IDEAS home Printed from https://ideas.repec.org/a/kap/jbuset/v150y2018i3d10.1007_s10551-016-3175-x.html
   My bibliography  Save this article

Efficiency and Ethically Responsible Management

Author

Listed:
  • Jeffery Smith

    (Seattle University)

Abstract

One common justification for the pursuit of profit by business firms within a market economy is that profit is not an end in itself but a means to more efficiently produce and allocate resources. Profit, in short, is a mechanism that serves the market’s purpose of producing Pareto superior outcomes for society. This discussion examines whether such a justification, if correct, requires business managers to remain attentive to how their firm’s operation impacts the market’s purpose. In particular, it is argued that the value of efficiency, despite views to the contrary, cannot be fully separated from the planning and intentions of business managers as long as those managers direct their firms in an ethically responsible fashion. This position is inspired by, and serves as a supportive clarification of Joseph Heath’s so-called “market failures approach” to business ethics.

Suggested Citation

  • Jeffery Smith, 2018. "Efficiency and Ethically Responsible Management," Journal of Business Ethics, Springer, vol. 150(3), pages 603-618, July.
    • Handle: RePEc:kap:jbuset:v:150:y:2018:i:3:d:10.1007_s10551-016-3175-x
    DOI: 10.1007/s10551-016-3175-x
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s10551-016-3175-x
    File Function: Abstract
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1007/s10551-016-3175-x?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Michael C. Jensen, 2010. "Value Maximization, Stakeholder Theory, and the Corporate Objective Function," Journal of Applied Corporate Finance, Morgan Stanley, vol. 22(1), pages 32-42, January.
    2. Dominic Martin, 2013. "The Contained-Rivalry Requirement and a ‘Triple Feature’ Program for Business Ethics," Journal of Business Ethics, Springer, vol. 115(1), pages 167-182, June.
    3. Jones, Thomas M. & Felps, Will, 2013. "Shareholder Wealth Maximization and Social Welfare: A Utilitarian Critique," Business Ethics Quarterly, Cambridge University Press, vol. 23(2), pages 207-238, April.
    4. Oliver E. Williamson, 2005. "The Economics of Governance," American Economic Review, American Economic Association, vol. 95(2), pages 1-18, May.
    5. Peter Koslowski, 2004. "Public Interest and Self-Interest in the Market and the Democratic Process," ICER Working Papers 09-2004, ICER - International Centre for Economic Research.
    6. Hausman, Daniel M & McPherson, Michael S, 1993. "Taking Ethics Seriously: Economics and Contemporary Moral Philosophy," Journal of Economic Literature, American Economic Association, vol. 31(2), pages 671-731, June.
    7. Matthews, R C O, 1981. "Morality, Competition and Efficiency," The Manchester School of Economic & Social Studies, University of Manchester, vol. 49(4), pages 289-309, December.
    8. Sen, Amartya, 1993. "Does Business Ethics Make Economic Sense?," Business Ethics Quarterly, Cambridge University Press, vol. 3(01), pages 45-54, January.
    9. Hussain, Waheed, 2012. "Corporations, Profit Maximization And The Personal Sphere," Economics and Philosophy, Cambridge University Press, vol. 28(3), pages 311-331, November.
    10. Heath, Joseph, 2006. "Business Ethics without Stakeholders," Business Ethics Quarterly, Cambridge University Press, vol. 16(4), pages 533-557, October.
    11. Wayne Norman, 2011. "Business Ethics as Self-Regulation: Why Principles that Ground Regulations Should Be Used to Ground Beyond-Compliance Norms as Well," Journal of Business Ethics, Springer, vol. 102(1), pages 43-57, March.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. David Silver, 2021. "Democratic Governance and the Ethics of Market Compliance," Journal of Business Ethics, Springer, vol. 173(3), pages 525-537, October.
    2. Samanthala Hettihewa & Lori S. Kopp & Christopher S. Wright, 2019. "Ethics/Virtues and Consequences: An Exploratory Study of Regional Small Businesses in Developed and Emerging Countries," International Journal of Business and Economics, School of Management Development, Feng Chia University, Taichung, Taiwan, vol. 18(1), pages 17-40, June.
    3. Almudena Martínez-Campillo & Mahinda Wijesiri & Peter Wanke, 2020. "Evaluating the Double Bottom-Line of Social Banking in an Emerging Country: How Efficient are Public Banks in Supporting Priority and Non-priority Sectors in India?," Journal of Business Ethics, Springer, vol. 162(2), pages 399-420, March.
    4. Frooman, Jeff, 2021. "Where MLM Intersects MFA: Morally Suspect Goods and the Grounds for Regulatory Action," Business Ethics Quarterly, Cambridge University Press, vol. 31(1), pages 138-161, January.
    5. Michael A. Sartor & Paul W. Beamish, 2020. "Private Sector Corruption, Public Sector Corruption and the Organizational Structure of Foreign Subsidiaries," Journal of Business Ethics, Springer, vol. 167(4), pages 725-744, December.
    6. Jeffrey Moriarty, 2020. "On the Origin, Content, and Relevance of the Market Failures Approach," Journal of Business Ethics, Springer, vol. 165(1), pages 113-124, August.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Frooman, Jeff, 2021. "Where MLM Intersects MFA: Morally Suspect Goods and the Grounds for Regulatory Action," Business Ethics Quarterly, Cambridge University Press, vol. 31(1), pages 138-161, January.
    2. Jeffrey Moriarty, 2020. "On the Origin, Content, and Relevance of the Market Failures Approach," Journal of Business Ethics, Springer, vol. 165(1), pages 113-124, August.
    3. Miguel Alzola, 2018. "Decent Work: The Moral Status of Labor in Human Resource Management," Journal of Business Ethics, Springer, vol. 147(4), pages 835-853, February.
    4. John F. Gaski, 2022. "Toward social responsibility, not the social responsibility semblance: marketing does not need a conscience," AMS Review, Springer;Academy of Marketing Science, vol. 12(1), pages 7-24, June.
    5. Pies, Ingo & Hielscher, Stefan & Beckmann, Markus, 2008. "Corporate citizenship as stakeholder management: An ordonomic approach to business ethics," Discussion Papers 2008-4, Martin Luther University of Halle-Wittenberg, Chair of Economic Ethics.
    6. Valentinov, Vladislav, 2023. "Stakeholder theory: Toward a classical institutional economics perspective," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 188(1), pages 75-88.
    7. Abraham Singer, 2018. "Justice Failure: Efficiency and Equality in Business Ethics," Journal of Business Ethics, Springer, vol. 149(1), pages 97-115, April.
    8. Ingo Pies & Philipp Schreck & Karl Homann, 2021. "Single-objective versus multi-objective theories of the firm: using a constitutional perspective to resolve an old debate," Review of Managerial Science, Springer, vol. 15(3), pages 779-811, April.
    9. Pasi Heikkurinen & Jukka Mäkinen, 2018. "Synthesising Corporate Responsibility on Organisational and Societal Levels of Analysis: An Integrative Perspective," Journal of Business Ethics, Springer, vol. 149(3), pages 589-607, May.
    10. Joseph Heath, 2011. "Business Ethics and the ‘End of History’ in Corporate Law," Journal of Business Ethics, Springer, vol. 102(1), pages 5-20, March.
    11. Vladislav Valentinov, 2023. "Stakeholder Theory: Toward a Classical Institutional Economics Perspective," Journal of Business Ethics, Springer, vol. 188(1), pages 75-88, November.
    12. Steen Thomsen, 2001. "Business Ethics as Corporate Governance," European Journal of Law and Economics, Springer, vol. 11(2), pages 153-164, March.
    13. Marc A. Cohen & Dean Peterson, 2019. "The Implicit Morality of the Market and Joseph Heath’s Market Failures Approach to Business Ethics," Journal of Business Ethics, Springer, vol. 159(1), pages 75-88, September.
    14. Michał Jurek, 2014. "The genesis and evolution of CSR self-regulation with special refer-ence to the case of financial institutions," Working papers wpaper70, Financialisation, Economy, Society & Sustainable Development (FESSUD) Project.
    15. David Silver, 2021. "Democratic Governance and the Ethics of Market Compliance," Journal of Business Ethics, Springer, vol. 173(3), pages 525-537, October.
    16. Christian Voegtlin & Michelle Greenwood, 2016. "Corporate social responsibility and human resource management: A systematic review and conceptual analysis," Post-Print hal-01481479, HAL.
    17. Matthew Caulfield, 2023. "Between Markets, Politics, and Ethics: On Vendor Conscience and Impersonal Markets," Journal of Business Ethics, Springer, vol. 188(2), pages 307-326, November.
    18. Pierre-Yves Néron, 2016. "Rethinking the Ethics of Corporate Political Activities in a Post-Citizens United Era: Political Equality, Corporate Citizenship, and Market Failures," Journal of Business Ethics, Springer, vol. 136(4), pages 715-728, July.
    19. Johannes Jahn & Rolf Brühl, 2018. "How Friedman’s View on Individual Freedom Relates to Stakeholder Theory and Social Contract Theory," Journal of Business Ethics, Springer, vol. 153(1), pages 41-52, November.
    20. Lakshmi, Geeta, 2018. "Gekko and black swans: Finance theory in UK undergraduate curricula," CRITICAL PERSPECTIVES ON ACCOUNTING, Elsevier, vol. 52(C), pages 35-47.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:kap:jbuset:v:150:y:2018:i:3:d:10.1007_s10551-016-3175-x. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.