Why ‘Corporate Ethics’ is Usually an Oxymoron

David Brooks, as he occasionally does, knocks it out of the park in The End of Philosophy, in yesterday’s NY Times. The subject: moral reasoning.

Wait wait–don’t run away! It’s interesting–I promise!

We often think of morality as principles-driven. Whether religious or philosophical, if we hear “moral,” we’re inclined to think rule-following or deductive reasoning of some kind.

Not so, says Brooks, surveying current literature. Moral reasoning is much more emotional and intuitive than we think. It evolves evolutionarily, as part of our social development. Which, interestingly, puts it on a par with competition.

Evolution isn’t just survival of the fittest. Evolution also favors those groups who have learned to cooperate—competition isn’t just individual, it’s between collaborating groups.

Which means the urge to collaborate is about on par with the urge to compete. Both come from the same parts of the brain, the emotional centers.

This makes common sense on several dimensions. One is that ethics is fundamentally about relationships—not about rules. Even Immanuel Kant—about as principles-based a philosopher as they come—agrees with this (ethics consists in treating others as ends, not means).

Quick cut to business ethics programs. Sometimes phrased as “ethics and compliance” programs. Which leads us to oxymoron number 1: if you’re talking about complying with the law, you’re probably not talking about ethics.

When Harvard Business School started its ethics program in 2004, here’s how the new course (Leadership and Corporate Accountability) was positioned:

"LCA stems from a belief that business leaders play a crucial role in society. They and the companies they build and lead are expected to deliver strong financial results for investors, superior goods and services for customers, attractive work environments for employees, and innovative ideas for the future. At the same time, they are expected to observe the laws of the countries in which they operate, respect society’s ethical standards, and contribute to the communities of which they are part."

It’s hard not to see this as a course about the art of balancing. Balancing competing demands is something at which HBS does a wonderful job. But the course sounds no different at root from other courses that describe balancing competing constituencies in marketing, or production, or business strategy.

Corporate ethics, by this view, is far more corporate than ethical. It is about navigating a company through a minefield of, among other things, people who believe in something called “ethics.”

This view of ethics is to real ethics as a professor of religion is to a churchgoer. Oxymoron Number 2 is “corporate ethics.”

Programs like this almost always still have one assumption at root: the survival of the corporation in a complex, often hostile world. That is the same assumption at the heart of a course in corporate strategy. Proof? How many ethics courses contemplate the disollution of the company? About as many as strategy courses envisioning the same. Zilch.

Just as Machiavelli linked war and negotiation as alternative means to the success of the State, this view links strategy and ethics as alternative means to the success of the Company. In this environment, cooperation is not about ethics–it’s about negotiation to achieve competitive aims. It’s cooperation as means, not ends. It’s not ethical.

No surprise. Machiavelli doesn’t come to mind as a foremost ethicist.

The continued existence and prosperity of a Corporation or a State is very much what competition is about. It is not at all what ethics is about. In an increasingly connected world, a course about ethics would talk about the value of collaboration across and between companies, and how to manage based on it. I don’t see that happening.

Competition and ethics may both derive from evolutionary, emotional sources. But as long as one is subordinated to the other—as long as they’re teaching ethics down the hall from competitive strategy, with a common philosophical goal of corporate competitive success–the winner will be competitive strategy, and the loser will be ethics. No contest.

Too bad, because old-think in a new world is not what we need.