Neoclassical economic theory assumes that people pursue utility maximization within an objective framework, evident to all, that serves as the basis for the interaction. Agents are assumed to be detached observers who see the situation as it is in objective reality. It is argued in this article that there is no objective ground for interaction that exists apart from the understanding of economic agents. Agents have orientations that change over time depending on the way that the situation is currently understood. Depth of understanding and the extent of common ground depend on the quality of attention and the will to openness and honesty. Efforts to maintain connections with others make possible mutual understanding and visions of the common good that enable the coordinated pursuit of desired states of the world.

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.

Stakeholder theory, as a method of management based on morals and behavior, must be grounded by a theory of ethics. However, traditional ethics of justice and rights cannot completely ground the theory. Following and expanding on the work of Wicks, Gilbert, and Freeman (1994), we believe that feminist ethics, invoking principles of caring, provides the missing element that allows moral theory to ground the stakeholder approach to management. Examples are given to support the suggested general principle for making business decisions under feminist moral theory.

This essay articulates a crucial and neglected element of a general theory of the ethics of bureaucratic organizations, both private and public. The key to the approach developed here is the thesis that the distinctive ethical principles applicable to bureaucratic organizations are responses to the distinctive agency-risks that arise from the nature of bureaucratic organizations as complex webs of principal/agent relationships. It is argued that the most important and distinctive ethical principles for bureaucratic organizations express commitments on the part of bureaucrats that function to reduce the agency risks that are inherent in such organizations. This approach to the ethics of bureaucratic organizations is shown to be more illuminating than those that concentrate exclusively or primarily on determining the conditions for corporate responsibility or on the idea that the ethical obligations distinctive of bureaucracies are role-derived.

The logic of the commons is applied to the U.S. labor pool. It is argued that the labor pool is an “active” commons, a commons in which the resource as well as the users of the resource can change voluntarily. For this commons to be tended properly, technical solutions are ineffective and inappropriate; both employer and employee must have trust in the mechanisms that tie them together. Collaborative control is given as a possible framework for making the morality shift necessary to avoid ultimate tragedy.

Employed professionals (e.g., accountants or engineers)—and those who study them—sometimes claim that their status as employees denies them the “autonomy” necessary to be “true professionals.” Is this a conceptual claim or an empirical claim? How might it be proved or disproved? This paper draws on recent work on autonomy to try to answer these questions. In the course of doing that, it identifies three literatures concerned with autonomy and suggests an approach bringing them together in a way likely to be useful both to philosophers interested in the concept and to social scientists interested in studying autonomy in the workplace.

This paper argues that business can be helpfully conceived of as a mediating institution. Drawing upon neo-conservative theology, the author argues that mediating institutions serve a vital function in a free society to provide social justice out of an expanded civil society and provide a framework for a flourishing free market. Such institutions also nourish the attitudinal orientation of solidarity in applying the principle of subsidiarity by which self-interest becomes fulfilled through concern for others.

The author further argues that businesses also be conceived of as mediating institutions and thereby be held to criteria of meeting associational needs. In addition to normative reasons for revising the social contract so that businesses do serve the role of mediating institutions, contemporary management theories demonstrate that businesses can also meet their social obligations of creating wealth while meeting associational needs.

Ethical problems in business include not only genuine moral dilemmas and compliance problems but also problems arising from the distinctive characteristics of imperfect duties. Collective action by business to perfect imperfect duties can yield significant benefits. Such arrrangements can (1) reduce temptations to moral laxity, (2) achieve greater efficiency by eliminating redundancies and gaps that plague uncoordinated individual efforts, (3) reap economies of scale and achieve success where benefits can be provided only if a certain threshold of resources can be brought to bear on a social problem, (4) solve assurance problems where voluntary compliance by some parties depends upon their perception that competitors are doing their fair share, and (5) produce higher levels of contribution than would occur through independent action in response to imperfect duties, stimulated by the perception that there is a fair distribution of burdens of contribution among all parties involved.

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.

The Prisoner's Dilemma is a popular device used by researchers to analyze such institutions as business and the modern corporation. This popularity is not deserved under a certain condition that is widespread in college education. If we, as management educators, take seriously our parts in preparing our students to participate in the institutions of a democratic society, then the Prisoner's Dilemma—as clever a rhetorical device as it is—is an unacceptable means to that end. By posing certain questions about the prisoners in the Prisoner's Dilemma, I show that management educators have created a Prisoners Dilemma, whereby they intellectually imprison themselves and their students by continuing to appeal to the Prisoner's Dilemma. These questions are not encouraged by the advocates of the Prisoner's Dilemma.

Codes of conduct are viewed here as a community's attempt to communicate its expectations and standards of ethical behavior. Many organizations are implementing codes, but empirical support for the relationship between such codes and employee conduct is lacking. We investigated the long term effects of a collegiate honor code experience as well as the effects of corporate ethics codes on unethical behavior in the workplace by surveying alumni from an honor code and a non-honor code college who now work in business. We found that self-reported unethical behavior was lower for respondents who work in an organization with a corporate code of conduct and was inversely associated with corporate code implementation strength and embeddedness. Self-reported unethical behavior was also influenced by the interaction of a collegiate honor code experience and corporate code implementation strength.

Recalling several profound disagreements about business ethics as it is currently discussed in Western societies, I emphasize the need for business ethics as an academic discipline that constitutes the “backbone” for both teaching business ethics and improving business practice (section 1). Then I outline a conceptual framework of business ethics that promotes a “bottom-up” approach (section 2). This “problem-and action-oriented” conception appears to be fruitful in terms of both practical relevance and theoretical understanding. Finally, I argue for (section 3) the relevance of discussing goals at all levels of human action (i.e., individuals, organizations, systems) as well as the indispensability of human rights, and propose Amartya Sen's “goal-rights-system” approach as a normative-ethical framework for business ethics that integrates these two fundamental aspects.

A businessperson acts, qua businessperson, in two institutional contexts which in principle are completely distinct, and normally entail two different ways of relating to other people; on the one hand as an actor in the market, and on the other as the employees’ manager. We shall assume that different sets of norms govern how to relate to trading partners in the market and how to relate to subordinates in the company. The moral problems which arise in the two different institutions for conducting human relations consequently also differ. The main problem relating to market operations originates in the fact that one achieves the most desirable consequences when the objective as such is difficult to justify on moral grounds. Profit is the target, if necessary at the expense of the person one is dealing with. In this context—i.e. in the market—altruistic considerations, or acting out of consideration for the other party, can produce socially undesirable results. The problems confronting the businessperson as manager are of a different nature. We shall not be considering all aspects of management or consultancy ethics, only what we regard as in principle the fundamental problem, one which in fact applies to all management in modern society.

A language of care and relationship-building has recently appeared with prominence in the business literature, driven by the realities of the marketplace. Thus, it seems a propitious time to reflect on a decade of writing in feminist morality that has focussed on the concept of an ethic of care, and examine its relevance for today's business context. Is the idea of creating organizations that “care” just another management fad that subverts the essential integrity of concepts of ethical caring? Conversely, are these concepts capable of beginning an important dialogue that may help us to see new possibilities for simultaneously enhancing both the effectiveness and the moral quality of organizations in the future?

Ethicists and legal theorists have proposed models of corporate culpability that shift the standard of guilt determination from vicarious attribution of individual action and intention to an assessment of culture, policies, as well as organizational action and inaction. This paper briefly reviews four prominent models of corporate culpability, arguing that each makes claims that extend well beyond the limits of existing law. As an alternative to these models, a constructive corporate fault is described that relies on both objective and subjective reasonableness judgments. The paper concludes with a consideration of constructive corporate fault in relation to an Accountability model of corporate liability.

This paper argues that moral thinking is an essential management capability which strengthens organizations and contributes to their performance in the marketplace. The paper explains what moral thinking is, and addresses the most common reasons for considering it inappropriate or irrelevant to managerial practice. The argument provides a compelling rationale for the corporate ethics initiatives undertaken in recent years.

The substantial work on cognitive moral development (CMD) by Lawrence Kohlberg and James Rest popularized the use of this construct in the literature on business ethics. This construct has been prominently used in models attempting to explain ethical/unethical behavior in management, marketing, and accounting, even though Kohlberg did not intend for the construct to be used in that manner. As a predictor of behavior, CMD has been attacked on the theoretical level, and its empirical performance has been weak. This article uses another established construct, which seems to satisfy the central criticisms of CMD, as a means of testing those complaints. The comparative multidimensional ethics scale (MES) substantially outperforms CMD, operationalized using Rest's Defining Issues Test, in every test. These results seem to suggest that other options perform better than CMD when the purpose is to model ethical/unethical behavior or even ethical judgment.

Many areas of business ethics research are “sensitive.” We provide an empirical assessment of the randomized response technique which provides absolute anonymity to subjects and “legal immunity” to the researcher. Beyond that, RRT techniques provide complete disclosure to subjects, unconditional privacy is maintained, and there is no deception.

I argue that Plato was right in claiming that justice is more profitable, more rational, and more intrinsically valuable than injustice, and that this is particularly true for business organizations. The research on prisoners’ dilemmas and social dilemmas shows that ethical behavior is more profitable and more rational than unethical behavior in terms of both the negative sanctions on unethical behavior when interactions with stakeholders are iterated, and the positive rewards of habitually ethical behavior when stakeholders can identify those who are predisposed to be ethical. In addition, the psychological research on justice shows that justice is intrinsically valued, both from an outcome and from a process perspective, and so crucial for business organizations, particularly in terms of organizational effectiveness.

The first issue of Business Ethics Quarterly appeared five years ago. This article classifies the content of the 141 articles that have appeared since that time along 18 dimensions, and 118 categories within those dimensions, to determine trends within the discipline. The major trend appears to be a shift in focus towards the increased discussion of a new approach/paradigm for the field, and towards a normative/descriptive interface of the theory. The major problem seems to be a lack of explicit conceptual definition and beginning empirical effort to support that new focus, which may thus prove unsustainable over time.