Foundations of Business Ethics, Misc

Game theory involves deliberating about what to do in light of what other people are likely to do. One of the central frameworks of game theory is the prisoner’s dilemma, in which participants who make rational choices end up in suboptimal outcomes. Using the prisoner’s dilemma to model competition between firms sets the stage for a new and promising approach to business ethics: the market failures approach.

Abstract (German version follows): -/- This paper develops a new proposal for a coherentist business ethic in which ethically justified and empirically supported proposed solutions to economic problems are developed through a coherentist process of adjustments between the three levels of (1) conception of problem and its solution, (2) positive economic theory, and (3) ethical theories. Using an example, it illustrates how in this framework, Homann's business ethics gains in validity and relevance but loses its claim to universality. // -/- (...) Diese Arbeit entwickelt eine kohärentistische Wirtschaftsethik, in der ethisch begründete und empirisch gestützte Lösungsvorschläge für ökonomische Probleme durch einen kohärentistischen Anpassungsprozess zwischen den drei Ebenen (1) Auffassung von Problem und Lösungsansatz, (2) positive ökonomische Theorie, sowie (3) ethischen Theorien erarbeitet werden. Anhand eines Beispiels wird illustriert, wie Homanns Wirtschaftsethik in diesem Rahmen an Validität und Relevanz gewinnt, jedoch ihren Universalitätsanspruch verliert. (shrink)

Business ethics is often understood as a variety of professional ethics, and thus distinct from ordinary morality in an important way. This article seeks to challenge two ways of defending this claim: first, from the nature of business practice, and second, from the contribution of business. The former argument fails because it undermines our ability to rule out a professional-ethics approach to a number of disreputable practices. The latter argument fails because the contribution of business is extrinsic to business in (...) a way that distinguishes from the established professions. The article ultimately suggests we adopt a more aspirational approach to business ethics, which retains an appeal even in the face of charges of anti-capitalist irrelevance. (shrink)

This very short paper highlights some of my recent and forthcoming work on “good epistemic practices” in the financial services industry. It identifies some epistemic dimensions of risk management in banking and illustrates how managing for good epistemic practices might be helpful.

I aim in this paper to provide defense of one way to look at what should be regulated in the market place. In particular, I discuss what should be tolerated and argue against corporate welfare. I begin by endorsing John Stuart Mill’s harm principle as a normative principle of toleration. I call strict commitment to the harm principle when considering the regulatory structure of markets market libertarianism and oppose that to promotionism, the view that endorses government interference to promote business (...) interests. I next discuss the widespread use of promotionist policies, arguing against them and for market libertarianism. I also consider problems for my view, recognizing that one of my responses may leave some thinking the paper is a reductio of the market libertarian view because of the sort of slow-growth state it endorses. Others will recognize it as a view promoted by some of the U.S. founding fathers and find it attractive in its own right. (shrink)

ABSTRACT:The distinction between what I call nonelective obligations and discretionary obligations, a distinction that focuses on one particular thread of the distinction between perfect and imperfect duties, helps us to identify the obligations that carry over from principals to agents. Clarity on this issue is necessary to identify the moral obligations within “shareholder primacy”, which conceives of managers as agents of shareholders. My main claim is that the principal-agent relation requires agents to fulfill nonelective obligations, but it does not always (...) require discharging discretionary obligations. I show that the requirement to fulfill nonelective obligations is more far-reaching than has been acknowledged by most defenders and critics of shareholder primacy. But I also show that managers are not bound by certain discretionary obligations like charity, showing that their moral obligations are more circumscribed than the obligations that apply to human beings in general. (shrink)

Without doubt, the global challenges we are currently facing—above all world poverty and climate change—require collective solutions: states, national and international organizations, firms and business corporations as well as individuals must work together in order to remedy these problems. In this chapter, I discuss climate change mitigation as a collective action problem from the perspective of moral philosophy. In particular, I address and refute three arguments suggesting that business firms and corporations have no moral duty to reduce greenhouse gas emissions: (...) (i) that business corporations are not appropriate addressees of moral demands because they are not moral agents, and (ii) that to the extent that they are moral agents their primary moral obligation is to their owners or shareholders, and (iii) the appeal to the difference principle: that individual business corporations cannot really make a significant difference to successful climate change mitigation. (shrink)

This paper examines ethics in finance, specifically related to responsible investment. In recent years, socially responsible principles are becoming the de facto standard not only for socially responsible but also for profitable investing. For instance, the United Nations developed the Principles for Responsible Investment (PRI) in 2006, which require institutional investors to incorporate ESG (Environmental, Social and Governance) issues into investment analysis and decision-making processes. This raises the following question: can responsible investments be justified from an ethical point of view? (...) In this paper I first explain responsible investments. Then, I turn to the ethical foundation of responsible investments. There are two arguments for responsible investments. I argue that both fail. Therefore, my conclusion is that the ethical foundation of responsible investments is not firm. (shrink)

Are corporations and other complex groups ever morally responsible in ways that do not reduce to the moral responsibility of their members? Christian List, Phillip Pettit, Kendy Hess, and David Copp have recently defended the idea that they can be. For them, complex groups (sometimes called collectives) can be irreducibly morally responsible because they satisfy the conditions for morally responsible agency; and this view is made more plausible by the claim (made by Theiner) that collectives can have minds. In this (...) paper I give a new argument against the idea that collectives can be irreducibly morally responsible in the ways that individuals can be. Drawing on recent work in the philosophy of mind (what Uriah Kriegel calls "the phenomenal intentionality research program") and moral theory (David Shoemaker's tripartite theory of moral responsibility), I argue that for something to have a mind, it must be phenomenally conscious, and that the fact that collectives lack phenomenal consciousness implies that they are incapable of accountability, an important form of moral responsibility. (shrink)

Recently, a number of people have argued that certain entities embodied by groups of agents themselves qualify as agents, with their own beliefs, desires, and intentions; even, some claim, as moral agents. However, others have independently argued that fully-fledged moral agency involves a capacity for reactive attitudes such as guilt and indignation, and these capacities might seem beyond the ken of “collective” or “ corporate ” agents. Individuals embodying such agents can of course be ashamed, proud, or indignant about what (...) the agent has done. But just as an entity needs to have its own beliefs, desires, and intentions to qualify as a bona fide agent, the required capacity for reactive attitudes is a capacity to have one’s own reactive attitudes. If fully-fledged moral agency requires reactive attitudes, the corporate agent must itself be capable of guilt and indignation. In this paper, we argue that at least certain corporate agents are. Or, more precisely, we argue that if there are bona fide corporate agents, these agents can have the capacities that are both associated with guilt and indignation and plausibly required for moral agency; in particular certain epistemic and motivational capacities. (shrink)

Karl Homann ist vor allem als Wirtschaftsethiker bekannt. Er war der erste Inhaber eines wirtschaftsethischen Lehrstuhls und gilt als einer derjenigen Autoren, die das Fach Wirtschaftsethik im deutschen Sprachraum maßgeblich geprägt haben. Dabei hat Homann seinen wirtschaftsethischen Theorieentwurf nie als eine schlichte Anwendung ethischer Grundsätze auf Fragen des Wirtschaftens verstanden. Vielmehr begriff er ihn als allgemeinen ethischen Ansatz mit ökonomischer Methode. Im Rahmen dieses Ansatzes sollte die abendländische Moral ökonomisch rekonstruiert werden, um sie so unter den Bedingungen moderner Gesellschaften mit (...) institutionalisiertem marktwirtschaftlichen Wettbewerb überlebensfähig zu machen. Mit seiner neuen Monographie Sollen und Können stellt Karl Homann dieses Grundmodell einem weiteren Leserkreis vor. Er will sein Buch also nicht als einen neuen Beitrag zur Wirtschaftsethik-Debatte verstanden wissen, sondern als allgemeinen philosophischen Ethikentwurf. Die Argumentation, die Homann in Sollen und Können vorstellt, soll im Folgenden selektiv zusammengefasst und kritisch gewürdigt werden. (shrink)

The theme of this issue of the St. Gallen Business Review is "Harmony". For this reason, we would like to discuss whether two aspects of our life- world are in harmony, namely economic optimization and morality. What is the relation between them? According to a widely shared view, which is one aspect of the doctrine of "mainstream economics", the functioning of an economic system does not require moral behaviour on the part of the individual economic agent. In what follows, we (...) will try to convince you that this is false. If all economic agents – managers, employees, bankers, consumers and so on – were purely self-interested, as mainstream economics assumes, our economic practice would fail. There are various reasons for this. Here we will focus on one of them, namely the pivotal role of interpersonal communication. (shrink)

According to the order ethics approach to business ethics, moral rules must be im-plemented by institutions that provide incentives for following the rules. As a minimal (normative) condition, these institutions must be able to motivate the homo eco-nomicus. But even if an institution passes this test, it will only motivate actual people (i.e. the homo psychologicus) to follow moral rules, if they have the relevant compe-tences and self-efficacy beliefs. Consequently, good institutional design includes com-prehensive change management. At this point applied (...) order ethics can draw on find-ings of psychology and experimental economics. It turns out, that role models can support self-efficacy beliefs and are thus more important for order ethics than has traditionally been assumed. (shrink)

What sort of connection is there between business ethics and philosophy? The answer given here: a weak one, but it may be getting stronger. Comparatively few business ethics articles are structurally dependent on mainstream academic philosophy or on such sub-specialities thereof as normative ethics, moral theory, and social and political philosophy. Examining articles recently published in the Journal of Business Ethics that declare some dependence, the author finds that such declarations often constitute only a pro forma gesture which could be (...) omitted without detriment to the paper's content and conclusions. He also finds, however, that some authors do draw on solid philosophical work in ways that are establishing ever more meaningful interconnections between business ethics and academic philosophy. These cross-disciplinary studies, he concludes, are ground-breaking and invite creative imitation. (shrink)

The article sets out to reconstruct the ongoing re-discussion of role of morality in the economic subsystem. Traditional dichotomies between selfishness and benevolence, individual and collective interest, equality and efficiency have been shown to need more cautious reformulation. The claim is that, rather than taking sides for or against the reasons of ‘man’ or ‘solidarity’ against alleged reasons of the economy or the market, what is required is better understanding of the ways economies and markets work.