Notwithstanding empirical evidence that combining ethics and compliance into one function or programme is likely to erode an ethical culture in organisations, the praxis to coalesce ethics and compliance conceptually and structurally remains attractive and continues in many organisations. Drawing on systems psychodynamic theory, this study enquires into unconscious complexities and drivers that may contribute to adverse consequences when combining ethics and compliance. Whereas previous research demonstrates that compliance dominates ethics because of self‐regulation issues, this research provides deeper insight into (...) why this happens. On explicating the unconscious dynamics that underlie the apparent lure of combination, it becomes clear that this praxis remains attractive because of its function to repress anxieties, maintain phantasies, and provide psychological comfort. In recognising the role of unconscious dynamics in the decision to combine ethics and compliance and the consequences thereof, cognition of this combination and its outcomes is moved beyond a conscious rational process. This elucidates the commanding opposing unconscious forces potentially at play in this decision. Insights could lessen adverse outcomes by prompting organisations to think of the combination of ethics and compliance as unconsciously motivated systemic processes that require sincere consideration before pursuing them. (shrink)

As information technologies have become synonymous with progress in modern society, several ethical concerns have surfaced about their societal implications. In the past few decades, information technologies have had a value-laden impact on social evolution. However, there is limited agreement on the responsibility of businesses and innovators concerning the ethical aspects of information technologies. There is a need to understand the role of business incentives and attitudes in driving technological progress and to understand how they steer the ethics discourse on (...) technology. In the information technology industry, there is an observed trivialization of ethics supported by a business driven and technology-centric approach to ethics. This trivialization rests on hardened beliefs, ideologies, and arguments which hint at reduced accountability for business and tend to individualize social responsibility. The phenomenon of ethics trivialization needs to be duly addressed to resolve the tensions between business needs and ethical concerns. This paper has identified from literature and conceptually analyzed the beliefs and ideologies underlying ethics trivialization which undermine ethics in business contexts. The paper has attempted to address the business concerns indicated by this phenomenon as well as highlight the weaknesses of its assumptions, rhetoric, and justifications. The aim of this paper is to systematically present the justifications in favor of and against the practice of ethics trivialization in the information technology domain, thereby highlighting the need to develop frameworks for assessment of ethical responsibility, accountability, and democratization of the value trade-offs involved in the design of technologies. (shrink)

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

In this article, we use a corporate social responsibility (CSR) framework to analyze the payday loan industry by critically examining its practices from an economic, legal, and ethical perspective. Payday loans are essentially a very high cost, unsecured, short‐term personal loan. Given the inherent nature of the product being offered, the industry appears on the face of it to be in a position to potentially exploit vulnerable consumers in pursuit of profits. With this concern in mind, our analysis investigates the (...) following three issues: Can the payday loan industry currently be considered to be acting in a socially responsible manner? If the industry cannot be considered to be socially responsible, should it be further regulated? If the industry should be further regulated, how should it be regulated? To address these issues, we first provide a brief historical overview of payday loans. Second, we describe the important characteristics of payday loans and how the industry operates. Third, we draw on various sources of evidence to demonstrate that the payday loan industry, while fulfilling its basic economic obligations, falls outside of both the legal and ethical domains of the Three Domain Model of CSR. Based on our analysis, our conclusion is that the payday loan industry requires additional government legal regulation, particularly with respect to allowable fees, and we conclude that there is a strong ethical case for banning payday loans altogether. (shrink)

This article discusses the transition that business ethics has undergone since its start essentially as a philosophical sub-discipline of applied ethics. Today, business ethics—as demonstrated by four examples of gatekeepers—is a well-established field in general management, and increasingly business scholars without a “formal” background in philosophy are entering the scene. I take this transition to examine an updated positioning of business ethics and offer a proposal to redefine what makes a business ethicist. I suggest taking critical thinking as the common (...) denominator of all business ethics activities beyond the academic silos of various disciplines. In conclusion, by borrowing from the post-colonial theorist Edward Said, this article offers a definition of what makes a business ethicist in the broadest possible sense. Implications are discussed, including the consequences suggesting that if critical thinking is the common denominator, business ethics-as-business-case logic is not considered a part of business ethics publications, but should be addressed within more instrumental publication outlets of business. (shrink)

Although apparently irrational, people with seemingly high moral standards routinely make immoral decisions or engage in morally questionable behavior. It appears as if under certain circumstances, people become in some enigmatic way blind to the immoral aspects of what they are doing or consequences of their immoral actions. This article focuses and reports on a psychoanalytic inquiry into the role of emotions and the unconscious management of unwanted emotions in promoting moral blindness. Emotions are essential to the conscience, self-sanctioning, and (...) advancement of moral behavior. Notwithstanding moral ideations, a sufficiently strong counterwill may create incongruence between moral intentions and actual desires or behavior. The unwelcome experience of acute moral emotions such as guilt and anxiety is likely to activate a range of psychological defense mechanisms and unconscious processes to manage these emotions. It is argued that the management of these emotions through undue avoidance, inappropriate regulation, or lack of regulation, can bypass self-sanctioning. As result, the condition of moral blindness can develop or be sustained. The psychoanalytic explanations offered contribute to the understanding as to how emotions in combination with the unconscious mind can cause moral blindness in any person, notwithstanding high moral standards and good intentions. Improved understanding of moral blindness represents an important scientific step in improved understanding of our moral and immoral selves, with all its complexities, conflicts, and contradictions. (shrink)

Crowdsourcing has attracted increasing attention as a means to enlist online participants in organisational activities. In this paper, we examine crowdsourcing from the perspective of its ethical use in the support of open innovation taking a broader system view of its use. Crowdsourcing has the potential to improve access to knowledge, skills, and creativity in a cost-effective manner but raises a number of ethical dilemmas. The paper discusses the ethical issues related to knowledge exchange, economics, and relational aspects of crowdsourcing. (...) A guiding framework drawn from the ethics literature is proposed to guide the ethical use of crowdsourcing. A major problem is that crowdsourcing is viewed in a piecemeal fashion and separate from other organisational processes. The trend for organisations to be more digitally collaborative is explored in relation to the need for greater awareness of crowdsourcing implications. (shrink)

Are there any advantages to thinking and speaking about ethical business in the language of citizenship? We will address this question in part by looking at the possible relevance of a vast literature on individual citizenship that has been produced by political philosophers over the last fifteen years. Some of the central elements of citizenship do not seem to apply straightforwardly to corporations. E.g., “citizenship” typically implies membership in a state and an identity akin to national identity; but this connotation (...) of citizenship is obviously problematic for multinational corporations. However, the language of citizenship does help to focus our attention on various legal and political virtues (or vices) for corporations—topics that have been largely neglected by discussions under other rubrics, such as CSR or sustainability. We finish with an evaluation of the potential benefits and costs of conceptualizing and talking about ethical business practices in the language of citizenship. (shrink)

Abstract:Extrapolating from Carroll’s four domains of corporate social responsibility (1979) and Pyramid of CSR (1991), an alternative approach to conceptualizing corporate social responsibility (CSR) is proposed. A three-domain approach is presented in which the three core domains of economic, legal, and ethical responsibilities are depicted in a Venn model framework. The Venn framework yields seven CSR categories resulting from the overlap of the three core domains. Corporate examples are suggested and classified according to the new model, followed by a discussion (...) of limitations and teaching and research implications. (shrink)

This paper seeks to identify a mid-level unifying ethical principle that may help clarify and articulate the ethical responsibilities of business firms in the field of marketing ethics. The paper examines critically the main principles which have been proposed to date in the literature, namely consumer sovereignty, preserving the conditions of an acceptable exchange, paternalism, and the perfect competition ideal, and concludes that all of them are vulnerable to damaging criticisms. The paper articulates and defends the mutuality principle as the (...) most plausible candidate for the role of master principle in the relations between a firm and its customers. This principle requires that sellers look for reciprocity in their relations with their customers, seeking to provide to their customers something that helps them improve in some way their well-being and is commensurate with what they receive from them. (shrink)

This research advances our understanding of the manifestation of tensions and ethical issues in entrepreneurial finance. In doing so, we offer an overview of ethics in entrepreneurship and finance, delineating the curious paucity of research at their intersection. Using twelve vignettes, we put forward the asymmetries between entrepreneurs and investors and discuss a set of ethical problems that arise among key actors centring on the dynamics of venture partner entry and exit, applying the multiple-lens ethical perspective to analyse these issues. (...) This analysis culminates in the introduction of a general classification scheme for ethical problems across venture partners. Our analysis highlights the moral dimension inherent in the entry and exit of venture partners and the importance of considering moral judgement, as well as intention in future analysis of any decision-making. Our study also points to the moral responsibility in finance, especially to the mutual moral responsibilities of investors and entrepreneurs. By integrating ethics into finance, this research also demonstrates that in the case of venture partner exit, an ethical approach and decent governance go beyond compliance to the law. We conclude with implications for practitioners, specifically with some proposals for a solution to the problem of blocked and forced exit. Together, we make several contributions to the literature by integrating ethics, finance and entrepreneurship, and we call for future research to stimulate a growing body of research within this presently overlooked area. (shrink)

This article answers several calls—coming as well from corporate governance practitioners as from corporate governance researchers—concerning the possibility of complying simultaneously with requirements of innovation and ethics. Revealing the long-term orientation as the variable which permits us to link the principal goal of organization, being “survival,” with innovation and ethic, the article devises a framework for incorporating ethics into a company’s processes and strategies for innovation. With the principal goal of organizations being “survival” in the long-term, it is assumed that (...) innovation is necessary in order to realize a going concern. Firms that do not innovate and adapt to rapidly changing business environments are less likely to be sustainable. Thus, it is in a business’ best interests to adopt an innovation process for long-term success. We posit that there are two simultaneous sources of innovation and change that are unavoidable and embedded in the corporate landscape. First, we argue for genetically embedded, Darwinian explanations for adaptations that enable an entity’s survival. This view is combined with more conventional, social science explanations for change. Our new, comprehensive model of the governance of innovation processes hinges on the one hand on an organization’s long-term orientation, which we argue, is not possible without a consideration of an ethical dimension. On the other hand, the model employs, for the first time, the concept of duality, in order to make the positive coexistence of innovation and ethic analytically visible. Guided by this concept the roots of the ethic within innovation are traced from both natural science forces for change, and cultural pressures operating on members of an organization. We present our Integrated Causal Model of Innovation and propose theoretical relationships that will generate numerous avenues for future research in the field, and help managers to reorient their governance strategies. (shrink)

Calvin’s view on the legitimacy of interest has had a great impact on the economic development of Western society. Although Calvin took a fundamentally positive attitude to interest, he also proposed several restrictions on the charging of interest. In this article, we investigate the relevance of these restrictions to the current credit crisis. We find that each of them provides a relevant interpretation of what went wrong in the buildup of the credit crisis and gives directions to improve policies of (...) banks and governments as well. (shrink)

Taking multidimensional ethics scale approach, this article describes an empirical survey of top managers’ moral decision-making patterns and their change from 1994 to 2004 during morally problematic situations in the Finnish context. The survey questionnaire consisted of four moral dilemmas and a multidimensional scale with six ethical dimensions: justice, deontology, relativism, utilitarianism, egoism and female ethics. The managers evaluated their decision-making in the problems using the multidimensional ethics scale. Altogether 880 questionnaires were analysed statistically. It is concluded that relying on (...) the utilitarian principles is a core ethical evaluation criterion amongst top business managers in Finland. This study proves that managers’ moral decision-making patterns change over time. According to the results of this research, managers’ moral decision-making became more multidimensional during the study period. The change is explained by the inclusion of female ethics items in the scale which allows managers to show more diversity in their decision- making, the change in the Finnish economic context from depression to economic prosperity and growth during the study period, which is conducive to the spread of post materialist values, such as the importance of social relations and the increasing public discussion of the importance ethical issues in business. (shrink)

In the sixteenth and seventeenth centuries, members of the Salamanca School engaged in a sustained and sophisticated discussion of the issue of just prices. This article uses their contribution as a point of departure for a consideration of justice in pricing which will be relevant to current-day circumstances. The key theses of members of this school were that fairness of exchanges should be assessed objectively, that the fair price of an article is one equal to its ‘value’, and that the (...) best indicator of that value is the price that article commonly fetches in an open market. This article tries to bring to light the attractiveness of those views in order to guide current practice by contrasting them with alternative views, showing their connection with intuitively attractive basic standards, and linking them to commonly shared intuitions. (shrink)

In this conceptual article, we look at the impact of culture on ethical decision making from a Douglasian Cultural Theory (CT) perspective. We aim to show how CT can be used to explain the diversity and dynamicity of ethical beliefs and behaviours found in every social system, be it a corporation, a nation or even an individual. We introduce CT in the context of ethical decision making and then use it to discuss examples of business ethics in the Indian business (...) context. We argue that the use of CT allows for a theoretically more sophisticated treatment of culture in ethical decision making and thus the avoidance of some common problems with existing cross-cultural studies of business ethics. In our discussion, we raise questions about the compatibility between management systems and processes created in one context and ethical behaviours in another. (shrink)

This study uses judgment and decision-making (JDM) perspective with the help of framing and schema literature from cognitive psychology to evaluate how managers behave when problems with unethical overtones are presented to them in a managerial frame rather than an ethical frame. In the proposed managerial model, moral judgment of the situation is one of the inputs to managerial judgment, among several other inputs regarding costs and benefits of various alternatives. Managerial judgment results in managerial intent leading to managerial action. (...) The model and the effects of taking an ethics course on ethical and managerial judgment and managerial intent were then indirectly tested in this study, wherein subjects judged the ethical wrongness, managerial badness, and the managerial intent regarding decisions made in a case. Forty-nine MBA students analyzed a case involving budget-based bonuses and production, in which the ethical issue evolved over three stages. It appears from the Path-analysis results that managerial judgment mediated between moral judgment and the judgment of managerial intent as suggested by the proposed model, and that taking an ethics course directly affected managerial judgment but did not affect the moral judgment. Additionally, in the first stage of decision-making (early stage of a developing “ethical slippery slope”), moral judgment did not significantly influence managerial judgment. However, students with ethics course still were more inclined to judge the decision as managerially bad as compared to others, indicating that they were more aware or sensitive to the moral issues involved. (shrink)

"Guanxi" involves interpersonal obligations, which may conflict with other obligations people have that are based on general or abstract moral considerations. In the West, the latter have been widely accepted as the general source of obligations, which is perhaps tied to social changes associated with the rise of capitalism. Recently, Western ethicists have started to reconsider the extent to which personal relationships may form a distinct basis for obligation. In administration and management, salient bases for decision-Making include deontological, consequentialist and (...) personalist ethics. The first may be reflected in a bureaucratic approach, the second in a price system, and the third in arrangements like "guanxi". Each has positive and negative aspects, but problems arise when they lead to conflicting obligations, as may occur for an office holder who has some obligations based in deontological considerations and others based in personal relationships. This is a type of conflict of interest. Such conflicts have been considered in the West, and remedies proposed. Problems arise especially in cases where it is not clear how to prioritise different obligations, and this has been noted as a difficulty in the Chinese legal system. Questions that need to be answered include not only questions about how to deal with conflicting obligations, but also questions about what institutions to accept as giving rise to obligations. Institutions themselves may be problematic not only because of their consequences for economic productivity, but because they are internally incoherent, and this may be manifested in frequent conflicts faced by office holders. (shrink)

Business codes are a widely used management instrument. Research into the effectiveness of business codes has, however, produced conflicting results. The main reasons for the divergent findings are: varying definitions of key terms; deficiencies in the empirical data and methodologies used; and a lack of theory. In this paper, we propose an integrated research model and suggest directions for future research.

This paper discusses the philosophical argument and the application of the Triple Font Theory for moral evaluation of human acts and attempts to integrate the conceptual components of major moral theories into a systematic internally consistent decision-making model that is theoretically driven. The paper incorporates concepts such as formal and material cooperation and the Principle of Double Effect into the theoretical framework. It also advances the thesis that virtue theory ought to be included in any adequate justification of morality and (...) the need to integrate or coordinate notions of virtue into various act-oriented or principles-based ethics. The TFT offers a comprehensive and practical approach to ethical decision-making and is a useful alternative embedded in traditional wisdom. This paper provides a more general framework of the TFT than traditionally presented. Practical judgment is shown to play a constitute role in providing a guide for right action and is the “glue” that integrates the various components of the TFT. (shrink)

This paper develops a typology of moral problems in business. The cross-classification of two fundamental dimensions of ethical conduct: judgment and motivation, is employed to distinguish four types of moral problems: genuine dilemmas, compliance problems, moral laxity, and no-problem problems. Actual cases are brought to illustrate each type of problem, and corresponding coping strategies are presented. The paper highlights the need to design a dynamic strategy that will take into account the relationships among different types of ethical problems. In its (...) capacities as both an analytical tool for identifying and clarifying an ethical problem and a strategic tool for handling it, the typology has direct implications for developing ethical awareness, assigning accountability, and unfolding typical rationalizations in business activity. (shrink)

At the heart of entrepreneurship are imagination, creativity, novelty, and sensitivity. It takes these qualities to develop a new product or service and bring it to market, to envision the possible impacts a new product may make and come up with novel and creative solutions to problems that may arise. These qualities go to make up what could be called the spirit of entrepreneurship, a spirit that involves the ability to handle the experimental nature of entrepreunerial activity. These same qualities (...) are crucial for moral decision making, and an ethical approach which emphasizes imagination, creativity, and has an experimental thrust is much better adapted to the entrepreneurial activity and much more relevant to the unique situations that entrepreneurs face. In this sense, the process approach to ethics developed in this article is a unifying framework that brings together the activity of entrepreneurship and moral decision making. (shrink)

When a member of an organization has to make a decision or act in a way that may benefit some stakeholders at the expense of others, ethical dilemmas may arise. This paper examines ethical sensitivity regarding the duties to clients and owners (principals), employees (agents), and responsibilities to society (third parties). Within this framework, ethical perceptions of male and female managers are compared between the U.S. and Turkey – two countries that differ on power distance as well as the individualism/collectivism (...) dimensions. Our results show that ethical sensitivity varies depending upon whether the interests of principals, agents, or third parties are affected by a given ethical dilemma. We also find that, contingent upon the principal-agent–society relationships, the nationality and gender of the decision-maker influences ethical sensitivity. (shrink)

This study investigates the relationship between intention to behave ethically and gender within the context of national culture. Using Reidenbach and Robin's measures of the ethical dimensions of justice and utilitarianism in a sample of business students from three different countries, we found that gender is significantly related to the respondents' intention to behave ethically. Women relied on both justice as well as utilitarianism when making moral decisions. By contrast, men relied only on justice, and did not rely on utilitarianism (...) when faced with the same ethical issues. Further, women's intention to behave was contextual, significantly affected by two national culture dimensions (uncertainty avoidance and individualism), whereas men's decisions were more universal, and not related to national culture dimensions. (shrink)

It is often assumed that conventional ethics will contribute positively to economics and business, but here, this judgment will be examined. The conventional ethics of our time is dominated by altruistic philosophy, which has deep roots in religion. Such an idealistic ‘altruistic ethics’ especially emphasizes helping the least advantaged. This principle is contrasted with a more profane ‘reciprocal ethics.’ This term is used for the principle of mutual advantage central to a number of significant philosophers. This latter principle is compatible (...) with the practical norms constituting the morals of the market, while the former implies major adjustment of behavior and policies. Many ethicists consider their field to be ‘applied ethics,’ bringing the concrete rules and practices of the economic sector closer to honored first principles of philosophy. Is it reasonable to expect an influence by the ideas of altruistic ethics to improve the morals and policies of the economy? The process of the Heavily Indebted Poor Countries (HIPC) Initiative of the United Nations illustrates a probably crucial connection with altruistic ethics. Is this project, supported by religiously inspired groups, a sound way to treat a serious global problem? The disadvantages of this project are discussed and alternatives with better potential are presented. The article suggests that altruistic ethics is a dubious foundation for constructive morality and that its dominance in contemporary philosophy constitutes a major obstacle to a more open-minded analysis and sound policies. (shrink)

Thesis )--University of Stellenbosch, 2010.

Prior research suggests brokers do not always act in the best interests of clients, although morally obligated to do so. We empirically investigated this issue focusing on trades executed at best execution price, before and after the introduction of electronic limit-order trading, on the London Stock Exchange. As a result of limit-order trading, the proportion of trades executed at the best execution price for the customer significantly increased. We attribute this to a sustained increase in the liquidity of stocks as (...) a result of limit-order trading, regardless of market capitalisation. We discuss the ethical implications of our findings and conclude that market structures that enhance market competitiveness may help reconcile broker and client interests. (shrink)

Workforce diversity has received increasing amounts of attention from academics and practitioners alike. In this article, we examine the empirical association between a firm’s workforce diversity and the degree of religiosity of the firm’s management by investigating their unidirectional and endogenous effects. Employing a large and extensive U.S. sample of firms from the years 1991–2010, we find a positive association between a measure of the firm’s commitment to diversity and the religiosity of the firm’s management after controlling for various firm (...) characteristics. In addition, after controlling for endogeneity with the dynamic panel generalized method of moment, we still find a positive association between the firm’s diversity and management’s religiosity. We interpret these results as supportive of the religious motivation explanation that views the firm as a human community and considers religion as a factor that influences managers to more positively embrace diversity. Our results, however, provide no support for the resource-constraint hypothesis that views the firm as a nexus of contracts and sees managers as aiming to maximize shareholder returns under resource constraints that force them to invest only in projects that have a positive net present value and reject diversity initiatives since these do not have a positive NPV. (shrink)

Performance appraisals are widely used as an HR instrument. This study among 332 police officers examines the effects of performance appraisals from a behavioral ethics perspective. A mediation model relating justice perceptions of police officers’ last performance appraisal to their work affect, perceived supervisor and organizational support and, in turn, their ethical (pro-organizational proactive) and unethical (counterproductive) work behavior was tested empirically. The relationship between justice perceptions and both, ethical and unethical behavior was mediated by perceived support and work affect. (...) Hence, a singular yearly performance appraisal was linked to both ethical and unethical behaviors at work. The finding that ethical and unethical aspects of employee behavior share several of the same organizational antecedents, namely organizational justice perceptions, has strong practical implications which are discussed as well. (shrink)

Whereas previous studies have criticized low-quality products for inadequate safety, this paper considers only safe products, and it examines the ethics of designing and selling low-quality products. Product quality is defined as suitability to a general purpose. The duty that companies owe to consumers is summarized in the Consumer-Oriented Process principle: “to place an increase in the consumer’s quality of life as the primary goal for producing products.” This principle is applied in analyzing the primary ethical justifications for low-quality products: (...) availability and applicability. Finally, a low-quality product should be designed afresh, not by altering an existing high-quality product. (shrink)

Putting measures in place to prevent wrongdoing in organizations is important, but detecting and correcting wrongdoing are also vital. Employees who detect wrongdoing should, therefore, be encouraged to respond in a manner that supports corrective action. This article examines the influence of the ethical culture of organizations on employee responses to observed wrongdoing. Different dimensions of ethical culture are related to different types of intended responses. The findings show that several dimensions of ethical culture were negatively related to intended inaction (...) and external whistleblowing and positively related to intended confrontation, reporting to management, and calling an ethics hotline. (shrink)

This article focuses on exerting influence in leadership, namely manipulation in storytelling. Manipulation is usually considered an unethical approach to leadership. We will argue that manipulation is a more complex phenomenon than just an unethical way of acting in leadership. We will demonstrate through an empirical qualitative study that there are various types of manipulation through storytelling. This article makes a contribution to the literature on manipulation through leadership storytelling, offering a more systematic empirical analysis and a more nuanced view (...) of the topic than previously existed by outlining how managers engage in manipulative storytelling and what kind of ethics they link to their manipulation in leadership. Four types of manipulation in storytelling are identified in the study: humorous, pseudo-participative, seductive and pseudo-empathetic. From an ethical perspective, we will show that manipulation is not always self-evidently reprehensible. We will conclude that the dominant ethical justification for manipulation stems from its consequences. (shrink)

As business environments become more complex and reliant on information systems, the decisions made by managers affect a growing number of stakeholders. This paper proposes a framework based on the application of normative theories in business ethics to facilitate the evaluation of IS related ethical dilemmas and arrive at fair and consistent decisions. The framework is applied in the context of an information privacy dilemma to demonstrate the decision making process. The ethical dilemma is analyzed using each one of the (...) three normative theories—the stockholder theory, stakeholder theory, and social contract theory. The challenges associated with the application of these theories are also discussed. (shrink)

Abstract:Companies have a share in our common responsibility to future generations. Hitherto, this responsibility has been all but neglected in the business ethics literature. This paper intends to make up for that omission. A strong case for our moral responsibility to future generations can be established on the grounds of moral rights theory, utilitarianism and justice theory. The paper analyses two practical cases in environmental policy, in order to come to grips with the complicated ethical issues involved in the responsibility (...) to future generations. The cases deal with the management of finite energy sources and of vulnerable resources of biodiversity. The ethical issues involved in these cases have an important bearing on business ethics: future generations should be included among the stakeholders of the firm. The paper concludes with a plea to institutionalize a “third arena” for debate and deliberation on the protection of the interests of future generations, next to the arenas of the government and the market. Companies should participate in this third arena, led by a participatory ethics. (shrink)

This article examines whether ethical business practice enhances financial performance with respect to interorganizational favour exchange. We argue that the link between the ethicality and economic utility of interorganizational favour exchange is governed by: (1) organizational–individual interest alignment/conflict and (2) the fairness or justifiability of favour exchanges from the perspective of third parties. We classify interorganizational (IO) favour exchange into four types (Business–Personal, Personal–Business, Personal–Personal and Business–Business favour exchange). Our analysis shows that the first three types of favour exchange are (...) unethical as they involve conflicts between organizational and individual interests in one or both participating organizations that negatively affect organizational value creation. The last type of favour exchange involves organizational–individual interest alignment in both participating organizations and positively affects the capacity of those involved in the exchange to create value. Favour exchanges of this fourth variety are ethically justifiable unless they unfairly damage the legitimate interests of third parties. In the latter case, these favour exchanges create the risk of negative third party reactions, which in turn affect the sustainability of the benefits of the favour exchanges to the focal group (the dyad). Our research results advance understanding of the ethical and economic implications of IO favour exchange, counter the prejudice against this behaviour in organizations, provide ethical guidance for management and business practice, and have implications for the relationship between doing well and doing good. (shrink)

Due to the domain characteristics of business ethics, a contractarian theory for business ethics will need to be essentially different from the contract model as it is applied to other domains. Much of the current criticism of contractarian business ethics (CBE) can be traced back to autonomy, one of its three boundary conditions. After explaining why autonomy is so important, this article considers the notion carefully vis à vis the contracting partners in the contractarian approaches in business ethics. Autonomy is (...) too demanding a condition for the realm of CBE. But a less stringent version of the contract may be possible, a version which uses the contract as a heuristic device, which merely requires moral responsibility. Furthermore, it is argued that views of (human) agency and the moral subject should be made explicit in such a theory. (shrink)

The political philosopher Hannah Arendt develops several arguments regarding why truthfulness cannot be counted among the political virtues. This article shows that similar arguments apply to lying in business. Based on Hannah Arendt's theory, we distinguish five reasons why lying is a structural temptation to businessmen: business is about action to change the world and therefore businessmen need the capacity to deny current reality; commerce requires successful image-making and liars have the advantage to come up with plausible stories; business communication (...) is more often about opinions than about facts, giving leeway to ignore uncomfortable signals; business increasingly makes use of plans and models, but these techniques foster inflexibility in acknowledging the real facts; and businessmen easily fall prey to self-deception, because one needs to act as if the vision already materializes. The theory is illustrated by a case study of Landis, which grew from a relatively insignificant organization into a large one within a short period of time, but ended with outright lies and bankruptcy. (shrink)

The current literature in business ethics is tending toward an unacknowledged moral pluralism, with all the problems this position entails. An adequate moral pluralism cannot be achieved by a synthesis of existing theoretical alternatives for moral action. Rather, what is needed is a radical reconstruction of the understanding of the moral situation that undercuts some of the traditional dichotomies, provides a solid philosophical grounding which is inherently pluralistic, and offers a new understanding of what it is to think morally. The (...) philosophical position of American pragmatism, as briefly sketched in this paper, offers one such possible reconstruction. (shrink)

Abstract:The present paper focuses on the linkage between two academic paradigms in the enquiry into business ethics: normative philosophy and empirical social sciences. The paper first reviews existing research pertaining to a normative-empirical dialogue. Further empirical data on the relationship between various standards of morality are discussed in relation to the normative frameworks of ethics. Lastly, future directions for such a dialogue in business ethics are suggested.

We examine the writings of Adam Smith and Milton Friedman regarding their interpretation and use of the concept of self-interest.We argue that neither Smith nor Friedman considers self-interest to be synonymous with selfishness and thus devoid of ethicalconsiderations. Rather, for both writers self-interest embodies an other-regarding aspect that requires individuals to moderate theiractions when others are adversely affected. The overriding virtue for Smith in governing individual actions is justice; for Friedman it isnon-coercion.

Business ethics of innovation strives to give orientation in settings where new products, new markets, new environments are predominant. The provision of new products and solutions is inseparably intertwined with the consequences of their use. These can be manifold and in some cases an (unwanted) consequence might even preclude them from being used. A case in point is illustrated by an example from the pharmaceutical industry.

This study investigates the relationship between intention to behave ethically and gender within the context of national culture. Using Reidenbach and Robin's measures of the ethical dimensions of justice and utilitarianism in a sample of business students from three different countries, we found that gender is significantly related to the respondents' intention to behave ethically. Women relied on both justice as well as utilitarianism when making moral decisions. By contrast, men relied only on justice, and did not rely on utilitarianism (...) when faced with the same ethical issues. Further, women's intention to behave was contextual, significantly affected by two national culture dimensions (uncertainty avoidance and individualism), whereas men's decisions were more universal, and not related to national culture dimensions. (shrink)

Calvin's view on the legitimacy of interest has had a great impact on the economic development of Western society. Although Calvin took a fundamentally positive attitude to interest, he also proposed several restrictions on the charging of interest. In this article, we investigate the relevance of these restrictions to the current credit crisis. We find that each of them provides a relevant interpretation of what went wrong in the buildup of the credit crisis and gives directions to improve policies of (...) banks and governments as well. (shrink)

The study examines whether (a) personal and organizational values differ in private and public sectors, and (b) personal values and value congruence -the extent of matching between personal and organizational values -influence unethical practices and work behavior. Three hundred and forty middle-level managers from four manufacturing organizations rated 22 values as guiding principles to them to identify their personal values. In order to index organizational values, 56 top-level managers of the same organizations rated how important such values were to the (...) organization. Results revealed that the important shared values among managers of private and public sectors are product quality and customer service. Congruence between personal and organizational values is found to be higher in the private sector compared to the public sector. Middle-level managers in the private sector shared the organizational values more than the managers in the public sector. Irrespective of the type of organizations and age of managers, personal values more potently and consistently decreased unethical practices and increased work behavior compared to value congruence. Hiring managers emphasizing personal values can demote unethical practices and promote work behavior. (shrink)

If business requires ethical solutions that are viable in the liminal landscape between concepts and corporate office, then business ethics and corporate social responsibility should offer tools that can survive the trek, that flourish in this well-traveled, but often unarticulated, environment. Indeed, feminist ethics produces, accesses, and engages such tools. However, work in BE and CSR consistently conflates feminist ethics and feminine ethics and care ethics. I offer clarification and invoke the analytic power of three feminist ethicists 'in action' whose (...) investigations into the "grey zones" of harms; identity and representational conventions; and "asymmetrical reciprocity" harmonize with business ethics' requirements. (shrink)

In recent times, representatives of American management science have been arguing increasingly for a functionalization of ethics to change economic thinking: what they are seeking is the systematic integration of ethics into the economic paradigm. Using the insights developed by Hirschman, I would like to show how one must first expose the rhetoric of those critics of change (referred to below as conservatives or reactionaries) in order then to implement that which is new (representatives of this approach are referred to (...) below as progressives). Such an ‹unmasking’ works particularly well when one can defuse the arguments of the reactionaries – which is precisely what one achieves by strategically integrating ethics into economics. In his work The Rhetoric of Reaction Hirschman examines three basic forms of reactionary thought: the perversity thesis, the futility thesis, and the jeopardy thesis. According to the perversity thesis, intended goals are transformed into their opposites. The futility thesis argues that the setting of goals is useless since history runs its own course independent of those goals. The jeopardy thesis claims to preserve what already exists since change might substantially endanger that which has already been achieved. The importance of Hirschman’s ideas for the strategic interplay between the academic disciplines can be seen quite clearly in the example of German business ethics. This will be displayed below with reference to Hirschman’s three theses. Finally, implications will be drawn for business ethics in general and for management theory in particular. (shrink)

Abstract:This article puts forth the thesis that the contractualist account of moral justification affords a powerful reply in business contexts to the question why a business person should put ethics above immediate business interests. A brief survey of traditional theories of business ethics and their approaches to moral motivation is presented. These approaches are criticized. A contractualist conception of ethics in the business world is developed, based on the work of John Rawls and Thomas Scanlon. The desire to justify our (...) choices in terms that others can be reasonably expected to accept, or at least in terms that others cannot reasonably reject, is identified and differentiated from other accounts of motivation. It is this desire that constitutes the core motive to be moral in business on the contractualist conception. Implications of this contractualist conception for the theory and practice of business ethics are then discussed. (shrink)