To What Extent Does Friedman's Efficiency Perspective Provide Foundation For Responsible And Moral International Management Behaviour?

Essay by PaperNerd ContributorUniversity, Master's March 2002

download word file, 12 pages 5.0

Downloaded 84 times

To what extent does Friedman's "efficiency perspective"� provide foundation for responsible and moral international management behaviour? Need we have any concern if it fails to do so? Friedman concludes his article "˜The social responsibility of business is to increase its profits' (1970), in which he explains his efficiency perspective, with the following sentence: "There is one and only one social responsibility of business -to use its resources and engage in activities designed to increase its profits so long as it stays within the rules of the game, which is to say, engages in open and free competition without deception or fraud."� To be able to draw this conclusion, Friedman set down several building blocks as a foundation for his efficiency perspective. But before discussing these, I will give a definition for responsible and moral international management behaviour, so that in the end I will be able to draw a conclusion about whether or not Friedman's perspective provides a foundation for such management behaviour.

A couple of decades ago, when the field of responsible and moral international management was just getting started, it was usually discussed under the heading of corporate social responsibility. Manakkalathil and Rudolf (1995) define corporate social responsibility as "the duty of organizations to conduct their business in a manner that respects the rights of individuals and promotes human welfare"�. Which in other words means "operating a business in a manner that meets or exceeds the ethical, legal, commercial and public expectations that society has of business"�. ( Friedman argues that the best way to be socially responsible is by maximizing profit, as described in his efficiency perspective. This efficiency perspective is built of three blocks that together form the fundaments of the perspective. The first building block in support of Friedman's efficiency perspective is...