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Business Stakeholders

  1. Introduction

The major conflict in this ethical dilemma is that between environmental protection and economic improvement. There is a need to increase domestic oil supply to decrease dependence on foreign oil, and in consequence, lowering oil prices. The proposal among some lawmakers is to allow drilling for oil in section 1002 or the 1.5 million acres of land in Alaska’s Arctic National Wildlife Refuge (ANWR), which had been set aside in 1980 for the study of petroleum production potential.

Proponents argue that current drilling technology can already minimize the environmental impact of petroleum extraction. Those against the proposal, however, say that drilling in the area would endanger the survival of a great caribou herd in the area. They argue that conservation is a better solution than expanding oil production because it is more long-term.

Who are the decision makers? The decision makers in this issue are the senators who will vote either for the ratification or for the junking of the House Energy bill. Who are the stakeholders? The stakeholders are the oil industry, the consumers, the environment, the caribou herd, the residents in the area like the Gwich’in Native Americans and the Inupiat Eskimos, and the future generations of Americans. Why is this an ethical decision? Ethics calls us to think about not just how we act toward people but also toward the natural world.

“…The natural world was often the unseen participant in many situations of ethical significance” (Warner & DeCosse, Step One section, para. 3). The effects of our actions on the environment are often overlooked because these effects are not felt or realized in the near term. Often, effects on the environment are cumulative, long-lasting and not immediately seen. We have to always think about the effects of our actions on the environment because it could produce harmful consequences for today and future generations.

The destruction of the environment would be detrimental for everyone. We should also remember “that the common good includes not only those environmental conditions that enhance the fulfillment of men’s and women’s lives but that the common good also includes the well-being of the natural world for its own sake” (Warner & DeCosse, The Common Good Includes the Goods of the Earth section, para. 1)

  1. Stakeholder Management – The Environment
    1. What are the environmental stakeholders’ interests for each ethical issue or concern you identified in the Introduction?

The interests of the environmental stakeholders are the protection of the caribou herd and the wildlife refuge area. Section 1002 is a critical calving area for the herd. Environmental stakeholders are concerned with the stability of the ecology of the area. Oil drilling could damage the environment and push the herd into the foothills where resources for their survival are scarce. They are also concerned with the long-term effects of drilling on the environment.

  1. What are the environmental stakeholder responsibilities for each ethical issue or concern you identified in the Introduction?

The environmental stakeholder responsibility is mainly for the protection of the environment. They have to make sure that the policy won’t be harmful to the environment and that it would be sustainable for the benefit of future generations.

  1. What are the possible decisions the corporation could make for each ethical issue or concern, and what are the possible effects on the environment?

The senators could pass the House Energy bill allowing the drilling in section 1002. If the proponents of the bill are right in saying that current drilling technology can minimize the harm on the environment, then there probably won’t be much adverse effects on the environment.  Still, the senators could include protectionist clauses on the bill so that whatever detrimental effects to the environment could further be avoided or, at least, minimized.

Or, the senators could scrap the bill altogether and let section 1002 still be a protected area.

  • Conclusion and Recommendation
    1. What is your recommendation to the corporation based on all of the facts, issues, and concerns of this case?

Whatever action is to be taken should be sustainable. Sustainable development “meets the needs of the present without compromising the ability of future generations to meet their own needs” (Partridge, Jackson, Wheeler & Zohar, 2005, page 6). Therefore, the decision should “include the simultaneous consideration of economic growth, environmental protection, and social equity” (Rondinelli & Berry, 1999, page 2). In this situation, it seems that it is impossible to ensure that the decision would allow economic growth and environmental protection at the same time. But if the lawmakers could ensure that there would be enough safeguards in the law to protect the wildlife in the area, then the proposal is not impossible.

The lawmakers should enlist an independent body composed of various sectors like the oil industry and the environmentalist groups to conduct studies on possible environmental effects of oil drilling in section 1002. The senators should draft the bill following the recommendations of the independent body. This recommendation would ensure that: 1) the senators would be able to make a decision based on empirical studies; 2) safeguards for the environment could be included in the bill; 3) expanded oil production could still be a possibility; 4) the decision would be fair for all sectors; and 5) the wildlife area would be protected.

  1. What are the positive implications of your recommendation?

The recommendation tries to make an acceptable compromise between competing sectors of the economy and the environment. Cost/benefit analysis would be employed. Meaning that “the value in the present [would be] weighed against the environmental health cost to the future” (Ethics module, Cost/benefit analysis section, para. 1).

  1. What are the negative implications of your recommendation?

The recommendation is still not conclusive in terms of whether the House Energy bill should be passed or not. The recommendation means that the senate would not be able to decide at once.

  1. What will critics of your recommendation argue?

The recommendation delays the decision on the bill, which could prove to be harmful for the economy in the future.

  1. How would you address your critics` concerns? How will you defend your recommendations?

The recommendation ensures that the senate would not make a haphazard decision. It would be based on a multi-sectoral independent study, which means that all sectors concerned could reach a compromise on the issue.


Ethics module. (n.d.). Retrieved February 18, 2007 from http://www.rsmas.miami.edu/groups/niehs/ambient/teacher/ethics/ethics.html

Partridge, K., Jackson, C., Wheeler, D., & Zohar, A. (2005, July). From Words to Action: The Stakeholder Engagement Manual, Volume 1: The Guide to Practitioners’ Perspectives on Stakeholder Engagement. Stakeholder Research Associates Canada Inc., United Nations Environment Programme, AccountAbility. Retrieved February 18, 2007 from http://www.stakeholderresearch.com/assets/downloads/From%20Words%20to%20Action,%20Volume%201,%20Practitioners’%20Perspectives%20on%20Stakeholder%20Engagement%20(2005).pdf

Rondinelli, D. & Berry, M. (1999). Environmental Citizenship in Multinational Corporations: Social Responsibility and Sustainable Development. University of North Carolina, Kenan-Flagler Business School, Kenan Institute of Private Enterprise. Retrieved February 18, 2007 from http://www.greeningofindustry.org/gin1999/Rondinelli%20_Berry.pdf

Warner, K. & DeCosse, D. (n.d.). Environmental Ethics Lesson Plan Two Who, When, Where, How, and What: The Distinctiveness of Environmental Ethics

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. Retrieved February 18, 2007, from Santa Clara University, Markkula Center for Applied Ethics Web site: http://www.scu.edu/ethics/practicing/focusareas/environmental_ethics/lesson2.html

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