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Part I
The discipline of business ethics
Focused on the ethics of commerce, business ethics (like other disciplines) has a history, theoretical tendencies, and preferred methods. The first two chapters in this section explore the history of business ethics and the way in which trade and commerce have featured in the thought of important philosophers. The next two chapters take up the current discipline of business ethics, both as a field of inquiry with particular theoretical assumptions and as field of pedagogyâ business ethics in the classroom.
In the opening chapter, The history of business ethics, Bernard Mees delineates the broad history of business ethics, commencing from some of its oldest and most ancient sources and then considering elements of medieval thought. With the rise of industrialization there emerged both defenses and criticisms of business and the effects of commerce. Mees notes some of the signal works of the twentieth century that would lead ultimately to the institutionalization of business ethics in the universities and to the contemporary focus on issues of responsibility, leadership, and sustainability.
In Chapter 2, Theorists and philosophers on business ethics, George Bragues offers a complementary essay that focuses on the ideas and arguments of significant philosophers and thinkers. Bragues discerns a dual tendency emerging in the history of ideas, with the institutions and achievements of trade and business receiving both criticism and valorization. Aristotle viewed trade rather suspiciously, bequeathing to later thinkers, such as St Thomas Aquinas, a âcircumscribed tolerance of business.â However, early modern thinkers, such as Machiavelli and Mandeville, seek a reconsideration of whether virtue is a unique condition for prosperity, with later thinkers, including Locke, Hume, Kant, and Bentham, developing this reassessment further and offering a positive outlook on commerce. However, Rousseau and Marx offer a more critical perspective. Within the contemporary sphere, says Bragues, philosophers offer a âmiddle wayâ between the positive embrace of commerce and its rejection.
In the third chapter, Theory and method in business ethics, Nicholas Capaldi probes the discipline of business ethics, taking up both its genesis as a disciplinary field and its guiding assumptions. After noting the ambiguities of business ethics, as well as the general antipathy of intellectuals toward commerce, Capaldi situates contemporary business ethics within deeper tendencies of the modern philosophical outlook and delineates how business ethics has become an instance of the philosophical exploration of an underlying structure of conduct. After setting forth two opposing narratives of exploration, the Lockean and the Rousseauian, Capaldi suggests an alternative method of business ethics that rejects abstract applications of theory and seeks, instead, to explicate the implicit practices and norms of business.
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Whether taught by philosophers or management scholars, business ethics is featured in most graduate business schools, as well as in many undergraduate curricula. In Chapter 4, Teaching business ethics: current practice and future directions, Darin Gates, Bradley R. Agle, and Richard N. Williams distinguish education from training and then canvas the purpose and content of business ethics education, noting its curricular location, academic levels, and methods. They offer counsel as to how education may reinforce a common-sense moral outlook and contribute to a greater awareness of moral blindness and self-deception.
Alexei Marcoux and Eugene Heath
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1
The history of business ethics
Bernard Mees
In 1956 the first edition of Samuel Noah Kramerâs bestselling History Begins at Sumer: Thirty-nine Firsts in Recorded History appeared, a good place if any to look for the origins of business ethics. The earliest written records acknowledged by historians come from the ruins of ancient Sumer, predating the earliest Chinese and European texts by many centuries. And the second-last of his historical firsts is, as Kramer labels it, the âThe Pickaxe and the Plow: Laborâs first victory.â The passage, dating from the third millennium bc, takes a typical Sumerian form: that of a disputation. It begins with a pickaxe challenging a plow to see which implement is superior. The plow states that it is âthe faithful farmer of mankind . . . the great nobles walk by my side, All the lands are full of admiration.â The pickaxe, retorts in turn, that it is used in many more industries than the plow is, and furthermore:
(Kramer 1956: 345, trans. Kramer)
The response of the plow (if any) is not recorded. The pickaxe won its case not just by arguing its broader utility, but particularly by pointing out that a pickaxe works much longer hours.
It is perhaps not customary to think of hours of work as particularly important in business ethics, but how many hours (and how hard) someone works has long been a key concern in commercial circles. One of the most widely accepted ethical judgements that prevails in the business world is that hard work is good and should be rewarded. Indeed a survey of American business ethics (Sutton et al. 1956), from the same year as Kramerâs History Begins at Sumer first appeared, claimed that hard work was the only ethic broadly upheld in commercial life at the time. The valuing of hard work (as opposed to laziness) is one of the key moral issues still stressed in contemporary business, whether by Confucian cultural nationalists, Middle Eastern Islamic moralists or members of the boards of Western corporations. It reminds us that what constitutes ethical behavior in business can include both universal and ancient issues. At the same time, since what is judged morally good behavior in a business context is often contested and evolving, it may be given both a politically conservative and progressive assessment, as well as being a historically grounded, particular, and contested concern.
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If business ethics is centrally concerned with âmoral reasoning aimed at supporting managersâ ethical obligationsâ (Green and Donovan 2010: 23), then issues such as work ethic remain central to its understanding. In fact, and as set forth in the first section of this chapter, discourses of business ethics are already evidenced at the dawn of recorded history and ancient philosophical traditions are widely referenced in contemporary business scholarship. In the subsequent section, we glimpse how similar discourses developed under the influence of industrialization; these became entwined with political philosophy as the number and size of organizations grew and increasing urbanization occurred. As characterized in the last section, a more focused tradition has arisen since the 1960s, and it has become a key concern of the business or management curriculum. These three periods of development are historically linked, with facets of present-day business ethics often having quite ancient intellectual histories.
The âidol of originsâ
Rather than begin (with Kramer) at Sumer, historical surveys of business ethics tend to start with a reference to the Bible, the laws of the ancient Babylonian King Hammurabi, or to Aristotle, the fourth-century bc Greek author of the Nicomachean Ethics (e.g., De George 2006, but see also Abend 2013). But an older philosophical source would be Confucius (Kong Fuzi), the semi-legendary sixth-century bc author of the Analects (Confucius, trans. Lau 1979). The Confucian underpinnings of East Asian business ethics, however, have been contested by historians. Duty to the family (xiao or filial piety), for example, trumps any duty to uphold state law in traditional Confucian thinking: as Confucius comments in the tale of âUpright Gongâ in the Analects (13.18) âfathers cover up for sons, and sons cover up for their fathersââUprightnessâ is to be found in thatâ (Rainey 2010: 25; Sarkissian 2010: 726). Indeed Confucius himself and his many followers (including later Confucian scholars such as Mencius) shared a disdain of merchants (Wang 2004). The notion of a Confucian business ethics often reflects a reconfiguration of the Confucian heritage by members of the Chinese diaspora (Dirlik 1995; Yao 2002; Makeham 2003; Wang 2004). How such understandings might apply in the Peopleâs Republic of China today remains something of a quandary when taken from a historical perspective (Sun 2005; Elstein and Tian 2017).
As the French medievalist Marc Bloch (1954: 24â35) explained, the âidol of originsâ or the search for roots can often obscure historical understanding. But as Foucault (1972) observes, it is the continuity and discontinuity of discourses (such as ethics) that are a key focus in the history of ideas. From the Greek perspective, beginning a history of business ethics with Aristotleâs assessment of commercial relationships in his Politics passes over the longstanding Greek traditions that date back to Homer. In the Homeric Hymn to Hermes, for example, the god most famous for his thievery states âI will take up whatever business is most profitableâ (trans. Brown 1947: 72). In myth, Greek morality is typically daring, cunning, heroic and resourceful, but by the time of Aristotleâs philosophical tracts it was logical, measured, considered and thoughtful. This distinction of mythos and logos (Fowler 2011) is characteristic of ancient Greek thought and is largely omitted from modern business-school accounts of Greek moral philosophy as if it were not a key tradition passed down from antiquity. But Hermesâ Roman equivalent Mercury is usually thought to have been named for his association with merx or âmerchandiseâ; hence merchant âa buyer of merchandise.â
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With the Greek and Chinese traditions, a third major influence on contemporary business ethics to have been passed down from ancient times is that of the Hebrew Torah and its associated texts. This religious collection from the last millennium bc was supplemented in the Christian tradition by four accounts of the life of Christ and a selection of other (mostly) first-century writings, but the Jewish and Christian scriptural traditions have long proved a treasure trove for moral teachings. From âA false balance is an abomination to the Lord but a just weight is his delightâ (Proverbs 11:1) to âIt is easier for a camel to pass through the eye of a needle, than for a rich man to enter into the kingdom of heavenâ (Matthew 19:24), all manner of scriptural quotations, both parables and specific moral claims, have proved influential to understandings of Western business.
Perhaps most notably, however, from the perspective of historical continuity, is the work of the thirteenth-century philosopher St Thomas Aquinas. Aquinas sought to reconcile the ancient Greek tradition, particularly in the form bequeathed by Aristotle, with Christian Scripture. In doing so, he developed a theory of just price: âIf someone would be greatly helped by something belonging to someone else, and the seller not similarly harmed by losing it, the seller must not sell for a higher price: because the usefulness that goes to the buyer comes not from the seller, but from the buyerâs needy conditionâ (Summa Theologica ii-ii.77.1). Perhaps more importantly than advocating fairness in trading, however, Aquinasâs Summa Theologica (ed. OâSullivan 1952) was considered such a great work for generations to come that he rescued Aristotelian ethics for the Western world and encouraged the establishment of a continuous tradition of writing on business ethics.
Many of the worldâs non-Western ethical traditions can be seen to be preserved in a state more akin to ancient Greek mythos or the largely unstructured manner in which Biblical quotations have often been used by Christian preachers. The Islamic prohibition against the charging of interest (riba), for example, derives directly from the Qurâan (2:275) and more reflections on commercial ethics can be found in the Hadith (Sayings of the Prophet) such as âThe seller and the buyer have the right to keep or return goods as long as they have not parted or till they partâ (Al-Bukhari, trans. Khan 1997: iii, 293). Vedic concepts such as karma âaction (cause and effect)â and dharma â(universal) lawâ are also important contributions to contemporary Indian understandings of business morality (Berger and Herstein 2014). Nonetheless, a developed tradition of business ethics comparable to the Thomist kind has not fully emerged in non-Western traditionsâthat is in the sense of major and in-depth studies of the logos of business practice. There are longstanding and distinctive discourses of received Confucian, Buddhist, Islamic, Taoist and Hindu ethics at the generic, personal or public levels, but these are not so clearly focused especially on commercial concerns. It is the continuity and focus brought to business ethics by Aquinas that makes him the founder of a considered continuous (or genealogical) tradition of writings on the morality of commercial dealings. The continuous nature of this tradition can be most obviously seen in the works of the late medieval business ethicist Johannes Nider (trans. Reeves 1966) who wrote an entire Thomist-inspired treatise, On the Contracts of Merchants, in the fifteenth century (Wren 2000), or John Lockeâs essay âVenditioâ (1661), which still informs conceptions of public choice today (GuzmĂĄn and Munger 2014). But perhaps a more crucial c...