3. A Virtue-Based Approach to Business Ethics: Insights from Aristotle and Sociobiology

The most prominent example of social Darwinism in the world of business is probably Milton Friedman, whose view is clearly expressed in the famous article “The Social Responsibility of Business is to Increase its Profits” (Friedman 1970). See also Berger et al.: “For decades, the late Milton Friedman served as the icon for those who believed that in a free enterprise, private-property system the only responsibility of business is to maximize wealth for the firms’ stockholders (within the constraints of the law and ethical custom” 2007).

This paper will not discuss deontological approaches to business ethics as they are rather rare and nowhere near as prevalent as utilitarian forms of business ethics. The possible boundary-crossings between virtue ethics and deontological ethics deserve a separate discussion as deontology and virtue ethics are in many ways a more “natural fit” than are virtue ethics and utilitarianism – both forms of ethical theory draw on the importance of intentions and motivations, and both are, to a degree, concerned with character. Furthermore, every virtue has its equivalent in a “deontological rule:” courage implies the imperative “be courageous,” honesty demands one “be honest,” etc. Since utilitarianism is more common in business ethics, and because it is straightforwardly at odds with virtue ethics, this paper focuses on the flaws of this moral theory rather than on deontological ethics.

“The principle of utility,” Bentham states, is “that principle which approves or disapproves of every action whatsoever, according to the tendency which it appears to ave to augment or diminish the happiness of the party whose interest is in question” (Bentham 1948). Compare John Stuart Mill: “The Greatest Happiness Principle holds that actions are right in proportion as they tend to promote happiness, wrong as they tend to produce the reverse of happiness” (Mill 2001).

There are, of course, more complex forms of utilitarianism which do take into account matters of character. Mill, for instance, argues that we should act in a way that corresponds to our “innate sense of dignity” and so introduces a non-consequentialist element into his theory. This paper engages only what could be called “straightforward utilitarianism,” the theory that judges an action as right or wrong based on consequences alone. By introducing a “sense of dignity,” Mill arguably moves away from “pure” utilitarian in the direction of either deontology or virtue ethics, or both.

As Aristotle puts it: “Every excellence we choose indeed for [itself]... but we choose [it] also for the sake of happiness, judging that through [it] we shall be happy” (1734).

“Companies need to view their commitments to corporate responsibility as one important part of their strategy, but not let the commitment obscure their broad strategic business goals. … companies and their leaders can make important contributions to the common good while advancing their broader financial and market objectives” (Pearce and Doh 2005).