Efficient markets are alienating if they inhibit us from recognizably caring about one another in our productive activities. I argue that efficient market behaviour is both exclusionary and fetishistic. As exclusionary, the efficient marketeer cannot manifest care alongside their market behaviour. As fetishistic, the efficient marketeer cannot manifest care in their market behaviour. The conjunction entails that efficient market behavior inhibits care. It doesn’t follow that efficient market behavior is vicious: individuals might justifiably commit to efficiency because doing so serves (...) the common good. But efficient market systems nevertheless have significant opportunity costs. The discussion yields a range of desiderata for non-alienated economic organization. (shrink)

This paper offers the concept of “justice failure,” as a counterpart to the familiar idea of market failure, in order to better understand managers’ ethical obligations. This paper takes the “market failures approach” to business ethics as its point of departure. The success of the MFA, I argue, lies in its close proximity with economic theory, particularly in the idea that, within a larger scheme of social cooperation, markets ought to pursue efficiency and leave the pursuit of equality to the (...) welfare state. As a result, the core ethical responsibility of business actors is to avoid profiting off of market failure. After reviewing this approach I challenge its emphasis on efficiency. I argue that just as we note the suboptimal efficiency of actual markets, we should also take seriously the suboptimal equality of actual welfare states. Taking this idea seriously results in a whole other set of ethical responsibilities for businesses to take into account; in addition to market imperfections and regulatory lacunae, managers should also avoid profiting from, and exacerbating, structural inequalities and injustices. I offer an outline of the kinds of injustices and inequalities that would have bearing on business ethics, and the kinds of ethical responsibilities that this approach suggests that business actors should take into account. (shrink)

Despite growing interest in workplace democracy, the question whether nonworker stakeholders, like suppliers and local communities, warrant inclusion in the governance of democratic companies, as workers do, has been largely neglected. We inspect this question by leaning on the boundary problem in democratic theory. We first argue that the question of who warrants inclusion in democratic workplaces is best addressed by examining why workplace democracy is warranted in the first place, and offer a twofold normative benchmark—addressing objectionable corporate power and (...) upholding efficiency—to assess the principles of democratic inclusion on offer. Against this benchmark, we next argue that the All-Affected Principle is unfit due to its over- and underinclusive extensional results, and that the All-Subjected Principle, whose variants we examine alongside their extensional results, holds more promise when coupled with independent considerations of justice or a constrained variant of the All-Affected Principle. These combinations need not entirely preclude, but speak against, nonworker stakeholder inclusion. (shrink)

The view of business ethics that Christopher McMahon calls the “implicit morality of the market” and Joseph Heath calls the “market failures approach” has received a significant amount of recent attention. The idea of this view is that we can derive an ethics for market participants by thinking about the “point” of market activity, and asking what the world would have to be like for this point to be realized. While this view has been much-discussed, it is still not well-understood. (...) This paper seeks to remedy this problem. I begin by showing, against some recent commentators, that McMahon’s view and Heath’s view are fundamentally the same. Second, I clarify the sense of “efficiency” at work in the market failures approach. Finally, I argue that, in its current form, this view has little relevance to the real world of business. I conclude by sketching two ways of modifying it to fit our world. (shrink)

Scholars who favor shareholder primacy usually claim either that managers should not fulfill corporate duties of beneficence or that, if they are required to fulfill them, they do so by going against their obligations to shareholders. Distinguishing between structurally different types of duties of beneficence and recognizing the full force of the normative demands imposed on managers reveal that this view needs to be qualified. Although it is correct to think that managers, when acting on behalf of shareholders, are not (...) required to fulfill wide duties of charity, they are nevertheless required to fulfill a variety of narrow duties of beneficence. What is more, the obligation to fulfill these duties arises precisely because they are acting on behalf of shareholders. As such, this article 1) refines our understanding of the duties of corporate beneficence and 2) helps to identify which duties of beneficence are imposed on managers when they are acting on behalf of shareholders. (shrink)

The Market Failures Approach (MFA) is one of the leading theories in contemporary business ethics. It generates a list of ethical obligations for the managers of private firms that states that they should not create or exploit market failures because doing so reduces the efficiency of the economy. Recently the MFA has been criticised by Abraham Singer on the basis that it unjustifiably does not assign private managers obligations based on egalitarian values. Singer proposes an extension to the MFA, the (...) Justice Failures Approach (JFA), in which managers have duties to alleviate political, social, and distributive inequalities in addition to having obligations to not exploit market failures. In this paper I describe the MFA and JFA and situate them relative to each other. I then highlight a threefold distinction between different types of obligations that can be given to private managers in order to argue that a hybrid theory of business ethics, which I call the MFA +, can be generated by arguing that managers have obligations based on efficiency and duties based on equality to the extent that these latter obligations do not lead to efficiency losses. This argument suggests a novel theoretical option in business ethics, elucidates the issues that are at stake between the MFA and the JFA, and clarifies the costs and benefits of each theory. (shrink)

This article reviews and criticizes Joseph Heath’s market failures approach (MFA) to business ethics. Our criticism is organized into three sections. First, we argue that, even under the ideal assumptions of perfect competition, when markets generate Pareto-efficient distributions, Heath’s approach does not rule out significant harms. Second, we show that, under nonideal conditions, the MFA is either too demanding, if efficiency is to be attained, or not sufficiently demanding, if the goal of Pareto efficiency is abandoned. Finally, we argue that (...) Heath’s appeal to regulations and specific moral requirements as a remedy for market failures is unlikely to safeguard efficiency and exposes a number of general worries regarding the moral force of the MFA. We end this article with a constructive suggestion on how to adjust the MFA to avoid these problems while preserving its contractualist and Paretian spirit. (shrink)

According to the Market Failures Approach to business ethics, beyond-compliance duties can be derived by employing the same rationale and arguments that justify state regulation of economic conduct. Very roughly the idea is that managers have a duty to behave as if they were complying with an ideal regulatory regime ensuring Pareto-optimal market outcomes. Proponents of the approach argue that managers have a professional duty not to undermine the institutional setting that defines their role, namely the competitive market. This answer (...) is inadequate, however, for it is the hierarchical firm, rather than the competitive market, that defines the role of corporate managers and shapes their professional obligations. Thus, if the obligations that the market failures approach generates are to apply to managers, they must do so in an indirect way. I suggest that the obligations the market failures approach generates directly apply to shareholders. Managers, in turn, inherit these obligations as part of their duties as loyal agents. (shrink)

ABSTRACT:In this address I argue that different perspectives on the normative foundations of corporate responsibility reflect underlying disagreements about the ideal arrangement of tasks between market and state. I initially recommend that scholars look back to the “division of moral labor” inspired by John Rawls’ seminal work on distributive justice in order to rethink why, and to what extent, corporations take on responsibilities normally within the purview of government. I then examine how this notion is related to recent theoretical work (...) in the field of business ethics. I thereafter turn to provide a brief outline of an alternative view that sees corporations as having responsibilities in so far as markets are sites of delegated oversight over the production of social goods that might otherwise be administered by the state. (shrink)

This paper explores the notion that business calls for an adversarial ethic, akin to that of sport. On this view, because of their competitive structure, both sport and business call for behaviours that are contrary to ‘ordinary morality’, and yet are ultimately justified because of the goods they facilitate. I develop three objections to this analogy. Firstly, there is an important qualitative difference between harms risked voluntarily and harms risked involuntarily. Secondly, the goods achieved by adversarial relationships in sport go (...) beyond the function of sport, i.e. to entertain audiences. Thirdly, the most plausible account of the athlete’s motivational development starts with their love of the sport, which can explain a commitment to the sporting ethics in a way that is not paralleled in business. I close by drawing attention to the ways in which an Aristotelian conception of business ethics may be able to accommodate these objections. (shrink)

The aim of this paper is to provide some insights for a normative theory of corporate political activities. Such a theory aims to provide theoretical tools to investigate the legitimacy of corporate political involvement and allows us to determine which political activities and relations with government regulators are appropriate or inappropriate, permissible or impermissible, obligatory or forbidden for corporations. After having explored what I call the “normative presumption of legitimacy” of CPAs, this paper identifies three different plausible strategies to criticize (...) and object to corporate political involvement: the “egalitarian” strategy, the “corporate citizenship” strategy, and the “market failures” strategy. It constitutes an attempt to develop the market failures approach to reflect on CPAs. My main claim is that within such an account, the idea that corporations have a license to operate considerably limits their right to engage in political activities. (shrink)

How should we distinguish between ethical and unethical ways of pursuing profit in a market? The market failures approach (MFA) to business ethics purports to provide an answer to this question. I argue that it fails to do so. The source of this failure is the MFA’s reliance on Pareto efficiency as a core ethical principle. Many ethically “preferred” tactics for seeking profit cannot be justified by appeal to Pareto efficiency. One important reason for this is that Pareto efficiency, as (...) understood by the theory of welfare economics upon which the MFA relies, assumes a static conception of efficiency. This is a problem because many ethically “preferred” tactics can only be justified by appeal to dynamic efficiency considerations. I argue that, instead of Pareto efficiency, we should look to the value of wealth creation to understand the ethical constraints on how market actors may pursue profit. (shrink)

Joseph Heath defends competitive markets and conceptualizes business ethics with reference to Pareto efficiency, which he takes to be the “implicit morality of the market.” His justification for markets is that they generate Pareto efficient outcomes, meaning that markets optimally satisfy consumer preferences. And, for Heath, business ethics is the set of normative constraints—regulation and beyond-compliance norms—needed to preserve that outcome. The present paper accepts Heath’s claim that the economic justification for markets is ethical, in that satisfying consumer preferences is (...) a good. But, contra Heath, the ethical consideration at work is a consequentialist one; and acknowledging this consequentialism exposes limitations of Heath’s “market failures” approach to business ethics. We suggest two limitations, and we expect many will accept our argument that Heath’s conception of business ethics is too narrow. The present paper outlines two broader implications. First, acknowledging that the justification for markets is ethical eliminates the apparent—and false—conflict between purportedly amoral economic activity on one hand and ethical considerations on the other; instead, business ethics is a matter of weighing the consequentialist ethical benefit of economic activity and markets against other moral arguments/other ethical considerations. Second, Heath restricts business ethics to the constraints needed to protect the market’s ability to efficiently satisfy consumer preferences, constraints he calls “efficiency imperatives”; this restriction supports the widespread tendency to think that all social problems are economic; and, a business ethics so-conceived diminishes the perceived importance of noneconomic values—this attitude is dangerous. (shrink)

ABSTRACT:The distinction between what I call nonelective obligations and discretionary obligations, a distinction that focuses on one particular thread of the distinction between perfect and imperfect duties, helps us to identify the obligations that carry over from principals to agents. Clarity on this issue is necessary to identify the moral obligations within “shareholder primacy”, which conceives of managers as agents of shareholders. My main claim is that the principal-agent relation requires agents to fulfill nonelective obligations, but it does not always (...) require discharging discretionary obligations. I show that the requirement to fulfill nonelective obligations is more far-reaching than has been acknowledged by most defenders and critics of shareholder primacy. But I also show that managers are not bound by certain discretionary obligations like charity, showing that their moral obligations are more circumscribed than the obligations that apply to human beings in general. (shrink)

I offer a novel distinction between two concepts of competition. The first, parallel competition, is designed to create separate pathways for each competitor wherein they can maximize their performance. The second, friction competition, is designed to facilitate a clash between competitors. Each concept is utilized as an institutional mechanism to generate social benefits. In parallel competition, the social benefit is the result of the aggregation of the independent efforts of each competitor. In friction competition, it emerges from the clash between (...) competitors. I argue that this distinction carries significant normative implications concerning debates over equality, freedom, and democratic institutional design. (shrink)

This paper proposes a description of the moral obligations of economic agents. It will show that a threefold division should be adopted to distinguish moral obligations applying to their interactions in the market, obligations applying to their interactions inside business firms and obligations applying to their interactions with agents outside the market. Competition might be permissible in the first case since markets are special patterns of social interactions (called adversarial schemes). They produce their benefits when agents try to satisfy exclusive (...) preferences at the expense of others. However, moral obligations inside the firm and moral obligations outside the market are of a different nature. This argument will be developed in the two first parts of this paper. In the third part, it will outline the relevant strengths of that account in relation with two popular views of economic agents’ moral obligations: the shareholder primacy view and the stakeholder theory. (shrink)

One common justification for the pursuit of profit by business firms within a market economy is that profit is not an end in itself but a means to more efficiently produce and allocate resources. Profit, in short, is a mechanism that serves the market’s purpose of producing Pareto superior outcomes for society. This discussion examines whether such a justification, if correct, requires business managers to remain attentive to how their firm’s operation impacts the market’s purpose. In particular, it is argued (...) that the value of efficiency, despite views to the contrary, cannot be fully separated from the planning and intentions of business managers as long as those managers direct their firms in an ethically responsible fashion. This position is inspired by, and serves as a supportive clarification of Joseph Heath’s so-called “market failures approach” to business ethics. (shrink)

This article provides an overview of the field of business ethics.

ABSTRACT:In his 2018 presidential address to the Society of Business Ethics, Jeffery Smith claimed that political approaches to business ethics must be attentive to both the distinctive nature of commercial activity and, at the same time, the degree to which such commercial activity is structured by political decisions and choices. In what we take to be a friendly extension of the argument, we claim that Smith does not go far enough with this insight. Smith’s political approach to business ethics focuses (...) solely on the outcomes of political choices. But if we think of politics in terms of processes—as in, ongoing disagreement and contest—and not merely a series of legal, administrative, or institutional outcomes, a different view of business ethics emerges. In particular, we argue that such an emphasis points us toward seeing business actors as having a normative duty to preserve the integrity and functioning of democracy. (shrink)

Social contract theory offers a powerful method and metaphor for the study of organizational ethics. This paper considers the variant of the social contract that has arguably gained the most attention among business ethicists: integrative social contracts theory or ISCT [Donaldson and Dunfee: 1999, Ties That Bind (Harvard Business School Press, Boston)]. A core precept of ISCT - that consent to membership in an organization entails obligations to follow the norms of that organization, subject to the moral minimums of basic (...) human rights - is a reasonable and appealing notion. One potential challenge for those attempting to apply this idea, however, lies in the dynamic nature of social norms. Organizational norms evolve, often through the conscious efforts of community members and leaders. As currently formulated, ISCT offers a framework that under-appreciates the evolving nature of moral norms. In this paper, we extend ISCT by considering the circumstances under which the terms of and parties to social contracts change. We also consider a number of principles that should be considered as the terms and parties to organizational social contracts change. (shrink)

Business ethics is often understood as a variety of professional ethics, and thus distinct from ordinary morality in an important way. This article seeks to challenge two ways of defending this claim: first, from the nature of business practice, and second, from the contribution of business. The former argument fails because it undermines our ability to rule out a professional-ethics approach to a number of disreputable practices. The latter argument fails because the contribution of business is extrinsic to business in (...) a way that distinguishes from the established professions. The article ultimately suggests we adopt a more aspirational approach to business ethics, which retains an appeal even in the face of charges of anti-capitalist irrelevance. (shrink)

Self-employment merits protection and promotion, we often hear, because it confers independence from a boss. But what, if anything, is wrong with having a boss? On one of the two views that this chapter inspects, being under the power of a boss is objectionable as such, no matter how suitably checked this power may be, for it undermines workers’ agency. On a second view, which republican theorists favor, what is objectionable is subjection not to the power of a boss as (...) such but to their arbitrary power. The first view is unconvincing, I argue, as it entails (implausibly) that being under the power of others in realms like the family or the state is likewise objectionable as such. And although the second view yields compelling reasons for self-employment, it only does so when employers’ power is not suitably checked. When it is, such reasons are more easily outweighed by competing considerations, like those stemming from the further forms of dependence—on suppliers and purchasers—that self-employment may prompt. (shrink)

MacIntyre’s theory of practices, institutions, and their respective kinds of goods, has revived and enriched the ethical critique of market economies, and his view of politics as centrally concerned with common goods and human flourishing presents a major challenge to neutralist liberal theorists’ attempts to exclude distinctively ethical considerations from political deliberation. However, the rejection of neutrality does not entail the rejection of liberalism tout court: questions of human flourishing may be accorded a legitimate role in political decisions-including those about (...) economic systems - provided that the powers of the state remain subject to certain recognizably liberal constraints. Further, although neutralist liberals often defend market economies on the mistaken grounds that they alone are consistent with the principle of ethical neutrality, a non-neutralist defence of them should not be ruled out, especially if the substantive theory of goods used to evaluate them is somewhat less restrictive than MacIntyre’s. (shrink)

Few issues in business ethics are as polarizing as the practice of risk classification and underwrit­ ing in the insurance industry. Theorists who approach the issue from a background in economics often start from the assumption that policy-holders should be charged a rate that reflects the ex­ pected loss that they bring to the insurance scheme. Yet theorists who approach the question from a background in philosophy or civil rights law often begin with a presumption against socalled “actuarially fair” premiums (...) and in favor of “community rating,” in which everyone is charged the same price. This paper begins by examining and rejecting the three primary argu­ ments that have been given to show that actuarially fair premiums are unjust. It then considers the two primary arguments that have been offered by those who wish to defend the practice of risk classification. These arguments overshoot their target, by requiring a “freedom to under­ write” that is much greater than the level of freedom enjoyed in most other commercial transac­ tions. The paper concludes by presenting a defense of a more limited right to underwrite, one that grants the legitimacy of the central principle of risk classification, but permits specific deviations from that ideal when other important social goods are at stake. (shrink)

For years business ethics has limited the moral duties of enterprises to negative duties. Over the last decade it has been argued that positive duties also befall commercial agents, at least when confronted with large scale public problems and when governments fail. The argument that enterprises have positive duties is often grounded in the political nature of commercial life. It is argued that agents must sometimes take over governmental responsibilities. The German republican tradition argues along these lines as does Nien-Hé (...) Hsieh. Agents in commercial life are bound by positive duties because at some point they become citizens that must take on the responsibilities of the state. In this paper we leave undisputed the claim that corporations must acknowledge positive duties. However, we demonstrate that the political grounding fails, at least in the sense that this theory insufficiently acknowledges a long standing liberal tradition that vindicates apolitical markets and clear borderlines between politics and economics. We carve out an alternative route to the grounding of one specific positive duty—the duty to further justice. Our argument is based on the moral nature of commercial agents and tries to demonstrate that the duty to further justice ensues from liberalism. Taking a Kantian perspective, it conceptualizes the duty to further justice as a moral duty, orientated toward the political domain. It is grounded in the obligation to attain moral autonomy in the civil condition. (shrink)

Corporate Strategy has emerged as a central metaphor for private-sector enterprise. Given inherent imperfections in markets, one important question to consider is how well the practice of Corporate Strategy contributes to social welfare. An account of the implicit morality of free markets is developed as a standard against which two particular, second best solutions to market imperfections — namely, American federal antitrust policy and Corporate Strategy — are compared. Corporate Strategy is subsequently evaluated in terms of the fundamental principles of (...) Rawls' theory of justice. In both analyses, Corporate Strategy is found to depart significantly and systematically from the standards of social justice. An alternative principle, grounded in the concept of duty, is introduced as a means for reconceptualizing Corporate Strategy. (shrink)

The market failures approach to business ethics argues that economic theory regarding the efficient workings of a market can generate normative prescriptions for managerial behaviour. It argues that actions that inhibit Pareto optimal solutions are immoral. However, the approach fails to identify goods that should be regulated or prohibited from the market, something common to the moral limits to markets approach to business ethics. There are, however, numerous assumptions underlying Paretian efficiency, including some about the preferences of market participants. Trade (...) in some goods violates some of these assumptions, and so these goods are morally suspect and can be understood to indicate that the market for these goods is not moral. This creates grounds sufficient for regulating, and possibly prohibiting, these goods. To help determine whether it is then necessary to regulate the goods, I propose a supplementary economic analysis to ascertain why an assumption regarding a particular preference is being violated. (shrink)

The growth of global value chains (GVCs) and the emergence of novel forms of value chain governance pose two questions for normative business ethics. First, how should we conceptualize the relationships between members of a GVC? Second, what ethical implications follow from these relationships, both with respect to interactions between GVC members and with respect to achieving broader transnational governance goals? We address these questions by examining the emergence of transnational eco-labeling as an increasingly prominent form of GVC governance that (...) is redefining the relationship between nominally independent firms. On the first question, we argue that GVCs occupy a middle ground between intrafirm and interfirm transactions, thereby posing a challenge to theoretical frameworks that attempt to apply ethical standards based on transaction types. On the second question, we argue that this unique institutional status leads to a range of novel ethical considerations and dilemmas for GVC members. Lead firms, their suppliers, and third-party standard-setters all confront new ethical quandaries when third-party eco-labeling is introduced to a GVC. The nature of these quandaries means that, while GVCs may be well-positioned to serve as instruments of transnational governance, they are frequently not well-oriented to do so. Our analysis marks an initial attempt to map the ethical considerations that apply to members of a GVC, and in doing so, places the literature on normative business ethics and transnational governance in a closer conversation. (shrink)

The growth of global value chains (GVCs) and the emergence of novel forms of value chain governance pose two questions for normative business ethics. First, how should we conceptualize the relationships between members of a GVC? Second, what ethical implications follow from these relationships, both with respect to interactions between GVC members and with respect to achieving broader transnational governance goals? We address these questions by examining the emergence of transnational eco‐labeling as an increasingly prominent form of GVC governance that (...) is redefining the relationship between nominally independent firms. On the first question, we argue that GVCs occupy a middle ground between intrafirm and interfirm transactions, thereby posing a challenge to theoretical frameworks that attempt to apply ethical standards based on transaction types. On the second question, we argue that this unique institutional status leads to a range of novel ethical considerations and dilemmas for GVC members. Lead firms, their suppliers, and third‐party standard‐setters all confront new ethical quandaries when third‐party eco‐labeling is introduced to a GVC. The nature of these quandaries means that, while GVCs may be well‐positioned to serve as instruments of transnational governance, they are frequently not well‐oriented to do so. Our analysis marks an initial attempt to map the ethical considerations that apply to members of a GVC, and in doing so, places the literature on normative business ethics and transnational governance in a closer conversation. (shrink)

A number of recent authors, most notably Joseph Heath, have persausively defended a market‐centered account of corporate responsibility that grounds standards of business conduct upon the normative presuppositions of the market. They have us focus on two important items: first, the value of welfare, or Pareto efficient outcomes, which underwrites the legitimacy of market arrangements; and second, the behavioral requirements needed to assure that corporations conduct business in a manner consistent with this value. This article critically examines the aspirations of (...) this literature by embracing its basic method but questioning how well it understands the aim of the market. It puts forth a limited case for corporate responsibility anchored in other dimensions of the public good, distinct from the value of efficiency, and argues that a plausible understanding of corporate responsibility arises from the notion that market arrangements are sites of delegated social authority to provision other aspects of the common good. (shrink)

The “question of reasonable compliance” concerns how business firms should comply with morally reasonable laws that have been democratically enacted. This article argues that, out of respect for the governing authority of democratic citizens, firms should comply with the law in accordance with legislators’ normative expectations of compliance. It defends this view against arguments from the legal, economic and business ethics literatures that focus on the contentious nature of democracy and the competitive nature of the market. In response this article (...) argues that these adversarial features of democracy and capitalism do not limit the ability of democratic legislatures to set normative expectations of market actors, nor the duty of firms to comply with them. (shrink)

This article revisits the "harmony doctrine" school of economics and its distinctive understanding of how ethics and economics intersect. Harmony doctrine thinkers staked out a “natural” understanding of economic phenomena that in many ways fused the classical political economy of Adam Smith with the earlier French Physiocratic School. Their metaphysically grounded interpretation was largely eclipsed by the developments of utilitarian and marginalist schools by the end of the nineteenth century. Yet harmony doctrine thinking adhered to a distinct understanding of how (...) ethical processes and outcomes play out within the economic sphere that has to date gone under examined by business ethicists. This paper outlines three characteristics of harmony doctrine views: the belief in curative forces empowered to "heal" the economic order, a dichotomous interpretation of the economic realm that distinguishes the “natural” from the “artificial,” and an overarching belief in a harmonious social order actualized by cooperative interdependencies within economic enterprises. Despite falling into obscurity in the economic discipline, all these ideas found new life in intellectual currents of organizational and political thought at the turn of the twentieth century. After surveying these historical developments, this article concludes by demonstrating how harmony doctrine thinking helpfully illuminates persisting metaphysical dimensions of contemporary business ethics. (shrink)

In latter-day discussions on corporate morality, duties of commission are fiercely debated. Moral institutionalists argue that duties of commission—such as a duty of assistance—overstep the boundaries of moral duty owed by economic agents. " Moral institutionalism" is a newly coined term for a familiar position on market morality. It maintains that market morality ought to be restricted, excluding all duties of commission. Neo-Classical thinkers such as Baumol and Homann defend it most eloquently. They underpin their position with concerns that go (...) to the core of liberalism—the dominant western political theory that sustains the ideals of both the free market and the free, rational person. Those authors claim that liberalism calls for a fully differentiated market because it resents the politicization of the market. Fully differentiated markets exclude duties of commission. They also claim that full differentiation of the market closes the troublesome gap between moral motivation and moral virtue. Full differentiation redeems the promise of "easy virtue". In this paper moral institutionalism will be rejected from a Kantian point of view, mostly inspired by Herman's thesis on the invisibility of morality. Liberalism may perhaps ban the politicization of the market; it does not forbid its moralization. The idea of a fully differentiated market must also be rejected because it is either morally over-demanding (to the morally autonomous person) or morally hazardous (to the person with failing moral motivation). Contrary to what the moral institutionalists claim, right action, morally, is actually quite difficult in fully differentiated markets. (shrink)

I present a dilemma for the market failures approach to business ethics. On an orthodox interpretation, it takes moral requirements for businesses to require them not to profit from market failures to approximate Pareto efficiency. On a moralized interpretation, it also incorporates other considerations. However, the orthodox approach is extensionally inadequate, for it is legitimate to profit from many of the allegedly ruled-out market failures. The moralized approach does better but fails to be sufficiently comprehensive. First, it has not been (...) shown why we ought to adhere to any particular limited subset of norms of and for the market. Second, we have a very general reason to mitigate the moral horror of the world, which indicates that the market failures approach is too arbitrarily restricted. (shrink)

Citing corporate concentration and lax enforcement since the Reagan era, the Biden administration has declared a new era of aggressive antitrust prosecution, bringing antimonopoly actions against tech giants such as Meta, Google, and Amazon. But what’s so bad about monopoly or corporate concentration? The standard answer appeals to economic consequences, such as higher prices or deadweight losses. This paper offers a different framework. It argues monopolizing can be a form of cheating, which is a wrong that attaches to means, not (...) just ends; an athlete who cheats but loses still does wrong. In particular, this paper argues that certain market-controlling strategies constitute a form of cheating I call ‘structural cheating,’ best illustrated by the metaphor of creating an unlevel playing field: rather than compete fairly on merits such as product quality and price, a firm that acquires rivals biases the market in its favor, thereby entrenching a dominant position that effectively forces would-be competitors to compete uphill. By framing (alleged) antitrust violations as cheating, while using the FTC’s lawsuit against Facebook (now Meta) as a test case, this paper provides a needed corrective to those citing market success as evidence of merit or skill. A further upshot is the structural cheating account better explains the distinctively problematic features of social media market concentration than Heath’s Market Failures Approach. More generally, this paper provides a normative lens for analyzing fair market competition and shows why it’s not only winning or losing that counts in capitalism, but how one plays the game. (shrink)

In many places, it is possible to buy psychic services, including tarot card, palm, and mediumship readings. Yet we have powerful evidence that psychic abilities do not exist. This paper asks whether psychic services should be for sale. I begin by considering whether psychics deceive or mislead buyers. Next, I consider a harm-based argument against the sale of psychic services. Finally, I consider an argument in favor of their sale that appeals to expressive considerations. I conclude with a tentative policy (...) recommendation: the sale of psychic services should be permitted. This is so even though much of the money spent on them will be money wasted. (shrink)

Managers often have discretion in interpreting their ethical requirements, and they should seek democratic guidance in doing so. The undemocratic nature of managerial ethical discretion is shown to be a recurring problem in business ethics. Joseph Heath’s market failures approach (MFA) is introduced as a theory better positioned to deal with this problem than other views. However, due to epistemic uncertainty and conceptual indeterminacy, the MFA is shown to allow a much wider range of managerial discretion than initially appears. The (...) paper explores how this range can be narrowed down with democratic input, comparing models based on formal state institutions and on the informal public sphere. A case study from the pharmaceutical industry illustrates the merits of the informal public sphere approach. (shrink)

A response to the discussants, Nien-hê Hsieh, Jeffrey Moriarty and J. (Hans) van Oosterhout, who took part in the March, 2005 symposium “The Political Theory of Organizations: A Retrospective Examination of Christopher McMahon’s Authority and Democracy: A General Theory of Government and Management” held in San Francisco as part of the Society for Business Ethics Group Meeting at the Pacific Division Meetings of the American Philosophical Association.

The idea that business firms qualify as group moral agents offers an attractive basis for understanding corporate moral responsibility. However, that idea gives rise to the “corporate autonomy problem” (CAP): if firms are moral agents, then it seems we must accept the implausible conclusion that firms have basic moral rights, such as the rights to life and liberty. The question, then, is how one might retain the fruitful idea of firms as moral agents, yet avoid CAP. A common approach to (...) avoiding CAP appeals to specific features of human embodiment, such as vulnerability to pain, as the basis for attributing moral rights to human persons but not to firms. But that response has less purchase in a Kantian framework, which does not ground moral status in such particularities of human embodiment, but rather in the rational nature that humans share with other rational beings. To avoid CAP while retaining a (broadly) Kantian framework, one does better to rely on features of firms as cooperative, compositionally derivative moral agents, created for the pursuit of specific ends. As derivative agents, firms do not qualify as Kantian ends in themselves, and thus are not appropriate bearers of basic moral rights. To further clarify the level of consideration we owe to firms, I draw on Darwall’s distinction between recognition respect and moral esteem, arguing that we should not respect firms as unconditional ends in themselves, but rather esteem morally autonomous firms as collective achievements of their human members. (shrink)

This treatise presents a transcendental argument for corporate social responsibility. The argument is that corporate social responsibility, or CSR, is best understood as a collective moral practice that is a precondition for sustainable business. There are a number of theories and definitions of CSR in the contemporary business literature. These theories include considerations of economic, legal, social, and environmental notions of what a corporation ought to take responsibility for based on either motives or concerns of accountability for corporate acts. This (...) work focuses on economic theories. I analyze the distinction between the technical terms "responsibility" and "accountability" found in these theories. This enables me to explicate the meaning of corporate responsibility as it relates to the conditions of sustainable business activity. These conditions necessarily include moral content. In other words, this is an applied ethics project. First, I inquire into the intellectual history of the broader sense of corporate responsibility and review various contemporary notions of corporate social responsibility. My concern is whether these notions presuppose broader forms of moral responsibility to others as an obligation, moral responsibility for acts, or to be held morally responsible based on moral tendencies, particular motives, or resulting outcomes. This concern forms the basis of my consideration of the notions of individual and collective responsibility. The following work includes an analysis of the notion of human choice as a collective endeavor of institutional relationships and practice in the economic market system. I argue that corporate motives for moral interrelationships are necessarily implicit in biosocioeconomic multinational market enterprise. I conclude that an analysis of corporate community involvement may be found in a case study of Starbucks Coffee Company's efforts to practice CSR in particular coffee bean farming communities in developing countries. (shrink)