Ethics and Information Systems: The Corporate Domain

IS-related ethical quandaries are receiving an increasing amount of attention. However, linkages to the normative theories of business ethics, which can be used in resolving these quandaries in the corporate domain, have been lacking. This paper enumerates and explains the three major normative theories. The stockholder theory holds that managers should resolve ethical quandaries by taking actions that increase the long- term profits to the stockholders without violating the law or engaging in fraud or deception. The stakeholder theory claims that managers should resolve ethical quandaries by balancing stakeholder interests without violating the rights of any stakeholder. The social contract theory states that managers should increase social welfare above what it would be in the absence of the existence of corporations without violating the basic canons of justice. The application of these theories to IS-related ethical quandaries is discussed, and a specific quandary dealing with a real-world example -- Blockbuster Video’s reported plans to market customer lists -- is explored in depth. The managerial challenges associated with the theories are then explored.