Some critics raise moral objections against corporate social responsibility on account of its supposedly undemocratic nature. They argue that it is hard to reconcile democracy with the private discretion that always accompanies the discharge of responsibilities that are not judicially enforceable. There are two ways of constructing this argument: the “perfect-market argument” and the ‘social-power argument.” This paper demonstrates that the perfect-market argument is untenable and that the social-power argument is sometimes valid. It also asserts that the proponents of the perfect-market argument are mistaken in their assumption that perfect markets are conducive to democracy. There are strong reasons to hold that perfect markets are undesirable from a democratic point of view. A proper conceptualization and differentiation of the relation between “the private and the public” can make this clear. The proponents of the social-power argument sometimes maintain that the democratic deficit can be compensated for by consulting the stakeholders affected. Against this, I will argue that the social power argument has nothing to offer affected parties. Still, it will be shown that modern theory on corporate social responsibility is not well accommodated to the democratic deficit as revealed by the social power argument.

In The Theory of Moral Sentiments, the book preceding The Wealth of Nations, Adam Smith argued for a kind of virtue that Milton Friedman and many another economist reject as appropriate market behavior:

This discussion develops six of the most important guiding principles of classical Jewish business ethics and illustrates their application to a complex recent case of product liability. These principles are: (1) the legitimacy of business activity and profit; (2) the divine origin and ordination of wealth (and hence the limits and obligations of human ownership); (3) the preeminent position in decision making given to the protection and preservation (sanctity) of human life; (4) the protection of consumers from commercial harm; (5) the avoidance of fraud and misrepresentation in sales transactions; and (6) the moral requirement to go beyond the letter of the law. Although these Talmudic principles are clearly obligatory only for “Torah-obedient” Orthodox and Hasidic Jews, many Jews share a sensibility informed by them. Non-Jews, too, may be instructed by Jewish teachings about business ethics.

Confucian scholars express skepticism about rights. This skepticism is relevant to managers who face issues about the recognition of workplace rights in a Confucian culture. My essay examines the foundations of this skepticism, and the cogency of potential leading Western liberal responses to it. I conclude that Confucian skepticism is more formidable than liberals have recognized. I attempt to craft an argument that defuses Confucian skepticism about workplace rights while at the same time respecting the moral depth of Confucianism.

Business ethics serves the important social function of integrating business and society, by promoting the legitimacy of business operations, through critical reflection. Although the social function of business ethics is implicit in leading business ethics foundation theories, it has never been presented in a systematic way. This article sets out to fill this theoretical lacuna, and to explore the theoretical potentials of a functional approach to business ethics. Key concepts from Parsonian functionalistic sociology are applied to establish the social integrative function of business ethics. This produces a theoretical framework for business ethics that provides strong theoretical arguments against often-heard criticisms of business ethics. Many of these criticisms are ideological in nature, in that they systematically play down the importance of integrative functions in the business-society relationship, on the grounds of unrealistic assumptions about the performance of economic and bureaucratic institutions. However, business ethics itself can also become ideological, if it forgets that the conditions for the application of ethics to business are not always ideal as well.

The subject of journal quality has received little attention in the business ethics literature. While there are reasons for this past neglect, there are important new considerations which make it vital that researchers now address this topic. First, virtually all business school departments use evaluations of journal quality as an important indicator of scholarly achievement, yet business ethics has no such studies. Second, as many schools are beginning to ask ethicists to publish in the wider management literature, it is important to find a way to compare journal quality across these domains. In the absence of such studies, performance review committees (including tenure decisions) may well make incorrect inferences about journal quality within business ethics or assume that ethics journals are not prestigious unless a candidate can provide evidence to the contrary (i.e. as in a study like this one). This study addresses these two issues. It relies on an opinion-based survey to establish journal quality by incorporating a list of journals within business ethics and the wider management literature. The target population is active business ethics researchers within the Society for Business Ethics (SBE). We present the results of the study and discuss their implications.

Intermediaries, such as accountants, lawyers, and bankers, are gatekeepers, which are parties whose cooperation is necessary for corporations to function and who, by withholding cooperation, are able to prevent significant corporate misconduct. The recent scandals at Enron and other corporations were due, in part, to failures by gatekeeper institutions. However, intermediaries exist primarily to provide for-fee services and not specifically to detect and deter misconduct. Insofar as these institutions are gatekeepers or guardians, they serve reluctantly. Hence the question: What is the responsibility of intermediaries to act as gatekeepers? This article argues that the appropriate moral, as well as legal, principle for justifying responsibility in a gatekeeper role is cost effectiveness. This conclusion is reached by means of a hypothetical exercise called the investors’ bargain in which investors—who bear the costs and receive the benefits of intermediaries’ gatekeeper role—are asked to choose the best means of protecting their interests.

Senior managers are important to the successful management of ethics in organizations. Therefore, their perceptions of organizational ethics are important. In this study, we propose that senior managers are likely to have a more positive perception of organizational ethics than lower level employees do largely because of their managerial role and their corresponding identification with the organization and need to protect the organization’s image as well as their own identity. By contrast, lower level employees are more likely to be cynical about the organization’s ethics. In order to compare senior managers’ and lower level employees’ perceptions of ethics in the organization, we surveyed randomly selected senior managers and lower level employees in three firms. We found that perceptions of ethics in the organization differed predictably across levels, with senior managers’ perceptions being significantly more positive and lower level employees’ perceptions being more negative. Implications for practice and research are discussed.

Recent corporate scandals raise an old question anew: is capitalism fundamentally infected by immorality? A now almost forgotten answer to this question was advanced at the dawn of capitalism, an answer that students of business ethics would find profit in considering. In the early eighteenth century, Bernard Mandeville authored The Fable of the Bees, which became notorious in its day for arguing that capitalism created wealth while necessarily relying on vicious impulses. The fundamental dilemma is that morality requires self-denial while capitalism runs on self-interest. As such, Mandeville claims that business and ethics are essentially separate.

While this would appear to align him with skeptics of business ethics, Mandeville does suggest a role for moral theorists in dealing with the challenges of commercial societies. The Mandevillean business ethicist proceeds by separating the public and private spheres. In the former, where government policy toward business is at issue, the Mandevillean ethicist applies a market-friendly utilitarianism. In the latter, where individual conduct is at issue, the Mandevillean gently articulates a market-critical ethic predicated on self-restraint.

In 1995, the American Association for the Advancement of Science and the American Society for Engineering Education received a grant from the National Science Foundation to undertake a project aimed both at assisting Russian philosophers in developing curriculum on engineering ethics and learning how context affects the teaching of engineering ethics. The project began with three Russian philosophers visiting the U.S. to observe how we teach engineering ethics. The American members of the project then made three visits to Russia to be part of three different workshops that brought together Russian professors from a variety of disciplines to exchange ideas about teaching ethics among themselves and with the Americans. During these visits, three of the Russians asked if we thought American philosophers would be interested in hearing about the Russian situation. We were delighted by the question (especially since we had become fascinated with the differences in Russian ideas about ethics), and responded with enthusiasm for the idea of their writing such an article. The article that follows is the result of their endeavor to explain how business ethics issues arise in Russia. Among other things, the article reveals how Russia’s history and the experiences of Russians under the U.S.S.R create a context extremely different from our own, for thinking about (and teaching) business ethics.

This article evaluates the social contract theorizing of Professors Thomas Donaldson, Thomas Dunfee and Michael Keeley. This theorizing is tested with G.E. Moore’s concept of moral authority, with moral psychology, and by managerial utility. Both strengths and weaknesses are found in the theories and the author concludes that while there is great potential, much work in theory development remains.

There is a long and distinguished history of ethical thought in both business and medicine dating back to ancient times. Yet, the emergence of distinct academic disciplines [“business ethics” and “bioethics”] which are also tied to broader social movements is a very recent phenomenon. In spite of the apparent affinities that would seem to emerge from this connection, many have argued that the differences between business and medicine make any constructive interaction between business ethics and bioethics minimal. Indeed, little has been done to specifically examine the potential for collaboration and interdisciplinary research. This paper argues that there is considerable potential for constructive interaction between these two movements based on three major arguments: that the differences between medicine and business have been exaggerated, that both fields face a number of urgent problems that are common to each, and that the model of bioethics can serve as a useful guide for business ethicists.

This paper argues that current accountability mechanisms are inadequate to ensure that straight-commissioned agents meet their fiduciary obligations to their clients. In doing so, using agency theory, it revisits how the straight-commission compensation system creates agents’ dueling loyalties and recommends mechanisms of accountability organizations, agents, and/or clients can recognize and employ to ensure agents’ fiduciary obligations to their clients.

Business ethics should not just be a corporate code, but be implemented in the line of business as a corporate philosophy. As an example of the above, I would like to present corporate activities of Canon, Inc. based on the “Kyosei” Initiative which I directed, especially its global development. I would like to show that these activities are ahead of the times and result in great prosperity of a corporation, and to tell my dream to increase corporations which take the same types of actions based on the “Kyosei” Initiative.

An influential set of economic theories argue that the firm is a nexus of contracts that institute a hierarchy to overcome the problems of incomplete contracting in the market. However, the economic theory of the firm as a hierarchy violates the moral requirement to respect the autonomy of those who contract into the firm. The internal logic of the theory depends on a morally unacceptable abdication of a part of the employee’s capacity to set her own ends in the future. So a different theory is needed to understand the nature and purpose of the firm. The development of such a theory can benefit from business ethicists engaging with existing economic theories of the firm to explore concepts like contracts, agency, and property.

Private governance raises important questions about democratic representation. Rule making is rarely based on electoral authorisation by those in whose name rules are made—typically a requirement for democratic legitimacy. This requires revisiting the role of representation in input legitimacy in transnational governance, which remains underdeveloped. Focussing on private labour governance, we contrast two approaches to the transnational representation of worker interests in global supply chains: non-governmental organisations providing representative claims versus trade unions providing representative structures. Studying the Bangladesh Accord for Fire and Building Safety, we examine their interaction along three dimensions of democratic representation: 1) creating presence, 2) authorisation, and 3) accountability to affected constituents. We develop a framework that explains when representative claims and structures become complementary but also how the politics of input legitimacy shape whose interests get represented. We conclude by deriving theoretical and normative implications for transnational representation and input legitimacy in global governance.

Organisational politics can raise the problem of “dirty hands,” illustrated in this paper by an example drawn from a textbook on organisation theory. The initial question is whether the main character has different ethical and political obligations, but this leads on to the question to what extent we can distinguish various different categories of obligation. The example may be of special interest because of the importance of close personal relationship in organisational politics, which brings the dirty hands problem together with the question to what extent friendships generate distinctive obligations. However, it is doubtful whether the allocation of obligations to different categories can be sustained in a useful way. It may be that we can put aside loyalty to an organisation, as a consideration which does not generate any distinctive obligation, but balancing other factors against one another may require the sort of judgment that has sometimes been called “political wisdom,” and sometimes “moral imagination.”

This article argues that the concept of deliberation is construed too narrowly in political corporate social responsibility (CSR) and that a concept of deliberation for political CSR should err toward useful speech acts rather than reciprocity and charity. It draws from the political philosophy, labor relations, and business ethics literatures to outline a framework for an extended notion of deliberative engagement. The characters of deliberative behavior and deliberative environment are held to generate four modes of engagement: strategic deliberation, unitarist deliberation, pluralist deliberation, and deliberative activism. The article concludes by arguing that political CSR will be better positioned to realize its potential by moving away from primarily consensus-centered objectives to a more responsive range of deliberative goals and practice.

In contrast to “social contract” theories of the corporation, a moral justification of the corporation as actual, not hypothetical, agreement is presented. Central to the justification is the idea of personal projects, as developed by Loren Lomasky. The key idea is the role that corporations can play in the construction and advancement of personal, value-creating projects. The concept of the corporation as actual agreement, as a type of “right of association” theory, is defended against influential criticism of such theories by Thomas Donaldson.

This article examines the place of Machiavelli’s Prince in the history of ethics and the history of leadership philosophy. Close scrutiny indicates that Machiavelli advances an ethical system for leadership that involves uprooting corruption and establishing rule of law. He draws on history and current affairs in order to obtain a realistic understanding of human behavior that forms a basis for a consequentialist ethics. While he claims a good leader might do bad things, this is in situations where necessity constrains a prince to choosing the “least bad” course of action. Furthermore, Machiavelli advocates winning the goodwill of followers through leadership as a source of power. Machiavelli’s leadership ethics has a sophistication not fully enjoyed by his reputation in management scholarship. He would not score as especially “Machiavellian” on the Mach IV. Many of his ideas contain seeds for theories that are now considered important for leadership today.