Do business organizations have a moral obligation to keep promises?

While conducting a workshop on corporate values for senior executives of a Fortune 100company, I suggested that promise-keeping was a central aspect of trustworthiness, that it is an ethical as well as a legal responsibility to keep commitments. The company’s legal counsel objected strenuously. “Hold on!” he said. He explained that whether the company decided to live up to an agreement was a business, not an ethical, decision. It was the company’s right, and perhaps its obligation to the shareholders, he said, toevaluate whether it was in the company’s best interests to breach contracts that have become unwise or unprofitable. He acknowledged that decisions to disavow an agreement should be rare; because they could be disadvantageous if no one would trust the company. But still, he said, the choice to keep a promise or not should be based on a simple cost/benefit analysis. Morality is not an issue.

What do you think? Do business organizations and the people who manage their affairs have a moral obligation to keep promises?

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