While the apartheid government was in power in South Africa, Caltex, a U.S. company operated a chain of gas stations and several oil refineries in that country. Caltex expanded its operations in South Africa, giving the South African government greater access to the oil it needed. Caltex hires Blacks and provides them with higher wages than they could get anywhere else in the country. But the apartheid South African government (run by Whites), does not allow Blacks (the majority of the population) to vote, they are no allowed to supervise Whites, they are not allowed to marry Whites, and must live in the poorest rundown part of the country. They are treated as second-class citizens in their own country.
The South African economy relied on oil for 25% of its energy needs, and South African law required refineries to set aside some of their oil for the government. In addition, Caltex was required to pay substantial corporate taxes which supplied and help sustain the South African government with funds to operate. This arrangement has been financially beneficial to Caltex.
Required: Assume you are a stockholder of Caltex. Do you think Caltex should have had an operation in South Africa during the apartheid era? Why or why not? Explain your position
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