The Paradox of Business
Abstract:Bouckaert's contribution is important and provocative. His idea, if I understand him rightly, is that co-opting ethical language into rational and economic discourse runs the risk of ethics being subverted by business goals such as calculative self-interest and systemic functionality, since by so doing, one is reinforcing opportunistic roots of business. Ethics becomes a tool for its opposition. It is similar to following a diet that produces weight gain. His point is welcomed.
However, though his solution is a noble one, I think the problem cannot be solved by keeping ethics separate from business and emphasizing moral and spiritual commitments. I think that the problem is due to a more general cause, which is the conception of business to begin with as based on calculative self-interest. In my opinion, the problem is not so much an “ethics management paradox” as a “business paradox.”
The business paradox is the understanding of business as a wealth-producing enterprise for owners that simultaneously creates value for stakeholders. In a recent paper published in the Journal of Business Ethics (Vol. 53, Nos. 1–2, August 2004), and also in a chapter in “Spirituality and Ethics in Management” edited by Laszlo Zsolnai (Kluwer, 2004), I have attempted to present a sustained argument for my ideas. The conclusion to the lengthy and detailed arguments provided in these pieces is that the concept of business as activity for profits for the owners is already inherently unethical. One man's profit is another man's loss. There is no way to make business, understood as activity for profits for the owners, ethical. The conditions for an ethical business enterprise do not currently exist. This was the idea behind the title of the article for the Journal of Business Ethics, “Circles within a Circle: The Condition for the Possibility of an Ethical Business Enterprise inside a Capitalist System.” The “circles” represent individual business enterprises striving to be ethical. The singular “Circle” represents the capitalist economic system inside which all businesses must operate. While it seems to be more politically correct to refer to this as the “market system,” this label does not identify different forms of economies such as a state socialism that functioned within its borders as a socialist economy but outside of its boundaries as a state capitalist enterprise.
Document Type: Research Article
Publication date: January 1, 2006