ABSTRACT:Profit maximizers have reasons to agree with stakeholder theorists that managers may need to consider different values simultaneously in decision making. However, it remains unclear how maximizing a single value can be reconciled with simultaneously considering different values. A solution can neither be found in substantive normative philosophical theories, nor in postulating the maximization of profit. Managers make sense of the values in a situation by means of the many thick value concepts of ordinary language. Thick evaluation involves the simultaneous (...) consideration of different values: making sense of a value always involves knowing how to engage with it given the other values in the situation. This also goes for profit: maximization is only one way of engaging with the value of profit, and grasping whether maximization is appropriate involves considering other values. We discuss some consequences of our approach for stakeholder theorists and profit maximizers. (shrink)

Stakeholder theory claims to promote moral values in business and this claim is generally accepted. Yet, literature shows that the theory is fundamentally strategic and only incidentally normative. This paper explores the assumptions of philosophical pragmatism that underpin the theory and concludes that the theory does not qualify as normative, since its conception of morality is basically hypothetical.

I argue that a governance perspective on corporate social responsibility (CSR) makes it possible to explain why the concept will always be under‐defined, is normative and thus political by nature, and is and should be difficult to measure. The perspective also makes it possible to understand the interaction between corporate values and stakeholders values.In processes of dialogue within governance systems and governance structures, changing insights into the principles of CSR can lead to regulation or its adjustment. Power is important in (...) these dialogues. Principles are at least partly shaped within governance systems and governance structures, and they influence the outcomes of corporate policies. Changes within the regulatory framework could also lead to changes in the principles of CSR.Value attunement processes could lead to regulation, which again influences the governance structures and thus the power of stakeholders within the dialogue. The theoretical model provided helps to analyze why CSR is different in companies, cultures and academic traditions. (shrink)

Though we cherish freedom and equality, there are human relations we commonly take to be morally permissible despite the fact that they essentially involve an inequality specifically of freedom, i.e., parental and fiduciary relations. In this article, I argue that the morality of these relations is best understood through a very old and dangerous concept, the concept of status. Despite their historic and continuing abuses, status relations are alive and well today, I argue, because some of them are necessary. We (...) must therefore carefully specify the conditions in which such status relations may morally obtain, as well as the duties of virtue and duties of right to which all parties are subject when it does (including a duty of care) to clearly articulate the ways in which these putatively moral status relations that essentially involve an asymmetry of autonomy (status relations) can go well or badly even within the context of the Kantian tradition from which our current legal and social practices arose. To this end, I offer Kant's own concept of status as a promising one because in Kant's theory, status is a nexus of virtue and right that is reducible to neither property nor contract but akin to each in familiar ways. Once status is admitted as an alternative to property and contract, status may be extended beyond Kant's domestic paradigm, most perspicuously to institutional ethics. In this article, I sketch a status-based theory of stakeholding that locates environmental impact, institutional oppression, and other significant features of our moral landscape within a Kantian framework of duties rich enough to more accurately characterize the complexities of stakeholding than current tradition has allowed. (shrink)

When corporate social responsibility (CSR) as a sensemaking process is assessed from a corporate governance perspective, this implies that stakeholders do not only influence companies by promoting and enforcing regulations and other corporate guidelines. They also influence companies by promoting regulation on influence pathways, by demanding that companies develop formal mechanisms that allow companies and stakeholders to discuss and in some cases agree on changes to principles and policies. This perspective suggests that regulation is an outcome of power relations and (...) is, as such, a reflection of certain mental models. As such, mental models reveal the political bias in corporate governance perspectives. For this reason, CSR research needs to be clear about the underlying assumptions about corporate governance, and corporate governance research needs to disclose which mental models of CSR influence the outcomes. Taking a governance perspective on the development of mental models of CSR helps to understand the interaction between CSR and processes of sensemaking at the institutional, organizational and individual levels. (shrink)

Can business humanize its stakeholders? And if so, how does this relate to moral consideration for stakeholders? In this paper we compare two business orientations that are relevant for current business theory and practice: a stakeholder orientation and a profit orientation. We empirically investigate the causal relationships between business orientation, humanization, and moral consideration. We report the results of six experiments, making use of different operationalizations of a stakeholder and profit orientation, different stakeholders, and different participant samples. Our findings support (...) the prediction that individual stakeholders observing a stakeholder-oriented firm see the firm’s other stakeholders as more human than individual stakeholders observing a profit-oriented firm. This humanization, in turn, increases individual stakeholders’ moral consideration for the firm’s other stakeholders. Our findings underscore the importance of humanization for stakeholders’ moral consideration for each other. This paper contributes to a deeper understanding of the firm as a moral community of stakeholders. Specifically, we move away from a focus on managers, and how they can make business more moral. Instead we direct attention to stakeholders, and how business can make these stakeholders more moral. (shrink)

We theorize that, in the current development of business ethics, there is a fruitful evolution that dissolves the dichotomy between the normative and behavioral research approaches developed, respectively, by philosophers and social scientists; this approach avoids many of the limitations originated by such distinction by reconnecting their two separate narratives. We call this emerging research model Humanistic Business Ethics (HBE) as it emphasizes the centrality of the human dimension of business and the importance of adopting a richer concept of humanity (...) in business ethics research. We argue that this specific research model in business ethics emerges when scholars combine a pragmatist philosophical approach with some key ideas coming from stakeholder theory, which we summarize and connect. By leveraging collaboration across ethics, economics, psychology, and entrepreneurship, HBE can help business and society scholars undertake fruitful inquiries into the way business works (and should work) at its best. (shrink)

The role and ethics of professionals in business and economics have been questioned, especially after the financial crisis of 2008. Some suggest a reorientation using concepts such as craftsmanship. In this article, I will explore professional practices within the context of behavioural theory and business ethics. I suggest that scholars of behavioural theory need a strategy to deal with normative questions to meet their ambition of practical relevance. Evidence-based management, a recent behavioural approach, may assist business ethics scholars in understanding (...) how professionals infer ‘evidence’ to make decisions. For a professional, ethical issues are an integral part of decision-making at critical moments. As reflective practitioners, they develop insights related to ethical concerns when collecting and assessing evidence within decision-making processes. (shrink)

The goal of this research is to analyze the heterogeneity of family firms in the normative attention to their non-family stakeholders. With this aim, we suggest that the psychological process of top family managers in terms of individual affective commitment to their firms is a key variable to explain that heterogeneity. However, we also suggest a moderator effect of the family stakeholder salience in the relationship between the managers' affective commitment to the firm and the establishment of firm goals toward (...) non-family stakeholders. The results of a hierarchical regression analysis on data obtained from 207 family executives show a significant positive influence of managers' affective commitment on the establishment of goals related both to internal and external non-family stakeholders. In addition, we can observe a negative moderator effect of the family utilitarian power—as an indicator of the family stakeholder salience—on the relationship between the family managers' affective commitment and the goals related to non-family employees. (shrink)

A central claim in stakeholder theory is that, if we see stakeholders as human beings, we will attribute higher moral standing or show more moral consideration to stakeholders. But would the same hold for firms? In this paper, I apply the concepts of humanization and moral standing to firms, and I predict that individuals attribute higher moral standing to stakeholder-oriented than to profit-oriented firms, because individuals attribute more experience to stakeholder-oriented than to profit-oriented firms. Five experiments support these predictions across (...) different operationalizations of stakeholder and profit orientations. The analyses show that moral standing attributions are not fully explained by attributions of agency to firms, or by attributions of experience or agency to human stakeholders. By unearthing the importance of experience attributions for moral standing attributions to firms, this work provides novel insights in ongoing legal, philosophical and public debates related to firms’ moral standing. The findings also bring the debate about firms’ moral standing to the heart of stakeholder theory, and lead to new normative and descriptive research questions about the interests of firms and their stakeholders. (shrink)

While many scholars agree that the ‘‘separation thesis’’ (Freeman in Bus Ethics Quart 4(4):409–421, 1994)—that business issues and ethical issues can be neatly compartmentalized—is harmful to business ethics scholarship and practice, they also conclude that eliminating it is either inadvisable because of the usefulness of the positive/ normative distinction, or actually impossible. Based on an exploration of the fact/value dichotomy and the pragmatist and virtue theoretic responses to it, we develop an approach to eliminating the separation thesis that integrates ‘‘business’’ (...) with ‘‘ethics’’ while still permitting a positive/ normative distinction, which we call ‘‘ethics from observation.’’. (shrink)

Managers in ethnic businesses are confronted with ethical dilemmas when taking action based on ethnic ties; and often as a result, they increase the already vulnerable positions of these businesses and their stakeholders. Many of these dilemmas concern the capital that is generated through variations in the use of ethnic stakeholder social ties. The purpose of this paper is to suggest a stakeholder-based model of social capital formation, mediated by various forms of ethnic ties, to explore the duality of ethnicity: (...) it can aid and hinder an ethnic business. Drawing upon the social capital/economic development, stakeholder salience, ethnic businesses literatures, and on social identity theory, we develop a cyclical model of relationships among ethnic business stakeholder attributes and social capital, as mediated by three-way Simmelian bonding and bridging ties, which then, in turn, affects the ethnic stakeholder attributes. We argue that the development of bridging yet strong ties through this cyclical process is relevant for the improvement of the positions of ethnic businesses in terms of both economic success and social responsibility. Specifically, we suggest that, given the duality of ethnicity in business, managers can prioritize stakeholder relationships based upon how these stakeholder ties affect social capital. (shrink)