The university just wanted to solve the short-term brand headache of a faculty member’s controversial opinion, but it harms its brand in the long term. The arguments tend to go as follows: (1) there are serious problems in the world, such as poverty, conflict, environmental degradation, and so on; (2) any agent with the resources and knowledge necessary to ameliorate these problems has a moral responsibility to do so, assuming the costs they incur on themselves are not great; (3) firms have the resources and knowledge necessary to ameliorate these problems without incurring great costs; therefore, (4) firms should ameliorate these problems.
Proponents of societal ethics tend to represent social ethics as being opposed to society – that acting in self-interest is done with disregard for the welfare of others – and therefore an individual who does not subordinate themselves to service of the society is anti-social, perhaps even to the degree of being sociopathic or seeking primarily to harm others.
Some distinction is to be made between the customer of a business (the individual who tenders payment in exchange for a good) and the consumer of the product (the individual who consumes or uses the product purchased) – especially since the contract exists between the business and the customer, but not between the business and the consumer.
We might also inquire as to whether at any point, action could have been taken by others to avoid the consequences (could the well have been dug deeper, or another water source found to provide for the crops) – and, if so, if it is the responsibility of the actor to have undertaken such an action, for the sake of drawing water.
Such fixes are not, however, a response to the deeper underlying problem of having a president with little commitment to responsible business behavior who sets a troubling ethical example for other U.S. investors who are not entangled in conflicts of interest, but who face ethical dilemmas as they seek to invest and trade worldwide.