Abstract

We propose that firms that engage in morally imaginative sensemaking will manage society's changing ethical expectations more effectively than those engaging in habituated sensemaking. Specifically, we argue that managers engaging in habituated sensemaking will tend to view changes in expectations as threats and respond to them defensively. In contrast, morally imaginative managers will tend to see these same changes as opportunities and address them by proactively or interactively engaging stakeholders in learning processes. We contribute to the literature on moral imagination by highlighting the value of moral imagination relative to conventional sensemaking, and by positioning moral imagination as an ongoing mode of sensemaking. While we recognize that managers' capacity to continuously address changing ethical expectations using moral imagination is constrained by cognitive limitations, we posit that morally imaginative sensemaking may economize on cognitive resources over time by enabling managers to avoid managing ethical issues unproductively based on habit. We also contribute to the issues management literature by calling attention to two underlying factors, managerial sensemaking mode and firm enterprise strategy, that drive companies' approaches to issues management.