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Democratic Governance and the Ethics of Market Compliance

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  • David Silver

    (The University of British Columbia)

Abstract

The “question of reasonable compliance” concerns how business firms should comply with morally reasonable laws that have been democratically enacted. This article argues that, out of respect for the governing authority of democratic citizens, firms should comply with the law in accordance with legislators’ normative expectations of compliance. It defends this view against arguments from the legal, economic and business ethics literatures that focus on the contentious nature of democracy and the competitive nature of the market. In response this article argues that these adversarial features of democracy and capitalism do not limit the ability of democratic legislatures to set normative expectations of market actors, nor the duty of firms to comply with them.

Suggested Citation

  • David Silver, 2021. "Democratic Governance and the Ethics of Market Compliance," Journal of Business Ethics, Springer, vol. 173(3), pages 525-537, October.
    • Handle: RePEc:kap:jbuset:v:173:y:2021:i:3:d:10.1007_s10551-020-04523-3
    DOI: 10.1007/s10551-020-04523-3
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    References listed on IDEAS

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    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.
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    6. James Alm & Kim M. Bloomquist & Michael McKee, 2017. "When You Know Your Neighbour Pays Taxes: Information, Peer Effects and Tax Compliance," Fiscal Studies, Institute for Fiscal Studies, vol. 38, pages 587-613, December.
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    8. Abraham Singer, 2018. "Justice Failure: Efficiency and Equality in Business Ethics," Journal of Business Ethics, Springer, vol. 149(1), pages 97-115, April.
    9. Singer, Abraham & Ron, Amit, 2020. "Prioritizing Democracy: A Commentary on Smith’s Presidential Address to the Society for Business Ethics," Business Ethics Quarterly, Cambridge University Press, vol. 30(1), pages 139-153, January.
    10. Alm, James & Shimshack, Jay, 2014. "Environmental Enforcement and Compliance: Lessons from Pollution, Safety, and Tax Settings," Foundations and Trends(R) in Microeconomics, now publishers, vol. 10(4), pages 209-274, December.
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    12. 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.
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    Cited by:

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    2. Michael Bennett, 2023. "Managerial Discretion, Market Failure and Democracy," Journal of Business Ethics, Springer, vol. 185(1), pages 33-47, June.

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