The normative foundations of the investor centered model of corporate governance, represented in mainstream economics by the nexus-of-contracts view of the firm, have come under attack, mainly by proponents of normative stakeholder theory. We argue that the nexusof- contracts view is static and limited due to its assumption of price-output certainty. We attempt a synthesis of the nexus-of-contracts and the Knightian views, which provides novel insights into the normative adequacy of the investor-centered firm. Implications for scholarship and management practice follow (...) from our discussion. (shrink)

Applied Business Ethics is a core module for business undergraduate students in an internationalised university business degree programme from the United Kingdom taught at a Private Higher Education Institution in Singapore. Students, who are working adults undertaking this part-time degree, are assessed purely on the application of theoretical knowledge through essays that show evidence of their ability to apply theory in workplace ethical dilemmas. This pilot study explores the utility of the module in terms of use and exchange value. It (...) was conducted in two phases as an empirical qualitative research. First, an email survey was sent to students, who had already graduated, to gather impressions of the module using open-ended questions. Based on the responses, semi-structured interviews of a purposive sample of four students were carried out to unearth insights on use and exchange value of the module through their stories. The study suggests that a key determinant of use value is workplace utility of the knowledge that has been gained. Over time, consistent derivation of use value translates to exchange value as long-term behaviour changes in the individual create positive workplace outcomes. The study also recognised the powerful influence of organisational culture in determining whether ethical thinking translates into ethical action, which also has a direct bearing on perceptions of use and exchange value. The findings of this study provide an insight to the understanding of the motivations of working adults attending the Applied Business Ethics module on a part-time basis. Having this understanding, it will be possible to further structure the module, in terms of positioning, delivery and assessment, to enable these students to become better managers when dealing with real-world workplace ethical issues. (shrink)

Business, management, and business ethics literature pay little attention to the topic of AI robots. The broad spectrum of potential ethical issues pertains to using driverless cars, AI robots in care homes, and in the military, such as Lethal Autonomous Weapon Systems. However, there is a scarcity of in-depth theoretical, methodological, or empirical studies that address these ethical issues, for instance, the impact of morality and where accountability resides in AI robots’ use. To address this dearth, this study offers a (...) conceptual framework that interpretively develops the ethical implications of AI robot applications, drawing on descriptive and normative ethical theory. The new framework elaborates on how the locus of morality and moral intensity combine within context-specific AI robot applications, and how this might influence accountability thinking. Our theorization indicates that in situations of escalating AI agency and situational moral intensity, accountability is widely dispersed between actors and institutions. ‘Accountability clusters’ are outlined to illustrate interrelationships between the locus of morality, moral intensity, and accountability and how these invoke different categorical responses: illegal, immoral, permissible, and supererogatory pertaining to using AI robots. These enable discussion of the ethical implications of using AI robots, and associated accountability challenges for a constellation of actors—from designer, individual/organizational users to the normative and regulative approaches of industrial/governmental bodies and intergovernmental regimes. (shrink)

Companies that contribute to charitable organizations rightly hope that their philanthropic work will also be good for the bottom line. Marketers of good corporate conduct must be especially careful, however, to market such conduct in a morally acceptable fashion. Although marketers typically engage in mild deception or take artistic license when marketing goods and services, these sorts of practices are far more morally troublesome when used to market good corporate conduct. I argue that although mild deception is not substantially worrisome (...) with respect to the marketing of most goods and services, it is a far greater moral blunder to use such methods in the marketing of good corporate character. These erode trust and demonstrate alack of adequate respect for the moral good. In light of these concerns, I suggest that such practices must be re-examined when applied to the marketing of corporate character and good conduct. Finally, I develop a revised set of ethical guidelines that are needed in order to address the problems peculiar to the marketing of morally praiseworthy behavior. (shrink)

Abstract:The purpose of this paper is to present an understanding of business ethics based on a theory of internal social criticism. Internal social criticism focuses on how members of a business organization debate the meanings of their shared traditions for the purpose of locating and correcting hypocrisy. Organizations have thick moral cultures that allow them to be self-governing moral communities. By considering organizations as interpretive moral communities, I challenge the conventional notion that moral criticism is based primarily on exogenous moral (...) principles delivered by outside critics. I describe an interpretive process of business ethics and develop a theoretical model of internal social criticism. I also propose that organizational identification serves as a mechanism for inducing ethical behavior. I conclude by calling for more research that understands the development and use of existing moral principles inside of organizations. (shrink)

In a previous essay (Sison and Fontrodona 2012), we defined the common good of the firm as collaborative work, insofar as it provides, first, an opportunity to develop knowledge, skills, virtues, and meaning (work as praxis), and second, inasmuch as it produces goods and services to satisfy society’s needs and wants (work as poiesis). We would now like to focus on the participatory aspect of this common good. To do so, we will have to identify the different members of the (...) firm as a community, drawing from corporate citizenship literature and stakeholder theory. Afterward, we will explore both the manner and the intensity of these different members’ participation and its impact on the firm’s common good. (shrink)

We address how to ethically evaluate workplace practices when workplace behavioral norms conflict with employees’ attitudes toward those norms, which, according to research on psychological contract violations, regularly occurs. Drawing on Scanlonian contractualism, we introduce the intersubjective reflection process (IR process). The IR process ethically evaluates workplace practices according to whether parties to a workplace practice have intersubjectively valid grounds to veto the practice. We present normative and empirical justification for this process and apply the IR process to accounts of (...) workplace moral dilemmas. We end by identifying future directions for research related to the IR process. (shrink)

Abstract:Shareholders’ relationship to the firm is a central theme in corporate governance, yet the investors’ perspective has been virtually ignored in governance research. This paper attempts to explain the previously unexplored role of trust in the investor decision-making process. The proposed model suggests that trust acts as the antecedent of the risk variable in existing investor decision-making models. Stock ownership involves both financial and ethical risk, which by definition requires some level of implicit trust in management and the market.

Abstract:Over the last two decades, institutional investing has rocked the world of corporate governance in a transformation that has begun to be reflected in the finance, legal, and management literatures. Traditional players have seen their roles change and bases of power shift, and new actors have entered the governance equation. These transitions have entailed an ethical upheaval that is only beginning to be addressed in the business ethics literature.This paper attempts to facilitate research in this area by integrating various literatures (...) into an examination of a series of business ethics issues related to pension fund activism and portfolio management, fund staffing, and employee compensation. The primary intent of this project is to encourage increased business ethics research in the area of institutional investing in general and pension fund management in particular. (shrink)

The concept of corporate social responsibility (CSR) has been widely investigated, but a generally accepted theoretical framework does not yet exist. This paper argues that the idiosyncrasies of large firms and SMEs explains the different approaches to CSR, and that the notion of social capital is a more useful way of understanding the CSR approach of SMEs, whereas stakeholder theory more closely addresses the CSR approach of large firms. Based on the extant literature, we present a comparison of large firm (...) and SME idiosyncrasies suggesting that both consolidated and emerging strategic orientations toward responsible behaviours exist. Idiosyncrasies of large firms and SMEs are also discussed to provide an assessment of the firm’s strategic CSR orientation, suggesting the key drivers upon which CSR strategies must be based. A twofold consideration emerges. First, the CSR–SME relationship could be better explained if the notion of social capital is taken into account, but this should also be accompanied by a stakeholder view of the SME; second, social capital and stakeholder theory should be taken as alternative ways of explaining CSR in both large firms and SMEs. (shrink)

As a result of recent corporate scandals, several rules have focused on the role played by Boards of Directors on the planning and monitoring of corporate codes of ethics. In theory, outside directors are in a better position than insiders to protect and further the interests of all stakeholders because of their experience and their sense of moral and legal obligations. Female directors also tend to be more sensitive to ethics according to several past studies which explain this affirmation by (...) early gender socialization, the fact that women are thought to place a greater emphasis on harmonious relations and the fact that men and women use different ethical frameworks in their judgments. The goal of this paper is to determine the influence of these characteristics of the Board in terms of promoting and hindering the creation of a code of ethics. Our findings show that a greater number of female directors does not necessarily lead to more ethical companies. Moreover, within Europe as a continent, board ownership leads to an entrenchment of upper-level management, generating a divergence between the ethical interests of owners and managers. In light of this situation, the presence of independent directors is necessary to reduce such conflicts. (shrink)

Organizations routinely make choices when addressing conflicting stakes of their stakeholders. As stakeholder theory continues to mature, scholars continue to seek ways to make it more usable, yet proponents continue to debate its legitimacy. Various scholarly attempts to ground stakeholder theory have not narrowed down this debate. We draw from the work of Juergen Habermas to theoretically advance stakeholder theory, and to provide practical examples to illustrate our approach. Specifically, we apply Habermas’ language-pragmatic approach to extend stakeholder theory by advancing (...) seven sets of normative axioms. We conclude that a deliberative approach, with its focus on the conditions of legitimation and deliberative democracy, has the potential to become a cornerstone of stakeholder theory. The need for global stakeholder discourse and its internalization in corporate structures and institutions is exemplified by a multitude of CSR and stakeholder initiatives that have mushroomed in response to global risk scenarios such as climate change, nuclear warfare, or terrorism. Further research may help to build a functioning global governance system in order to provide guidance for management in the 21st century. (shrink)

Stakeholder theory is widely recognized as a management theory, yet very little research has considered its implications for individual managerial decision-making. In the two studies reported here, we used stakeholder theory to examine managerial decisions about balancing stakeholder interests. Results of Study 1 suggest that indivisible resources and unequal levels of stakeholder saliency constrain managers’ efforts to balance stakeholder interests. Resource divisibility also influenced whether managers used a within-decision or an across-decision approach to balance stakeholder interests. In Study 2 we (...) examined instrumental and normative implications of these two approaches. We conclude by considering the contributions of this research. (shrink)

Corporate social responsibility (CSR) has acquired an unquestionably high degree of relevance for a large number of different actors. Among others, academics and practitioners are developing a wide range of knowledge and best practices to further improve socially responsible competences. Within this context, one frequent question is according to what theory should general knowledge of CSR be developed, and in particular the relationship between CSR and small and medium-size enterprises (SMEs). This paper suggests that research on large firms should be (...) based on stakeholder theory, while research on CSR among SMEs should be based on the concept of social capital. This paper first provides a theoretical and practical perspective on CSR today; the focus then shifts to the specific literature on CSR and SMEs; some data and information follow on SMEs in Europe and Italy; finally, some conclusions and questions for future research are suggested. (shrink)

Large companies must increasingly satisfy not only the conditions of their formal licences, but also the concerns and expectations of host communities and broader society. This has led to the emergence, particularly in the minerals industry, of the notion of “social licence”, an interdiscursive term whose meaning is rarely interrogated. We use textual analysis to critically investigate the construction of social licence discourse in minerals companies’ sustainable development reports and at a recent industry conference. We find that the texts mystify (...) the nature of agency, and privilege processes that maintain existing power relations. Through their partial accommodation of heterogeneous discourses, the texts downplay tensions and conflicts. We conclude that there is a need to reconceptualise the nature of company–stakeholder relationships through a more collaborative, dialogic and reflexive process, avoiding the binary state implied by the term licence. (shrink)

Stakeholder theory claims to promote moral values in business and this claim is generally accepted. Yet, literature shows that the theory is fundamentally strategic and only incidentally normative. This paper explores the assumptions of philosophical pragmatism that underpin the theory and concludes that the theory does not qualify as normative, since its conception of morality is basically hypothetical.

How does a board of directors decide what is right? The contest over this question is frequently framed as a debate between shareholder value and stakeholder rights, between a utilitarian view of the ethics of corporate governance and a deontological one. This paper uses a case study with special circumstances that allows us to examine in an unusually clear way the conflict between shareholder value and other bases on which a board can act. In the autumn of 2010, the board (...) of Liverpool Football Club sold the company to another investing group against the explicit wishes of the owners. The peculiar circumstances of this case provide insight into the conflict between ethical approaches to board decisions, allowing us to see certain issues more clearly than we can in listed corporations with many shareholders. What the analysis suggests is that the board saw more than one type of utility on which to base its ethical decision, and that one version resonated with perceived duties to stakeholders. This alignment of outcomes of strategic value with duties contrasted with the utility of shareholder value. While there are reasons to be cautious in generalizing, the case further suggests reasons why boards may reject shareholder value, in opposition to mainstream notions of corporate governance, without rejecting utility as a base of their decisions. Further, the partial alignment of duty and utility facilitates a pragmatic decision rather than one based on a priori claims. (shrink)

In early writings, stakeholder theorists supported giving all stakeholders formal, binding control over the corporation, in particular, over its board of directors. In recent writings, however, they claim that stakeholder theory does not require changing the current structure of corporate governance and further claim to be “agnostic” about the value of doing so. This article’s purpose is to highlight this shift and to argue that it is a mistake. It argues that, for instrumental reasons, stakeholder theorists should support giving all (...) stakeholders control over the corporation, in the form of control over its board. That is, stakeholder theorists should support stakeholder democracy over the status quo. A larger goal of this article is to steer the conversation about stakeholder theory toward questions of governance and control. Stakeholder theorists tend to sidestep these questions, but it is vital that they be addressed. (shrink)

Many arguments have been advanced in favor of employee participation in firm decision-making. Two of the most influential are the "interest protection argument" and the "autonomy argument." I argue that the case for granting participation rights to some other stakeholders, such as suppliers and community members, is at least as strong, according to the reasons given in these arguments, as the case for granting them to certain employees. I then consider how proponents of these arguments might modify their arguments, or (...) views, in response to this conclusion. (shrink)

ABSTRACT:Debates about the ethics of executive compensation are dominated by familiar themes. Many writers consider whether the amount of pay CEOs receive is too large—relative to firm performance, foreign CEO pay, or employee pay. Many others consider whether the process by which CEOs are paid is compromised by weak or self-serving boards of directors. This paper examines the issue from a new perspective. I focus on the dutiesexecutives themselveshave with respect totheir owncompensation. I argue that CEOs’ fiduciary duties place a (...) moral limit on how much compensation they can accept, and hence seek in negotiation, from their firms. Accepting excessive compensation leaves the beneficiaries of their duties (e.g., shareholders) worse off, and thus is inconsistent with observing those duties. (shrink)

This essay provides an overview of business ethics. I describe important issues, identify some of the normative considerations animating them, and offer a roadmap of references for those wishing to learn more. I focus on issues in normative business ethics, but discuss briefly the growing body of work in descriptive business ethics. I conclude with a comment on the changing nature of the field.

Some virtue ethicists are reluctant to consider principles and standards in business ethics. However, this is problematic. This paper argues that realistic Personalism can be integrated into virtue-based business ethics, giving it a more complete base. More specifically, two principles are proposed: the Personalist Principle (PP) and the Common Good Principle (CGP). The PP includes the Golden Rule and makes explicit the duty of respect, benevolence, and care for people, emphasizing human dignity and the innate rights of every human being. (...) The CGP entails cooperation to promote conditions which enhance the opportunity for the human flourishing of all people within a community. Both principles have practical implications for business ethics. (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)

This paper proposes a description of the moral obligations of economic agents. It will show that a threefold division should be adopted to distinguish moral obligations applying to their interactions in the market, obligations applying to their interactions inside business firms and obligations applying to their interactions with agents outside the market. Competition might be permissible in the first case since markets are special patterns of social interactions (called adversarial schemes). They produce their benefits when agents try to satisfy exclusive (...) preferences at the expense of others. However, moral obligations inside the firm and moral obligations outside the market are of a different nature. This argument will be developed in the two first parts of this paper. In the third part, it will outline the relevant strengths of that account in relation with two popular views of economic agents’ moral obligations: the shareholder primacy view and the stakeholder theory. (shrink)

The mainstream literature on corporate governance is based on the premise of conflicts of interest in a competitive game played by variously defined stakeholders and thus builds explicitly and/or implicitly on masculinist ethical theories. This article argues that insights from feminist ethics, and in particular ethics of care, can provide a different, yet relevant, lens through which to study corporate governance. Based on feminist ethical theories, the article conceptualises a governance model that is different from the current normative orthodoxy.

The primary aim of this study is to clarify the authorship trends, collaboration patterns, and impact factors in business ethics literature by looking at articles published between 1960 and 2015 in four leading business ethics journals: Business and Society, Business Ethics: A European Review, Business Ethics Quarterly, and the Journal of Business Ethics. This study showed the growth type of business ethics literature, authorship trends, collaboration patterns, authors' productivity evolved by subperiods and journals, and authors' dominance factor by subperiods and (...) journals. After providing an evaluation of the results of the study, the authors discuss the study's limitations and suggestions for future research. (shrink)

Corporate community responsiveness relates to business activities that are integral parts of a firm’s operations and are designed to benefit the firm through benefiting the local communities. Using data from commercial banks in the United States between 1997 and 2000, the authors measured banks’ corporate community responsiveness by their Community Reinvestment Act (CRA) lending activities and their performance ratings by CRA examiners. The authors developed and tested eight hypotheses on the influence of contextual (community income, minority population, and competition) and (...) organizational (age, profitability, risk, institutional ownership, and mergers and acquisitions) factors on the two measures of corporate community responsiveness. The authors found a negative effect for minority population; a positive effect for banks’ profitability; and partial support for community income, competition, and risk factors. The results show no effects for institutional ownership or mergers and acquisitions. The implications of these results for the instrumental aspect of stakeholder theory are discussed. (shrink)

Globalization has changed the nature of business in the twenty-first century :481–502, 2010). With the increased internationalization of multinational corporations, the need to address international marketing ethics arises :481–493, 2005). Given the diversity of environments and cultures, ethical issues are numerous and complicated :3–24, 2001). The understanding of international marketing ethics is critical to academics as well as practitioners. This paper is a literature review of the study of ethics in international marketing. In order to develop a comprehensive review of (...) articles, we review topics such as ethical problems, moral philosophies, and culture and ethics. We also discuss the methodological procedures that are used in international marketing ethics. Researchers and practitioners alike can use this research on international marketing ethics to discuss the phenomena and subsequently lead to future work research. (shrink)

Extant business ethics literature available for application to international business demonstrates some variety but no comprehensive principles. While the domains of both international business and business ethics are expanding, they are also becoming increasingly divergent. At the same time, the primacy accorded to the multinational enterprise in both fields ignores the socio-cultural and political embeddedness of economic activities, and multiple agencies in international business (individuals, firms, nations, etc.). Some international business theorists have offered the view that international exchange should be (...) the central building block for theories on international business. In this paper, it is argued that international exchange could be the fundamental unit of analysis for international business ethics as well. The potentially unifying features of exchange norms and ethical principles leads the author to develop some core exchange ethics principles that are tested on three recent international business practices. (shrink)

Many popular business strategies, such as re-engineering, core competency, and value engineering, may achieve short-term profits by antagonizing workers and alienating customers. We contend that self-actualized companies must create an ethical business environment grounded in three ethical principles. To suggest these principles, which characterize all "volitionist companies", we first review two typical problems and the questionable ways that some companies resolved them. Then, we discuss these principles and compare "volitionism" to three well- known normative ethical theories. Finally, we show that (...) these principles form the core of at least four popular management theories. (shrink)

Can private companies legitimately regulate sharing markets, and if yes, how? Whereas scholars have either criticized sharing platforms for expanding into private and public arenas or welcomed them to counterbalance encroaching government regulations, studies document their unbridled popularity. On the basis of a special version of social contracts theory pioneered by James Buchanan, we develop a heuristics that helps guide reasoning about the legitimacy of the sharing economy’s regulatory function. First, we discuss the conditions under which free and responsible individuals (...) deliberately subject themselves to rules without their prior direct participation, that is, exit, voice, and constitutional limits. Second, we suggest sharing platforms can use novel ordo-responsibilities to establish a sharing constitution that takes these conditions into account. Third, we argue that sharing platforms can legitimately do so within an enabling institutional environment in society, the provision of which relies on the joint efforts of sharing platforms, political actors, and civil society. (shrink)

Abstract:After a decade of intensive debate, stakeholder ideas have come to exert a significant influence on academic management thinking, but normative stakeholder theory itself appears to be in considerable disarray. This paper attempts to untangle the confusion and to prepare the ground for a more productive approach to the normative stakeholder problem. The paper identifies three distinct kinds of normative stakeholder theory and three different levels of claim that can be made by such theories, and uses this classification to argue (...) that stakeholder theorists have consistently pitched their sights either too high or too low to engage effectively with the rival shareholder theory. To the extent that they have their sights too high they have also undermined their own position by sacrificing credibility and introducing major problems of derivation. (shrink)

The nature of stakeholder theory and its fundamental normative prescriptions are the subject of much confusion and academic debate. This article attempts to provide an account of both the fundamental normative implications of stakeholder theory and the theory’s range of application that both stakeholder advocates and critics can agree upon. Using exclusively the language of leading stakeholder theorists, the article identifies the essential prescriptions of the theory and the type of organizations to which stakeholder theory applies in the hope of (...) facilitating effective discussion and evaluation of the normative dimension of stakeholder theory. (shrink)

Business ethics – both stockholder and stakeholder theories – makes the same mistake as the one made by the traditional ethics of medicine. The traditional ethics of medicine was a teleological ethics predicated on the assumption that the goal of medicine was to prolong life and promote better health. But, as bioethicists have made plain, these are not the only or even the overriding goals of most patients. Most of us have goals and values that limit our desire for medical (...) treatments. Similarly, the view of the stockholder in business ethics is that the stockholder has only one interest – profit. If stockholders have no other values or interests that would limit their desire for additional profit, their sole interest is in profit maximization. But investors are real people with interests and values that balance and limit their desire for profit. It would be an extremely odd individual who cared for nothing except more profit. And institutional investors are supposed to serve the interests of individual investors. Stockholders hold many stakes in the firms in which they invest. The conclusion that most stockholders have interests that would limit the pursuit of maximum profit has significant implications both for business ethics and for the management of for-profit corporations. Something like “informed consent for investors” is needed. Corporate managers, to the extent that they are to be agents of their stockholders, must not simply pursue profit maximization. They must ascertain the interests and values of their investors that limit the single-minded pursuit of profit. (shrink)

Given the tremendous proliferation of student plagiarism involving the Internet, the purpose of this study is to determine which theory of ethical reasoning students invoke when defending their transgressions: deontology, utilitarianism, rational self-interest, Machiavellianism, cultural relativism, or situational ethics. Understanding which theory of ethical reasoning students employ is critical, as preemptive steps can be taken by faculty to counteract this reasoning and prevent plagiarism. Additionally, it has been demonstrated that unethical behavior in school can lead to unethical behavior in business; (...) therefore, correcting unethical behavior in school can have a positive impact on organizational ethics. To meet this objective, a content analysis was conducted on the written records of students formally charged with plagiarizing at a large West Coast university. Each case was classified according to the primary ethical reasoning that the student used to justify plagiarism. Results indicate that students predominately invoke deontology, situational ethics, and Machiavellianism. Based on these findings, specific recommendations are offered to curb plagiarism. (shrink)

With the rise of globalization, the debate around free trade versus fair trade and liberalism versus protectionism has become increasingly complicated. At times, the regulations of the World Trade Organization seem to pit developed markets against emerging markets as governments attempt to expand international trade while at the same time protecting local industry. To this end, antidumping measures have been extensively developed as a way to block foreign low-cost goods from entering domestic markets. In response, some exporters have begun to (...) circumvent these antidumping measures using strategies such as transhipment, assembly operations, and slightly modified products. While previous studies have addressed the ethical aspects of antidumping measures, this study will focus on the ethics of circumvention strategies with a special focus on the theories on legal compliance and, specifically, civil disobedience and conscientious evasion. (shrink)

Multinational enterprises (MNEs) have long had a reputation of not doing enough for their host communities in developing countries. This study critically examines the role of MNEs in community development initiatives in developing countries, using the Nigeria oil industry and the South African mining industry as case study. Specifically, the study assessed the usefulness of MNE-supported community development projects as a means of demonstrating corporate social responsibility. The findings suggest that expectations for community development projects are greater in developing countries. (...) This study introduced new information on MNEs'local development programs that were drawn from interviews with MNEs'managers, government officials, and local communities. (shrink)

Interest shown on the environmental impact of operations of multinational enterprises in developing countries has grown significantly recently, and has fuelled a heated public policy debate. In particular, there has been interest in the environmental degradation of host communities and nations resulting from the operations of multinational oil companies in developing countries. This article examines the issue of environmental costs and responsibilities resulting from oil exploitation and production in the Niger Delta region of Nigeria. The case study is based, in (...) part, upon series of interviews with key stakeholders in the Nigerian oil industry. The article further examines the implications of the current practice and policies of multinational oil companies with respect to environmental impact of oil exploitation. The study’s findings illustrates that it is becoming increasingly apparent to oil companies that pollution prevention pays while pollution does not and under pressure from stakeholder groups, oil companies now routinely incorporate environmental impact assessments into their corporate strategy. (shrink)

This study examines the ethical position and behaviour of multinational mining companies regarding hazardous employment and health and safety of employees in the South African mining industry. Mining companies have long had a reputation for being unethical on health and safety issues. Too often there are occurrences of fatal accidents, which bring the ethical behaviour of multinational mining companies into question. The litmus test for the mining companies is to devise benchmark standards that will reduce accidents tremendously at their place (...) of operations. This study addresses this issue by examining measures and regulations set up to check the occurrences of mining accidents in South Africa. It follows that the remedy needs to be fundamental and thoroughgoing. (shrink)

This article examines the ethical characteristics of MNEs employee relations in developing countries. Specifically, it addresses various ethical issues relating to labour relations and trade unions in extractive industries in Nigeria, South Africa and Zambia. Data collected in these countries indicate that criticisms aginst MNEs relating to labour issues and labour practices in developing countries are not lessening. The discussion is lent focus and direction through the analysis of critical incidents from the perspectives of various stakeholders: government, oil and mining (...) companies, and leaders of trade unions. Tensions over pay, expatriate employments as against the locals, negotiation rights and employees well-being are evident. The argument advanced is that the MNEs operating in the extractive industries of Africa will have to improve their relations with local employees in order to bridge the legitimacy gaps that exist. An improved mutual understanding between the MNEs and trade unions is required for both actors to have a smooth working relationship. (shrink)

Drawing on ethical principles of fairness and integrative social contracts theory, moral obligations of fair dealing exist between the firm and all shareholders. This study investigates empirically whether privileged investors of publicly traded firms engage in legal, but morally questionable, trading that at the expense of non-privileged institutional or atomistic investors. In this context, we define privilege as the access to material, nonpublic earnings surprise information. Our results show that the opportunity for procedural unfairness increases with the presence of privileged (...) investors. However, this procedural unfairness does not appear to lead to distributive unfairness even though the level of abnormal trading also increases with the presence of privileged investors. That is, our findings suggest that other shareholders are in fact better off from an outcome perspective given that the abnormal stock price returns upon the announcement of an earnings surprise are either more positive or less negative when the firm has a high proportion of privileged investors. We extract the important implications of our study for future research on the fairness of capital markets and information asymmetry amongst classes of investors, as well as for public policy. (shrink)

With the advent of social networking websites, privacy concerns have reached a new high. One particularly problematic concern entails employers requesting login credentials to popular social media platforms. While many people may consider this request unethical, they may not agree on the reasons it is unethical. One reason may be to blame the behavior on egoism. Egoism, however, comes in multiple flavors, not all of which would agree that violating privacy is acceptable. In this paper, we articulate how one egoist (...) perspective provides a defense of privacy in the face of unjust information access requests. Objectivism, the philosophy of Ayn Rand, offers an egoist approach to ethics that values individual privacy on rational, self-interested grounds. By applying Objectivist principles to a business context, we observe that businesspeople should not violate other people’s privacy for short-term gains. Furthermore, we observe that privacy can be protected without distinct right to privacy. Rather, Objectivism’s conception of rational self-interest suggests that long-term flourishing is the proper end of individuals and businesses, predicated on, among other things, respecting privacy and enforcing individual rights. (shrink)

This paper carries forward the conceptual clarification of normative theories of business ethics ably begun by Hasnas in the January 1998 issue of BEQ. This paper proposes a normatively neutral framework for discussing and assessing such normative theories. Every normative theory needs to address these seven issues: it needs to specify a moral principle that identifies (1) recommended values and (2) the grounds for accepting those values. It also must specify (3) a decision principle that business people who accept the (...) theory can use. It must determine (4) who the normative theory applies to and (5) whose interests need to be considered. It must also outline (6) in what contexts it applies, and (7) what legal and regulatory structures it assumes. Once clarified, this paper applies the framework to the normative versions of stockholder theory, stakeholder theory, and ISCT. It is concluded that ISCT is the most promising normative theory currently under discussion, but that there are some major issues that ISCT has not dealt with yet. (shrink)

Here I synthesize certain ideas presented in two different articles that appeared in the same issue of Business Ethics Quarterly. One article (Hasnas) invokes the stockholder model as a valid normative theory of business ethics, the other article (Dunfee) invokes a marketplace of morality. Both articles imply that the accepted financial-economic view of the firm is a view that can accommodateethics. I offer empirical support for this view. I also identify the ethic of the stockholder model as a variant on (...) might-makes-right andconsider the social acceptance of this ethic as a postmodern phenomenon. (shrink)

Business ethics literature regularly examines obligations of firms. This article examines the contrary and relatively under‐explored notion of obligations of stakeholders. It does so by discussing incidents of sexual misconduct arising under the umbrella of the #MeToo movement. This article explores how the theory of stakeholder responsibility can aid firms in understanding and addressing complex issues associated with stakeholder irresponsibility. It examines the moral responsibilities of regime members in the context of #MeToo incidents to provide a conceptual framework for firms (...) addressing issues associated with irresponsible stakeholder actions. (shrink)

Abstract:Over the last two decades, institutional investing has rocked the world of corporate governance in a transformation that has begun to be reflected in the finance, legal, and management literatures. Traditional players have seen their roles change and bases of power shift, and new actors have entered the governance equation. These transitions have entailed an ethical upheaval that is only beginning to be addressed in the business ethics literature.This paper attempts to facilitate research in this area by integrating various literatures (...) into an examination of a series of business ethics issues related to pension fund activism and portfolio management, fund staffing, and employee compensation. The primary intent of this project is to encourage increased business ethics research in the area of institutional investing in general and pension fund management in particular. (shrink)