Contrasting the Behavioural Business Ethics Approach and the Institutional Economic Approach to Business Ethics: Insights From the Study of Quaker Employers

Journal of Business Ethics · 2008 · Volume 82 · Issue 4

Abstract

The article suggests that in a modern context, where value pluralism is a prevailing and possibly, even ethically desirable interaction condition, institutional economics provides a more viable business ethics than behavioural business ethics, such as Kantianism or religious ethics. The article explains how the institutional economic approach to business ethics analyses morality with regard to aninteractionprocess, and favoursnon-behavioural, situationalintervention withincentive structuresand withcapital exchange. The article argues that this approach may have to be prioritised over behavioural business ethics, which tends to analyse morality at the level of theindividualand favoursbehaviouralintervention with the individual’svalue, norm and belief system, e.g. through ethical pedagogy, communicative techniques, etc. Quaker ethics is taken as an example of behavioural ethics. The article concludes that through the conceptual grounding of behavioural ethics in the economic approach, theoretical and practical limitations of behavioural ethics, as encountered in a modern context, can be relaxed. Probably only then can behavioural ethics still contribute to raising moral standards in interactions amongst the members (stakeholders) of a single firm, and equally, amongst (the stakeholders of) different firms.

Keywords

behavioural approaches to business ethics, economics & business ethics, pluralism, quaker industrialists, stakeholder theory

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