The ethics of a company can be measured by different theories. Some of these theories can be used to measure Shell Petroleum Development Company of Nigeria (Shell Nigeria). The first ethical measure discussed is utilitarian reasoning, also referred to as cost-benefit analysis, which compares the costs and benefits of a decision. Secondly for the human rights theory, were the rights of the stakeholders respected? Third, the ethical theory of justice is measured by whether the benefits and costs are fairly distributed equitably and according to some accepted rule. Finally, the legal theory is explored to determine if a company is acting within the legal limits of the law. Using the utilitarian reasoning, it is clear that Shell Nigeria is unethical. Under revenue sharing agreements, only 1.5 percent of the government’s revenue from oil was returned to the communities where the production plants were and much of that revenue was taken by officials in those communities. (Lawrence, Weber, Post) This is while the Nigerian government received 90 percent of the net revenue on each barrel of oil sold. In a nation where the business elites and the nation’s military grew wealthy from oil revenues, most Nigerians lived in poverty. Shell Nigeria had to have realized how poorly the Nigerian government treated its citizens. The emphasis was on making a profit rather than making sure they were ethically responsible.
Based on the information presented in the Case Study, Shell Nigeria did not respect the human rights of the Ogoni people by continually polluting land, streams and creeks. Shell Nigeria never took responsibility for any ecological damage that had occurred. Whenever an issue was brought to their attention, Shell Nigeria could explain how or why it was not their fault and problem. For instance, a hotly contested oil spill that had occurred in Ebubu that spread over 25 acres penetrated deeply into the soil and contaminated nearby waterways. Shell,...
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