes associates with shares