Abstract

Loyalty within the firm, though praised by some, is criticized by others. An analysis of the historical and current significance of theconcept of loyalty can aid in both understanding its critics and responding to them. Loyalty in the business world is generallyunderstood in three ways: i) transactional retention, ii) sentimental attraction, and iii) willingness to commit oneself. In the third type,the commitment to adhere to a person, cause, or institution may contribute to human flourishing and therefore generate the humanvirtue of loyalty. The human virtue of loyalty is as far from fanaticism as it is from the betrayal of legitimate commitments freely undertaken. As with all virtues, its content must be rationally determined. Loyalty thus understood enhances the humanity of both persons and business firms and contributes to heightened cohesion and cooperation within the firm. Moreover, according to some recent research, managing a business on the basis of loyalty can enhance economic results.