In the business ethics literature, many argue that managerial decision making ought to be improved by more robust ethical concerns. Some see the virtue of “practical wisdom” as the key for improved managerial decision making. However, because of the epistemic limitations confronting decision makers in the face of irreducible market complexity, there is a risk that practical wisdom, employed in the context of day‐to‐day managerial decision making, becomes an impractical concept. Nevertheless, if the attempt to incorporate virtue ethics (and its (...) related concepts) into business practices is laudable, if indeed a virtuous life is worth pursuing and practical wisdom plays an essential role toward that end, it is important to attempt to salvage practical wisdom and uncover its appropriate usage. Thus, this article pursues two major ends. First, upon surveying some of the prominent and standard usages of the term, it articulates concerns, rooted in epistemic limitations, about the way that practical wisdom appears in business ethics literature. Second, it offers a new way forward for understanding “practical wisdom.” By contextualizing day‐to‐day, rule‐based managerial decision making within the ethical value of the market order, practical wisdom reappears as the higher‐order capacity to pursue vocations, as morally worthwhile projects, in business. (shrink)

Several alternative leadership approaches have been introduced to supplement the long-standing transformational leadership model as concerns have grown that it did not place enough emphasis on leader ethics. Nonetheless, to establish the value of the newer approaches, evidence of conceptual and empirical distinctiveness is required. Though meta-analysis has been somewhat helpful in this regard :517–536, 2016), we conducted two within-study comparisons of ethical leadership, virtuous leadership and key components of TL reflected by socialized charismatic leadership. We predicted that these alternative (...) models differ in the strength of their ties to a range of valued outcomes. Our analyses of 230 leader–follower dyads based predominately in North America and US-based 131 dyads left many hypotheses unsupported; nonetheless, there was evidence of differential associations. For example, across both samples, in the context of all three models, follower-rated ethical leadership was the only significant predictor of follower-rated leader effectiveness, leader-rated subordinate in-role performance, and leader-rated follower ethicality. As hypothesized, virtuous leadership was the strongest predictor of self-rated leader happiness in Sample 1, but contrary to expectations, in Sample 2, only the TL components were related to happiness and life satisfaction among both leaders and followers. (shrink)

“No one can serve two masters.” This Bible quotation highlights an irreducible contradiction, which echoes numerous organizational settings. This article considers the under-explored ethical implications of paradoxical injunctions created by such a contradiction at the managerial level. Contradictory organizational constraints turn into paradoxant systems , where the organization structurally settles paradoxical injunctions which challenge managerial ethics in practice. We then ask what managerial responsibility means in such contexts and find that managers have then to reshape their practice as a situated (...) construction through constant mediation between different “masters” and bricolage (i.e., tinkering with concepts). An ethnographic case study of an anti-money laundering service in an investment bank illuminates this phenomenon from a practice perspective. The possibility to enact an actual ethical practice within the contradictory organization relies on a new role of the manager. This implies drawing on an approach of responsible management as an enactment of ethics in practice which is situated within the framework of a new conception of both the organization, as a structurally “paradoxant system,” and the manager as a mediator in charge of enacting coherence. (shrink)

Based on ideology-infused psychological contract theory and cognitive evaluation theory, this study investigated the curvilinear relationship between ethical leadership and employee creativity. A curvilinear mediation model was proposed to explain the impact of ethical leadership on creativity, using employee intrinsic motivation as the mediator. Applying a two wave sampling design that consist 258 employees and their leaders, we found that employee creativity improved as ethical leadership increased from low to moderate levels. However, the employee creativity improvement was attenuated when ethical (...) leadership increased from moderate to high levels. Furthermore, the study also revealed that employee intrinsic motivation partially mediated this curvilinear relationship. The theoretical and managerial implications are discussed. (shrink)

We propose a liminality-based analysis of the process of ethical leadership/followership in organizations. A liminal view presents ethical leadership as a process taking place in organizational contexts that are often characterized by high levels of ambiguity, which render the usual rules and preferences dubious or inadequate. In these relational spaces, involving leaders, followers, and their context, old frames may be questioned and new ones introduced in an emergent way, through subtle processes whose evolution and implications may not be easy to (...) grasp even by those participating in them. (shrink)

The aim of this study is to contribute to a conceptualization of organizational politics that underscores the possibility of developing positive political behavior at the workplace. In this respect, we seek to provide a context of re-evaluating the normative foundations of organizational politics. Normative issues are critically discussed in the context of mainstream ethical theories that illuminate the interaction of ethics and political behavior. More specifically, it is argued that a deontological framework is of particular importance for the proper management (...) of negative political behavior, whereas a virtue-ethics context can be employed so as to foster positive political behavior at the workplace. Finally, the implications of this approach for organizational life and HRM processes and practices are taken into consideration. (shrink)

In this paper, we offer a conceptualization of leadership as contemplative. Drawing on MacIntyre’s perspective on virtue ethics and Levinas’ and Gilligan’s work on the ethics of responsibility and care, we propose contemplative leadership as virtuous activity; reflexive, engaged, relational, and embodied practice that requires knowledge from within context and practical wisdom. More than simply offering another way to conceptualize the ethics of leadership, this research contributes to understanding the ethics of leadership in practice. Empirically, we analyze the narratives of (...) those in positions of formal authority and other organizational members in churches. We illustrate contemplative leadership as driven by a good purpose, derived from the unique organizational and broader societal context in which leadership occurs, and grounded in an ethical concern for the other. Contemplative leadership accounts for the complexity of experience and is discerned in mundane and everyday practices. We conclude with the implications for leadership theory, practice, and education. (shrink)

This study examines a mediated model of ethical leadership on ethical climate, turnover intention, and affective commitment. It is suggested that managers are role models in their organizations. Specifically, through ethical leadership behavior, managers can influence perceptions of ethical climate, which in turn will positively influence organizational members’ turnover intention, and affective commitment. The results indicate that ethical leadership has both direct and indirect effect on affective commitment and turnover intention. The indirect effect of ethical leadership involves shaping perceptions of (...) ethical climate, which in turn, engenders greater affective organizational commitment and less turnover intention. (shrink)

Interest in ethical leadership from academics and practitioners has grown enormously in recent years. This article addresses this literature through a framework that identifies three interlocking questions. First, who are ethical leaders and what are their characteristics? Second, how do ethical leaders do what they do? Third, why do leaders do as they do and what are the outcomes of ethical leadership? Different dimensions to ethical leadership are examined and presented as three interlocking circles; Virtues, Purposes and Practices. This framework (...) presents an integrated approach to ethical leadership and argues that future research take this holistic framework and apply it to different sectors or contexts. (shrink)

Using a sample of multinational firms in Germany, we develop and empirically examine a model to test the effects of ethical climate and its antecedents on purchasing social responsibility (PSR). Our results show different effects of benevolence dimensions of ethical climate on PSR: employee-focused climate has no effect, but community-focused climate is a significant driver of PSR. The results also show that top management ethical norms and code of conduct implementation impact PSR directly as well as indirectly through ethical climate.

Hubris among CEOs is generally considered to be undesirable: researchers in finance and in management have documented its unwelcome effects and the media ascribe many corporate failings to CEO hubris. However, the literature fails to provide a precise definition of CEO hubris and is mostly silent on how to prevent it. We use work on hubris in the fields of mythology, psychology, and ethics to develop a framework defining CEO hubris. Our framework describes a set of beliefs and behaviors, both (...) psycho-pathological and unethical in nature, which characterize the problematic relationship of the hubris-infected CEO towards his or her own self, others and the world at large. We then demonstrate how the development of authentic leadership may contribute to preventing or attenuating hubris by addressing its psycho-pathological nature through the true self and meaningful relationships with others. In addition to its psycho-pathological dimension, CEO hubris also contains an ethical dimension. We therefore propose that the development of the virtue of reverence might contribute to the prevention or attenuation of CEO hubris, because reverence makes the individual aware of his or her place in the world order and membership of the community of humans. (shrink)

Despite a long history in eastern and western culture of defining leadership in terms of virtues and character, their significance for guiding leader behavior has largely been confined to the ethics literature. As such, agreement concerning the defining elements of virtuous leadership and their measurement is lacking. Drawing on both Confucian and Aristotelian concepts, we define virtuous leadership and distinguish it conceptually from several related perspectives, including virtues-based leadership in the Positive organizational behavior literature, and from ethical and value-laden leadership. (...) Then, two empirical studies are presented that develop and validate the Virtuous Leadership Questionnaire, an 18-item behaviorally based assessment of the construct. Among other findings, we show that the VLQ accounts for variance in several outcome variables, even after self-assessed leader virtue and subordinate-rated social and personalized leader charisma are controlled. (shrink)

Quality is commonly applied to products and processes, but we can also define human quality in dealing with people. This requires first establishing what treatment is appropriate to the human condition. Through an inquiry into the characteristics that define the human being and what ethical requirements constitute a good treatment, we define “Human Quality Treatment” as dealing with persons in a way appropriate to the human condition, which entails acting with respect for their human dignity and rights, caring for their (...) problems and legitimate interests, and fostering their personal development. With this in mind, we can distinguish between five different levels or degrees of HQT in organizations which can be characterized by the following terms: maltreatment, indifference, justice, care, and development. (shrink)

This study examines a moderated/mediated model of ethical leadership on follower job satisfaction and affective organizational commitment. We proposed that managers have the potential to be agents of virtue or vice within organizations. Specifically, through ethical leadership behavior we argued that managers can virtuously influence perceptions of ethical climate, which in turn will positively impact organizational members’ flourishing as measured by job satisfaction and affective commitment to the organization. We also hypothesized that perceptions of interactional justice would moderate the ethical (...) leadership-to-climate relationship. Our results indicate that ethical leadership has both a direct and indirect influence on follower job satisfaction and affective commitment. The indirect effect of ethical leadership involves shaping perceptions of ethical climate, which in turn, engender greater job satisfaction and affective organizational commitment. Furthermore, when interactional justice is perceived to be high, this strengthens the ethical leadership-to-climate relationship. (shrink)

Virtue ethics is generally recognized as one of the three major schools of ethics, but is often waylaid by utilitarianism and deontology in business and management literature. EBSCO and ABI databases were used to look for articles in the Journal of Citation Reports publications between 1980 and 2011 containing the keywords ‘virtue ethics’, ‘virtue theory’, or ‘virtuousness’ in the abstract and ‘business’ or ‘management’ in the text. The search was refined to draw lists of the most prolific authors, the most (...) cited authors, the most cited articles, and the journals with the most virtue ethics publications. This information allows one to chart how virtue ethics articles have evolved through the decades and to establish ‘schools’ or clusters of authors as well as clusters of themes. The results of this quantitative analysis of authors, ‘schools’, themes, and publications provide a foundation for the future study of virtue ethics in business and management, identifying its achievements and potentials. (shrink)

This paper argues that corporate governance reformers in Anglo-American jurisdictions should consider a different approach in their quest for better corporate governance. Traditionally, corporate governance reform has taken a structural approach, tightening the rules around the number of independent directors required on boards and committees and fine-tuning the definition of independence. However, such an approach has failed to achieve effective corporate governance. Moreover, this approach is informed by the arguably discredited assumption that individuals are rational self-interest utility maximizers. This conceptual (...) paper questions why corporate governance scholars and regulators remain uncritical of this assumption and suggests an approach to reform inspired by a different view of human nature. Indeed, incorporating an actor-based approach to reform into existing structures may better achieve effective corporate governance while addressing an unjustified adherence to this flawed assumption. (shrink)

A vast majority of marketing theory and research has focused on relativism and idealism in order to understand ethical behavior. However, making ethical assessments that in turn influence behavior is much more complicated than it appears. One of the most important developments in contemporary philosophy has been the renewed interest in epistemic virtue. Epistemologists contend that belief is an ethical process that is susceptible to the intellectual virtue or vice of one’s own life and personal experiences. Open-mindedness, curiosity, careful thinking, (...) creativity, and intellectual courage are the foundations of epistemic virtues. Closed-mindedness, intellectual overconfidence, unimaginativeness, intellectual conformity, and wishful thinking are among epistemic vices. The purpose of this investigation is to introduce epistemology to marketing ethics by linking it to personal moral philosophies (idealism and relativism) and optimism to explain various ethically challenging organizational behaviors. The items of epistemology were developed and pretested by the lead author of this study. Structural equations (LISREL) analyses found that epistemic virtues and vices are better predictors of ethical behavior than were personal moral philosophies (idealism and relativism), and their influence on mild and severe levels of unethical behaviors was enhanced by the moderator variable, optimism. Implications are designed to develop suggestions for improving ethical behavior in the workplace. (shrink)

Six cardinal leadership virtues based on Aristotelian and Confucian typology were advanced through this study by developing a measurement instrument and examining its predictive validity by studying the causal association with perceived leader happiness. Based on a sample of 183 school principals engaged in various types of schools, the results of both exploratory and confirmatory factor analyses generated satisfactory empirical outcomes by finding adequate support for the overall leadership virtue scale and the constituent subscale elements. The paper concluded with the (...) theoretical and practical implications for this developed instrument of leadership virtue especially in the context of school education. The major contribution of the paper lies in developing a measurement scale of virtues for school leaders. (shrink)

This paper formulates a vision for leadership based on integrity in business, banking, government and politics. It proposes a tripartite response to the current grave difficulties affecting international finance and markets: a renewal of values and virtues, acceptance of the centrality of the human person, and appropriate recourse to key principles of Catholic social teaching, as articulated in Pope Benedict XVI’s encyclical, Caritas in Veritate. By considering Ireland’s “Celtic Tiger” period, particularly the actions of the Anglo Irish Bank, we show (...) how failures in leadership and integrity at all levels of Irish society, including business, politics, government, public sector and church, have eroded trust and damaged the reputation of key institutions. The paper presents plain suggestions for civic leaders on how putting people first can help restore trust, reputation, integrity and professionalism at local and global levels. (shrink)

In a multi-source study, we examine how frequent change interacts with ethical leadership to reduce turnover intentions. We argue that ethical leaders enhance employees’ state self-esteem, which explains the moderating effect of ethical leadership. Results from 124 employee-coworker-supervisor triads revealed that ethical leadership moderated the relationship between frequent change and turnover intention such that the relationship was positive only when ethical leadership was low. The moderating relationship could be shown to be mediated by employees’ state self-esteem.

In business ethics journals, Kant’s ethics is often portrayed as overly formalistic, devoid of substantial content, and without regard for the consequences of actions or questions of character. Hence, virtue ethicists ride happily to the rescue, offering to replace or complement Kant’s theory with their own. Before such efforts are undertaken, however, one should recognize that Kant himself wrote a “virtue theory” (Tugendlehre), wherein he discussed the questions of character as well as the teleological nature of human action. Numerous Kant (...) scholars argue that Kant already erected precisely the kind of integrative moral architecture that some of his modern interpreters (while aiming to supersede him) wish to construct. For business ethics, this divergence of scholarly opinion is of crucial importance. It shows first that the standard portrayals of Kant’s ethics in business ethics textbooks—as rigidly deontological, narrowly individualistic, and hence unsuitable for the specific demands of corporate agency—might have to be revised. Second, discussions in the business ethics literature on stakeholder-engagement and managerial decision-making likewise stand to gain from a more nuanced picture of Kant’s moral philosophy. Third, a reassessment of Kant’s ethics with regard to questions of personal character and moral sentiments might also lead to a more favorable view of the relevance of his ethics for managerial practice. Last, but not least, the many current attempts to reconcile Kant’s freedom-oriented philosophy with virtue theories stand to benefit considerably from a better understanding of how Kant himself conceived of one such synthesis between the formal and substantial aspects of morality. This, ultimately, could lead to an important overlapping consensus in the academic literature as to the role and relevance of virtuous conduct in business. (shrink)

Although legitimacy theory provides strong arguments that environmental, social and governance disclosure and performance can help mitigate firm-specific risks, this relationship has been repeatedly challenged by conceptual arguments, such as ‘transparency fallacy’ or ‘impression management’, and mixed empirical evidence. Therefore, we investigate this relationship in the revelatory case of initial public offerings, which represent the first sale of common stock to the wider public. IPOs are characterised by strong information asymmetry between firm insiders and society, while at the same time (...) suffering from uncertainty in firm legitimacy, culminating in amplified financial risks for both issuers and investors in aftermarket trading. Using data from the United States, we demonstrate that voluntary ESG disclosure reduces idiosyncratic volatility and downside tail risk and higher ESG ratings have lower associated firm-specific volatility and downside tail risk during the first year of trading in the aftermarket. We provide theoretical arguments for the relationships observed, suggesting that companies striving for ESG performance and communicating their efforts signal their compliance with sustainability-related norms, thus acquiring and upholding a societal license to operate. ESG performance and disclosure help companies build their reputation capital with investors after going public. We also report that ESG disclosure is a more consistent proxy for ex-ante uncertainty as an indicator of aftermarket risk, thereby replacing some of the more conventional measures, such as firm age, offered in the existing literature. (shrink)

The actions of “world‐based” multinational corporations (MNCs) have effectively decoupled the revenue generation and the production sides of the business equation. This decoupling has led to an end of “virtuous capitalism,” which has widespread ramifications for the societies within highly developed countries as well as those in developing and underdeveloped nations. This article presents an overview of the defining aspects of virtuous corporations and the linkages to virtuous capitalism. It then describes the actions of Apple Computer as emblematic of an (...) MNC that is nonvirtuous in its practices. The article then discusses how the encouragement of globalized trade has prompted the shift away from virtuous capitalism and closes with a summary of possible actions that could reverse the decline in corporate virtue. (shrink)

Human Quality Treatment (HQT) is a theoretical approach expressing different ways of dealing with employees within an organization and is embedded in humanistic management tenants of dignity, care, and personal development, seeking to produce morally excellent employees. We build on the theoretical exposition and present a measure of HQT-Scale across several studies including cross-culturally to enhance confidence in our results. Our first study generates the 25 items for the HQT-Scale and provides initial support for the items. We then followed up (...) with a large study of managers (n = 363) from Nigeria in study 2, which confirms the theoretical properties of the five dimensions of HQT and highlights a two-factor construct: HQT Ethically Unacceptable and HQT Ethically Acceptable using a 20-item HQT-Scale. Study 3 with a large sample of New Zealand employees (n = 452) again confirms the nature of the construct and provides construct validity tests. Finally, using time-lagged data, study 4 (n = 308) focuses on New Zealand employees and job attitudes and behaviors, and a well-being outcome. That study not only confirms the theoretically implied effects but also shows the HQT Ethically Acceptable factor mediates the detrimental effects of HQT Ethically Unacceptable. Overall, our four studies provide strong support for the HQT-Scale and highlight important understandings of HQT and humanistic management in the workplace. (shrink)

Spirituality is an area of interest for management and business. But two issues confront it: the struggle to be amidst a utilitarian framework where spirituality is reduced as a means to forward profit-oriented goals and difficulty with spirituality’s subjective and multifaceted nature in business management. Challenges abound in determining which spirituality is appropriate. Business scholarship is dominated by a utilitarian view, which some more philosophically oriented scholars have opined to be counterintuitive to the real purpose of workplace spirituality. But some (...) recognize the significance of pragmatic and useful approaches, which this paper views as something integrated into the more philosophic approaches, particularly through virtue ethics. Thus, the authors offer the case for virtue, examined in the person of Corazon C. Aquino, Asia’s first woman president, who successfully bridged the gap between the sacred and secular. To appease both utilitarian and more metaphysical orientations, this research stipulates that for every value-added service rendered to others, there is a corresponding virtue enhancement in the person. (shrink)