There are certain ethics required in any organization. Normative ethics refers to the study of ethical actions. Normative ethics is usually under the umbrella of philosophical ethics and is meant to study the moral actions of any person and the questions that may arise thereafter. Normative theories continue to be upgraded on a daily basis with traditional one being subjected to various criticism. According to a research, some critics argue that some of the flaws associated with traditionally related normative theories include: involvement of abstraction from reality, are narrowly based on the application side, do not consider the human aspect of reality and are really prescriptive.
According to John Hasnas (1998), there are basically three leading theories in the evolving world which encompass most of the needs of an organization. The first is the stockholder theory. This theory encompasses the stockholder of any business entity and the management. The stockholders advance capital to the managers who tend to examine the use and put it into profitable terms. In the meantime, the stockholder gains an interest in the capital invested and the profits gained. This is according to stated contracts. The second most relevant theory in any organization is the stakeholder theory. The major flaw in this theory is the inability to draw the line between the normative theory of business ethic and empirical theory of management.
In the realm of the empirical theory of management, the theory asserts that proper management of any organization requires a balance in priorities between the interests of all the stakeholders. With the stakeholders defined as people who have a proper claim in the organization. On the other side, an empirical consideration is that management is designed with the mandate to improve the organization in terms of performance. This entails that any organization has any moral obligations towards any third parties. Finally, there is the social contract theory which asserts that organizations have moral duties towards the employees and the consumers. The theory is not yet fully developed and is a theory into which many theories have been rolled into. The theory is founded on the traditional concept of a social contract, an agreement between the society and any organization. The organization is recognized by the society on conditions that it serves their interests in specific ways. (Hasnas, 1998). In this essay, we will discuss in detail the relevance of the social contract theory in any organization. To an extent, we will cover the main advantages and the disadvantages of the theory in any organization.
Social Contract theory.
Social contract theory views moral values of a person and his political obligations are dependent on a contract or agreement between him and the society. It states that in the beginning man had no governments and there were no laws to rule them. They had to enter into agreements so in order to overcome hardships they were facing. They formed pacts to protect and respect each other’s lives. Furthermore, they formed pacts to obey and respect authorities too. The authority also sorts to protect the society’s lives and properties. In this theory, morality consists of the set of rules governing behaviors in which people would accept on the condition that others would abide by them too (Elahi, 2005).It is perceived that all men reach for what is in their best interests. They respond mechanically and are drawn to what attracts them and are repelled to what doesn’t attract them (Thommas, Leviathan, 1985). Since man is rational and also reasonable, he will subject himself to authority in order to be able to live in a civil society.
Prior to the development of the basic social contracts in which men agree to live together and abide themselves to authority. Nothing was immoral nothing was unjust and anything would have gone (Thomas, The languages of moral, 1994).
According to John Locke’s theory of social contracts, man lived in a state of nature. According to his state of nature, man lived in an enjoyable and fairly good state. The state of man was peaceful and full of goodwill (Locke, 2003).In this state, the man was completely free to control his life as he deemed best and was equal to each other.
Private property was established when man mixed his labor with materials from nature (Locke, 2003).Although one had a right to own private properties, there was a limitation to what one can own. Furthermore, one could not take from nature than he could use. In this state of nature man needed to protect his property. It is to this purpose men entered to a social contract. To this contract, man did not surrender himself to an authority but only surrendered his right to preserve the property, maintain order and to enforce the laws.
According to John Locke, the purpose of a government was to protect the nature of men. In fact, by agreeing to this, men gained judges and laws. John made life, liberty and property rights that dominated the formation of the declaration of the Americans independence.
According to Jean Jacques Rousseau, a social contract is not a fact but a reason of construction. Before the social contracts, men were living peacefully and in equality. As time passed the population increased and basic needs needed to be satisfied. People started to live together in small families and division of labor was introduced. This led to the development of private properties. Furthermore, the general public surrendered their rights to the whole community.
Through the social contract, a new social organization was made to protect the rights, freedoms, and liberty of the community. The General will is which majority citizens were to be blindly obeyed. It viewed that the majority were more right than the minority. Individuals were not subjected to each other but to the general will. It was to this purpose Rousseau’s theory favored sovereignty of individuals. He stated that man’s sovereignty was not limitable and infallible (Rousseau, 1987).
It is shown in this theories that when the government fails to do its works people have the right and even the reason to rebel. In this people can withdraw their support to the government. Hobbes viewed that whatever the government did was just whereas according to Locke and Rousseau justice was supposed to be seen to be done (Locke, 2003). This theory led to the creation of government policies that put into place fairness and equity. Although one can find a lot of disadvantages in them, the theories have led to liberation in whole (Fitzpatrick, 2017). Social contracts are just theoretical works and they can be altered to favor practical experiences that differ with them (William, 2008).
 
To begin with, the social contract theory is focused on putting an organization on its heels when in relation to the welfare of the society. The theory is meant to put any organization into an imaginary world where only simple organizations are present. The idea behind this is to put individual production into consideration. Long story short, any society is considered in starting any organization with respect to the moral obligations the organization will have to meet. This theory delivers a contract between the members of society and an organization. The organization gets to exist around such a society and the society gets benefits from the organization. Since the society allows the organization to exist, it is mutually binding since any organization is granted the permission to use the land and natural resources available and to hire people from the society.
Since the business is granted the permission to use the land and natural resources available, the question that remains is what the society would want in return. A major concern is to prevent any negative impacts on the society such as land destruction and pollution of any sort. This would mean that ‘enhancing the welfare of the society in such a way that has its basis on exploring the special advantages and a reduction in the disadvantages’. This can be defined into two terms which are the justice and social welfare. In terms of the social welfare, the organization acknowledges that grants by any society will require some returns back to the society. On the justice factor, societies allow any organization to engage in any activity if there is no breach in the justice foundations within any society. In a nutshell, this first consideration of any organization on the relevance of the society in a developing world is an utmost requirement if any organization is to succeed.
The basis of this is that managers of any organization are fully obliged to the social and justice system of any society. Though it is a law of contract, this can impose humongous amounts of pressure on these managers. This is mainly due to the social responsibilities that come with the social contract.
Since the government is considered as an organization, the social contract theory is meant to instill some law between the government and the governed. There is the belief that if any society transfers its rights to the government, a social contract is automatically entered into. This, in turn, means that the society is subject to one ruler and in return there is the provision of security. A famous philosopher Locke put this to the structure that government should focus on human equality and that all powers that the government has as an organization are derived from the people. Many organizations are obliged to the government’s rule since it is the supreme ruler of any land inhibited (Keeley, 1990).
A social contract is generated since the government puts an enabling atmosphere through the laws passed and through the provision of security. Since the organization is meant to benefit from this environment, the returns required are taxes. There are different views as to how the government as and organizations should coexist. According to Locke, the government should be a representation while Hobbes supported the rule of Supremacy whereby the government has absolute power and can keep any organization from going back to the previous state. This is to say that organizations enter into a social contract with the government in order to gain three things which are: laws, rights to enforce the laws and to have people who can arbitrate and settle conflicts arising from any laws granted. This is a gain from the laws of nature which do not state the boundaries between individuals and organizations.The social contract theory can thus be viewed as a way to which the government and organizations can have a mutually beneficial relationship. The major related term in this theory is the explicit consent. This is an acknowledgment of both the parties involved in any social contract of the options that are involved and the consequences that can arise thereafter.
THE SOCIAL CONTRACT THEORY MAIN DISADVANTAGE
On the flip side of the social contract, some parties may regard the theory as not a contract at all. According to the law, there are three types of contracts that are recognized. The express contracts implied contracts and quasi-contracts. Express contract is recognized since there is a speech or writing context. Implied contracts are agreements between parties and are recognized since it is bound by any other method such as actions. Finally, the quasi-contract is mainly due to a contractual relationship such as a doctor operating an unconscious patient. This is relevant to avoid an impending injustice such as the death of a patient in the stated case example.
The social contract theory is thus regarded an express or social contract. To some extent, it may be regarded as a quasi-contract. In contradiction to this belief that it may be a quasi-contract, most organizations do not believe that there is any contractual agreement between them and the society in any way that is not stated by the law. The main aim of the social contract is the organization to provide to the community socially and through the justification of their activities. Most laws do not state the social responsibility of any organization and this can be ignored by many organizations (Hasnas, 1998).
 
CONCLUSION
The main aim of the social contract is to enable different parties and any organization to coexist. As such most ethical issues are put into consideration since a society can provide an enabling environment to any organization making them morally obliged to some of the demands of the society.
 
 
 
 
 
 
 
 
 
 
 
Bibliography
Elahi, M. (2005). What is special Contract theory (1st ed.). India: SophiaOmi Org.
Fitzpatrick, M. (2017). The Advantages of a Social Contract Theory. Retrieved from People of our everyday life: http://peopleof.oureverydaylife.com/advantages-social-contract-theory-10730.html
Hasnas, j. (1998). Normative Theories Of Business Ethics.A guide for the perplexed.
Keeley, M. (1990). Social contract theory of an organization. journal of business ethics.
Locke, J. (2003). Two Treatises of Government and A Letter Concerning Toleration. yale: Yale University Press.
Rousseau, J.-J. (1987). The Basic Political Writings. Hackett Publishing Company.
Thommas, H. (1985). Leviathan. London: Penguin Books.
Thommas, H. (1994). The languages of moral (2nd ed.). Chicago: Hackett Publishing Company.
William, S. (2008). Bussiness Ethics (1st ed.). Australia: Thomson Wadsworth Photocopy.