Investors and Ethical Corporate Decision Making

Another set of organizations with an indirect but significant impact on the ethics of publicly owned corporations includes investment firms, brokerage houses, and financial institutions—and the thousands of investors they represent. Based on literature reviews of empirical studies correlating the two factors, an investment specialist concluded that socially responsible organizations are the most likely to make long-range profits.14 While this can be considered a positive finding, the cynical implication is that the best investment for short-term profits may be earned from the least socially responsible organizations.

Another study correlating profits and ethics found that senior managers of the most profitable corporations tended to be more ethical—in the sense of being more favorably predisposed toward minorities, the poor, and other aspects of human rights—than were executives in the less profitable firms.15 The optimistic implication is that the greater the slack resources in the organization, the more ethical the decision making by senior managers. The pessimistic implication is that lean machines are mean machines because tight budgets and severe economic constraints increase unethical decision making.

Insert 3-25 Quick Check about here.

Professional Associations

A professional association is an excellent example of an activist public. It is a group of individuals who are engaged in similar activities, faced with common problems and opportunities, and very much aware of each other. Peer pressure plays an important role in defining a profession. Professionals are dedicated to a common set of principles, and they encourage ways of enforcing adherence to those principles. Professionals often have to demonstrate mastery of an identifiable body of specialized knowledge that allows them to perform special services or earn special privileges. As a consequence of their privileges, professionals often have special responsibilities to meet specific obligations to others in society. Social scientists have identified five major characteristics of professionals:

1. A common set of values.

2. A common set of principles.

3. A common set of loyalties.

4. Membership in a strong professional association.

5. Mastery of an identifiable body of knowledge, and a commitment to the development of this knowledge.16

In public relations, there are scores of professional organizations worldwide, some of which have hundreds of individual chapters. Some professional associations have regional, national, and international memberships. Others are organized to serve certain industries or specializations within public relations. Still others are single-issue activist publics serving professionals interested in specific ethnic, religious, political, economic, or gender issues.

State Licensing of Professions  

For a wide variety of occupations, entry into a profession is regulated by the state. For example, the state controls who can practice as lawyers, doctors, plumbers, and beauticians. The state’s compelling interest is to protect the public from some potential harm: for example, injustices, poor medical services, unsafe buildings, or chemically scorched heads of hair. The ethical rationale is that the restrictions imposed on these few individuals by the state when it licenses certain professions is more than offset by the total good achieved for the greater number of individuals in society. The more restrictive the state-imposed guidelines on a profession, the greater the economic consequences; the more restricted the number of individuals who can perform state-sanctioned functions, the more likely it is that they will be able to demand and receive higher rewards either in status or remuneration, or both.

In public relations, the merits of state licensing have been debated for years. One of the founding fathers of the profession, Edward Bernays, organized an activist public dedicated to helping achieve licensing in public relations because, he has argued, it is essential to the attainment of full professional status.17 A number of public relations practitioners and scholars have argued that to license public relations practitioners would not be constitutional in the United States because it would violate the First Amendment, which guarantees freedom of the press.18 However, as Petersen has pointed out, there is no constitutional prohibition against licensing public relations: the structure and function of media in society may be constrained whenever various rights and provisions of the constitution come into conflict.19

The argument against public relations licensure is based on the assumption that all individuals in a just society should have access to the media and should have the right to influence and participate freely in public discussions. Licensing public relations practitioners would limit individual freedoms of expression and of the press, this argument states, making life more difficult for those without the resources to engage the services of a licensed public relations professional. Consequently, the limited good achieved by licensing practitioners and requiring state-monitored professional standards would be offset by the greater harm done to the large number of individuals who would not be able to benefit from unrestricted access to the media. This argument does not take into consideration the volunteer, pro bono, work that might be performed by licensed public relations practitioners for less fortunate individuals. Also, it does not acknowledge access to the media that less fortunate individuals may have through other channels besides licensed public relations professionals.