This study contextualizes business leaders’ perspectives on business-society interaction through the theoretical lens of wisdom. Morally effective interaction between business and society relies on shared perceptions of expected values grounded in leaders’ virtuous behavior. Through empirical fieldwork across industries in a developing society, the article documents how local business leaders perceive wise leadership in dealing with socially complex problems. Using grounded theory, we inductively developed a model of wisdom, executive wisdom, that identifies 14 characteristics of wisdom, located in three groups: (...) technē, wise decisions, and virtuous disposition. The findings broaden the view of the complex nature of wise decision-making in the business-society context. (shrink)

The field of behavioral ethics has seen considerable growth over the last few decades. One of the most significant concerns facing this interdisciplinary field of research is the moral judgment-action gap. The moral judgment-action gap is the inconsistency people display when they know what is right but do what they know is wrong. Much of the research in the field of behavioral ethics is based on early work in moral psychology and American psychologist Lawrence Kohlberg’s foundational cognitive model of moral (...) development. However, Kohlberg’s model of moral development lacks a compelling explanation for the judgment-action gap. Yet, it continues to influence theory, research, teaching, and practice in business ethics today. As such, this paper presents a critical review and analysis of the pertinent literature. This paper also reviews modern theories of ethical decision making in business ethics. Gaps in our current understanding and directions for future research in behavioral business ethics are presented. By providing this important theoretical background information, targeted critical analysis, and directions for future research, this paper assists management scholars as they begin to seek a more unified approach, develop newer models of ethical decision making, and conduct business ethics research that examines the moral judgment-action gap. (shrink)