The moral responsibility of corporations in arms trade

The moral responsibility of corporations in arms trade

The paper deals with the discrepancy between the societies’ view, in terms of moral standards, on the export of arms and the actual standards in this field. Furthermore I am going to prove that the handling of the export of weapons is directly related to our own moral standards. In relation to business ethics I will conclude that thus there has to be a change either in the circumstances of these exports or in the support of such in general.

Introduction

We live in a pleasant world. At least so it seems – but alert. There is war, as far it may seem occasionally and we are being confronted with images of destruction and demolition in every news report. The question of the cause may be answered in philosophical, historical even religious dimensions but in practical terms spoken: weapons are the most direct cause.

Thus the latest waves of discussions and debates about “our” (referring to the German society) connection to war through arms trade is only legitimate. Normally expertise and knowledge aim to be the foundation of any debate but due to the huge lack of information on this topic the first problem in relation to arms trade is being revealed: Intransparency.

Not even the UN resolution for an open Register of arms trades was capable of breaking the code of trade secrets among the actors in these trades. I see the real dangers of transparency in the consequences such as neglecting and underestimation.

Both result in the admired lack of action, action against weapons, against war and thus against the military industry. Although this point has to be put into perspective since there is actual protest against all of the above – but the big uproar fails to appear. This might change in the very moment when the actual number of killings caused by “German” arms will be revealed. Up to that point the debate remains academic.

In these debates the arguments in favor of export can be reduced to the following three key points:

  1. Dependence of all importers and thus gain of political power and influence
  2. Self-defence benefit
  3. Economic profits (and thus the huge negative impact on economy in case of reduction of the arms trade)

All of these arguments only concern the direct and indirect influences of arms trade but fail to reflect on the ethical basics of corporates’ responsibilities.

The rules they follow

On the website of the biggest German producer of sidearms “Heckler and Koch” they announce that they clearly follow all laws and regulations and that their corporation’s ethics are orientated on such. This illustrates the immense impact of politics on weapons-trade, since this – the law – is the only direct instance that can actually influence these within our country. Following that path of argument the existing rules should follow our general moral standards to ensure that the practice of arms trade does as well.

Regarding the existing regulation this appears to be done with little care, since the conclusion of export contracts with countries that neither belong to the EU nor NATO (and thus can’t automatically be qualified as allies) needs to be approved one by one by the committee Bundessicherheitsrat. In practice this Security Council only contains members of the cabinet and hosts the corpus of its meetings in secret.

The approval itself shall only be given to states that act according to the human rights declaration and at best aren’t in times of inner crisis. As far as I am concerned the United Arab Emirates do not quite follow the idea of equality e.g. between women and men. Unfortunately they rank high (enough) on the list of importers and apparently this renders human rights protests irrelevant to the issue.

Furthermore the parliament, as the connection between the nation’s will and advocate of its wishes, isn’t part of the specific decision making process. The main rules and ideas of democracy: influence of the public (even if only through a representative instance) thus influence of the parliament and transparency of political processes are being neglected and ignored. As a conclusion of that one must not accept and approve any of the decisions as long as the process of this decision making remains this unethical.

The justification of the common procedure lays in the first argument of all pro speakers that through economic relations dependence and thus political power is being established. Since there is absolutely no positive change in the human rights situation neither in the UAE nor in countries like Indonesia is visible, this point is invalid.

In terms of dependence one must state that Germany is the third largest exporter of weapons. But with great power comes even greater responsibility. Since Germany is clearly one of the leaders in this economic field it should be our aim to look beyond our own benefits and long for more than simple profit.

This is a clearly idealistic and less economic point of view but since our laws reflect our moral standards, ideas and practice shouldn’t be separated. As long as the German economy wants to profit from the values a brand like “Made in Germany” represents, they must accept the responsibility that comes with it. I will comment on the specifics of these values in my third point (III).

Corporate responsibility and the prospect of change

Following the normative logics of microeconomic theories the only potential interest a company can have is the increase of profits. This would require the optimal homo oeconomicus forming the basis of both society and economy. Such a thing can hardly exist in a social state (as Germany defines itself in its declaration). Assuming that there is thus no such one-dimensional thinking homo oeconomicus in our society the shareholder perspective according to the Friedmann debate must be supplemented by Freeman’s stakeholder theory.

Especially the aspect of external stakeholders in this theory follows the idea of industry finding its right to exist by accepting the societies’ values and thus finding acceptance in the population. Normally this is easily regulated by the demand that doesn’t only follow the need but the image of a product and company. Since the inner demand for weapons is highly limited, regulation can either be hosted on a higher (political) level or by personal action.

Still the weapon industry shows a deep believe in successful lobbying but the political turnover in nuclear energy politics should have shown that if the collective pressure increases the political influence in terms of change gains enough strength to show massive impacts. Thus permanent production needs corporate responsibility.

Corporate responsibility includes sustainability and thus a positive reputation, as well as an economic need. This economic need presents itself in this context mainly in the allocation of employment. Furthermore the idea of science and research and the resulting benefits in other economic sectors shall be mentioned, since this is the second argument pro exporters put forward (see above).

I don’t want to neglect the potential positive impact of these factors but the relation to the impact of the products must be the scale. Per definition weapons can’t have the best reputation so the company’s image depends on the responsible handling (sale) of these. In terms of sustainability and responsibility weaponry producing and trading companies would profit in the long run from stricter ethical codes.

Sources of morality

Ethical principles follow the idea that the sources of morality (Fontes Moralitatis) can be distinguished and measured along three criteria:

  1. Finis operis (the object: first consequence of action)
  2. Circumstatitae (circumstances under which the actions takes place)
  3. Finis operantis (goal or intend)

In matters of arms trade one must distinguish between the general production and sale of arms and the specifics of arms exports. The Finis operis is thus firstly the production of arms. This might (expect from a pacifistic point of view) not appear as condemnable. The Circumstances measure the need of such an action in relation to the general surrounding. Although I believe that a stable economy doesn’t necessary rely on the field of weaponry production, the positive effects (or at least the absence of clear disadvantages) exceed up to this point.

Regarding the intend of arms trade I refer to my second (II) point and the correlation between profits and the corporations’ sensitivity for moral values. The general intention of the production and selling of weapons is still to enable another power to defend itself or fight actively.

Whenever questioning weapons trade I pledge to reflect on the general ethics of weapons and war. I personally think that at no point in the history of mankind a war proved to have been the better solution that should be preferred over peaceful resolutions. Even from a less radical point of view the question in how far a product which can only be used to kill, to take away lives can generally be considered good. The intention to produce such a product must be seen in direct relation to its purpose of use.

Concerning the intend behind exports of weaponry arguments such as stabilisation and self-defence are being put forward. I don’t see in how far the enabling of governments (e.g.UAE) that don’t act in accordance to the human rights declaration could potentially stabilise a country in any other way than by repression of critical voices and political oppositions.

All ethical concepts follow the idea of ratio; sense as the reign of human minds. Since sense and sanity live and grow by reflection we must realise that there is a huge discrepancy between the idea of exporting arms and its real results.

Arms trade is out of control.

The whole Iraq war should have shown that weapons do not distinguish whom they shoot in the end. A trustworthy friend today, the “Good ones” can potentially turn into an enemy. Since it remains impossible to control which “final destination” weapons reach I would opt for long term security over short term profits.

The economies’ aim might contain, apart from the obvious goal of drawing profits, political ideas that aren’t morally bad. But in reality the discrepancy remains. Due to the fact that our collective idea of peace stands in contrast to any result of all actions concerning arms trade according to the momentary regulations, there are two options: Either the change the goal or to change to actions towards such.

Since the idea of world peace seems a legitimate goal our actions are the ones that must be changed. Arms trade and especially arms exports of German companies must either be forbidden or seriously regulated.

Conclusion

As long as the lack in information and transparency concerning arms trade persists, regulation must be lifted to higher, explicit and moral standards. It is our responsibility as a society to act according to our own values and believes. Since industry and economy are part of our society they must accept these values as their own. Cutbacks in arms exports might result in financial costs but, since these must otherwise be measured according to the loss of moral integrity, it seems worth the effort.

© Titelbild: Sgraffite du Marchand d’armes Lambert SEVART à Liège, rue Grangagnage, 16. | Olnnu (wikimedia.org)
Alexander Pyka

Dr. Alexander Pyka is Co-Founder of IFAIR and programme coordinator for the Impact Group ”Fireside Chats Berlin”. He was a member of the executive Board until 2016. Alexander works at the public international law division at the German Federal Foreign Office. He wrote his doctoral thesis about the international sanctions regime against Iran while working as personal adviser to a former head of government. Alexander studied Law at Bucerius Law School, Germany and Tel Aviv University, Israel, as a scholar of the German National Academic Foundation. In 2013, he was selected “Global Leader of Tomorrow” by the St. Gallen Symposium, “Top 99 under 33 Foreign Policy Leader” by the Diplomatic Courier in Washington D.C. and “Global Shaper” by the World Economic Forum, Davos. Alexander speaks German, English, French and Spanish.