The Relative Role of the Intellectual and Moral Virtues in Sustainable Management Decisions: The Case of Practical Wisdom and Justice

Abstract

We analyze the status of virtues in management by going in some depth into the two main virtues, justice and practical wisdom. We next study how ethics requires that all virtues should be present under the ideal concept of a ‘unity of virtues’ for a completely wise person and discuss the practical limitations of this concept. Then, we draw a framework for decision making depending on whether the decision maker possesses justice and practical wisdom or lacks one of them and then discuss which one is better to have. We conclude that justice is more important, as it is about setting objectives and prioritizing, whereas practical wisdom is about attaining these objectives, once listed, in a rationally wise and contextual way. Hence, we conclude that objectives (justice) must come first, because this makes it more likely that, in the end, practical wisdom is developed, and thus we end up having the two virtues.

Practical Wisdom for Sustainable Management and Knowledge Sharing

“…These changes often affect the character of the organization, at least in the long-run, but often also in the short-run. Recently, the new demands on managing require strategies that must incorporate being sustainable, in the three dimensions-economic, social, and environmental-that would need to include aspects of knowledge management and ethics [16,17].…”

“…Then, "automatic" systems in management that have become fashionable in the last few decades (balanced scorecards, key performance indicators-KPIs, big data and analytics, and so on) are doomed to failure, as the concept of knowledge required is close to the intellectual virtue of phronesis, as we are going to examine in the following examples of real managerial issues. This knowledge can be shared by example, and at the same time allow to be complemented with moral virtues regarding which objectives are morally sound to be pursued, as it is the case of justice [16,17].…”

“…We will proceed as follows. First, we will review two essentially antagonistic approaches to management that coexist nowadays and show how we want to take a different approach where phronēsis is an essential element for sustainable management practices [16,17]. Next, we will review the decision-making process, to show that in complex, non-operational decisions, there is always some kind of "experiential information" which prevents us from finding a merely technical solution to the decision problem, especially if we want to build and share knowledge in organizations, that is particularly important in social sustainable management [16].…”

“…Next, we will review the decision-making process, to show that in complex, non-operational decisions, there is always some kind of "experiential information" which prevents us from finding a merely technical solution to the decision problem, especially if we want to build and share knowledge in organizations, that is particularly important in social sustainable management [16]. We then go back to Aristotle's analysis of different types of knowledge, to show how the Aristotelian concept of phronēsis fits in the decision-making process, and particularly allows to improve management virtues which are seen as crucial in sustainable managerial decision-making processes [17].…”

Untitled

“…Management Control Systems have been often considered as the main tool for managing organizations (Anthony and Govindarajan, 2003;Chong, 2013;Merchant and Van der Steede, 2007;Cugueró-Escofet and Rosanas, 2020a). Setting objectives, measuring, evaluating and taking control action are the main activities of such systems.…”