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ACCA Strategic Professional · Strategic Business Leader · Professionalism, ethical codes and the public interest

Orlin Mining is deciding whether to close a polluting plant. The board member Raj says the company's only obligation is to maximise profit within the law. Another member, Dana, argues the board must consider the effect on the local community and the public interest even where this lowers profit. Which statement best classifies their views?

Raj holds a narrow, shareholder-focused view that the company's duty is to maximise profit within the law, while Dana holds a broader stakeholder view that the board must also weigh community and public interest impacts, even at some cost to profit.

  1. ARaj takes a shareholder-focused (narrow) view of responsibility; Dana takes a broader stakeholder viewCorrect
  2. BRaj takes a stakeholder view; Dana takes a shareholder view
  3. CBoth take a deontological view of rules only
  4. DBoth take a purely egoist view

Explanation

Raj limits the company's duty to profit for owners within the law, a narrow or shareholder-oriented, Friedman-type position. Dana extends responsibility to wider stakeholders and the public interest, a broader pluralist or stakeholder view.

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