Competitive Markets, Corporate Firms, and New Governance—An Ordonomic Conceptualization

Abstract

Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in III AbstractThe purpose of this article is to develop an ordonomic conceptualization of corporate citizenship and new governance that (a) provides a framework for positively explaining the political participation of companies in new governance processes and (b) does not weaken but instead strengthens the functional role of corporations as economic actors in the market system of value creation. To this end, we develop our ordonomic approach in a critical discussion of Milton Friedman's stance on the social responsibility of business in three steps.(1) The ordonomic perspective on the economics ethics of competitive markets argues that the social responsibility of business does not lie in maximizing profits but in addressing societal needs through the mutually advantageous creation of value. (2) The ordonomic approach to the business ethics of corporate actors claims that corporate firms can use moral commitments as a factor of production. (3) The ordonomic perspective on the process ethics of new governance holds that companies can act not only as economic actors but also participate as political and moral actors by taking ordo-responsibility in processes of new governance. This role of corporate citizens in the new governance does not weaken but, instead, strengthens the role of business firms as economic agents for value creation.

How do Companies Invest in Corporate Social Responsibility? An Ordonomic Contribution for Empirical CSR Research

“…Drawing on the ordonomic approach, we embed the idea of corporate social responsibility (CSR) in the wider liberal notion that companies are agents of social value creation [34]. We develop this ordonomic concept in four steps.…”

“…Yet in contrast to Friedman's idea, companies do not operate within an ideal framework of perfect market institutions. In the ‗real' world, companies have to deal with systematic incompleteness-with an incomplete institutional order of competitive markets and with incomplete contracts for market transactions [34].…”

“…Yet, embedding the corporation into the system of market competition and its indisputable moral quality, a claim for social responsibility cannot simply mean abandoning the profit principle in conflicts between profit and morality. Therefore, any role of business in society must be compatible with the real-world market system, and must be founded on the premise that companies are societal agents for mutually advantageous value creation [34].…”

Why Do Corporate Actors Engage in Pro-Social Behavior? A Bourdieusian Perspective on Corporate Social Responsibility

“…Hence, corporations are understood not only as economic but also political actors that have the duty to engage in political processes in order to fill the regulatory vacuum of contemporary societies. This political role enlarges corporate activity significantly as corporations are not only said to serve markets but fulfill political functions such as supporting health care systems, fighting corruption, providing education or preserving peace (Logsdon and Wood, 2002;Pies et al, 2011). To cope with such tasks, corporations have to subdue their economic calculus and install a governance mode according to democratic principles (Gilbert et al, 2011;Steinmann and Scherer, 1998) which will grant them moral legitimacy.…”

The Ordonomic Approach to Business Ethics

“…1 Some book publications include Pies (2008) [How to Fight Corruption], Pies (2009a) [Morality as Heuristics], Pies (2009b) [Morality as a Production Factor], Pies (2012) [Rule Consensus instead of Value Consensus], Pies (2015) [Good Advice Need not be Expensive]. 2 Characteristic contributions include Pies, Hielscher, Beckmann (2009), Pies, Beckmann, Hielscher (2010), Pies, Beckmann, Hielscher (2011), Hielscher, Pies, Valentinov (2012, Valentinov, Hielscher, Pies (2013), , , , Pies, Will, Glauben, Prehn (2015), Beckmann, Pies (2016), Hielscher, Pies, Valentinov, Chatalova (2016), , Will, Pies (2016), Hielscher, Winkin, Crack, Pies (2017), Pies (2017). -For a general overview cf.…”