Santiago Mejia

According to the conventional wisdom among business ethicists, the “Business Judgment Rule” gives corporate leaders the discretion needed to abide by the firm’s moral obligations. In the first part of the paper, I challenge this view: managers have compelling reasons to believe that the Business Judgment Rule (and corporate law more generally) allows corporate leaders to pursue ethically motivated decisions only when these decisions are expected to be profit-enhancing. This is problematic because it instrumentalizes ethics, pushes ethically motivated corporate leaders to dissemble, and corrupts the quality of our public discourse. In response, I propose that corporate law should incorporate ethics into the Business Judgment Rule, explicitly giving managers discretion to make ethically motivated decisions that are profit-sacrificing. After responding to concerns about implementing such a rule, I contend that such a rule would be an important step to put corporate ethics in its proper place.

Within virtue ethics, there has been a growing interest in topics surrounding moral education and ethical development. It is often taken to be a truism that self-examination and self- knowledge play an important part in ethical development. This perception might explain why little attention has been paid to problematizing and understanding the role that self- examination and self-knowledge play in such development. This alleged truism, namely, that self-examination and self-knowledge are important for ethical development has come under attack in recent years from scholars inspired by research in social psychology and cognitive science. Research on depressive realism, for instance, has been used to claim that a certain dose of self-deception is necessary for a flourishing life. Research on associative learning, priming influences, and automatic processes has shown that our behavior is shaped by such a myriad of unconscious influences that the project of knowing oneself appears futile. Even within virtue ethics there has been a slowly growing distrust about the relevance of self-examination and self-knowledge for the development of virtue. It has been objected that the self-centered nature of self-examination is an impediment to the development of virtue, which is outward-oriented. It has also been suggested that in making self-knowledge central for ethical development one ends up portraying such development as excessively intellectual, failing to accommodate virtuous agents who are not very good at knowing themselves. In the dissertation I respond to these challenges. I show that coming to know yourself, in particular coming to know the unconscious mental states that inform your life, is an essential xipart of ethical development. A central part of the argument consists in showing that there is an internal connection between self-examination, self-knowledge and rational agency. In showing this I make perspicuous why self-knowledge should be taken to be, not just one of the many tools that allow us to develop ethically, but a capacity that underwrites any such tool. Examining the relationship between self-examination, self-knowledge and ethical devel- opment is particularly pressing for moral philosophers whose work is, like the work of most virtue ethicists, informed by historical figures. These philosophers have been influenced by thinkers who, for the most part, wrote before the 20 th century, a century that saw signif- icant contributions from psychotherapists, cognitive scientists and social psychologists to our understanding of the relationship between self-examination, self-knowledge and ethical development. Engaging with the literature on psychotherapy and psychology allows me to offer a textured account of ethical development that is empirically informed. At the same time that the dissertation establishes that self-examination and self-knowledge play an important role in ethical development, it investigates a distinction that has been central to epistemology but whose ethical significance has been overlooked: the distinction between what one might call first- and third-personal self-knowledge. In highlighting the ethical significance of this distinction the dissertation puts in contact the work that episte- mologists have done on self-knowledge and first-person authority with the work that ethicists have done in moral education and ethical development. Thus, although the dissertation is mainly a contribution to moral philosophy it also sheds some light on epistemology. The dissertation defends the thesis that knowing oneself first-personally, as opposed to third-personally, is essential for developing virtue. In arguing for this thesis I am attempting to do justice to an insight that is central to most forms of psychotherapy but which has been neglected within virtue ethics (as well as within social psychology and cognitive science). The work of David Finkelstein and Richard Moran provides the framework within which xiiI argue, against a number of social psychologists and cognitive scientists working on the topic of self-knowledge, that if the aspiration to know oneself is part of a person’s ethical development, then it cannot be merely an aspiration to acquire information about oneself but also, and quite importantly, to relate and engage with this information in a first-personal way. I claim that it is only with this kind of self-knowledge that one can aspire to unify rationally the competing elements in one’s life into a coherent whole. I also appeal to the work by Jonathan Lear to elucidate further the nature of first-personal self-knowledge. Moran and Lear agree on the thesis that a certain kind of first-personal self- knowledge is important for ethical development but disagree on how to characterize this kind of self-knowledge. Lear defends an expressive model of first-personal self-knowledge according to which a person has first-personal self-knowledge of her mental state in virtue of the fact that she can express it in a self-ascription. Moran defends an agential model of first-personal self-knowledge according to which a person has first-personal self-knowledge of her mental state because she can make up her mind about it deliberately. Although their positions seem in competition with each other I argue that they are actually complementary. Each of these types of first-personal self-knowledge plays a distinctive role in our ethical development. Expressive self-knowledge is required to make explicit patterns of thought that interfere with the person’s ability to live well. Agential self-knowledge is the ultimate aim of this kind of self-transformation —a properly human life is one where the person’s mental states are formed and can be transformed though her rational assessments of the merits of the situation. These two ways of knowing oneself are connected by the fact that, if things are working well, the former leads to the latter. In fact, I argue that the expressive dimension of self-knowledge facilitates the process whereby instinctive and automatic responses that are not rational become unified with, and transformed by, our self-conscious reflection, a process that ultimately leads to the acquisition of the kind of agential self-knowledge that Moran defends.

In this chapter, I contribute to the broad question of how to justify next-stage capitalism by focusing on a narrower issue. On the one hand, I will limit myself to discussing the role that normative ethics should play in justifying capitalism. On the other hand, I will not discuss capitalism in general but will focus on one particular corner within it: corporate governance. The central thesis I will defend is that unless normative ethics informs discussions about corporate governance, the accounts of how corporate managers should conduct the firm will be ethically inadequate. I will defend my claim by focusing on the influential account proposed by Oliver Hart and Luigi Zingales, two of the most prominent economists of the last decade. They have recently argued that managers should maximize shareholder welfare (i.e., promote the preferences of shareholders, including their ethical and social preferences) instead of shareholder value (i.e., maximize profits for shareholders). Among the central motivations for their revised proposal is offering a more ethically attuned version of corporate governance. Their account is valuable because, unlike the dominant model of shareholder primacy, it seeks to incorporate ethical and social values into managerial decision-making. However, I show that the framework with which they work, in particular its paucity of normative ethical resources, does not allow Hart and Zingales to provide an account of corporate governance that passes moral muster. I conclude by arguing that a proper account of the corporation’s governance requires using the normative conceptual resources usually discussed by moral philosophers. I highlight, however, that one should not merely draw on moral philosophy. A proper account of corporate governance (and a proper justification of next-stage capitalism) requires a multidisciplinary approach where the insights from moral philosophy are informed, at the very least, with those from economics and legal scholarship.

In his latest book, Ethics for Capitalists, Joseph Heath draws on his many years of thinking about business ethics to propose, as the book’s subtitle indicates, “a systematic approach to business ethics, competition, and market failure.” He develops his argument carefully, draws on a wealth of interdisciplinary work, uses valuable and insightful examples, contrasts his views with important alternatives, and provides responses to compelling objections. In this review article, we argue that his book revises and sharpens many of Heath’s earlier ideas, addressing important criticisms raised against them. We highlight that the book also offers a broad macro-level framework for market design, an explanation of how current corporate governance structures fit such a framework, and concrete responses to micro-level questions about what businesses and individuals ought to do. By doing all of this, his book shifts the scope of the “market failures approach” (MFA) from what used to be a narrow focus on the obligations of professional managers to an encompassing “ethics for capitalists” that ought to guide any economic actor within a capitalistic system. Despite the many merits of his book, we conclude by discussing some concerns we have about its scope and methodology.

In response to the growing criticisms to shareholder primacy, Oliver Hart, a Nobel Economics Prize recipient, and Luigi Zingales, a very well-known finance professor, have offered a revision to Milton Friedman’s dominant account. Seeking to incorporate social and moral concerns into the objective function of the firm, they have proposed that managers should maximize shareholder welfare instead of shareholder value. Their account has been highly influential and reflects many of the substantive and methodological assumptions of corporate governance scholars within the law and economics literature. In this paper, we engage closely with their account from a normative perspective, unearthing and criticizing the implications of many of these assumptions. In doing so, we also formulate a set of principles necessary to ensure the ethical legitimacy of any proposal that puts shareholders at the center of the firm’s objective function.

The scholarship on meaningful work has approached the topic mostly from the perspective of the subjective experience of the individual worker. This has led the literature to under-theorize, if not outright ignore, the cultural and normative dimension of meaningful work. In particular, it has obscured that a person’s ability to find meaning in her life in general, and her work in particular, is typically anchored and dependent on shared institutions and cultural aspirations. Reflecting on the future of work, particularly on the dangers posed by the threat of technological unemployment, helps us recognize this cultural and normative dimension of meaningful work. I argue that a world with few work opportunities is a world devoid of a core structuring ideal around which our society has organized itself and, as such, will strain our ability to make sense of what it means to find life meaningful. To make this case I show that work operates as a central organizing _telos_ around which our contemporary lives gravitate. Work touches everyone and everything, defining the rhythms of our days and weeks and providing a center of gravity around which our lives are structured. Work constitutes a central dimension of human flourishing. Through work we provide for our material needs, develop our skills and virtues, build community, and contribute to the common good. As such, work constitutes a central organizing ideal in contemporary Western societies, a fact has significant normative force and plays an important role in our finding work meaningful.

This paper introduces a body of research on Organizational Behavior and Industrial/organizational Psychology that expands the range of empirical evidence relevant to the ongoing character-situation debate. This body of research, mostly neglected by moral philosophers, provides important insights to move the debate forward. First, the OB/io scholarship provides empirical evidence to show that social environments like organizations have significant power to shape the character traits of their members. This scholarship also describes some of the mechanisms through which this process of reshaping character takes place. Second, the character-situation debate has narrowly focused on situational influences that affect behavior episodically and haphazardly. The OB/io research, however, highlights the importance of distinguishing such situational influences from influences that, like organizational influences, shape our character traits because they are continuous and coordinated. Third, the OB/io literature suggests that most individuals display character traits that, while local to the organization, can be consistent across situations. This puts pressure on the accounts of character proposed by traditional virtue ethics and situationism and provides empirical support to interactionist models based on cognitive-affective processing system theories of personality. Finally, the OB/io literature raises important challenges to the possibility of achieving virtue, provides valuable and untapped resources to cultivate character, and suggests new avenues of normative and empirical research.

Klara and the Sun, the latest novel by Nobel-prize winner Kazuo Ishiguro, forces one to reckon with one's own anxieties about the future of emerging technologies and confront deep questions about the nature of dignity, existence, and humanity. The novel also provides one with complex characters and a speculative future through which to live new lives, experience novel worlds, and see through different eyes. At the same time, the novel’s world offers us an uncanny distance from our own, making us prone to pass judgments on the characters’ moral faults that we later come to recognize are also our own.

Duties of beneficence are said to allow for leeway to discharge them. By distinguishing between two different types of leeway, Mejia identified three structurally different duties of beneficence. In this Commentary I deploy those distinctions to clarify the nature of a fourth type of duty of beneficence, one prompted by a global pandemic, a duty with a peculiar, and seldom recognized, conceptual logic. I provide some guidelines that should orient managers when they take themselves to be fulfilling such a duty on behalf of shareholders.

Scholars who favor shareholder primacy usually claim either that managers should not fulfill corporate duties of beneficence or that, if they are required to fulfill them, they do so by going against their obligations to shareholders. Distinguishing between structurally different types of duties of beneficence and recognizing the full force of the normative demands imposed on managers reveal that this view needs to be qualified. Although it is correct to think that managers, when acting on behalf of shareholders, are not required to fulfill wide duties of charity, they are nevertheless required to fulfill a variety of narrow duties of beneficence. What is more, the obligation to fulfill these duties arises precisely because they are acting on behalf of shareholders. As such, this article 1) refines our understanding of the duties of corporate beneficence and 2) helps to identify which duties of beneficence are imposed on managers when they are acting on behalf of shareholders.

ABSTRACT:The distinction between what I call nonelective obligations and discretionary obligations, a distinction that focuses on one particular thread of the distinction between perfect and imperfect duties, helps us to identify the obligations that carry over from principals to agents. Clarity on this issue is necessary to identify the moral obligations within “shareholder primacy”, which conceives of managers as agents of shareholders. My main claim is that the principal-agent relation requires agents to fulfill nonelective obligations, but it does not always require discharging discretionary obligations. I show that the requirement to fulfill nonelective obligations is more far-reaching than has been acknowledged by most defenders and critics of shareholder primacy. But I also show that managers are not bound by certain discretionary obligations like charity, showing that their moral obligations are more circumscribed than the obligations that apply to human beings in general.

Socrates’ inquiry into the nature of the virtues and human excellence led him to experience Socratic ignorance, a practical puzzlement experienced by his recognition that his central life commitments were conceptually problematic. This practical perplexity was not, however, an epistemic weakness but a reflection of his wisdom. I argue that Socratic ignorance, a concept that has not received scholarly attention in business ethics, is a central aim that business practitioners should seek. It is what a truthful, thorough, and courageous inquiry into their professional roles and commitments leads to. It wakes them up from the moral complacency engendered by organizations, forcing them to become much more critical of their day-to-day activities and more intentional about living virtuously. It curbs the corrupting potential of authority positions and prevents the tendency of subordinates to routinely conform to sanctioned norms and expectations. Finally, it opens up novel and creative moral avenues and provides a promising model to deal with the conflicts posed by our globalized and increasingly polarized world.