Theory of ethical relativism

Some theorists uphold that moral notions apply only to individuals and not to corporations. They say that it makes no sense to hold businesses "responsible" since businesses are more similar to machines than people. Others oppose that corporations do act like individuals having aims and actions which can be moral or immoral just as an individual's action might be.

In 2002 for illustration, the Justice Department charged the accounting firm of Arthur Andersen for hindrance of justice. Arthur Andersen was caught shredding documents showing how they helped Enron hide its arrears through the use of many accounting tricks. Critics later claimed that the Justice Department should have charged the individual employees of Arthur Andersen not the company as "Companies don't commit crimes, people do."

Perhaps even extreme view is incorrect. Corporate actions do lie on individuals who should be held accountable for their actions. However, they also have policies and culture that  guide individuals  and  therefore  should    be  held  liable  for  the  effects  of  these corporate artifacts.

However, it makes absolutely good sense to say that a corporate organization has moral duties and that it is morally in charge for its acts. However, organizations have moral duties and are responsible for the same in a secondary sense; a corporation has a moral duty to do something only if some of its members have a moral liability to make sure it is done and a corporation is morally responsible for something only if some of its members are morally answerable for what happened.

Almost all of the 500 largest U.S. industrial corporations today are multinationals. Operating in more than one country at once produces a new set of fair dilemmas. Multinationals can flee environmental policies and labor laws by shifting to another country for instance; they can shift goods, raw materials and capital so that they getaway taxes. In addition, as they have new technologies and products that less developed countries do not, multinationals must decide when a particular state is ready to digest these new things. They are also faced with the unlike moral codes and laws of different countries. Even if a specific norm is not unethical, they must still choose between competing standards in their many operations.

Ethical relativism is the theory that, as different societies have different ethical beliefs, there is no lucid way of determining if an action is morally right or wrong other than by asking whether the people of this or that society believe it to be right or wrong by asking if people of a particular society believe that it is. In fact, the diversity of moral codes illustrates that there is no one "right" answer to ethical queries. The best a company can do is to follow the old maxim, "When in Rome, do as the Romans do." In other words, there are no absolute moral values.

Cultural  relativism  asserts  that  morality  differs from one  culture  to  another,  since  same practices are regarded as correct in some cultures and wrong in others.                      

However, regarding practices  as  right  or  wrong  neither  necessarily  make  them  so,  nor  does  it  exclude  the possibility of representing that moral beliefs are mistaken.  For this reason, cultural relativism does not forbid the possibility of justification. On the other hand, Ethical relativism makes the philosophical contention that there is no standard of right or wrong apart from the morality of a culture. Whatever practices a culture holds to be true is actually right for that culture.  There is no chance for justification because there exists no standard beside that culture.  Ethical relativism leads to an uncritical acceptance of all moral beliefs as equally valid.

Critics of ethical relativism spot out that it is illogical to presume that because there is more than one answer to an ethical query that both answers are equally correct or even that either answer is correct. They also uphold that there are more similarities than differences even among what seem to be very opposing societies.

The late Philosopher James Rachels put the matter quite concisely:

The fact that unlike societies have unlike moral codes proves nothing. There is also disagreement from society to society regarding scientific matters: in some cultures it is believed that the earth is flat and evil spirits cause disease. We do not on that story conclude that there is no reality in geography or in medicine. Instead, we gather that in some cultures people are well informed than in others. Similarly, disagreement in ethics may hint nothing more than, that   people are less enlightened than others.  At the very least, the fact of dissimilarity does not, by itself, entail that truth does not exist.

Why should we believe that, if ethical truth exists everyone must know it?'

However, the most influential criticisms of the theory spot out that it has incoherent results. For  illustration,  it  becomes  unfeasible  to  criticize  a  practice  of  another  society  as  long  as members of that society conform to their own principles. How could we preserve that Nazi Germany or pre-Civil War Virginia were wrong if we were steady relativists? There must be criteria other than the society's own moral values by which we can judge actions in any specific society.  Though  we  should  not  dismiss  the  moral  values  of  other  cultures,  we similarly should not conclude that every systems of morality are equally acceptable.

Finally, new technologies developed in the last decades of the 20th century and the beginning years of the 21st century are again changing society and business and creating the potential for new ethical troubles. They bring with them queries of risks, which may not be predictable or irreversible. Who shall decide whether the advantages of a particular technology are worth the risks? How will sufferers of bad technology be compensated for their loss? How will risk be dispersed? How will privacy be upheld? How will property rights be conserved?