Thomas Donaldson

How should highly-placed multinational managers, typically schooled in home country moral traditions, reconcile conflicts between those traditions and ones of the host country? When host country standards for pollution, discrimination, and salary schedules appear substandard from the perspective of the home country, should the manager take the high road and implement home country standards? Or does the high road imply a failure to respect cultural diversity and national integrity? In this paper, I construct and defend an ethical algorithm for multinational managers to use in reconciling such international normative conflicts.

Hedge funds are targets of mounting ethical criticism. The most salient focuses on their opacity. Hedge funds are structured to block transparency for strategic reasons: that is, they systematically deny information to their own investors and to governments in order to protect their competitive advantage, even though the information they hide holds tremendous significance for the interests of both groups. In this article I will detail the ethical allegations made against hedge funds, showing why their opacity creates intractable conflicts that cannot be resolved through government regulation. Sometimes opacity be regulated away; but with hedge funds I show why it cannot because of “regulatory recalcitrance.” In the end a form of voluntary moral coordination, a form of “microsocial contract” instituted as an industry standard, is required relief. In a word, the solution to hedge fund opacity is ethical.

ABSTRACT:The articles in the special issue ofBusiness Ethics Quarterly, “Normative Business Ethics in a Global Economy: New Directions on Donaldsonian Themes,” were written by a set of outstanding scholars: Margaret M. Blair, Joseph P. Gaspar, Nien-hê Hsieh, Peter L. Jennings, Marietta Peytcheva, Andreas Georg Scherer, Amy J. Sepinwall, Andrew Stark, Danielle E. Warren, and Manuel Velasquez. In this commentary I reply to my colleagues, arranging my reply around the following themes: 1) the corporate moral agent; 2) the idea of a social contract for business; 3) managing ethics within corporations; and 4) values in business. I discuss each in turn. However, I reflect first on my idiosyncratic approach to business ethics.

Social contract is rapidly becoming one of the significant alternatives for analyzing ethical issues in business. Contractarian approachesemphasizing consent as a means of justifying principles can provide needed context for rendering normative judgements conceming economic behaviors. Current research issues include developing tests of consent for both hypothetical and extant social contracts, and empirically testing the assumptions of the major contractarian approaches. Open questions include exploring the relationship between contractarian business ethics and other approaches, such as stakeholder management and virtue based ethics; and analysis of the intersection of contractarian approaches with the findings and assumptions of the field of moral psychology. Finally, the managerial utility of social contract based approaches needs to be explored with emphasis on identifying “translator” concepts.

This paper examines two issues about professionalism and business that appear at first blush to be entirely separate. The first is the question of who counts as a “professional,” and whether, in particular, business people are “professionals.” The second issue is howacknowledged professionals that regularly interact with business, such as accountants, lawyers, and physicians, can find the moral free space necessary to maintain professional integrity in the face of financial pressures. Conflicts of interest for professionals working incorporations recur with disturbing regularity, and often have serious consequences. In the end I will show how both issues share a common solution. The solution involves understanding the normative function of the manager in the modern corporation, a function, I will argue, made more conspicuous by work over the last two decades done in the areas of stakeholder theory, corporate social performance (CSP), and social contract theory. The remainder of the paper is devoted to articulating these two problems and clarifying their common solution.

This latest volume in the acclaimed Ruffin Series in Business Ethics brings together the contributions to the annual Ruffin Lecture series, in which some of the leading scholars in business ethics addressed the question: Can business, and business education, be considered one of the humanities, or is it in a class by itself? At a time when business is coming under attack for its apparent transgressions, this book iluminates the special values that inhere in the business world. Arguing all sides of the issue, the distinguished contributors include Richard DeGeorge, Ronald Green, Thomas Dunfee, Robert Solomon, Edwin Hartman, Peter French, Patricia Werhane, Clarence Walton, W. Michael Hoffman, David Fedo, Kenneth Andrews, Joanne Ciulla, Manuel Velasquez, and George Brenkert. The editors contribute an informative Introduction and an Epilogue to set the debate in its proper context.

The dynamic relationship between hypernorms and microsocial contracts can explain novel, evolutionary changes in economic life. The conceptual machinery of Integrative Social Contracts Theory (ISCT) can be expanded in order to understand dynamic moments in the evolution in economic life such as the economic crisis of 2008–2009. When a transition in the ethical interpretation of economic events occurs over time, it can be understood as a transition from the opaqueness of hypernorms to the relative clarity of microsocial contracts. This phenomenon deserves more study than it has recevied, and entails, at a minimum, the application of an enhanced, more dynamic interpretation of ISCT.