Mihailis Diamantis (University of Iowa – College of Law) has posted Corporate Virtue and Vice (in The Nature of Corporations (Jonathan Hardman, Stever Kourabas, Billie Lytheberg, Christoph Van der Elst & Susan Watson eds., 2027)) on SSRN. Here is the abstract:
Authorities and academics primarily evaluate corporations through their behavior. But consumers, investors, and many corporate professionals implicitly evince an alternative perspective. For them, what matters is not just what corporations do, but also the deeper structures behind corporate behavior. While corporations might innovate, they can also be innovative. While they might lie, they can also be dishonest. Such traits of character vary from corporation to corporation, anchoring predictable patterns of behavior. Judgments about corporate character shape how people, both professional and lay, respond to the businesses they interact with on a daily basis.
This chapter introduces virtue theory as a framework for formalizing this lay perspective on corporations. The virtue ethical picture turns on an understanding of corporate purpose and of the internal business mechanisms that reliably realize or thwart it. The practical orientation of authorities and academics, which fixates on corporate action rather than on deeper corporate structure, generates several well-known corporate pathologies, like managerial short-termism and criminal recidivism. By excavating and systematizing the theory and governance structure of corporate virtue and vice, lawmakers might uncover more reliable techniques for understanding, evaluating, and influencing corporate conduct.
Highly Recommended!
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