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The Ethics Management Paradox

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Postwar Europeans are proud of their model of social market economy. Although they pay a price for less flexibility, lower rates of employment, and the lack of competitiveness in global markets, the model remains morally attractive because of its capacity to create social stability and distributive justice. We may debate the limits of government intervention, but few European citizens are willing to give up their European way to combine business and humanity in the framework of a social market economy.

We no longer live in the postwar era, where business and social partners had the challenging task of building up national welfare states. As we all know, business today operates in the global context. The Internet is a worldwide information market. Competition in the labor and consumer markets is a game with global actors. Financial markets are short-lived, and the pressures of greed on business conduct are transnational. The question of my paper is, How can we save the genuine ethics of the European model of business and humanity in this new context? Even further, How can we increasingly develop the ethical potential of the European way to combine economic prosperity with social welfare?

As a starting point, I take the Green Paper of the European Commission Promoting a European Framework for Corporate Social Responsibility (2001). The Green Paper and the synthesis of its follow-up consultation process (Communication from the Commission, 2002) are worth reading and studying. The document puts business ethics and the central concept of corporate social responsibility (CSR) on the political agenda. It provides a regulative, political framework for an ethically driven economy, which goes beyond the logic of the social market economy. Whereas the dynamics of the social market economy rested on a clear separation between economic and social institutions operating mainly within national boundaries, the new regulative structure is built on voluntary partnerships among business, government and civil society. But we have to ask what kind of ethics is at work through this document.

Document Type: Research Article


Publication date: January 1, 2006

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