Publications
Publications
- June 1997
- HBS Case Collection
The Normative Foundations of Business
Abstract
What is the appropriate role for business to play in a capitalist society? In analyzing responses to this question, this note distinguishes two separate dimensions. The first involves the distinctive objective of business as a social institution, considers the pros and cons of profit maximization as well as alternatives to profit maximization such as putting the customer or the employee first, stakeholder theory, and the corporation as a public service entity. It then considers a second dimension, the appropriate moral constraints on business's pursuit of its objectives. On this dimension, the note considers minimal strategic compliance, libertarian structures against force or fraud, the law, social norms, and independent standards of moral behavior.
Keywords
Citation
Dees, J. Gregory, and Jaan Elias. "The Normative Foundations of Business." Harvard Business School Background Note 897-012, June 1997.