This article proposes a theory of the firm based on the common good. It clarifies the meaning of the term “common good” tracing its historical development. Next, an analogous sense applicable to the firm is derived from its original context in political theory. Put simply, the common good of the firm is the production of goods and services needed for flourishing, in which different members participate through work. This is linked to the political common good through subsidiarity. Lastly, implications and (...) challenges arising from the positing of work as the common good of the firm are explored. (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)

Standard accounts on the nature of the firm are highly dependent on explanations by Coase, coupled with inputs from agency theory and shareholder theory. This paper carries out their critique in light of personalist and common good postulates. It shows how personalist and common good principles create a framework that not only accommodates business ethics better but also affords a more compelling understanding of business as a whole.

Christian ethics applied to economics and business has a long tradition. This dates back at least to the thirteenth century, with noteworthy developments in the four following centuries and again in the last century. Christian faith and reason intertwine to bring about principles, criteria, and guidelines for action and a set of virtues with relevance for economic activity. Christian spirituality, with 2000 years of history, has been embedded in Christianity from its beginning, but the application to modern business activity is (...) relatively recent. This article introduces a special issue which, we hope, will make its own small contribution to the developments of both Christian ethics and spirituality in the leading business organizations. After a short historical overview and a consideration of the current situation of Christian ethics and spirituality in business, we introduce the papers selected for this issue. (shrink)

We build on limited research concerning the mediation processes associated with the relationship between ethical culture and employee outcomes. A multidimensional measure of ethical culture was examined for its relationship to overall Person-Organization (P–O) fit and employee response, using a sample of 436 employees from social economy and commercial banks in Spain. In line with previous research involving unidimensional measures, ethical culture was found to relate positively to employee job satisfaction, affective commitment, and intention to stay. New to the literature, (...) ethical culture was also found to be associated positively with employee willingness to recommend the organization to others. These effects were observed even when perceptions of P–O fit were controlled. Importantly, ethical culture was also positively related to overall P–O fit, which in turn, partially mediated the relationship between ethical culture and employee outcomes. Our findings add to studies that focus on the importance of the degree of ethical congruence between the individual employee and the organization. They suggest that ethical culture, with its expected impact on virtuousness and emotional well-being, will positively influence outcomes independently of the degree to which there is a match between employee and organizational values. (shrink)

Virtue ethics, the authors believe, is distinct and superior to other options because it considers, in the first place, which preferences are worth pursuing, rather than just blindly maximizing preferences, and it takes into account intuitions, emotions and experience, instead of acting solely on abstract universal principles. Moreover, virtue ethics is seen as firmly rooted in human biology and psychology, particularly in our freedom, rationality, and sociability. Work, business, and management are presented as vital areas for the development of virtues, (...) not the least with a view to human flourishing. We conclude by introducing the articles included in this special issue. (shrink)

In light of the recent crisis and its aftershocks, it becomes crucial to reflect on the relationship between finance and accounting and on how to integrate ethics and efficiency, as well as on how to motivate and empower practitioners in the world of finance to commit to justice, fairness and enhanced understanding, and to improving their personal integrity. This article, written as an editorial introduction to a special issue includes works related to control measurement and ethical behavior, misbehaviors in finances (...) and accounting, professionalism in accounting, ethical investing and corporate reporting. We conclude by suggesting further research for a better integration of technical aspects of accounting and finances into business activity—human activity actually—and an for understanding of ethics not limited to rules, but as a mutual and interdependent system of values, virtues and principles. (shrink)

Virtue ethics, the authors believe, is distinct and superior to other options because it considers, in the first place, which preferences are worth pursuing, rather than just blindly maximizing preferences, and it takes into account intuitions, emotions and experience, instead of acting solely on abstract universal principles. Moreover, virtue ethics is seen as firmly rooted in human biology and psychology, particularly in our freedom, rationality, and sociability. Work, business, and management are presented as vital areas for the development of virtues, (...) not the least with a view to human flourishing. We conclude by introducing the articles included in this special issue. (shrink)

This paper introduces ‘Virtue and Virtuousness: When will the twain ever meet?’ a special edition of Business Ethics: A European Review. The Call for Papers invited contributions that could inform the relationship between organisational virtuousness, as conceptualised by positive organisation studies, and the classical conception of virtues pertaining to individual women and men. While the resources of particular virtue traditions – Aristotelian, Catholic, Confucian, and the like – could inform their own debates as to whether virtue extends beyond individuals, the (...) debate between virtue traditions and positive organisation studies has a different dimension. The question is whether the claims of positive social sciences as such are compatible with those of any virtue tradition. We argue that positive social science and virtue traditions are indeed rivals such that adherence to the claims of the one precludes adherence to the other. Resolution to such conflicts requires that one tradition is able to resolve questions that exhaust the resources of the other. This paper suggests that at least one area of incoherence in the findings of positive social sciences can be resolved by virtue traditions, and introduces the remaining papers in the special edition. (shrink)

Caritas in Veritate (CV) poses a challenge to the business community when it asks for “a profoundly new way of understanding business enterprise” (CV 40). The paper proposes the concept of the “common good” as a starting point for the discussion and sketches a definition of the common good of business as the path toward an answer for this challenge. Building on the distinction between the material and the formal parts of the common good, the authors characterize profit as the (...) material part of the common good of business and work as the formal part that expresses the essential significance of business. (shrink)

The purpose of this paper is to analyze the virtue of temperance as a moral competence in professional performance. The analysis relies on three different streams of literature: virtue ethics, positive psychology and competency-based management. The paper analyzes how temperance is defined in each of these perspectives. The paper proposes an integrative definition of temperance as “moral competence” and summarizes behaviors in business environments in which temperance plays a role.

A cool, lucid examination of the thought of the American philosopher Charles S. Peirce, offering an important clarification and an innovative way to view human ...

Various international authorities have insisted on the importance of ethical learning in higher education for would-be professionals, including students of Business Administration. As the process of creating the European Higher Education Area gathers pace, first steps have been taken to explicitly incorporate ethics in the common European Qualifications Framework (EQF). However, the authors of this study show how in the course of the EQF development process, the consideration given to ethical qualifications has been curtailed and subjected to serious limitations. In (...) this article, the authors review the historical development and the main elements of the EQF. Then, they analyze the gradual elimination of ethics within the EQF. Finally, they highlight the implications of this gradual elimination and propose avenues for further research. (shrink)

Various international authorities have insisted on the importance of ethical learning in higher education for would-be professionals, including students of Business Administration. As the process of creating the European Higher Education Area gathers pace, first steps have been taken to explicitly incorporate ethics in the common European Qualifications Framework. However, the authors of this study show how in the course of the EQF development process, the consideration given to ethical qualifications has been curtailed and subjected to serious limitations. In this (...) article, the authors review the historical development and the main elements of the EQF. Then, they analyze the gradual elimination of ethics within the EQF. Finally, they highlight the implications of this gradual elimination and propose avenues for further research. (shrink)

This paper is the Introduction to the Special Issue comprising a selection of papers submitted to the 19th IESE International Symposium on Ethics, Business and Society. The main topic of the Symposium was “Ethical Challenges in Strategic Management.” The paper presents the rationale and context of the Symposium. We begin with a brief historical overview of the evolution of the relationship between ethics and strategy. We propose four pillars that are at the core of a definition of strategy and elaborate (...) on how ethics can contribute to strategy. We present the six papers that make up this selection within the framework of the four aspects introduced in the previous section. We conclude with some proposals for further research that consider the content of the papers. (shrink)

Aristotle indicates that although a monarchy is the best form of government in theory, in practice, a polity (“mixed regime”) is best. IDOM Engineering Consultancy is presented as an example of a “corporate polity.” In this case study, stories and rationales behind the institutionalization of worker participation in ownership and management are discussed. Arguments in favor of the corporate common good as the firm’s overarching concern are proffered. Legal challenges as well as those arising from the company’s growth and overseas (...) expansion are studied. (shrink)

This case examines how IBERDROLA, Spain’s leading electricity supplier, shifted the company’s strategic focus to concentrate on sustainability and turned it into a source of competitive edge in a liberalized market. Largely pre-empting the industry obligations that came out of the Kyoto agreement, IBERDROLA decided to put sustainability at the heart of the company’s decision-making processes. IBERDROLA sold off its most polluting facilities and all non-core activities to concentrate on becoming the greenest player on the market. Its success was due (...) to its willingness to walk the talk, to get stakeholders on side, and to demonstrate its determination to be a corporate citizen. An important element of the strategy was to establish a working relationship with important NGOs and effect their involvement with IBERDROLA’s activities. An early and uneasy partnership with WWF/Adena over the production of green energy proved a sharp learning curve for both parties. Then in 2004 a relatively minor event triggered a chain of reactions that led to a revolution in the company’s policy of stakeholder integration. A small group of protected birds was killed when they flew into the blades at one of IBERDROLA’s wind power facilities. When previous similar crises had occurred, IBERDROLA had dealt with them through the time-honoured methods of dialogue and confrontation. This time, IBERDROLA decided to initiate a new approach. They invited SEO/BirdLife, the oldest Spanish NGO dedicated to the environment, to undertake a study into the implications of similar installations on bird conservation and the environment. The intention is for this collaboration to lead to a strategic agreement between both parties. (shrink)

The paper is the introduction to a selection of papers submitted to the EBEN 25th Annual Conference which took place at IESE Business School in Barcelona from September 20 to 22, 2012. The text presents the rationale behind the program of the Conference, and summarizes the content of the selected papers.