How do you think the financial crisis has impacted the public’s view of businesses? What other societal trends seem to be affecting businesses today?In your opinion, what is the greatest strength of a pluralistic society? What is the greatest weakness? Do you think these characteristics work for or against business? Why?
Predictably, the financial crisis has impacted the way the public views businesses. In a recent survey, public trust in businesses has crumbled as a result of "a very significant crisis of leadership." The public is not very optimistic about the way in which businesses are run, as well as the transparency that displays rules being followed. The perception is that businesses are more interested in profits at the cost of consumer rights or consumer advocacy. This was enhanced in the divulging of private conversations and correspondence in the corporate malfeasance case of Enron energy when Enron brokers were mocking "grandmas" who were at their mercy during rolling blackouts in California. Such internal disclosures only help to substantiate how the public is distrustful of the motives of businesses and their relationships with the public. The drive for corporate profit at nearly all costs is an embedded part of the culture that constitutes a trend that dictates this reality.
The realities of a pluralist society can help to restore business confidence and trust with the public. In examining the tendencies of a pluralist setting, one recognizes that the lack of dogmatism and extremism can enable businesses to earn back the public trust. This is seen when Sir Isaiah Berlin defines pluralism as praising discourse and freedom of articulation in thought and experience:
[l]et us have the courage of our admitted ignorance, of our doubts and uncertainties. At least we can try to discover what others […] require, by […] making it possible for ourselves to know men as they truly are, by listening to them carefully and sympathetically, and understanding them and their lives and their needs….
Sir Berlin's understanding of pluralism is that its greatest strength lies in the ability to "listen" and understand individuals in an authentic manner, apart from "admitted ignorance." The greatest strength is to see consciousness as an ongoing experiment, where one strives to "get it right" each time out. For a pluralist society, there is no extreme totality that silences voices.
It is in this where business can work to restore trust with the public. The failure of many businesses to restore the public trust is not an opportunity for dogmatic Marxism to take over. Nor should it be an opportunity zealously advocate a pro- corporate platform without regard for anything or anyone else. Rather, the pluralist setting allows individuals and businesses to share discourse and engage in constructive dialogue that can help to remedy that which went wrong. The ability for a pluralist society to "know men as they truly are" can enable individuals and businesses to find common ground where corporate profit does not have to be defined in such a cutthroat manner. It is in a pluralist setting where individuals can use their voice to ensure that all interests are represented in the accumulation of wealth and the expansion of capital opportunities. The pluralist society demands transparency and openness. In its most theoretical exploration, Smith's notion of the free market is an open- ended reality. The marketplace is not controlled by anyone or any other force. It is synonymous with freedom and transparency. This convergence between business and freedom is what makes the pluralist setting so ideal for businesses to reclaim their relationship with the public, replenishing a reservoir that results from a significant "crisis of leadership."
Since you have already asked the first part of this question, I will focus only on the second part (the part about interests, rights, stakeholders, and such) and will not have space to discuss the first part.
There are three types of stakes that people might have in the decisions that a business makes or the actions that it takes. The one in which people have the least connection to or involvement with the business is called an “interest.” If I have an interest in what a business does, it simply means that I am affected by the business’s decisions. So, for example, my town does not have a Costco. When Costco decided not to come here, it affected me because it means that I have to drive about an hour if I want to shop at one of their stores.
One step up from an interest is a right. If I have a right, I can expect a business to treat me in a certain way. In other words, the business has an obligation to treat me in that way (unlike Costco, which had no obligation to locate in my town). So, let us say that I go to a restaurant. I have the right not to be discriminated against on the basis of my skin color. As another example, I have the right to expect factories in my town not to emit poisonous gasses that will harm me.
The highest level of stake is ownership. Here, a person has legal title to some part of a business. Anyone who owns a business or part of a business has an ownership stake in that business. Everything the business does concerns that person.
Now, let us look at different views of a firm. The production view of the firm says that the firm’s stakeholders are very limited in number. In this view, the only stakeholders in a firm are its suppliers, the firm itself, and its customers. The managerial view of the firm broadens the scope a little more. In this view, we still look at suppliers, customers, and the firm, but the firm is differentiated into three parts. The owners are one set of stakeholders, the managers are a second, and the employees are a third. In this view, each set of stakeholders has a different interest in what the business does. Finally, there is the stakeholder view. Here, we add the government and the community as a whole to the set of stakeholders. We are basically saying that a firm’s actions do not only affect its employees, suppliers, managers, customers, and owners. Instead, its actions can affect the whole community and the government as well. For Best Buy, then, stakeholders would include the people who live in the communities that have Best Buy stores. They would include people who shop at the stores. It would include the families of the people who work there. It would include anyone who could possibly be affected by anything that the firm does.