Dissecting the empirical-normative divide in business ethics

Abstract

Purpose This paper aims to probe the limits of the empirical-normative divide as a conceptual framework in business ethics. Design/methodology/approach A systems theory perspective debunks this divide as a false distinction that cannot do justice to the conceptual complexity of the field of corporate social responsibility (CSR) scholarship. Findings Drawing on the systems-theoretic ideas of Niklas Luhmann and the “Laws of Form” by George Spencer Brown, the paper shows that the divide may be dissected into a four-cell matrix constituted by two other distinctions-descriptive vs prescriptive and categorical vs hypothetical-the latter of which was seminally suggested by Donaldson and Preston (1995). Practical implications The emerging four-cell matrix is shown to centrally embrace the multiplicity of normative, empirical and instrumental approaches to CSR. This multiplicity is exemplified by the application of these approaches to the phenomenon of CSR communication. Social implications A more general implication of the proposed argument for the field of business ethics is in tracing the phenomena of moral diversity and moral ambivalence back to the regime of functional differentiation as the distinguishing feature of the modern society. This argument drives home the point that economic operations are as ethical or unethical as political operations, and that both economic and political perspectives on ethical issues are as important or unimportant as are religious, artistic, educational or scientific perspectives. Originality/value In contrast to the empirical-normative divide, the perspective is shown to centrally embrace the multiplicity of normative, empirical and instrumental approaches to CSR.

Diabolical perspectives on healthy morality in times of COVID-19

“…The self-stabilising moral code offered new functional systems a relevant specificity, thus serving the specific function of moralising in specific educational, political, scientific, legal, health issues. What is morally detested in one systemic context might—and often is—assessed by diverging moral standards in another functional context, even leading to indifference altogether, thus constituting a specific “modern” challenge for organisations engaging across functional boundaries (Roth et al , 2020a). Aside from organisational issues (often managed by creating internal structures of differentiation), corporeal existence has limited capacity for adaptation.…”

Isn’t it time we transitioned to integrated sustainability? De-codifying the hard-soft divide from a systems-theoretic perspective

“…This system-environment tension is of considerable importance in contexts of degrowth marked by short-term market imperatives (Roth, 2016), and if applied to the context of the firm, this theory helps to develop the reflection on integrating the firm system, with all its subsystems, into the natural system (Plaza-Úbeda et al, 2020). Contrastingly, in Luhmann's (1995) perspective, such tensions occur as a result of functional differentiation between multiple function systems (Roth, 2017;Roth et al, 2019;Valentinov and Hajdu, 2019). More broadly, the complexity-sustainability trade-off developed by Valentinov (2014) provides a solid conceptual foundation for navigating the dynamics of systems, including especially the business system, in their relation with the environment and their implications on societal sustainability at large.…”

“…Against this backdrop, it appears that investigating a "reconciliation" route in the instrumental-normative divide, assuming the divide is real (Roth et al, 2019), boils down to excavating pathways for devising adapted de-codification mechanisms that would defy the presumed chasm separating instrumental/hard methods and normative/soft ones. In other terms, could an "augmented use" of these methods, enclose within the necessary and sufficient de-codification mechanisms needed to make both ends conveniently "meet and talk"?…”

Does national ethical judgement matter for earnings management?

“…Indeed, most financial accounting issues deal with matters of human behaviour, namely, the judgements and decisions of managers (Koonce and Mercer, 2008). The ethical issues involved in the financial reporting process have long been a concern of the accounting profession (Grasso SAMPJ 13,2 et al, 2009), involving both mandatory (Satava et al, 2006) and voluntary disclosure (Roth et al, 2019). Although managers' flexibility in accounting choices is inherent to the practice, many consider that higher levels of earnings management are tantamount to unethical practices (Grasso et al, 2009).…”