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Business Ethics ­MGT610
VU
LESSON 30
COST AND BENEFITS
The problems involved in getting accurate measurements of the benefits and costs of pollution
control are also illustrated by the difficulties businesses have encountered in trying to construct
a social audit (a report of the social costs and social benefits of the firm's activities). This can
be difficult, however. How do we measure the costs and benefits of pollution control when they
involve damages to human life or health? Measurement itself is also difficult when the effects
of pollution are uncertain and therefore hard to predict. In fact, getting accurate pollution
measurements is sometimes nearly impossible, and the problem only is multiplied when there
are a number of polluters in a single area. Measuring benefits is likewise difficult, which poses
significant technical problems for utilitarian approaches to pollution.
Even where measurement is not a problem, another problem remains for the utilitarian
approach. Is it morally permissible to impose costs on unwilling or unknowing citizens? Can
some unilaterally impose costs on others without their consent? Even getting consent is tricky,
because many pollution problems involve information and risks that are extremely technical
and difficult to understand. It is perhaps impossible in principle to get informed consent from a
segment of the public on some complicated issues.
Because of these problems, some contend that utilitarianism cannot lead our pollution control
policy. Perhaps absolute bans on pollution are more adequate. Some writers even suggest that
when risk cannot be reliably estimated, it is best to steer clear of such projects. Others maintain
that we should identify those who will bear the risks and take steps to protect them.
It holds that until those patterns of hierarchy and domination are changed, we will be unable to
deal with environmental crises. In a system of hierarchy, one group holds power over another
and members of the superior group are able to dominate those of the inferior group and get
them to serve their Many thinkers have argued that the environmental crises we face are rooted
in the social systems of hierarchy and domination that characterize our society. This view, now
referred to as social ecology, ends.
Until these systems (such as racism, sexism, and social classes) are changed, we will be unable
to deal adequately with the environment. Eco-feminists, a related group of thinkers, see the key
form of hierarchy connected to the destruction of the environment as the domination of women
by men. They believe that there are important connections between the domination of women
and the domination of nature­patterns of thinking, which justify and perpetuate the
subordination. This logic of domination sets up dualisms (artificial and natural, male and
female) where one of the pair is seen as stronger and more important. To solve our ecological
problems, we must first change these destructive modes of thinking.
According to the ethics of caring, the destruction of nature that has accompanied male
domination must be replaced with caring for and nurturing our relationships with nature and
other living things. Nature must be seen as an "other" that must be cared for, not tamed or
dominated. Thought-provoking as these approaches are, they are still too new and undeveloped
to give us specific direction.
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Business Ethics ­MGT610
VU
Basis of social audit
Social audit as a term was used as far back as the 1950s. There has been a flurry of activity and
interest in the last seven to eight years in India and neighboring countries. Voluntary
development organizations are also actively concerned.
Social audit is based on the principle that democratic local governance should be carried out, as
far as possible, with the consent and understanding of all concerned. It is thus a process and not
an event.
What is a social audit?
A social audit is a way of measuring, understanding, reporting and ultimately improving an
organization's social and ethical performance. A social audit helps to narrow gaps between
vision/goal and reality, between efficiency and effectiveness. It is a technique to understand,
measure, verify, report on and to improve the social performance of the organization.
Social auditing creates an impact upon governance. It values the voice of stakeholders,
including marginalized/poor groups whose voices are rarely heard. Social auditing is taken up
for the purpose of enhancing local governance, particularly for strengthening accountability and
transparency in local bodies.
The key difference between development and social audit is that a social audit focuses on the
neglected issue of social impacts, while a development audit has a broader focus including
environment and economic issues, such as the efficiency of a project or program.
Objectives of social audit
1. Assessing the physical and financial gaps between needs and resources available for
local development.
2. Creating awareness among beneficiaries and providers of local social and productive
services.
3. Increasing efficacy and effectiveness of local development programs.
4. Scrutiny of various policy decisions, keeping in view stakeholder interests and
priorities, particularly of rural poor.
5. Estimation of the opportunity cost for stakeholders of not getting timely access to public
services.
Advantages of social audit
(a)
Trains the community on participatory local planning.
(b)
Encourages local democracy.
(c)
Encourages community participation.
(d)
Benefits disadvantaged groups.
(e)
Promotes collective decision making and sharing responsibilities.
(f)
Develops human resources and social capital
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