Legal vs. Ethical Actions in Corporate Conduct

 

 

 

Discussion Post: Legal vs. Ethical Actions in Corporate Conduct

Legal but Unethical Action: Price Gouging by Pharmaceutical Companies

One action that is legal but strikes me as unethical is price gouging in the pharmaceutical industry, particularly when companies significantly raise the prices of essential medications during crises. A notable example is when Martin Shkreli’s company raised the price of the life-saving drug Daraprim from $13.50 to $750 per pill. This action falls under state laws governing pricing practices and federal regulations on drug pricing, which do not explicitly prohibit such increases unless they violate anti-price gouging laws that vary by state.

I believe an action can be legal yet unethical because laws often lag behind ethical considerations. While price gouging may not violate specific laws, it exploits vulnerable populations and raises moral questions about access to necessary medications.

Ethical but Illegal Action: Whistleblowing

An example of an ethical but illegal action is whistleblowing on corporate misconduct. For instance, an employee at a corporation may leak information about unsafe working conditions or environmental violations to the media or regulatory agencies, which can be considered a breach of confidentiality agreements. This action falls under federal laws, such as the Sarbanes-Oxley Act, which protects whistleblowers, yet many corporations still retaliate against whistleblowers, creating a chilling effect.

Whistleblowing is more likely to occur among individuals rather than corporations because it often requires personal sacrifice and risks job security. A legal precedent supporting this premise is the case of Burlington Northern & Santa Fe Railway Co. v. White, where the U.S. Supreme Court affirmed protections for whistleblowers against retaliatory actions by employers.

In conclusion, the tension between legality and ethics in corporate actions illustrates the complexities of law and morality in business practices.