Following corporate accounting scandals there has been an increasing concern with understanding the factors that undermine the occupational values of accounting professionals, which emphasize self-transcendence in the pursuit of public good and openness to change in the pursuit of autonomy and creativity. Prior studies have demonstrated that these values are undermined in economically rationalized organizational environments. Our study advances this research by examining how accounting professionals’ occupational values are influenced by the economic rationalization of countries where they are employed. While (...) economic rationalization of countries is recognized as a key macrostructural, social-level influence on individual values, the theory is divided regarding its normative effects. While economic rationalization may decrease the priority of occupational values by transforming professional action in accordance with the calculative logic of economic rationality, it can also increase the priority of these values by providing resources necessary for freeing professionals from the material constraints of survival. We test these divergent insights using the European Social Survey data for 28 countries. Our results indicate that economic rationalization decrease accountants’ occupational values beyond the effects of cultural values and work-related characteristics. (shrink)

We sketch out two basic paradigms informing banking practice: the economistic paradigm focusing on profit maximization and the humanistic one, serving the common good. We then highlight paradigmatic cases to explore how each of these business models fared during the quasi-natural experiment of the financial crisis. We find that many humanistic banks outperformed traditional economistic banks. Despite the uneven playing field humanistic banks fared remarkably well with regard to traditional financial performance judgements, muting criticisms of competitiveness. We find that overall (...) both paradigms can provide a basis for successful banking as long as social and financial value generation are blended. We conclude by providing lessons learned for better banking. (shrink)

The notion of dignity as that which has intrinsic value has arguably been neglected in economics and management despite its societal importance and eminent relevance in other social sciences. While management theory gained parsimony, this paper argues that the inclusion of dignity in the theoretical precepts of management theory will: improve management theory in general, align it more directly with the public interest, and strengthen its connection to social welfare creation. The paper outlines the notion of dignity, discusses its historical (...) understanding, and explains its relevance in the context of management theory. Furthermore, it proposes a framework of paradigmatic assumptions along two dimensions: understanding human dignity as unconditional or conditional and understanding social welfare as wealth creation or well-being creation. I propose alternative management theory archetypes and discuss these archetypes’ theoretical implications for management research. I also suggest how management theory can be shifted to contribute toward social welfare creation more directly. (shrink)

We identify a normative paradox of responsible management education. Business educators aim to promote social values and develop ethical habits and socially responsible mindsets through education, but they attempt to do so with theories that have normative underpinnings and create actual normative effects that counteract their intentions. We identify a limited conceptualization of freedom in economic theorizing as a cause of the paradox. Economic theory emphasizes individual freedom and understands this as the freedom to choose from available options. However, conceptualizing (...) individuals as profit-maximizing actors neglects their freedom to reflect on the purposes and goals of their actions. We build on the work of pragmatist philosopher John Dewey, who distinguishes between habitualized and creative problem-solving behaviors, conceptualizes knowledge construction as a process of interdependent scientific social inquiry, and understands actors as having the freedom to determine what kind of people they wish to be. We apply pragmatist theory to business education and suggest equipping students with a plurality of theories, supplementing neoclassical economics with other economic perspectives and views from other disciplines on economic behavior. Moreover, we suggest putting students into learning situations that require practical problem solution through interdependent social inquiry, encouraging ethical reflection. In doing so, we contribute by linking the problematic conceptions of freedom identified in economic theorizing to the debate on responsible management education. We conceptualize a pragmatist approach to management education that explicitly re-integrates the freedom to discursively reflect on the individual and societal purpose of business activity and thereby makes existing tools and pedagogies useful for bringing potential freedom back into business. (shrink)

The Confucian tradition, which places the virtue of ren or fellow feeling at its heart as a ‘gateway’ to the more concrete virtues of common Western parlance, offers a potential antidote to the excesses of a Western business ethics which, even after its recent academic reembrace of the Aristotelian tradition, in practice still too often instrumentalises virtue in the service of a ‘rational’ or ‘reasonable’ constraining of the profit motive. The deeper, intrinsic ‘ethos’ promised by a Confucian approach also finds (...) its echo in the West in the work of Hans Küng’s Weltethos project, led today on the business ethics front by Klaus Leisinger and Claus Dierksmeier. This paper explores a dilemma at the heart of the World Ethos movement seen from the twin peaks of the World Ethics Institute at Peking University and the Weltethos Institut at the University of Tübingen: namely, whether a business ethics culture accustomed to thinking in terms of CSR-esque lists of corporate values, virtues or principles can best be reformed via documents like the UN Global Compact, the 2010 Global Economic Ethic Manifesto, or even the UN Sustainable Development Goals, or whether a more radical, revolutionary quest for an inner ‘ethos’, to be lived and experienced by self-cultivating individuals engaged in business all over the world regardless of background, ought somehow to be undertaken parallel to these endeavours. The authors outline possible steps towards such a transformation of the management community’s understanding of virtue, without, however, dismissing the contribution of traditional, dilemma-oriented Western thinking about applied ethics in general, and business ethics in particular. (shrink)

This paper argues that economics, over the past 200 years, has become steadily more anti-philosophical and that there are three stages in the development of economic thought. Adam Smith intended economics to be a descriptive social science, rooted in an understanding of the moral and psychological processes of an individual’s decision-making and its connection to society in general. Yet, immediately after Smith’s death, economists made a clean cut and invented a totally new discipline: they switched towards a physicalist understanding of (...) human nature. Humans, like atoms, follow a natural law: they are driven by an emotion (defined as a non-emotion, rationality), namely selfishness. Thus economics became a ‘natural’ science. In the 20th century, the second reinterpretation removed all traces of humanity from the study of economics and declared economics to be a formal science like mathematics and logics. The actor in Phase 3 economics is homo economicus syntheticus, a postulate whose only connection to real humanity is the word homo. The paper asks what the results of this dramatic relocation are and why Phase 3 economics still claims descent from Smithian economics, despite the massive differences. (shrink)

In both the public and the business world, in academe as well as in practice, the ideas of Adam Smith are regarded as the bedrock of modern economics. When present economic conditions and management practices are criticised, Adam Smith is referred to by defenders and detractors of the current status quo alike. Smith, it is believed, defined the essential terms of reference of these debates, such as the rational pursuit of self-interest on part of the individual and the resultant optimal (...) allocation of goods in free markets thanks to the workings of an “invisible hand.” In this article, we question whether this standard view of Smith, the economist, is tenable. We provide an extensive review of the extant secondary literature from economists, business ethicists, and philosophers, comparing their assessments to crucial elements of Smith’s theoretical system. As a result, we show that Smith, far from being an advocate of a value-free or even value-averse conception of economic transactions, stood for a virtue-based and values-oriented model of business. Accordingly, we argue current management education and the pedagogy of business ethics ought to be changed, and certain strategic conclusions drawn for business practice. (shrink)

This paper argues that the MBA, probably the most successful academic program of the last 50 years, negatively affects the theory and practice of management with regard to ethics through its pedagogy, structure, and its underlying epistemic assumptions. In particular I seek to demonstrate how the syllabus, the pedagogy and the epistemological assumptions of MBA programs together make managers/leaders unable and unwilling to deal with ethics. I also argue that while the what and the how play a very important role, (...) it was only the emergence of a radical philosophical underpinning that has put management education on a negative trajectory. The paper thus examines MBA education from a meta-level perspective, connecting the pedagogical model with epistemological beliefs. (shrink)

The paper takes a fresh look at two essays that Adam Smith wrote at the very beginning of his career. In these essays, Smith explains his philosophy of science, which is social constructivist. A social constructivist reading of Smith strengthens the scholarly consensus that The Wealth of Nations needs to be interpreted in light of the general moral theory he explicates in The Theory of Moral Sentiments, as the two essays and TMS stress the importance of the same concepts: e.g., (...) moral imagination, the socially embedded individual, and humility. The connecting tissue between all three works is made up of sentiments and values. Smith regards the socially embedded human as the agent in all three realms, and humans are always driven by values. Smith not only conceives of economics as an applied moral philosophy, but also bases both research areas on a view of knowledge creation that stresses specific epistemic values. If mainstream economic theory wants to have any claim to Adam Smith, it would have to change not only what it argues but also how it argues. Economists would have to replace the language of mathematics with the language and logic of moral philosophy and give values centre stage. (shrink)

In order to provide context and ground for a future assessment of the manifold overlap and possible differences between the Humanistic Management Project and the Weltethos Project, this article offers a comprehensive assessment of the history, arguments, and relevance of the Weltethos Project as applied to economics and business. A literature review of foundational documents on “Weltethos” and “Weltethos for business” outlines essential elements and arguments from two main Weltethos Project pioneers. It first recounts how its founder, the theologian Hans (...) Küng, has launched a fruitful academic and public discourse spanning almost three decades since 1990, including the presentation of the Manifesto for a Global Economic Ethic by world leaders at a joint event with the UN Global Compact at the UN headquarters in New York in 2009, calling for business to serve human dignity. Then, the agenda of Claus Dierksmeier, Küng’s academic successor and a philosopher with foundational contributions to the Humanistic Management Project, is assessed both in regard to Weltethos motifs and Humanistic Management arguments, spanning from Dierksmeier’s conception of qualitative freedom as the foundation of unity in diversity to his effort to reframe economic theory and ethics, the inclusive and innovative practices of Humanistic Management, and to the capability approach. The article ends by highlighting how these two different approaches to Weltethos commitments converge in their care for human dignity, the idea of globally responsible freedom, and the capacity for dialogue as a learning process for creative change leadership. (shrink)

Property regimes are based on fundamental values of the society or group that designs and reproduces them. This paper analyses the ethical underpinnings of Progressive Commons in comparison to the...

Innovation is strongly associated with survival and growth of all kind of organizations in a global competitive economy. Moreover, nowadays companies are increasingly questioned on how they deliver innovative solutions to deep-seated problems, such as poverty. Our research aims to understand how Economy of Communion companies respond to this challenge by applying the logic of gratuitousness and giving. This paper examines the altruistic behaviour of EoC leaders and the connection with organizational innovation, necessary for firm’s survival in the long-term. We (...) analyse these connections through a qualitative descriptive case study of three Spanish EoC companies. The findings reveal altruistic behaviours of leaders seeking the Common Good. Innovation derives from the desire to help others, such as employees and customers. Moreover, the findings reveal that a culture of dialogue among employees, managers and the whole organisation enhances risk-taking and, therefore, innovation The paper contributes to our understanding of how EoC companies are able to reconcile innovation with the ideal of altruism, distinctive of the Economy of Communion. We believe that this study opens up a wide range of future research opportunities on the antecedents of an innovative organizational culture. (shrink)

A variety of theories of management and organizational studies have failed to consider the human being in his or her integrity and, thus, fall short of being humanistic. This article seeks to contribute to the recovery of a more complete view of the human being in management, learning from classical humanism developed throughout Western Civilization, from the Greek and Roman Philosophers and the Judeo-Christian legacy to the Renaissance. More specifically, it discusses several relevant aspects of this Classical humanism, which can (...) aid in re-thinking management. These include a realistic epistemology and metaphysics, and the human being as a whole. Classical humanism also entails the consideration of the human action as a unity with both internal and external dimensions, ethics understood as a guide for good life, society viewed as a community of people, and being open to beauty and transcendence. (shrink)

Today’s globalized economy cannot be governed by legal strictures alone. A combination of self-interest and regulation is not enough to avoid the recurrence of its systemic crises. We also need virtues and a sense of corporate responsibility in order to assure the sustained success of the global economy. Yet whose virtues shall prevail in a pluralistic world? The moral theory of Thomas Aquinas meets the present need for a business ethics that transcends the legal realm by linking the ideas of (...) justice and virtue in an ingenious way. While allowing for, and incorporating, the specificities of region and religion, industry and culture, Thomas’s virtue theory coordinates private and public activities through a set of context-invariant, justice-oriented norms with conceptual appeal to contemporary questions of global business ethics.In our article, we first sketch how Aquinas’s theory can be also of relevance to a non-confessional audience through its appeal to the ‘natural light of reason.’ Then we explain how his theory of ‘natural law’ aligns his ideas of virtue and justice. From this vantage point, we address the tension between cultural diversity and moral uniformity in the economic sphere in general and in today’s globalized business world in particular. Throughout the article, we aim to show that by interpreting the virtue-dimension of business in light of the idea of social justice, Aquinas’s conception of virtuous business conduct gains inter-personal and inter-cultural validity that establishes social justice as the global virtue of business. (shrink)

Resting as it does on the principle of freedom, today’s global economic system is in need of a global economic ethos of responsibility so as to assure its social and ecological sustainability. Not all ideas of freedom, however, are equally amenable to conceptions of cosmopolitan responsibilities. This article examines how quantitative versus qualitative notions of freedom respectively respond to this challenge. Simply put, quantitative models hinder the integration of responsibility into models of economic rationality whereas qualitative conceptions advance it. As (...) a consequence, efforts to promote a humanistic paradigm of economics and management fare better when oriented at a qualitative idea of freedom. Cast along the lines of a qualitative conception of freedom, corporate responsibility more readily takes on a cosmopolitan dimension apt to meet the needs of the current age of globality. (shrink)

Michael Jensen made a name for himself in the 1970s–1990 s with his ‘agency theory’ and its application to questions of corporate governance and economic policy. The effects of his theory were acutely felt in the pedagogics of business studies, as Jensen lent his authority to combat all attempts to integrate social considerations and moral values into business education. Lately, however, Michael Jensen has come to defend quite a different approach, promoting an ‘integrity theory’ of management learning. Jensen now rather (...) aspires to empower students to give authentic expression to their personal values in their professional lives, and he sees the main function of management studies in assisting them in this effort. This article reconstructs the transformation of Jensen’s outlook, drawing on Jensen’s theories as an exemplar of wider trends in the current literature on management learning, away from a decidedly ‘mechanistic’ and towards a more ‘humanistic’ pedagogy of management. Jensen’s case serves to highlight developments that might make for better preconditions for the appreciation of business ethics on part of business students. On closer inspection, though, it appears that his remaining within a positivistic framework ultimately impedes the kind of progress Michael Jensen envisions for business studies. (shrink)

Lamenting the deplorable state of business ethics is, itself, a staple of the deplorable state of business ethics. But if, as its many critics claim, business ethics continuously fails to deliver on its promise, what could take its place in management education? After business ethics—How else can we integrate ethics into the curriculum? This article argues that an ethical grounding of business theory and corporate practice requires a critique of conventional economics, replacing the mechanistic paradigm that predominated economics over the (...) last 200 years with a humanistic alternative. (shrink)

Today, capitalism is in question, as the 2013 Academy of Management conference theme claimed. Many view business skeptically because they see capitalism as incompatible with ethics. The same problem pervades the business ethics education classroom. Business ethics can be taught in a way that demonstrates that economics and ethics are compatible and are integrated most directly in the function of management. This essay provides an overview of Ayn Rand’s philosophy as an alternative to current conventions but largely consistent with approaches (...) such as virtue ethics and conscious capitalism. The essay concludes with challenges to teaching Objectivism in business schools. (shrink)

In management literature, practical wisdom is increasingly perceived as a necessary resource for excellence in judgment. However, so far, little effort has been devoted to provide substantive guidance on how to apply practical wisdom into day-to-day managerial decision-making processes. In order to close this gap, we develop an item-based guideline for self-guided decision-making, which explores the specific aspects a practically wise decision-making process inherently entails. To do so, we introduce the concept of practical wisdom, highlight its recent adaptions in management, (...) and draw a link to self-guided decision-making. Then, we explain our methodological framework and procedure. Based on these considerations, we develop the particular items by transdisciplinary unfolding and synthesizing the main dimensions and features of practical wisdom. Finally, we discuss suggestions of application, theoretical implications, limitations, and propose avenues for further research. (shrink)