Of the many developments in business ethics that Thomas Donaldson has helped pioneer, one is the application of social contract theory to address questions about the responsibilities of business actors. In Corporations and Morality, Donaldson develops one of the most sustained and comprehensive accounts that aims to justify the existence of for-profit corporations and to specify and ground their responsibilities. In order to further our understanding about the purpose and responsibilities of productive organizations, and as a contribution to the scholarship on Donaldson’s thought, this paper gathers together the critical responses to Donaldson’s account along with Donaldson’s replies to his critics. The paper argues that we would do well to continue engaging with Donaldson’s account because of its distinctive and challenging conception of the purpose and responsibilities of productive organizations, but that many of the insights to be gained come from reframing the role played by social contract theory.

I address an interesting puzzle of how marginalized groups gain self-representation and influence firms’ strategies. Accordingly, I examine the case of access to low-cost HIV/AIDS drugs in South Africa by integrating W. E. B. Du Bois’s work into stakeholder theory. Du Bois’s scholarly work, most notably his founding contribution to Black scholarship, has profound significance in the humanities and social sciences disciplines and vast potential to inspire a new way of thinking and doing research in the management and organization fields, including business ethics research. By drawing on Du Bois’s works, I argue that through reconstruction of their selves—knowing their souls—marginalized groups know their capabilities better, enabling them to overcome their political and strategic limitations and ensure their true self-representation. They are also empowered to use political imagination and strategies of resistance against more powerful opponents. This influences powerful actors to accept the demands of marginalized groups.

This article challenges the assumption that the source of ethical leadership is the well-intentioned leader of good character. Drawing from Michel Foucault’s critical philosophy, it argues that those aspiring to lead ethically must actively constitute themselves in order to become subjects who are free to exercise ethical agency. The practices of self-care (epimeileisthai sautou) and courageous speech (parrhesia) are introduced as means by which such self-constitution can be approached. The case of US President Barack Obama’s inability to close the detention centre at Guantanamo Bay serves as an illustrative device to ground Foucault’s ideas. The argument enriches a philosophically informed rendering of ethical leadership in three ways: by highlighting the role resistance plays in any leader’s attempts to achieve ethical ends, by demonstrating the importance of an orientation of critique on the part of those aspiring to lead ethically, and by revealing the importance of followers in realizing ethical outcomes.

Although “fairness” and “social responsibilities” form part of the business ethics agenda of Japanese corporations, the meaning of these terms must be understood in the context of the distinctive Japanese approach to ethics. In Japan, ethics is inextricably bound up with religious dimension (two normative environments) and social dimension (framework of concentric circles). The normative environments, influenced by Confucianism, Buddhism, and other traditional and modern Japanese religions, emphasize that not only individuals but also groups have their own spirit (numen) which is connected to the ultimate reality. The framework of concentric circles lets moral agents apply different ethical rules to the respective circles. The dynamics of these religious and social dimensions lead to a different view of both individuals and corporations from that dominant in the West.

While a ubiquitous phenomenon, initial public offerings (IPOs) have received no attention in the ethics literature. We provide an overview of a series of potential conflicts of interest that pervade the IPO process. We also report the results of an empirical assessment of IPOs and those elements that may inform a substantive moral hazard faced by key players in the period prior to and just after an IPO.

Fifty years ago, two Princeton professors established game theory as an important new branch of applied mathematics. Game theory has become a celebrated discipline in its own right, and it now plays a prestigious role in many disciplines, including ethics, due in particular to the neo-Hobbesian thinking of David Gauthier and others. Now it is perched at the edge of business ethics. I believe that it is dangerous and demeaning. It makes us look the wrong way at business, reinforcing a destructive obsession with measurable outcomes and a false sense of competition. It falsely characterizes or insidiously advocates a style of human behavior that is utterly unacceptable. To put the matter quite crudely, a person who actually practiced the form of “rationality” advocated by game theory would be something of a monster.

We should not ask for more precision than a subject is capable of giving us. — Aristotle, (384–322 B.C.E.) Nicomachean Ethics Bk. 1

Not that you won or lost—but how you played the game. — Grantland Rice (1880–1954) “Alumnus Football”

The United States is distinctive among advanced economies in that its employment laws and practices are governed by Employment at Will (EAW). Most other nations have variations on Just Cause dismissal rules. I argue that the U.S. preference for EAW is unsupported by concerns about net social or economic consequences. More centrally, I argue that the basic moral commitments that underlie the U.S. system of private property and freedom of contract are commitments that lend support to Just Cause over EAW.

Jewish business ethics in Israel addresses two major sources of economic immorality—unbounded desire and fear of economic uncertainty—through enforcement and spiritual education. Business is seen as a path to sanctity, when time is set apart for religious study, wealth is seen as originating from God, the vulnerable are protected against fraud and theft, charity is seen as an obligation, and mercy towards debtors is tempered by justice.

The expansion of extractive corporations’ overseas business operations has led to serious concerns regarding human rights–related impacts. As these apprehensions grow, we see a countervailing rise in calls for government intervention and in levels of socially conscious shareholder advocacy. I focus on the latter as manifested in recent use of the shareholder proposal mechanism found in corporate law. Shareholder proposals, while under-theorized, provide a valuable lens through which to consider the argument that economic behaviour is embedded within social relations. In doing so, I situate my analysis within Third World Approaches to International Law (TWAIL) scholarship. Elsewhere, I have supported the use of corporate law tools in advancing the international human rights enterprise and argued that investment activism can be an essential component of this advancement. This paper represents a reflexive pause. Using the case study of a recent proposal submitted to Goldcorp Inc., I seek to problematize the shareholder proposal as a human rights advocacy tool and to examine it as a site of contestation.

Combating and overcoming corruption in business and in political affairs is one of the most important issues facing business and professional ethics in the 21st century. That corruption exists is a fact. That corruption is widespread and spreading is a common perception. Many believe that corruption is culturally induced. Some believe corruption to be so much a part of the fabric of some societies as to be unquestioned and unassailable. Or, is it simply a myth that corruption is a matter of culture?

In this comment I challenge two of the arguments made in the paper, “Toward the Feminine Firm.” First I challenge the claim that Gilligan's work on gender differences in moral orientation provides a logically and empirically sound foundation for an alternative theory of the firm. I cite recent work that discredits any concise notion of a feminine ethic. Second I challenge the claim that, if such a firm were to exist, it would flourish in a competitive market economy. I suggest that, far from flourishing, such a firm will rapidly perish.

Business ethics research has long been interested in understanding the conditions under which ethical consumption is consistent versus context-dependent. Extant research suggests that many consumers fail to make consistent ethical consumption decisions and tend to engage in ethical decisions associated with ingroup (vs. outgroup) identity cues. To fill this gap, four experiments examine how construal levels moderate the influence of ingroup versus outgroup identity cues in ethical consumption. The studies support the contention that when consumers use concrete construal to process information, they will focus on ingroup cues and make ethical consumption decisions that are aligned with ingroup biases. However, when consumers use abstract construal, they will act more consistently with their inner goals rather than focusing on ingroup and outgroup cues. Social goodwill, which indicates desires to give back to society, is identified as mediating the effects. The findings have important implications for ethical consumption and social influence literature.

The paper argues that the point of a business ethics course is to improve behavior in business, and that an essential ingredient in that improved behavior is knowing what's right or wrong. To make that claim, the paper attempts to dispose of three arguments which support the contrary claim, that business ethics courses are useless. First, it is argued that morals can't be taught, since they only result from training. Second, it is argued that such courses are unnecessary because business executives already know right from wrong. Third, it is argued that ethical knowledge is impossible, so there is nothing to teach. The first two arguments are dealt with briefly, and the third is addressed extensively. The paper argues that the scepticism about ethical knowledge is part of a pervasive “relativism” in our society, but shows that such a relativism/scepticism is untenable and indicates how ethical knowledge is possible. If, then, knowledge of right and wrong is an essential ingredient for improving business behavior, and such knowledge can be imparted in an ethics course, there is some point to teaching business ethics.

In this article I inquire into Confucian ethics from a non-ideal stance investigating the complex interaction between Confucian ideals and the reality of the modern workplace. I contend that even Confucian workers who regularly engage in social rites at the workplace have an internal, Confucian reason to appreciate the value of rights at the workplace. I explain, from a Confucian non-ideal perspective, why I disagree with the presumptuous idea that labor (or workplace) rights are necessarily incompatible with Confucian ideals and values. Specifically, I argue that if managers were “sages,” the highest moral exemplars and authorities in the Confucian tradition, they would perceive that social rituals alone are often not a contextually intelligent and valued response for the development of intimate communities in the modern workplace. The sage perspective will lead Confucian managers to realize, from their own moral perspective, that they have good reason to balance rites with rights, so long as the adoption is extrinsically valuable and consistent with the Confucian ideal. This article contributes to the debates about Confucianism's compatibility with rights, helps Western human rights scholars better contextualize their arguments in Confucianism-influenced cultures, and contributes to the development of a Confucian or Chinese approach to business ethics.

I evaluate the adequacy of the three models of international business ethics that have been recently proposed by Thomas Donaldson, Gerard Elfstrom and Richard De George. Using the example of the conduct of the aluminum companies in Jamaica, I argue that these three models fail to address the most important of the ethical issues encountered by multinationals because they focus too narrowly on human rights issues and on utilitarian considerations. In addition I argue that these models also evidence an inadequate understanding of microeconomic theory. I end by proposing that these defects can be remedied by a model of ethics that incorporates a theory of moral rights, a utilitarian-based theory of the market, and a theory of justice.

Concern for one’s “reputation” has been introduced in recent game theory enabling theorists to demonstrate the rationality of cooperative behavior in certain contexts. And these impressive results have been generalized to a variety of situations studied by students of business and business ethicists. But it is not clear that the notion of reputation employed has much explanatory power once one sees what is meant. I also suggest that there may be some larger lessons about the notion of rationality used by decision theorists.

Singer has recently argued that questions related to corporate governance are beyond the reach of Rawls’s political conception of justice. This is because justice applies to the basic structure of society, understood as society’s legally coercive structures, and because corporate governance cannot be considered part of this structure in political liberalism. This commentary challenges the second part of the argument. First, it suggests that the criterion used to exclude corporate governance from the basic structure—whether employees can exit economic organizations—is not conclusive for corporate governance, notably as institutionalized in corporate law. Second, even if the focus were on corporate governance, it would still be possible to argue that it legally coerces citizens, if not employees, in a relevant way. Thus, the argument is not successful in demonstrating that political liberalism goes beyond its legitimate boundaries when considering that aspects of corporate governance may be matters of justice.

This article argues for the compatibility of casuistry and the business case method. It describes the salient features of casuistry and the case method, shows how the two methods are similar yet different, and suggests how elements of casuistry might benefit the use of the case method in management education. Toward these ends, it shows how casuistry and the case method are both inductive and practical methods of reasoning focussed on single settings and real-life situations and how both methods stress that real-life decision making is not the exclusive domain of experts. It also shows how casuistry and the case method are not identical processes but have different purposes and emphasize order and problem-resolution differently. In the end, Casuistry and the Business Case Method suggests that, despite their differences, casuistry and the case method might be brought together to benefit business management and the field of business ethics.

This article explains how the private equity-leveraged buyout type of financial institution (PE-LBO) operates as a form of finance capitalism. PE-LBO capitalism is described and compared with other types of capitalism such as family business capitalism, managerial capitalism, and other forms of finance capitalism such as shareholder value capitalism. Ethical and social issues structurally related to the PE-LBO form are analyzed. Potential reforms and/or solutions are considered.