Reading these papers—each one a straightforward declaration of a preferred position—has the odd (and I trust, unintended) effect of projecting the reader into a world of virtual reality. The words, the concepts, the theories, the divisions and dualisms, the premises, the arguments themselves all seem to be real. They seem to make sense. Yes, we can say to ourselves, I see and understand what each one is saying. “Fact,” “value,” “empirical,” “normative,” “science,” “philosophy,” “naturalistic fallacy,” and similar terms all invoke meanings that seem to be clear and that help to clarify the issues being debated. But do they? To what extent is this particular discussion about business ethics only virtually real, a product of an imagined or invented dialogue that may rest on little more than the assumed and inherited meanings assigned to the phrases we toss around so freely?

By raising the question, it should be obvious that I am inclined to believe that the debaters have convinced themselves that they are engaged in a dialogue about something “real” but which actually exists only in the invented forms and phrases that they have brought to the debate. The issues are only “virtually” real. If that is so, then one needs to ask where did those inventions—the virtual realities of the debate—come from. Why are they so appealing? Why do they seem to make so much sense to us? Why are they defended so vigorously by both sides or, perhaps more aptly, by all sides?

This paper examines economic arguments employers sometimes use to justify restricting or excluding from employment those workers who are likely to incur high costs in health care insurance. We argue that, although profit-making is a legitimate goal for businesses, hiring practices based on non-job-related criteria violate principles of self determination, autonomy, discrimination, justice, and privacy. We conclude that hiring practices based on liability-driven ethics are not morally justified, but that as long as health care insurance and employment are linked, businesses will continue to have an incentive to use liability-driven arguments.

Although “fairness” and “social responsibilities” form part of the business ethics agenda of Japanese corporations, the meaning of these terms must be understood in the context of the distinctive Japanese approach to ethics. In Japan, ethics is inextricably bound up with religious dimension (two normative environments) and social dimension (framework of concentric circles). The normative environments, influenced by Confucianism, Buddhism, and other traditional and modern Japanese religions, emphasize that not only individuals but also groups have their own spirit (numen) which is connected to the ultimate reality. The framework of concentric circles lets moral agents apply different ethical rules to the respective circles. The dynamics of these religious and social dimensions lead to a different view of both individuals and corporations from that dominant in the West.

The paper suggests replacing the shareholder/stakeholder distinction with a “Dual-Investor” model of business: stockowners provide the specific capital for business ventures, while society provides the “opportunity capital.” Thus society is an investor in every business venture. Dual-Investor theory provides a response (based purely on the ethics of investment) to Milton Friedman’s arguments that executives should maximize profit by any legal means, avoids recent criticisms by Kenneth Goodpaster and Thomas McMahon, and suggests that the dichotomy between private and public ownership overlooks several important alternatives. Some consequences of the theory are detailed and a sketch of a theory of property, based on Dual-Investor theory, is appended.

Most papers in this issue carefully analyze normative and empirical methodologies. I shall argue that (a) there is no purely empirical nor purely normative methodology; (b) some terms escape the division of the normative and descriptive. (c) Most importantly, dialogues such as this one point to a form of integration that allows us to reflect on what it is that each approach presupposes in its study of business ethics. Thus we have made progress in recognizing the importance of each methodology, how each is dependent on the other, and how neither is singularly The Approach to business ethics.

Stakeholder theory has become one of the most important developments in the field of business ethics. While this concept has evolved and gained prominence as a method of integrating ethics into the basic purposes and strategic objectives of the firm, the authors argue that stakeholder theory has retained certain “masculinist” assumptions from the wider business literature that limit its usefulness. The resources of feminist thought, specifically the work of Carol Gilligan, provide a means of reinterpreting the stakeholder concept in a way that overcomes many of the existing limitations. This reading provides a different understanding of the identity and meaning of the firm, specifically in terms of its relationship to stakeholder groups and what it means for a firm to succeed. The alternatives proposed also converge with recent trends in the wider management literature and provide practical guidance for firms which face a myriad of challenges in the increasingly complex and global marketplace.

Japan’s political, cultural, and geographic isolation, its symbiotic government-business arrangement, and its practice of practical, resources-oriented politics, trade, and diplomacy have led it to be the only major global economic power to strictly comply with the Arab boycott. A brief history and description of the boycott are presented here, along with an overview of the responses of major economic trading nations. Three issues are addressed: Japan’s global conscience, the framework appropriate to analyze the ethics of global economic boycotts, and the Japanese government’s excuse of leaving boycott decisions to business considering the historic relationship between the two. The logical conclusion of this analysis is that Japan as a nation must abandon its insularity and take a greater ethical responsibility in line with its economic power. From this comes the responsibility of the govenment to guide the business sector towards a corporate conscience, one that is grounded in global awareness.

In this paper I try to enlarge the scope of the questions commonly treated in business ethics. I first argue that not motives but action structures should form the basis of our analytical endeavours. I then distinguish three basic structures in human action: self-directed, other-including and other-directed actions. These structures, when linked with the concepts of interests and legitimate claims or rights, lead to a taxonomy of moral behaviour in business that I describe as, respectively, transactional, recognitional and participatory ethics, three distinct realms of moral behaviour, each characterized by a specific set of moral principles and a special relation between moral agents. My contention is that, up to now, analysis in business ethics has largely been focused on issues in the field of recognitional ethics. The discipline itself as well as ethical practices in business may greatly profit by paying explicit attention to market morality and transactional ethics as well as to the non-enforceable we-alliances of a participatory ethics, increasingly possible and needed in present-day civil society.

For a number of reasons, Fr. Haughey answers “yes,” to the question in his title. “The object of many workplace loyalties seems to be changing from a person-centered focus…to a cause-centered or common good or public interest focus” (p. 22).

The idea of a change in the object of loyalty raises a number of interesting issues. The end of individual hero-worship seems appealing: to give love and loyalty to principles rather than persons sounds moral and ever so high-minded. One thinks of Plato’s move from the focus on the personality of Socrates in the early dialogues to the impersonal “Athenian Stranger” of his last work, “Laws.” But we must also note that the Athenian Stranger and his principles have hardly received the attention given to Socrates and the earlier dialogues. Would the principles of Christianity have persisted through the centuries without the story of Christ? Would we have Mohammedanism without Mohammed, Confucianism without Confucius, Buddhism without Buddha?

Do people work, fight, sacrifice, for principles without personal leadership? When they have, are those principles desirable objects of loyalty? Historical examples have ranged from loyalty to the fatherland to “making the world safe for democracy.” Even these principles were tied to personal leadership.

A morally healthy individual must have more than one loyalty, as Haughey says. “A single loyalty invariably becomes extreme” (p. 9). Therefore, loyalty to one’s business connection is not to be the only loyalty. The problem, then, is to balance the business loyalty with the others. Fr. Haughey gives some, but very little, guidance on this tricky matter.

In mid-1993 a provocative piece on business ethics appeared on the pages of the Harvard Business Review. Andrew Stark’s “What’s the Matter with Business Ethics?” (1993a) found plenty wrong with business ethics, arguing that the product served up to managers and potential managers by traditional ethicists in their articles and classrooms is without practical value. Since it is supposed to be “applied” ethics, he finds something seriously amiss with a business ethics that offers nothing to help a manager resolve moral dilemmas in business. While some “new” ethicists are now beginning to appear, ethicists who are willing to get their hands dirty and acknowledge the legitimacy of normal business practices, the traditional ethicists continue to dominate the field and continue to offer a product unable to satisfy the manager’s needs. According to Stark, “[Business ethicists] have been too preoccupied with absolutist notions of what it means for managers to be ethical, with overly general criticisms of capitalism as an economic system, with dense and abstract theorizing, and with prescriptions that apply only remotely to managerial practice” (1993a, p.38). Or, as he puts it in a more detailed discussion, traditional business ethics fails because it is a deadly combination of “too general,” “too theoretical,” and, worst of all, “too impractical” (1993a, p.44). In short, the “old” approach is idealistic and academic, irrelevant to the rough-and-tumble of real business.

The author argues that a continuing effort to avoid self-deception is the pre-requisite to any ethical analysis; that this effort cannot be altogether successful; that it is likely to even be dysfunctional in a variety of organizational contexts, perhaps particularly in the context of corporate middle management, but that it ought not therefore be ignored. It is contended that business ethicists should be committed to making the difficulties associated with self-scrutiny explicit. Finally, it is argued that in order to do that legitimately for the corporation, university based business ethicists must be willing to face up to parallel difficulties in the university generally and in the school of business in particular.

It is proposed that mangers have to be moral, have to be concerned about the distribution of benefits and the allocation of harms brought about by their decisions and actions, in order to build trust, commitment, and effort among the stakeholders of the firm. Trust, commitment, and effort on the part of all of the stakeholders are essential for long-term corporate success, given the economic conditions of intense global competition that now exist for the foreseeable future.

This paper shows how John R. Commons’ analysis of a firm’s goodwill value gives analytical support to Professor Amartya Sen’s contention (BEQ, 1993) that business ethics makes economic sense. A firm’s market value consists of the value of both tangible and intangible capital, including the goodwill value of ongoing customer relations. If a firm is to defend its goodwill value, it needs to have the protection of the courts and to pursue ethical practices. The courts defend fair competition by giving protection from unethical competitors while the firm defends its reputation with honest dealings.

By implication, firms which depend on ongoing customer relations will tend to engage in more ethical business practices than firms which do not. Even a firm which makes a mistake that compromises its product’s safety may reduce the loss of goodwill value over time by admitting the mistake early rather than hiding it.

Also by implication, the transition from a command socialist economy to a market economy cannot be made instantaneously since trust, reputation, and these ongoing customer relations—key institutions of market economies—cannot be generated instantaneously.

In an article in the Journal of Business Ethics, Professor Kevin Jackson raised a critical challenge to my claim in The Ethics of International Business that corporations should be excused from certain rights-honoring responsibilities. Surely he is right to sound a note of caution. Not lightly, and not without deep reflection, should we let rich and powerful global corporations off the moral hook. Not lightly should we excuse the Sonys and General Motors of the world from the burdens of remedying global rights abuses. And this is the nub of the issue between Professor Jackson and me; for even though I have written that corporations should bear heavy and often unacknowledged duties in honoring human rights, I have also stipulated that these duties (unless “exceptional” circumstances obtain) should fall only in two classes, namely:

Ethical analyses of the relations between managers and subordinates have traditionally focused on the employment contract. The inequality and requisite mutual trust between managers and subordinates makes the sub-disciplines of professional ethics and feminist ethics more applicable than the contractarian perspective. When professional ethics is applied to hierarchic relationships, specific obligations emerge for managers and subordinates alike. The application of feminist ethics results in the identification of an entirely different, though not contradictory, set of obligations. In toto, the analysis improves on the conventional wisdom governing hierarchic relationships while at the same time remaining consistent with our moral intuitions.