Harvard University recently sold most of its investments in tobacco companies. The investments were quite profitable for the Harvard endowment. Derek Bok, who was Harvard's president at that time, said the divestiture was prompted by recognition of the

Question

dangers of smoking and concern over aggressive marketing tactics to promote tobacco products to teenagers and in countries where the dangers of smoking are not widely known. Bok stated the university was "motivated by a desire not to be associated as a shareholder with companies engaged in significant sales of products that create a substantial and unjustified risk of harm to other human beings." Harvard owned $58 million in tobacco company shares. An investment analyst noted that Harvard's action will have a "strong ripple effect across the country." Evaluate the actions of Harvard and evaluate the conduct of the tobacco companies to this point using both the Blanchard/Peale model and the moral reasoning process.

Answer 1

Neither Harvard nor the tobacco companies are doing anything illegal. Cigarettes are still lawful products in the United States and around the world, so the product is not illegal. Harvard's actions are a reflection of how the investment makes them feel because of the medical harm to individuals and the aggressive marketing techniques. Under the moral reasoning process, Harvard uses the moral standard that they do not want to be associated with any activity that causes significant harm to other human beings. Data indicate that smoking produces such harm. Without divestiture, Harvard would be unethical since there is harm to individuals. The tobacco firms could apply the same reasoning process but have not. Their data indicate the harm is not clear and they have not reached the Harvard conclusion. Furthermore, there are other moral standards such as the freedom to choose on the part of the consumer that creates conflicts for the tobacco companies' moral reasoning process. Their attitude under Blanchard/Peale appears to stop after the question of whether the activity is legal.