Organizations adopt formal sanctioning systems to deter ethical violations, but the formal systems’ effectiveness may be undermined by informal sanctioning systems which promote violations. I conducted an ethnographic study of six trading crowds on two financial exchanges to understand how informal and formal sanctioning systems, which are grounded in different interpretations of equity, interact to affect trader deviance from rules established by the financial exchange (exchange deviance). To deter informal trader norms that conflict with exchange rules, the exchanges formally prohibit traders’ informal sanctions. The exchanges, however, underestimate traders’ informal sanctions related to ostracism and social rejection, which are not only difficult for the exchanges to detect, but also interpersonally hurtful and harmful to trader performance. Consequently, the traders’ informal social sanctions lead to secondary sanctions from trading firms. Ultimately, the informal sanctioning system evades the formal sanctioning system by exploiting what the exchanges deem to be minor rule violations.

A quid pro quo is an exchange of value between a citizen or group—often a businessperson or organization—and an official; what the citizen or group offers can take either monetary or nonmonetary form and what the official supplies, in return, is some kind of public act. Despite the fact that instances of quid pro quo seem continually to compel public attention, very few rise to the level of bribery; i.e., the level in which they are resolved judicially. In part, quid pro quo eludes judicial forums for factual reasons: It is difficult to prove. And in part, the reasons are normative: The distinction between objectionable quid pro quo and acceptable democratic norms—on which citizens and groups ought to be able to support officials who are in turn responsive to them—is difficult to draw. Hence, a great gray area of quid pro quo finds itself resolved (or at least debated) in political forums. In what follows I examine central strands of American public discourse over the factual and normative issues of quid pro quo. My purpose is to articulate those principles which most parsimoniously account for its structure, and to explore what presuppositions various discourse-participants either explicitly or implicitly bring to bear in determining whether a situation constitutes a troubling quid pro quo.

Evidence abounds that when ethics initiatives are decoupled from the actual work of organizations, ethics policies may become little more than “window dressing” (Weaver, Trevino, and Cochran 1999; Collen and Gonella 2002). We found, however, an unexpected, positive feature of decoupling in the study of a local government; namely, when organizational members engage in discussions that turn away from the letter of an ethics code they often do so to address higher ethical principles embedded in the spirit of the code. The decoupled understanding of the code in these cases becomes a symbolic, legitimating gesture grounded not in strict provisions but in creative and complex interactions. This counterintuitive explanation of decoupling capitalizes on discourse that evolves from a legalistic interpretation to rich discussions that value the multiplicity of voices within organizational life. What follows is that ethical decision making emerges as creative, dynamic, and responsive to its constituents.

This article first describes some of the chief contrasts between Judaism and American secularism in their underlying convictions about the business environment and the expectations which all involved in business can have of each other—namely, duties vs. rights, communitarianism vs. individualism, and ties to God and to the environment based on our inherent status as God’s creatures rather than on our pragmatic choice. Conservative Judaism’s methodology for plumbing the Jewish tradition for guidance is described and contrasted to those of Orthodox and Reform Judaism.

One example of how Conservative Judaism can inform us on a current matter is developed at some length—namely, privacy in the workplace. That section discusses (1) the reasons for protecting privacy; (2) protection from intrusion, including employer spying; (3) protection from disclosure of that intended to remain private; (4) individualistic vs. communitarian approaches to grounding the concern for privacy; and (5) contemporary implications for insuring privacy in business.

The UNCED Earth Summit established two new principles of international justice: an equitable international order and protection of the environment. UNCED was a significant symbol, a morality play about environment and economics. Wealth is asymmetrically distributed; approximately one-fifth of the world (the G-7 nations) produces and consumes four-fifths of goods and services; four-fifths (the G-77 nations) get one-fifth. This distribution can be interpreted as both an earnings differential and as exploitation. Responses may require justice or charity, producing and sharing. Natural and national resources come into tension with the common heritage of humankind, exemplified in disputes about who owns biodiversity resources. Ethics has to learn planetary home economics.

In 2010, Business Ethics Quarterly published ten articles that considered the potential contributions to business ethics research arising from recent scholarship in a variety of philosophical and social scientific fields (strategic management, political philosophy, restorative justice, international business, legal studies, ethical theory, ethical leadership studies, organization theory, marketing, and corporate governance and finance). Here we offer short responses to those articles by members of Business Ethics Quarterly’s editorial board and editorial team.

In this journal, Jeffrey Moriarty argued that CEOs must refuse to accept compensation above the minimum compensation that will induce them to accept and perform their jobs. Acting otherwise, he maintains, violates the CEO’s fiduciary duty, even for a CEO new to the firm. I argue that Moriarty’s conclusion rests on a failure to adequately distinguish when a person acts as a fiduciary from when she acts on her own account as a person. Further, Moriarty’s argument assumes that the CEO knows this minimum level of compensation. However, we learn the suitability of compensation only through the market process of wage negotiation, not through some process of introspection. I conclude that a CEO who abstains from interfering with the board of directors and its compensation committee is morally free to negotiate for the highest wage available.

Must even Confucian rights skeptics—those who are, on account of their Confucian beliefs, skeptical of the existence of human rights, and believe that asserting or recognizing rights is morally wrong—concede that in the workplace, they are morally obligated to recognize rights? Alan Strudler has recently argued that such is the case. In this article, I argue that because Confucian rights skeptics locate wrongness in inconsistency with the idea of “Confucian community,” Confucian community should be viewed as a moral ideal. I then argue that Confucian rights skeptics ought to act in a manner that is consistent with this ideal, even when the ideal has not yet been realized, just as Kantians ought to act consistently with the Kantian kingdom of ends ideal. Accordingly, contrary to Strudler, I argue that Confucian rights skeptics need not concede that they are morally obligated to recognize rights in the workplace. This conclusion suggests the need for inquiry into the metaphysical foundations of these conflicting views. However, such inquiry is commonly thought to lie beyond the scope of philosophical business ethics proper. I conclude the article by suggesting a number of reasons for business ethicists to consider rejecting the prevalent narrow conception of the scope of the discipline.

In this discussion I explore challenges to a particular Confucian system of morality that generally eschews reliance on rights. I argue that such a system may at the same time both assert that there are moral problems with rights and assert that it is acceptable to invoke rights in limited contexts. Adam Bailey has objected that the position I defend is inconsistent. I answer Bailey’s objections.

This special issue of Business Ethics Quarterly on ethics in finance was planned before the high profile scandals at Enron, WorldCom, Global Crossing, Tyco, and Arthur Andersen, among other firms. Although these unfortunate events make this special issue especially timely, the subject matter of finance ethics has long been in need of scholarly attention. It is ironic that business ethics as an academic field owes its existence in part to the insider trading and junk bond scandals of the 1980s, and yet business ethics scholars have devoted comparatively little attention to financial topics. Now that another wave of ethical failures in finance is upon us, it is appropriate to present this collection of the best work on finance ethics.

From a theoretical point of view, finance is a unique field for ethical exploration. The central activity of finance is financial contracting, in which parties make agreements with regard to the assets that they control. An individual who rents a home, leases a car, buys an insurance policy, invests in a mutual fund, or saves for retirement is entering into a contract with someone who promises something in return. In making these contracts, individuals are assumed by finance theorists to be entirely self-interested and opportunistic, which is to say that they will renege on their promises if they can do so safely. The response of rational contractors, therefore, is to build in safeguards to ensure compliance with the agreements made.

Under the present judicial interpretation of federal securities law, an individual is prohibited from trading on non-public information that has been misappropriated in contravention of a fiduciary duty. Trades made using non-public information that has not been misappropriated are not prohibited by Rule 10b-5, promulgated under the Securities and Exchange Act of 1934. The current requirement of misappropriation to trigger Rule 10b-5 liability creates a gap that permits transactions that are both ethically and economically undesirable. Judicial or legislative reforms are recommended to close the gap and help ensure the fairness and efficiency of securities markets.

The law of insider trading has progressed from an expansive approach, according to which all trading on nonpublic information was considered illegal, to a constricted approach, under which corporate outsiders are permitted to trade on nonpublic information provided such trading does not breach a fiduciary duty. This article analyzes both the former, expansive theory and the currently utilized constricted theory, within a framework of basic tenets of the American capitalist social contract regarding legitimacy of property claims. The existing constricted approach to the regulation of insider trading is found to be deficient in meeting the expectations of two core components of the social contract: it discourages procedural equality of opportunity, and it endorses claims to property that are not characterized by legitimate methods of acquisition or transfer. Because the old, expansive regulatory interpretation was more consistent with the terms of the social contract in regard to property claims, it served our economic and ethical expectations more effectively than the system presently in place. Accordingly, the article culminates in a recommendation that the expansive approach to regulating insider trading be reestablished under Unites States law.

EDITOR’S NOTE: Business Ethics Quarterly invited a number of scholars involved with BEQ over its first twenty years (especially in its early years, as editors or editorial board members) to offer their reflections on the past, present, and future of business ethics. The resulting comments, which appear below, are as diverse and eclectic as the group of scholars who have given their energies to BEQ over the years.

This essay responds to Patricia Werhane’s 1994 Ruffin Lecture address, “Moral Imagination and the Search for Ethical Decision-making in Management,” using institutional theory as an analytical framework to explore conditions that either inhibit or promote moral imagination in organizational problem-solving. Implications of the analysis for managing organizational change and for business ethics theory development are proposed.

Drawing from Michel Foucault’s reading of Immanuel Kant’s essay “What is Enlightenment?,” and specifically his definition of ascesis, we associate maturity with a capacity for, and interest in, forming the self. On the basis of an empirical study of making vinyl records following the successful commercialization of digital media, we identify micro-disciplinary techniques of self-forming that emerge as enthusiasts steadily learn the craft of vinyl record manufacturing. It is, we argue, through technology, rather than against it, that organizational immaturity can be resisted. Craftwork involves testing and transforming, rather than just acquiring, traditional skills. Maturity involves an ongoing struggle of selectively and reflectively engaging with technologies via attempts to be the subject of one’s own subjection. The former contributes to the latter.

“Business Ethics and Postmodernism: A Response” considers the contribution of Ronald Green, David Schmidt, Clarence Walton, Ron Duska, and Richard Neilsen to a special issue of Business Ethics Quarterly entitled “Business Ethics and Postmodernism.” This essay poses a fundamental question: to what extent can a position which characterizes itself as postmodern be ethical? The paper argues on philosophical grounds that the debate between modernity and postmodernity is a debate over the very possibility of an ethic. The paper concludes that although Jacque Derrida has made the most convincing argument for an ethic within postmodernity, it remains skeptical because such an argument simply presupposes assumptions which owe their origin to modernity.

The debate about the differing philosophies of human-nature relationship is ongoing. Several studies discuss the need to develop and adopt a new environmental paradigm to replace the neoclassical economic paradigm predominant in Western societies. This issue has been discussed mainly at a societal level. Society or societies are, however, entities that consist of smaller particles. If a phenomenon is supposed to exist in an entity, signs of the phenomenon should also be found in its particles, business enterprises among others. This paper examines a shift of a managerial paradigm in a business organization, since not only the actions of individuals and governments but also those of business enterprises account for the preservation of the natural environment. It studies empirically how a managerial paradigm can shift from “traditional managerial thinking” to “environment-related management.” Two frameworks will be developed for this purpose.

This special issue of Business Ethics Quarterly was organized for two reasons. First, the academic fields of business ethics and accounting ethics have developed without close theoretical or empirical connections. This is the case even though the profession of accounting is an important component of the organizational world. For this reason, it is important to foster attempts to build a bridge between the two fields, so that research in accounting ethics is more closely related to business ethics. Second, the recent deluge of business scandals (primarily, but not only, in the United States) in which financial reporting and auditing were central elements suggests that a special issue on accounting ethics is timely.

The original hope was that the special issue would contain a balance of papers from researchers in “accounting ethics” and those in “business ethics.” In line with the hope that the papers would be responsive to both fields, almost every paper submitted was reviewed by one person who is identified with business ethics and one person who is identified with accounting ethics. As it turns out, most of the papers in this issue were written by people whose academic home is the accounting department. The mix of papers reflects the emphasis in the accounting literature on empirical research on ethical behavior.