What is the basis of the belief that institutions should pursue only their own goals and disregard moral aspects of their actions' wider consequences?

Question

I've always believed that a man must be aware of the wide consequences of their actions. Fulfilling one's obligations with regard to their roles is important; but whenever these obligations clash with basic human decency, or in other words - obvious moral values, the latter should be prioritized, not the former.

However, the longer I live, the harder I learn that the general consensus seems to be the total opposite; and I only feel more and more surprised.

I understand that I may have not been clear enough in what I wrote above, so I'll try to give some examples to better explain what I mean.

Example 1: There was a discussion on Polish Wikipedia a few years ago on whether or not to decorate a biographic article with a photo. The issue was that the photo of that person had been taken during the funeral of their son, and the photo had been showing a very prominent grimace of pain and sorrow.

Some editors wanted the picture out for ethical reasons. Others were adamant that any ethical arguments are nonsubstantitive, because they are not based on Wikipedia's rules and they also do not mention improving the quality of the encyclopedia. They were claiming that the encyclopedia needs photos for biographic articles, and this is the only relevant argument, while all ethical or moral arguments should be rejected since they were off-topic.

The photo finally got removed, but for other reasons - namely, its legal status was found to be questionable. However, the official reason of this deletion explicitely said that any issues regarding a mourning father were irrelevant.

Example 2: In Politics SE some user asked how to defect from UK to North Korea. Other users posted comments below this question, arguing that defecting to North Korea was an insane idea. These comments got deleted. There was a proposal to restore the comments, but it was rejected; the reasons for the rejection of this proposal was that (1) the comments were off-topic and in a violation of the commenting guidelines of SE sites and (2) There were no reasons to believe that the author of the question really wants to defect to NK and even if they do, nothing in the world could convince them not to do this. I have feeling that reason (1) was the primary reason.

To be frank, I am disgusted by this outcome. Even though it is only possible, not certain, that the author of the question wants to seek asylum in NK - lives may be in danger here. The person who chooses to flee to NK places themselves in a grave danger of being tortured and/or executed. Giving advice on how to commit this mistake and not even trying to dissuade it and even forbiding all attempts to dissuade it - this, for me, means taking partial responsibility for the bitter end this man may soon meet.

There are many such examples; I'll limit myself to these two for the sake of brevity.

To sum up, we see a clear consensus that a man should - to the greatest extend permitted by applicable laws - only guide himself with the obligations that come with their roles, insofar as they are acting under this role, while disregarding all wider implications of their actions. THerefore, if one is an editor of Wikipedia, then, as long as they act as an editor of Wikipedia, they should only be concerned with the quality of Wikipedia and its rules, even if this means publicly disrespecting other person's grief; and if one is a participant of an SE site, they should only be concerned with the rules and completeness of this site, even if a potential life-or-death situation would require withhodling the rules of this site.

What is the basis for this belief and why does it seem to be the general consensus?

Answer 1

For institutions, this often happens due to a the form of fiduciary responsibility. If an institution represents a wide range of people with different ethical opinions, to choose one of them makes it not representative of the others. If it becomes less effective at its stated goals in a way that is not representative of all those participating, it is breaking the agreement that it do what is specified in good faith to its participants.

The concept of a 'fiduciary' applies to all corporations with investors, for-profit, governmental and otherwise. This may not cover all of what you mean, but it is the case for most institutions, since those are most of the institutions.

Corporations often also include the right to look at wider ethical concerns in the agreement that founds them. Then to ignore it would be counter-fiduciary. But that often makes them specifically uninteresting to a wide range of investors.

In fact government agencies are generally not bound by this constraint. If a moral question is not religious, there is no reason it cannot be part of a law. Publicly-funded educational settings are often among those most free in our current culture to address moral issues directly.

It is private firms with investors and public-serving groups with a stated charter that are not allowed to moralize with anonymous money or to choose one form of morality over another in a way that excludes or disadvantages potential participants with different agendas.

For individuals, there is no such concept, and no such moral escape. There is just a habit of humans acting like corporations because we are used to assuming that life is business and this is he normal way to do business.

Answer 2

Stating a realistic position

I'm not sure that anyone would defend the view that institutions should pursue only their own goals, irrespective of moral consequences. Even the high priest of market capitalism, Milton Friedman, set limits : 'the only one responsibility of business towards society is the maximization of profits to the shareholders', yes he said just that but he was careful to add - 'within the legal framework and the ethical custom of the country'.

Four view about corporate social responsibility (CSR)

That said, there are at least four groups of views about the moral responsibility of social institutions:

1. A first group in which it is assumed that the corporation is an instrument for wealth creation and that this is its sole social responsibility. Only the economic aspect of the interactions between business and society is considered. So any supposed social activity is accepted if, and only if, it is consistent with wealth creation. This group of theories could be call instrumental theories because they understand CSR as a mere means to the end of profits.

2. A second group in which the social power of corporation is emphasized, specifically in its relationship with society and its responsibility in the political arena associated with this power. This leads the corporation to accept social duties and rights or participate in certain social cooperation. We will call this group political theories.

3. A third group includes theories which consider that business ought to integrate social demands. They usually argue that business depends on society for its continuity and growth and even for the existence of business itself. We can term this group integrative theories.

4. A fourth group of theories understands that the relationship between business and society is embedded with ethical values. This leads to a vision of CSR from an ethical perspective and as a consequence, firms ought to accept social responsibilities as an ethical obligation above any other consideration. We can term this group ethical theories. ( Elisabet Garriga and Domènec Melé, 'Corporate Social Responsibility Theories: Mapping the Territory', Journal of Business Ethics, Vol. 53, No. 1/2, Building Ethical Institutions for Business: Sixteenth Annual Conference of the European Business Ethics Network (EBEN) (Aug., 2004), pp. 51-71 : 52-3.)

Instrumental theories come closest to the moral stance you outline in your question. The ground of the instrumental view is that (at least in a business context) society gains in wealth creation if companies and corporations take the maximisation of profits to shareholders as their overriding purpose. It is an application of the division of labour; companies and corporations concentrate on what they do best, namely create wealth and maximise profits.

This strikes me as a simplistic view. Even if institutions operate within the law (which we may hope is not a corrupt law) and within society's ethical norms or customs, there is no guarantee that what maximises profits also optimises social utility : it may be more profitable to make toys and guns than healthy food and non-polluting vehicles. I am reminded of John Ruskin's distinction in Unto this Last (1860) between wealth and illth - companies and corporations do not distinguish the two since profits can be maximised in the creation of either, indifferently.

However, this is not a wholesale moral condemnation of companies and corporations. It is only a critique of those that operate in line with the first group of views.