Environmental problems and ethical jurisdiction: the case concerning Texaco in Ecuador

Determining the ethical standards to apply to environmental issues presents a difficult dilemma for many managers. The many stakeholders to whom managers must answer tend to view environmental issues quite differently. Multinational corporations often encounter attitudes toward environmental protection in other countries that are quite different from those found in their domestic market. Corporate policy makers must address the national differences in values when determining ethically acceptable behavior. Using the case of Texaco and its alleged contamination of Ecuador's Amazon jungle as an example, this paper applies the framework of Integrative Social Contract Theory to address issues of ethical jurisdiction and environmental protection.