Abstract:To date, our understanding of ethical decision making and behavior in organizations has been concentrated in the area of moral judgment, largely because of the hundreds of studies done involving cognitive moral development. This paper addresses the problem of our relative lack of understanding in other areas of human morality by applying a recently developed construct—moral approbation—to illuminate the link between moral judgment and moral action. This recent work is extended here by exploring the effect that organizations have on ethical (...) behavior in terms of the moral approbation construct. (shrink)

Abstract:To date, our understanding of ethical decision making and behavior in organizations has been concentrated in the area of moral judgment, largely because of the hundreds of studies done involving cognitive moral development. This paper addresses the problem of our relative lack of understanding in other areas of human morality by applying a recently developed construct—moral approbation—to illuminate the link between moral judgment and moral action. This recent work is extended here by exploring the effect that organizations have on ethical (...) behavior in terms of the moral approbation construct. (shrink)

Corporate governance and finance are dynamic academic fields that offer myriad opportunities for business ethics analysis. Within the corporate governance triad in recent years, shareholders have increased their power over boards of directors and executives through both regulation and movements to change corporate by-laws. The impact of board characteristics on firm performance has proven elusive, leading to questions concerning board processes and individual director beliefs and behaviors. At the same time, CEOs have lost considerable power, leaving many struggling to regain (...) their control and maintain their compensation levels, while others adopt a stewardship approach to their posts. In the field of finance, the recent financial debacle has led to a reexamination of financial regulation and of the fundamental nature and purpose of the industry. All of these issues provide business ethicists fodder for investigation and analysis. (shrink)

The relationship between corporate executives and shareholders has riveted the attention of business ethicists since the inception of the field. Most ethicists agree that corporate executives owe their investors the duties of loyalty, candor, and care. These fiduciary duties undergird the promises made to shareholders at the time of incorporation, placing on executives moral obligations to engage in fair dealing and to avoid conflicts of interest.We concur that executives owe all of their existing shareholders both promise-keeping and fiduciary duties and (...) argue that some corporateexecutives violate these responsibilities by attempting to withhold information from or limit information to some shareholders while courting others. We analyze the ethical implications of six techniques and tools that executives use to attract certain types of shareholders while deterring others. We conclude with recommended structural and behavioral changes to these current managerial and investor practices. (shrink)

The relationship between corporate executives and shareholders has riveted the attention of business ethicists since the inception of the field. Most ethicists agree that corporate executives owe their investors the duties of loyalty, candor, and care. These fiduciary duties undergird the promises made to shareholders at the time of incorporation, placing on executives moral obligations to engage in fair dealing and to avoid conflicts of interest.We concur that executives owe all of their existing shareholders both promise-keeping and fiduciary duties and (...) argue that some corporateexecutives violate these responsibilities by attempting to withhold information from or limit information to some shareholders while courting others. We analyze the ethical implications of six techniques and tools that executives use to attract certain types of shareholders while deterring others. We conclude with recommended structural and behavioral changes to these current managerial and investor practices. (shrink)

Abstract:Shareholders’ relationship to the firm is a central theme in corporate governance, yet the investors’ perspective has been virtually ignored in governance research. This paper attempts to explain the previously unexplored role of trust in the investor decision-making process. The proposed model suggests that trust acts as the antecedent of the risk variable in existing investor decision-making models. Stock ownership involves both financial and ethical risk, which by definition requires some level of implicit trust in management and the market.

Abstract:Over the last two decades, institutional investing has rocked the world of corporate governance in a transformation that has begun to be reflected in the finance, legal, and management literatures. Traditional players have seen their roles change and bases of power shift, and new actors have entered the governance equation. These transitions have entailed an ethical upheaval that is only beginning to be addressed in the business ethics literature.This paper attempts to facilitate research in this area by integrating various literatures (...) into an examination of a series of business ethics issues related to pension fund activism and portfolio management, fund staffing, and employee compensation. The primary intent of this project is to encourage increased business ethics research in the area of institutional investing in general and pension fund management in particular. (shrink)

Issues-driven shareholder activism suggests that specific issue characteristics brought by shareholders, a group to which firms are obligated to respond, interact in a way that affects the materiality of the issue in the eyes of the modern corporation. Relevant issue characteristics include: issue type, social significance, and issue life cycle stage.

Issues-driven shareholder activism suggests that specific issue characteristics brought by shareholders, a group to which firms are obligated to respond, interact in a way that affects the materiality of the issue in the eyes of the modern corporation. Relevant issue characteristics include: issue type, social significance, and issue life cycle stage.

Shareholder activism has become a dynamic institutional force, and its associated, rapidly increasing body of scholarly literature affects numerous disciplineswithin the organizational science academy. Despite growing shareholder empowerment, the impact of shareholder activism on corporate outcomes remains equivocal. The heterogeneity of factors in shareholder activism, such as environmental, firm, proponent, and issue characteristics; the variety of activism methods and processes; and varying outcomes provides a plethora of theoretical and methodological challenges for activism researchers. Furthermore, the separation of prior research on (...) financial and social activism has left unanswered questions critical for both the scholarly discourse on shareholder activism and the normative debate on shareholder empowerment. Our multidisciplinary review integrates both the financial and social activism streams and explores shareholder activism controversies, seeking to provide an impetus for more cohesive conceptual and empirical work in the field. (shrink)

A recent contribution to the moral decision-making literature argues that individuals' moral behavior is partially shaped by the amount of moral approbation they expect to receive from their moral referent groups (Jones and Ryan, 1997). This paper examines the nature and content of these previously underexamined sources of moral guidance. In an open-ended empirical test of undergraduate business students (n = 369), we found that 1) significant differences exist between individuals' moral referent groups and work-related referent groups, 2) females were (...) more likely than males to include themselves in their moral referent groups, 3) females were more likely than males to be designated as moral referents, and 4) females were more likely to be included in moral referent groups than in work-related referent groups. The paper also includes a general description of the membership of these business subjects' moral referent groups and presents a variety of suggestions for future research. (shrink)