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Virtue Ethics, the Firm, and Moral Psychology1

  • Daryl Koehn

Business ethicists have increasingly used Aristotelian “virtue ethics” to analyze the actions of business people and to explore the question of what the standard of ethical behavior is. These analyses have raised many important issues and opened up new avenues for research. But the time has come to examine in some detail possible limitations or weaknesses in virtue ethics. This paper argues that Aristotelian virtue ethics is subject to many objections because the psychology implicit within the ethic is not well-suited for analyzing some problematic forms of behavior. Part One offers a brief overview of the firm and of the good life from a virtue ethics perspective. Part Two develops a number of criticisms of this perspective.

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1 I am indebted to Ed Hartman, Wayne Eastman, Tim Fort and two anonymous reviewers for their helpful comments on an earlier draft of this manuscript. I profited as well from some objections John Dienhart and Ron Duska raised when I first began thinking about the relationship between moral psychology and virtue ethics.

2 Donaldson has offered some criticisms of virtue ethics from a deontological perspective. Thomas Donaldson, “The Language of International Corporate Ethics,” Business Ethics Quarterly vol. 2, no. 3 (July 1992): 271–281. This paper attempts to critique virtue ethics more on its own terms by exploring possible weaknesses stemming from the moral psychology implicit within the ethics.

3 In this section, I have drawn heavily upon Hartman’s recent work on the character of the firm. While I would argue that Hartman’s ethical stance is more autonomy-based than Aristotle’s is, many of the issues Hartman raises are very much in the spirit of Aristotle. Moreover, his insistence that the virtuous person, rather than a rule or hypernorms, serves as the ethical standard is thoroughly Aristotelian. See Edwin Hartman, Organizational Ethics (Oxford: Oxford University Press, 1996)

4 Hartman, 15–16; 69–70.

5 Hartman is well aware of the sort of problems Michael Keeley identifies with any attempt to construe the firm in purely descriptive instrumental terms. See Michael Keeley, A Social Contract Theory of Organizations (Notre Dame: University of Notre Dame Press, 1988). Hartman understands the firm as a normative human enterprise. He likely would agree with Aristotle’s contention that anyone who can live apart from a lawful community is either a beast or god.6 Or, as Aristotle puts it, the human being is by nature political.7 The virtuous person is someone who sees things as they truly are and thus understands this political nature of human beings.

6 Hartman, 82. See also 113n14: “The moral problem for management is to get people with differing interests to cooperate; the only real solution is to get them to do so voluntarily. That management characteristically orchestrates common tasks requiring cooperation does not necessarily undermine rights.”

7 Hartman, for example, distinguishes between a merely prudential point of view and a moral one. However, he correctly notes that virtue ethics, unlike deontological ethics, does not treat these two points of view as mutually exclusive. For confirmation of Hartman’s point, see NE 1106a19–24 where Aristotle argues that the virtue of something makes the thing good in itself and instrumentally good. Hartman’s insistence that no one is required to become an ethical martyr is consistent with virtue ethics, which does not recognize supererogatory actions. Hartman, 82.

8 Hartman, 7, 10, 24, 32n42, 75–76, 80, 88n.17, 88n.19, 112n.6.

9 In the short run, the overgrazer may think overgrazing is in his interest. After all, it is better to have some grass for his flocks than none. But in the long run, Hartman’s point still holds—the overgrazer will have acted against his own interests (prudentially understood) if he now has no grass while he could have had some grass through, say, cooperation with his fellow grazers.

10 Indeed, Hartman understands culture, be it the national or organizational, as those beliefs, values, expectations and behavior that shape life within the culture. Hartman, 149.

11 Hartman makes the point that desires are vulnerable to pleasures. Hartman, 149.

12 I concur with both Nussbaum and Hartman that Aristotle is a foundationalist only in a limited sense of that term. Hartman, 119n60; Martha C. Nussbaum, Love’s Knowledge: Essays on Philosophy and Literature (New York: Oxford University Press, 1990), 56–66. Aristotle does provide a ground or basis for judging acts and agents good. The prudent agent is the good agent and the good act is done as the prudent person would do it. But what considerations the prudent person chooses to advance may vary from situation to situation.

13 Wiggins captures this interplay rather nicely. He characterizes Aristotle’s ethic as “a conceptual framework which we can apply to particular cases, which articulates the reciprocal relations of an agent’s concerns and his perception of how things objectively are in the world; and a schema of description which relates the complex ideal the agent tries in the process of living his life to make real to the form that the world impresses, both by way of opportunity and by way of limitation, upon that ideal.” David Wiggins, “Deliberation and Practical Reason,” in Amelie Oksenberg Rorty, Essays on Aristotle’s Ethics (Berkeley: University of California Press, 1980), 221–240. Hartman would presumably agree since he argues that we must continually move back and forth between intuitions and principles, rethinking each. Hartman, 104.

14 Hartman rejects hypernorms on a number of grounds, all of which Aristotle would likely agree with. Hartman, 97–98.

15 Again, there is no absolute rule as to what the good manager would do in this sort of case. Much would depend on the particulars of the case. While the virtuous generally do consult with other people, confidentiality requirements might preclude such conferences in some cases.

16 Gary Edwards, “False Comfort: Corporate Compliance and the Board of Directors,” Director’s Monthly, vol. 20, no. 11 (November 1996): 1–6.

17 Aristotle NE 1147a5–9.

18 Aristotle compares the incontinent person to an actor who simply repeats lines written by others at NE 1147a24.

19 It is not surprising that Aristotle’s treatment of choice should be ethical and not psychological because Aristotle believes that ethics and psychology are discrete disciplines with an integrity of their own. Like Plato, I doubt that the ethical can be divorced from the psychological, in part for the reasons given in this paper.

20 The purely ethical quality of Aristotle’s understanding of choice is apparent in his discussion of bestiality. He concedes that some people are bestial through disease but insists that others become bestial through choice. Aristotle NE 1145a25–35.

21 During the 1980s, Harvard Business Review wrote a set of glowing case studies about ethics at Dow Corning. These are discussed in John A. Byrne, Informed Consent (New York: McGraw Hill, 1996), 36.

22 Byrne, 62.

23 “Airline Pilot Who Refused To Dump Fuel,” Chicago Tribune, March 31, 1997, Section 2, p. 4.

24 Ethan A. Singer and Leland M. Wooten, “The Triumph and Failure of Albert Speer’s Administrative Genius: Implications for Current Management Theory, Journal of Applied Behavior Sciences, no. 12 (1976): 79–103.

25 Singer and Wooten, 80–88.

26 Singer and Wooten, 85–88.

27 Daryl Koehn, “A Role for Virtue Ethics in the Analysis of Business Practice,” Business Ethics Quarterly, vol. 5 (July 1995): 533–540.

28 Keeley, 8.

29 Keeley, 8.

30 I am reminded of the story David Grossman tells about the young son of his neighbor. Grossman and the boy passed a Palestinian women on her knees cleaning the floor in their apartment complex. Grossman stopped to speak with the woman and the boy was visibly surprised. As they moved out of earshot from the woman, the boy asked if the woman was “a little bit a person and a little bit a dog, right?” When Grossman probed as to why the boy thought this, the boy responded, “She is a little bit a dog because she always walks on all fours. And she is also a little bit a person, because she knows how to talk.” The boy’s question was quite reasonable given that the political structures in Israel resulted in the Palestinians doing much of the menial work and little else. David Grossman, The Yellow Wind (NY: Farrar, Straus, Giroux), 214–215.

31 See, e.g., the way the Israeli military court interpreted the requirement. It contended that “a feeling of lawfulness...lies deep within every human conscience [including those] who are not conversant with the books of laws.” The court thus refused to equate “lawfulness” with conventional law. It went on to refer to “an unlawfulness glaring to the eye and repulsive to the heart, provided the eye is not blind and the heart is not stony and corrupt.” Quoted by Hannah Arendt, “Personal Responsibility under Dictatorship,” The Listener, August 6, 1964, 187.

32 David Messick, “Why Ethics Is Not the Only Thing That Matters,” Business Ethics Quarterly, vol. 6 (April 1996), 224.

33 A. Tversky, S. Satta, and P. Slovic, “Contingent Weighting in Judgment and Choice,” Psychological Review, vol. 95, 371–384. Of course, such data are descriptive and do not tell us how people should proceed when making a judgment. Nevertheless, it would be a mistake to invoke the normative versus descriptive distinction and to dismiss this data. At a minimum, the data suggest that we will be misled if we try to distinguish among character types on the basis of whether or not they summon reason to help them combat licentiousness and to grapple with the particulars of the decision they face. It looks as if somewhat licentious people can and do reason. Moreover, they apparently appeal to a variety of principles and considerations, including some which the virtuous person would cite (e.g., issues of justice and equity). In general, people’s preferences appear to be quite sensitive to whether options are considered in groups or individually. If the relative weighting of principles is indeed highly responsive to how the agent groups options, this sensitivity is a psychological fact that will need to be reflected in the ethicist’s account of choice and the good manager. It means that the good manager must become a student of psychology and must try to make people aware of the need to reflect on how they are evaluating their options.

34 M. H. Bazerman, H. A. Schroth, P. P. Shah, “The Inconsistent Role of Comparison to Others and Procedural Justice in Reactions to Hypothetical Job Descriptions: Implications for Acceptance Decisions,” Organizational Behavior and Human Decision Processes, vol. 60, pp. 326–352.

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Business Ethics Quarterly
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