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Should defenders of the Stakeholder Theory Condemn Sweatshops?
Analyzing the Implications of the Stakeholder Theory of the Modern Corporation
The stakeholder theory says that a company has a moral responsibility towards all the groups that have a stake in the firm. They provide two justifications for this argument: the agent-principal relationship and the Kantian respect for persons. The first justification states that there is a fiduciary relationship between stakeholders and managers which means that management must act in the best interest of stakeholders. Per the Kantian respect for persons, each person has a right to not be treated as a means to a business’ end. It can be inferred that what Evan and Freeman meant to say is that people should not be treated as a mere means, which means to treat someone only as devices to further one’s own ends.
Defenders of the stakeholder theory should condemn sweatshop labor because sweatshops fail to manage the firm in the best interest of employees and sweatshop managers treat the workers as mere means. The inhumane conditions of sweatshops highlight this. Employees are subject to the following central conditions: low wages, long working hours, and systemic health and safety risks. They can also be subject to some peripheral conditions including forced overtime, coercion, underpayment, deception, abuse. Thus, managers are violating…