Purpose:On the background of innovation-driven growth strategy of the Chinese government, this study aims to explore the impact of the knowledge base on innovation-driven growth of a firm, which is moderated by organizational character.Design/methodology/approach:Based on the data of 965 Chinese listed companies, some hypotheses were tested using the method of hierarchical regression analysis.Findings:Organizational growth relies on both technological and business model innovations and their interactive effect. Knowledge base, both breadth and depth, makes a positive impact on the innovation-driven growth of (...) an enterprise. In the impacting mechanism, an explicit organizational character not only has direct positive effects on business model innovation, it also strengthens the effect of knowledge breadth on business model innovation. On the contrary, an implicit organizational character is not significantly related to innovation.Research limitations/implications:In order to achieve growth, enterprises are suggested to adopt such dual innovation strategy, led by technological innovation and supplemented with business model innovation, which is supported by the integrated management of intangible resources, deep and broad knowledge, and explicit organizational character.Originality/value:A new theoretical framework of organizational innovation-driven growth was proposed. The realization paths of innovation-driven growth were explored. The idea of collaborative governance between the knowledge base and organizational character was raised. (shrink)

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)

Business Ethics: A European Review, EarlyView.

In recent years, there has been increasing concern about unethical conduct within corporate business, not least because of the scandalous behavior of former chief executives at top blue chip companies such as Enron, Worldcom, Parmalat, and Volkswagen. These scandals have not only threatened the privileged position of senior corporate employees but also the solvency of the companies they manage and lead. The high profile cases of corporate crime and corruption that occurred in the early 2000s together with the 2008 Wall (...) Street bailouts and the growth in criminal prosecutions since have raised the profile of business ethics to an unprecedented level. Greater public sensitivity toward and awareness about the unlawful and immoral conduct of firms in the United States and elsewhere, has created demand for organizations to become more accountable and socially responsible and prompted greater regulatory scrutiny. It has also served to highlight the embryonic and delimited state of research and scholarship on business ethics, where the focus has tended to remain on leadership. A neglected, though important, line of ethical enquiry concerns followership. Corporate wrongdoing would be less formidable and extensive if it was not aided and abetted. Two key questions arise. First, what prompts followers to support rather than oppose bad leaders? Second, what can be done to stem or at least curtail their allegiance to bad leaders? (shrink)

This paper seeks to show how MacIntyre’s concept of a practice can survive a series of ‘scope problems’ which threaten to render the concept inapplicable to business ethics. I begin by outlining MacIntyre’s concept of a practice before arguing that, despite an asymmetry between productive and non-productive practices, the elasticity of the concept of a practice allows us to accommodate productive and profitable activities. This elasticity of practices allows us to sidestep the problem of adjudicating between practitioners and non-practitioners as (...) well as the problem of generic activities. I conclude by suggesting that the contemporary tendency to regard work as an object of consumption, rather than undermining MacIntyre’s account of practices, serves to demonstrate the potential breadth of its applicability. (shrink)

This study investigates the connection between corporate social responsibility (CSR) and corporate reputation among the public using fuzzy set qualitative comparative analysis (fsQCA). To examine complex processes underlying the reactions of this influential stakeholder group, hypotheses are drawn from the category diagnosticity approach. Thereby, a psychological model of perceived (im)morality is transferred to the CSR context. In line with these hypotheses, positive/negative CSR activities influence reputation in the expected directions (H1a, b), while the effects of specific configurations of CSR activities (...) reveal an asymmetry suggesting a negativity bias (H2). Further analyses confirm that positive effects require a consistent positive performance regarding prior reputations (H3a) and the aggregated CSR activities of several previous years (H3b, c). Moreover, the relevant patterns vary between industries (H4). The present study thus contributes to CSR research by investigating a powerful but hitherto understudied stakeholder group through a category diagnosticity lens combined with a configurational approach to analysis. (shrink)

An extensive literature has focused on the impact of new public management oriented structural changes on academics’ practice and identity. These critical studies have been resolute in concluding that NPM inevitably leads to a degeneration of academics’ ethos and values. Drawing from the moral philosophy of Alasdair MacIntyre, we argue that these previous analyses have overlooked the moral agency of the academics and their role in ‘moralizing’ and consequently shaping the ethical nature of their practices. The paper provides a new (...) theoretical understanding of NPM-oriented reforms in light of the virtue ethics approach, thereby directing the attention to the moral character and moral agency of academics. Our analysis of interviews collected in the business department of a Danish university provides an example of how individuals have divergent ethical understandings of these structural changes and enact/resist pre-defined social roles in different ways. While in some cases the NPM agenda of the institutions has triggered internal moral conflict and a crisis of moral character, in other cases the new logic resonates with academics’ values and evaluative standards. Partially departing from the theoretical ground of MacIntyre, we conclude that academics can play a crucial role in shaping the morality of NPM-oriented institutions and in transforming these settings into suitable contexts for the cultivation of virtues. (shrink)

It has been claimed that ‘virtuous structures’ can foster moral agency in organisations. We investigate this in the context of employee involvement in corporate philanthropy, an activity whose moral status has been disputed. Employing Alasdair MacIntyre’s account of moral agency, we analyse the results of eight focus groups with employees engaged in corporate philanthropy in an employee-owned retailer, the John Lewis Partnership. Within this organisational context, Employee–Partners’ moral agency was evidenced in narrative accounts of their engagement in philanthropic activities and (...) in their disputes about the moral status of corporate philanthropy. (shrink)

The current economic and preceding financial crises seem to provide evidence in favour of the self-destruction thesis of capitalism. Responses to the crisis have been polarised. Some suggest that regulatory changes are all that is needed. Others suggest the need to change the economic system by developing a new global economic ethic. The first is too limited, the second too utopian. This article suggests that a MacIntyrean virtue ethics approach provides both a more convincing diagnosis of the problem and leads (...) to a more workable prescription. First, we need to understand the internal contradictions of the tradition that has developed of how to ‘do’ business. Then we need the virtues to be exercised inside practices and institutions. But virtue itself needs to be institutionalised; we need an appropriate governance of virtue in organizations. Even though governance is usually taken to ‘crowd out’ virtue, this article proposes an approach to governance that ‘crowds in’ virtue. (shrink)

Building on dissatisfaction with current approaches that entail a superficial conception of the firm’s moral agency, this article has two broad theoretical underpinnings. First, it refers to the Catholic Social Thought’s view of the enterprise as a community of work, which leads to place stress on the possibility of creating ‘organizational humanizing cultures’ that revolve around the principles of human dignity and the common good and allow organizational members to flourish. Second, the article draws on the perspective of the sociologist (...) Philip Selznick to emphasize the key role of ‘institutional leadership’ in the formation and maintenance of a moral organizational character, also suggesting that these processes involve an influence on the development of employees’ moral identity conceived as a driver of moral agency. On these theoretical grounds, the article’s central argument is articulated by claiming that human resource management can provide essential support for the development of organizational humanizing cultures. In particular, it is highlighted how human resource management professionals may operate as institutional leaders who contribute to the embedding of moral identities in the organizational context. (shrink)

Ethical networks are an emerging form of social alliance based on collaboration between organizations that share a common ethical commitment. Grounded in a theoretical framework of virtue-based business ethics and focusing on nonprofit alliances, this study investigates the virtuousness of ethical networks; that is, how they trigger virtuous practices in their member nonprofit organizations. Adopting a qualitative grounded theory approach, the study focuses on one of the largest Italian ethical networks of nonprofit organizations operating in the social care sector. The (...) findings show that shared ethical values and religious beliefs are positively associated with ethical network building. Based on these findings, a circular model of virtuousness is proposed in which ethical networks foster virtuous practices among their members at four levels: (1) the strategic orientation level, (2) the institutional level, (3) the organizational level, and (4) the relational level. At each of these levels, ethical networks foster a habituation to virtues and the propagation of virtuous behaviors among their members. Theoretical, practical, and social implications of the research findings are discussed. (shrink)

Islamic financing instruments can be categorised into profit and loss/risk sharing and non-participatory instruments. Although profit and loss sharing instruments such as musharakah are widely accepted as the ideal form of Islamic financing, prior studies suggest that alternative instruments such as murabahah are preferred by Islamic banks. Nevertheless, prior studies did not explore factors that influence the use of Islamic financing among non-financial firms. Our study fills this gap and contributes new knowledge in several ways. First, we find no evidence (...) of widespread use of Islamic financing instruments across non-financial firms. This is because the instruments are mostly used by less profitable firms with higher leverage. Second, we find that profit and loss sharing instruments are hardly used, whilst the use of murabahah is dominant. Consistent with the prediction of moral-hazard-risk avoidance theory, further analysis suggests that users with a lower asset base are associated with murabahah financing. Third, we present a critical discourse on the contentious nature of murabahah as practised. The economic significance and ethical issues associated with murabahah as practised should trigger serious efforts to steer Islamic corporate financing towards risk-sharing more than the controversial rent-seeking practice. (shrink)

This paper critically reviews and discusses the concept of organizational virtuousness as presented in positive organizational scholarship. It identifies Kim S. Cameron, David S. Bright, and Arran Caza as the most influential researchers within this field and portrays commonalities, differences, and inconsistencies among the various notions of organizational virtuousness offered in positive organizational literature throughout the last 15 years. While the commonalities refer to attributes, levels of analyses, outcomes, and methodology, the variances concern the locus of residence, the priority of (...) outcomes, indicators, supporting features and the virtues included in positive organizational virtuousness. The analysis further discusses the strengths and weaknesses of these differences and stresses the challenges which the POS movement needs to face in order to clarify its definition of organizational virtuousness and, maybe, converge on one unified meaning. Finally, these challenges are summarized and linked to future research proposals which offer potential ideas on how to further develop the concept of positive organizational virtuousness. (shrink)

One of the key debates about applying virtue ethics to business is whether or not the aims and values of a business actually prevent the exercise of virtues. Some of the more interesting disagreement in this debate has arisen amongst proponents of virtue ethics. This article analyzes the central issues of this debate in order to advance an alternative way of thinking about how a business can be a form of virtuous practice. Instead of relying on the paired concepts of (...) internal and external goods that define what counts as virtuous, I offer a version of speech act theory taken from Paul Ricoeur to show how a business can satisfy several aims without compromising the exercise of the virtues. I refer to this as a polyvalent approach where a single task within a business can have instrumental, conventional, and imaginative effects. These effects correspond to the locutionary, illocutionary, and perlocutionary dimensions of meaning. I argue that perlocution provides a way in which the moral imagination can discover the moral significance of others that might have not been noticed before, and furthermore, that for such effects to be practiced, they require appropriate virtues. I look at two cases taken from consultation work to thresh out the theoretical and practical detail. (shrink)

Anthropomorphism is the attribution of human features to non-human subjects. Anthropomorphized organizations acquire in the minds of their members a unique identity, which becomes capable of guiding members’ motivations, with important managerial implications. Ashforth et al. offered a theoretical model of anthropomorphism in organizations, including “top-down” and “bottom-up” processes of organizational anthropomorphism as antecedents, and sensemaking and the sense of social connection of the organization as outcomes. Using SEM, this study operationalizes Ashforth et al.’s model using a two-trait scale of (...) organizational virtue derived from Chun, including measures of CSR and OCB as antecedents, and organizational justice and affective commitment as outcomes. The model is tested on survey data from seven UK managed service organizations in the hotels, logistics and legal sectors. As secondary contribution, moderation analysis is undertaken by industry, offering further insight into the evaluation of organizational anthropomorphism. Firstly, we note that high evaluations of Empathy influence evaluations of Courage through a halo effect. Secondly, we note that heuristic evaluation of the firm’s CSR practice also influences perceptions of Empathy and Courage. The paper also includes a discussion of the critique of organizational virtues by virtue ethicists in an effort to advance the dialogue between the two traditions. (shrink)

Aristotle's doctrine of the mean states that a virtue is the mean state between two vices: a deficient and an excessive one. The Corporate Ethical Virtues Model defines the mean and the corresponding deficient vice for each of its seven virtues. This paper defines for each of these virtues the corresponding excessive vice and explores why organizations characterized by these excessive vices increase the likelihood that their employees will behave unethically. The excessive vices are patronization, pompousness, lavishness, zealotry, overexposure, talkativeness, (...) and oppressiveness. (shrink)

This article analyzes in detail the virtue of practical wisdom as described by Thomas Aquinas, and on this basis it develops a comprehensive framework to enrich Authentic Leadership theory, establishing the virtue of practical wisdom as foundational for the authentic leader’s behavior and character development, and highlighting shortfalls that may stem from vices opposed to it. The goal of the article is twofold: First, it seeks to fill a void on the role of virtues –and in particular practical wisdom– in (...) leadership studies; second, it aims to show how cultivating the virtue of practical wisdom as described by Aquinas promotes the development of exactly those traits that are characteristic of an authentic leader, offering a set of propositions delineating these correlations. (shrink)

So far, the field of business ethics lacks validated measures for assessing virtues at the organizational level. The aim of this study is to investigate the measurement invariance of a shortened Corporate Ethical Virtues scale. In this manner, we contribute to validating an instrument that is both psychometrically sound and efficient to use. We conducted two survey studies of two independent groups (managers and school psychologists). Confirmatory factor analysis supported the eight‐factor model of the scale, and we found it to (...) be invariant in two different occupational groups. The managers gave higher appraisals of ethical culture than the psychologists did in seven out of the eight dimensions. We found that despite the contextual differences, the shortened scale measures the eight dimensions of organizational ethical virtues, as intended. Thus, the use of this more compact scale can be recommended for future studies, which will hopefully stimulate more research on ethical culture in various work contexts. (shrink)

Organizational integrity is a key concept with and through which a company can assume its responsibility for ethical and societal issues. It is a basic premise for sustainable corporate success, as ethical risks ultimately become economic risks for a company. Recent research shows the potential of integrity‐based governance models to reduce corporate risks and to improve business performance. However, companies are not yet able to assess nor evaluate their level of organizational integrity in a sound and systematic way. We aim (...) to develop a theoretical model as a basis for the measurement of organizational integrity by conceptualizing the construct and sizing the theoretical model's scope. We suggest that the theoretical model follows a holistic approach and involves three types of dimensions: prerequisite dimensions, independent dimensions, and dependent dimensions. The organizational integrity triad—consisting of active commitments to self‐imposed norms and principles, their transparent institutionalization into corporate processes and structures, and their implementation into action—plays a key role in this context. (shrink)

Business Ethics: A European Review, EarlyView.

This paper argues that Shanahan and Hyman’s Virtue Ethics Scale should be abandoned and that work should begin to develop better-grounded measures for identifying individual business virtue in context. It comes to this conclusion despite the VES being the only existing measure of individuals’ virtues that focuses on business people in general, rather than those who hold specific leadership or audit roles. The paper presents a study that, in attempting to validate the VES, raises significant concerns about its construction. In (...) particular, investigation of the VES items leads to adjustments in the language used and examines participants’ understanding of the virtue terms and their descriptors. Confirmatory factor analysis of data collected from a sample of 137 HR practitioners establishes that the 6-factor solution identified by Shanahan and Hyman is not appropriate for the sample under examination. Rather, exploratory factor analysis results in three dimensions based in 13 items focusing on the individuals’ reliability, resourcefulness, and leadership. Finally, multiple regression establishes that these dimensions do not on the whole show associations with MA or PRESOR, two measures through which it would be expected to establish convergent and divergent validity. The paper concludes by suggesting guidelines for the development of future measures of IBV. (shrink)

The objective of this study is twofold: to examine the patterns that govern social reporting with reference to an Islamic framework and to identify the moral legitimacy factors that influence them. We select 146 publicly listed Sharia‐compliant companies and classify the disclosures in their annual reports according to an Islamic framework that categorises items as either Required, Expected or Desired to indicate the degree of importance each item carries from an Islamic perspective. Based on this framework, we then analyse moral (...) legitimacy factors, specifically the type of Sharia screening body and the proportion of Muslims in the population, that may influence the prioritisation of the different categories of social reporting. We find that disclosures that fall into the Required category of our framework—especially those that relate to companies’ involvement in “haram” activities (activities not permissible in Islam)—are still few among the companies studied. Our research also reveals that both moral legitimacy factors under investigation influence the three categories of social reporting, although in different ways. This research contributes to the existing literature by empirically examining how organisations prioritise their disclosure of virtues and the moral legitimacy factors that influence that prioritisation. (shrink)

The compliance-based approach and the integrity approach have been the mainstream responses to corporate scandals. This paper proposes that, despite each approach comprising necessary elements, neither offers a comprehensive solution. Compliance and integrity, far from being mutually exclusive, reinforce each other. Working together, in a correct relationship, they build a harmonized system that yields positive synergies and which also advocates prudence. It enables the generation of a culture of compliance that tends to minimize the technical and ethical errors in decision (...) making. In order to explore an applied harmonized approach, we analyze the audit committee, a specific and broadly accepted regulatory instrument. Formed by non-executive members, regulation requires these members to be dedicated, qualified, and independent as a guarantee of efficiency. We show how the compound of those elements produces positive effects in a context of solid governance. We conclude that it is the strong relationship between efficiency and prudence, in the creation of a culture of compliance, which enables the minimization of errors. (shrink)

We extend the Theory of Planned Behavior (TPB) for ethics in the workplace. Using a path modeling methodology, we find evidence that, for ethics, moral disengagement is an antecedent to the TPB predictors of attitude, subjective norms, and perceived behavioral control (PBC). We show that the TPB predictors mediate the influence moral disengagement has on ethical behavioral intentions. Thus, to improve ethical behavior, reducing moral disengagement is critical. We find support for including both types of PBC (self-efficacy and locus of (...) control) when modeling ethical behavior. We use four ethics scenarios and international data to test this model. We also evaluate potential positive influences on ethics in the workplace and find that recency of ethics training interacts with religiosity and activates it to reduce moral disengagement. We also find that principles-based ethics training enhances professionals’ self-efficacy to behave ethically. Experience, including time as a member in a professional accounting organization, increases both locus of control and self-efficacy to behave ethically. These variables—recency of ethical training, religiosity, principles-based professional ethics training, and experience—influence parts of the core TPB model, which in turn lead to improved ethical behavioral intentions. (shrink)

This paper introduces ‘Virtue and Virtuousness: When will the twain ever meet?’ a special edition of Business Ethics: A European Review. The Call for Papers invited contributions that could inform the relationship between organisational virtuousness, as conceptualised by positive organisation studies, and the classical conception of virtues pertaining to individual women and men. While the resources of particular virtue traditions – Aristotelian, Catholic, Confucian, and the like – could inform their own debates as to whether virtue extends beyond individuals, the (...) debate between virtue traditions and positive organisation studies has a different dimension. The question is whether the claims of positive social sciences as such are compatible with those of any virtue tradition. We argue that positive social science and virtue traditions are indeed rivals such that adherence to the claims of the one precludes adherence to the other. Resolution to such conflicts requires that one tradition is able to resolve questions that exhaust the resources of the other. This paper suggests that at least one area of incoherence in the findings of positive social sciences can be resolved by virtue traditions, and introduces the remaining papers in the special edition. (shrink)

This article considers financial risk management practice using a virtue ethics lens, in response to ongoing critiques of risk management from within business ethics. Risk management should be seen as embedded within a complex system of cultures, organizations and regulations that are underpinned by a quantitatively reductive or ‘mechanistic’ economic paradigm, where dominant logics of self-interest, profit maximization and short-termism prevail. Building on recent work applying virtue ethics in finance, an alternative to the values, normative expectations and priorities in financial (...) risk management is presented in the form of a refined ‘taxonomy’ of the virtues that can be applied to individuals and organizations engaged in financial risk management. This article aims to contribute to and extend debate on the ethical aspects of risk management and presents an alternative to more technically based critiques which do not engage with the underlying socially constructed foundations of risk management practice. It thereby provides a basis to critique the mechanistic and narrow approach used in the current regulation of the sector. (shrink)

Dimensions of character are often overlooked in professional practice at the expense of the development of technical competence and operational efficiency. Drawing on philosophical accounts of virtue ethics and positive psychology, the present work attempts to elevate the role of ‘good’ character in the professional domain. A ‘good’ professional is ideally one that exemplifies dimensions of character informed by sound judgement. A total of 2340 professionals, from five discrete professions, were profiled based on their valuation of qualities pertaining to character (...) and judgement. Profile differences were subsequently examined in the self-reported experience of professional purpose towards a wider societal ‘good’. Analysis of covariance, controlling for stage of career, revealed that professionals valuing character reported higher professional purpose than those overweighting the importance of judgement or valuing neither character nor judgement, F = 7.92, p <.001. No differences were found between the two groups valuing character, irrespective of whether judgement was valued simultaneously. This profiling analysis of entry-level and in-service professionals, based on their holistic character composition, paves the way for fresh philosophical discussion regarding what constitutes a ‘good’ professional and the interplay between character and judgement. The empirical findings may be of substantive value in helping to recognise how the dimensions of character and judgement may impact upon practitioners’ professional purpose. (shrink)

Phronesis is essential for good decision‐making and actions. This literature review shows how phronesis has been discussed and related to elements of the field of administration and organizations. A search in the database systems Scopus, EBSCO, Web of Science, and Scielo, based on eligibility criteria, resulted in 43 theoretical and 14 empirical works. The analysis of these studies showed the most significant empirical contributions, the most cited authors, methods, journals, and central themes addressed in studies on phronesis to understand ethics (...) in business. From a virtue ethics perspective, we discuss the major theoretical and empirical contributions, as well as the implications of a restricted understanding of phronesis when it is treated apart from other elements of the virtue ethics framework. We present a synthesis of the concepts of phronesis, based on dimensions of magnitude and amplitude of the conceptions, ranging from formal to substantive phronesis, and covering individual, organizational, or societal levels of analysis. We argue that a substantive conception of phronesis within virtue ethics may improve our understanding of ethics because it assumes the interdependence of phronesis and moral virtues, integral anthropology, and the common good. We present a future research agenda, considering the study's limitations and findings. (shrink)

Sustainability is a crucial issue for many sectors in Malaysia, including the manufacturing sector. Many businesses, especially the chemical manufacturing industry, aim to achieve a sustainable business through the implementation of green practices. Green practices provide guidelines for the employees to simultaneously sustain the organisation in a sustainable manner and carry out the required manufacturing activities. Focusing on that, this study aimed to examine the effects of green practices on corporate sustainability performance through Islamic work ethics, organisation size, and organisation (...) age as moderators. Using the stratified random sampling technique, 344 chemical manufacturing organisations in Malaysia were invited to participate in a survey. Data from 130 completed questionnaire sets were subjected to partial least square (PLS) analysis. The results demonstrated significant effects of green practices on corporate sustainability performance via Islamic work ethics and organisation size. However, organisation age was found to exhibit no moderation effect on the relationship between green practices and corporate sustainability performance. Conclusively, as part of the organisational strategies, the sustainability of chemical manufacturing organisations must involve successful implementation of green practices, Islamic work ethics, and organisation size. This study offered several theoretical and practical contributions on green practices, Islamic work ethics, organisation size, and organisation age, and corporate sustainability performance. Theoretically, this study extended literature on the resource-based view theory, natural-resource-based view theory, and stakeholder theory. Al-Quran and hadith were used to support this study to link the relationships of the variables under study, particularly in the context of chemical manufacturing organisations in Malaysia. Practically, this study was expected to assist chemical manufacturers in selecting the appropriate green practices to achieve corporate sustainability performance and good implementation of Islamic work ethics. Additionally, it is recommended for future research to explore other types of industries in the manufacturing sector given the focus of this study on the chemical manufacturing industry only. (shrink)