Shareholder Ownership is Irrelevant for Shareholder Primacy (Business Ethics Journal Review)
Abstract: Alan Strudler rejects shareholder primacy and argues that, once contractual obligations have been fulfilled and shareholders have received a reasonable return on investment, corporate executives may use corporate wealth for the general good. He seeks to establish this claim via an argument that, contrary to the received view, shareholders do not own corporations. After raising some questions about the latter argument, this commentary goes on to argue that the question of corporate ownership is a red herring. The argument for shareholder primacy that Strudler wants to reject does not rely on the premise that shareholders own the firm.
Oxymoron: Taking Business Ethics Denial Seriously (Journal of Business Ethics Education)
Abstract: Business ethics denial refers to one of two claims about moral motivation in a business context: that there is no need for it, or that it is impossible. Neither of these radical claims is endorsed by serious theorists in the academic fields that study business ethics. Nevertheless, public commentators, as well as university students, often make claims that seem to imply that they subscribe to some form of business ethics denial. This paper fills a gap by making explicit both the various forms that business ethics denial can take, and the reasons why such views are ultimately implausible. The paper argues that this type of serious engagement with business ethics denial should be an important part of the job description for teachers of business ethics.
Professionalism, Agency, and Market Failures (Business Ethics Quarterly)
Abstract: According to the Market Failures Approach to business ethics, beyond-compliance duties can be derived by employing the same rationale and arguments that justify state regulation of economic conduct. Very roughly the idea is that managers have a duty to behave as if they were complying with an ideal regulatory regime ensuring Pareto-optimal market outcomes. Proponents of the approach argue that managers have a professional duty not to undermine the institutional setting that defines their role, namely the competitive market. This answer is inadequate, however, for it is the hierarchical firm, rather than the competitive market, that defines the role of corporate managers and shapes their professional obligations. Thus, if the obligations that the market failures approach generates are to apply to managers, they must do so in an indirect way. I suggest that the obligations the market failures approach generates directly apply to shareholders. Managers, in turn, inherit these obligations as part of their duties as loyal agents.
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Shareholder Primacy and Deontology (Business and Society Review)
Abstract: This article argues that shareholder primacy cannot be defended on the grounds that there is something special about the position of shareholders that grounds a right to preferential treatment on part of management. The notions of property and contract, traditionally thought to ground such a right, are now widely recognized as incapable of playing that role. This leaves shareholder theorists with two options. They can either abandon the project of arguing for their view on broadly deontological grounds and try to advance consequentialist arguments instead, or they can search for other morally relevant properties that could ground shareholder rights. The most sustained argument in the latter vein is Marcoux’s attempt to show that the vulnerability of shareholders mandates that managers are their ﬁduciaries. I show that this argument leads to the unacceptable conclusion that it would be unethical for corporations to make incomplete contracts with nonshareholding stakeholders.
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Armchair versus Armchair: Let’s Not Try to Guess the Social Value of Corporate Objectives (Business Ethics Journal Review)
Abstract: Jones and Felps claim that social welfare would be enhanced, if corporate managers adopted the goal of directly improving the happiness of their stakeholders instead of profit maximization. I argue that their argument doesn’t establish this. They show that a utilitarian case for profit orientation cannot be made from the armchair. But neither can the case for Jones and Felps’ preferred alternative. And their defense of it relies on empirically unsubstantiated assumptions.
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