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UCR BUS 102 Aristotelian Answer Reading Notes

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姝 Academy of Management Learning & Education, 2006, Vol. 5, No. 1, 68 – 81.
Can We Teach Character?
An Aristotelian Answer
Rutgers University
Business ethics courses can help improve our students’ ethics by teaching them about
character, as opposed to just principles, the application of which creates difficulties. In
particular, we can help our students consider their values and realize them in practice.
According to Aristotle, ethics is about virtue, which is a matter of one’s own well-being
primarily, but as we are rational and social creatures, this state of well-being entails
having what we would consider good moral values. Does good character really serve the
agent’s interests? Yes, if the agent has the right interests, and interests can be cultivated
to some degree. One’s values must be coherent, and one must be able to discern the
salient moral features of the situations with which one deals. These are marks of good
character, which the culture of one’s organization may nurture or undermine. We arrive
at principles supportive of good character by reflective equilibrium, a process like what
Aristotle calls dialectic. Case studies assist our students in developing good character
and learning to bring it to bear in complex situations, as some recent research has
suggested is possible. One way to protect one’s character, our students may learn, is to
choose a workplace that does not undermine it.
the right thing to do. But so-called virtue ethicists,
following Aristotle’s Nicomachean Ethics (hereafter NE), argue that the moral principles on which
we can reach a consensus are usually vague, often
in conflict, seldom unexceptionable, hence not reliably action-guiding. MacIntyre (1981) is the best
known of these, though Anscombe (1997) and Foot
(1997) were pioneers. Williams (1981, 1985), Slote
(1983, 1992, 2001), McDowell (1997), and Hursthouse
(1999) have been influential as well. Solomon
(1992), Koehn (1998), Walton (1997, 2001, 2004) and
Moore (2002, 2003) emphasize virtues and character
in business ethics.
Even most of these virtue ethicists do not entirely rule out principles, however. A generous
person acts according to principles derived from
the nature of generosity; so Hursthouse argues
concerning what she calls v-principles. For example: a generous person happily lends money
to needy friends even if they may not be able to
pay it back. As generosity is a virtue, one ought
to act on the principle (among others) that one
should happily lend money to needy friends even
if they may not be able to pay it back. An ungenerous person can know the applicable principles
but be stingy anyway; so what good is mere
knowledge of the principles?
What Ethics is About
One might wonder whether business ethics
courses are of any value. We sometimes hear this:
If character is formed in childhood, how can a
course improve a student’s character? The question whether good character is teachable, and if so
by whom, is as old as Socrates (see the Meno,
Plato/Bluck, 1961). The issue for us here is whether
character can be taught in business school. One is
tempted to add, “of all places.” I shall argue for an
affirmative answer.
The assumption that teaching business ethics
entails improving character is at odds with the
widespread view that ethics is not about character
primarily but about principles that an agent can
apply to situations in business or elsewhere to find
Thanks go to Katherina Glac, a most valuable research assistant. Dennis Moberg, Amanda Anderson, and Dennis Patterson
offered helpful advice on different essays of mine on related
issues. Mikhail Valdman gave me good ideas on several topics.
James Bailey, Mark Seabright, Patricia Werhane, Geoff Moore,
and Robert Audi offered feedback useful to the readers of this
essay as well as its author. Thanks also to the Prudential
Business Ethics Center at Rutgers, which supported the research on this work.
Even if an ethical person is one who acts according to certain principles, it does not follow that the
best way to teach Smith to be ethical is to give her
principles to follow. By analogy, we can show that
she is an excellent employee by stating her sales
figures, but a training professional will focus on
her knowledge and skills as a way of improving
her sales figures. The analogue in ethics is improving Smith’s character as a way of causing her to
act according to appropriate moral principles (see
Hartman, 1998: 547f.).
A virtuous person is a person of good character.
We may define character as one’s standard pattern
of thought and action with respect to one’s own
and others’ well-being and other major concerns
and commitments; so, approximately, Kupperman
(1991: 17). Character includes virtues and vices and
entails certain values, dispositions, and emotions
as well as actions. Aristotle suggests not only that
one’s character ought to be consistent over time
and coherent at all times, but also that character is
essential to personal identity. In a person of good
character, virtues and values are reinforced by appropriate dispositions and emotions. And why is
character important? What could be more important? Maintaining your character is tantamount
to continuing your life (see NE IX 4: 1066a13–29,
According to Aristotle, we have certain enduring
desires that can serve as premises of so-called
practical syllogisms—in effect, as good reasons to
act. These desires have to do with our well-being
and with our most important concerns and commitments. So a person of generous character acts generously, wants to do so, and thinks it good to do so.
If you are generous, you are and want to be motivated by thoughts like this: “Jones needs help, so I
want to help him,” although one need not be quite
so self-conscious. The next-best thing, short of a
generous character, is mere acceptance of one’s
moral obligation: “Jones needs help, so I suppose I
ought to help him, so all right, here I go.” To be a
person of truly generous character is to have and to
want to have a settled disposition to help a friend
in need, with emotions to match. It entails wanting
to be consistently motivated by a friend’s need. (A
desire to have a desire is what Frankfurt, 1981,
calls a second-order desire.) Some of our enduring desires and dispositions, especially those
concerning the sort of person we want to be, we
call values.
Parents tell children not to lie, as employers tell
new employees not to be late for work. Beyond that,
however, many parents raise children to be honest—that is, to be inclined not to lie, to feel some
repugnance when lying even in circumstances that
justify it. A v-principle that proscribes lying will be
fairly unresponsive to utilitarian considerations.
Employers, similarly, want employees to work well
out of genuine loyalty. Virtues involve certain dispositions and attitudes. Consider gratitude: When
you give me a generous gift, I ought not only to
thank you but also to be actually grateful. Ethicists
who rely just on principles have a hard time saying
why one ever has an obligation to be grateful, or to
care about one’s employer’s success. But those who
believe that one has an obligation to be grateful
must defend the view that one is morally responsible for one’s feelings, which are not typically
voluntary. Aristotle suggests that while you cannot
make yourself feel grateful on a particular occasion you can over time become the sort of person
who is grateful on appropriate occasions (see NE I
3: 1095a2–13). If he is right, it is not absurd to try to
help make a student a certain sort of person.
Teaching Ethics
Even if we cannot mold our students’ character,
business ethics courses have some value if they
help students who already want to be ethical businesspeople get better at it. Business ethics courses
can encourage morality by raising critical questions about the standard economist’s definitions of
morally significant concepts (utility, maximization,
and rationality, for example) and presuppositions
about behavior (facile egoism, for example). We
can also teach well-meaning students some techniques for deciding what the right thing is. We can
teach them how to create organizations that encourage rather than punish doing the right thing.
All this is worthwhile, but recent corporate scandals suggest the need for business ethics courses
that will improve the character even of those future
businesspeople that are not clearly predisposed to
work and play well with others. My claim is that a
business ethics course can improve students’ character by helping them think critically about their
values and realize them in practice. Those two
activities are essential to character development.
Still, no ethics course will much affect a student
who, after careful consideration, believes that the
one who dies with the most toys wins in the zerosum game that is business and that s/he wants to
be such a person. Nor can we do a great deal for
people incapable of developing any skill in dealing with complex situations, or those incapable of
doing anything other than what nearly everyone
else is doing. Not every student is in such bad
moral condition, however, and we can reach the
ones that are not.
Academy of Management Learning & Education
Aristotle on Well-Being and Ethics
Character and Interests
In Aristotle’s view, every substance, including the
human being, has an essence and an associated
end or purpose. We are essentially social and reasoning creatures; our natural end is therefore to
live in communities and to think and act rationally.
If you reach your actuality as a person, you are
virtuous (or, on an alternative translation, excellent). You are in a state of eudaimonia, a particularly broad, deep, long-lasting form of well-being
characteristic of good character and psychological
health—health being a normative notion (see especially Prior, 2001). Aristotle would find asking
what reason I have to be virtuous as odd as asking
what reason I have to be healthy.
Aristotle holds that your character is a matter of
what you enjoy doing (NE II 3: 1104b5ff.): good
things if you are a good person, bad things if you
are a bad one. Good character is therefore a matter
not only of doing the right thing but also of having
the right desires and emotions (NE X 8: 1178a9 –24,
etc.). You should be grateful for kindnesses, angry
if and only if you are seriously wronged, sympathetic toward the wretched. If you do the right thing
while gritting your teeth, you are not really a person of good character, and virtuous action is not in
your best interests. The person of good character
has an enjoyable life, acting rationally and doing
good things, unless misfortune intervenes.
Elster (1998), who acknowledges a debt to Frank
(1988), argues that certain emotions supplement
rationality. His view is similar to that of Aristotle,
who believes that desires may be rational or irrational, whereas Hume and those that he has influenced believe that rationality is a characteristic
only of the way in which we choose means when
the desired ends are given. In any case, there is
broad support for the view that appropriate emotion is required to support moral behavior. Psychopaths typically know what is right, but their knowledge has no emotional support; so say Cleckley
(1976) and Hare (1993). The brain-damaged Phineas
Gage, described by Damasio (1994: 3–33), is an excellent and appalling example.1
Aristotle’s view raises an obvious question for
us, who think of ethics as encompassing others’
interests, not just one’s own. What reason is there
to believe that being a person of good character in
Aristotle’s sense is good not only for that person
Haidt (2001, esp. 824) discusses these works in an article on
emotion and reason. Walton (1997) notes similarities between
Aristotle’s views and Damasio’s.
but for others too? To put it another way, why is a
virtue like generosity, for example, good for the
agent? Aristotle’s answer is that, since human beings are social creatures, the good life, hence good
character, involves living satisfactorily in a congenial community. So your virtues cause you to benefit your family and friends and people in your
community. We can think of an organization as a
community—arguably the emerging preeminent
kind of community. Virtue ethics in the Aristotelian
tradition takes status in the community seriously,
does not presuppose equality as a good, and deemphasizes rights. So it fits well with how most
people view organizations and their employees. As
Walton (2001, 2004) notes, in NE III Aristotle describes a good polis—not unmanageably large,
united in purpose, with distributed but not necessarily democratic decision-making authority—
much as we would a good organization.
Aristotle’s form of egoism is useful in dealing
with business students, who want to know how
studying ethics can add value to a career in business. Kantians would argue that morality needs no
support from self-interest, but Aristotle’s claim that
psychological health and good character coincide
speaks to our students’ self-regarding concerns.
Aristotle argues that if you behave stingily, you
will become a stingy person. But what if you want
to be a stingy person? Won’t you enjoy your stinginess? Why then should our students try to be
people of good character? Getting to Aristotle’s
answer requires considering his moral psychology. In doing so I largely agree with Irwin (1988),
but Nussbaum’s (1990) and Sherman’s (1994) accounts are useful as well.
Values and Strength of Character
We say that people of good character have good
values. That formulation does not distinguish between values in the moral sense—the usual meaning of the term values—and what one considers
good for oneself. From the point of view of Aristotle’s brand of egoism, however, it makes sense to
say that the two are identical. This is not absurd.
Many people who give values any thought would
prefer to be driven by morally good ones (Jones &
Ryan, 2001). We have enough self-respect that we
like to think of ourselves as wise, mature, rational,
and courageous. I perform a vindictive act and tell
myself that it is just. I lose my nerve in confronting
the boss and tell myself that I am being diplomatic.
So we provide students with motivation as well as
information when we teach them that, for example,
courage requires not acting impulsively in a macho culture.
Wise and mature people have desires largely
determined by their values. In fact some philosophers (e.g., Watson, 1982) regard this determination
as definitive of autonomy. Ideally we would want
to be so strong in character that we can choose to
be a person with emotions, values, and desires
that are consistent and good for us. That degree of
autonomy is rare, like being able to decide to crave
salads more than doughnuts. Aristotle claims that
the right upbringing in a good community and long
practice are necessary, though not sufficient, to
make us value and choose the right things. So one
way to choose to be a certain sort of person is to
choose to be in a certain sort of community.
Most of us have limited strength of character. We
cannot choose to enjoy courage and generosity at
all times; we find them occasionally burdensome.
And while one can habituate oneself to like doing
the right sort of thing, there are limits: No normal
person can learn to like root canal surgery. Good
people will not suffer the discomfort of pretending
to be, say, congenial, but virtues sometimes impose costs. Courage would not be courage if the
courageous person did not sometimes pay a price
for it. Honesty entails opportunity costs. But despite whether doing the honest thing always pays,
if you are a virtuous person you think yourself
better off on the whole for being the sort of person
who is inclined to do the honest thing.
What Is Good About Good Character: Choosing
One’s Interests
But why, a business student might ask, is it in my
interest to be a person of good character rather
than a stingy person? How do I know I’ll enjoy it
more? On the Aristotelian view, those are wrongheaded questions. Here is a better one: Given that
you want to serve your own interests, what do you
want your interests to be? Do you want to be the
sort of person who enjoys only overwhelming financial success? Or the sort of person who enjoys
a life in which work plays an important but not
dominant role and in which that work offers challenge, variety, growth, association with interesting
people, and compensation that lets you live comfortably? The question is not which one our students prefer. It is a higher-order question about
which one they would choose to prefer if they could
choose. That question cannot be readily answered
by reference to self-interest, since it is hard to see
what would count as a straightforwardly self-interested answer to the question, “What do you want
your interests to be?” (see Hartman, 1996: 80 – 83
and 134f. and Elster, 1985: 109 –140 on what the
latter calls adaptive preference formation).
There is a wise answer to that question if, as is
probable, most MBA students who give the second
answer are happier in the end than those who give
the first. Huge wealth is hard to come by, and many
people who achieve it enjoy it less than they expected to. Many who have retired from a successful
career say that if they had it to do over again they
would spend more time with their families. Why
didn’t they? Perhaps they were committed to a
conception of the good life based on peer pressure
rather than reflection.
Students need to understand that things can go
wrong because they can have mistaken beliefs
about the benefits of what they want. Most people
are not very good at “affective forecasting,” as it is
called. Gilbert, Pinel, Wilson, Blumberg, and
Wheatley (1998), Loewenstein and Adler (2000), and
others offer evidence that we cannot accurately
estimate how happy or unhappy some future
event, or our future success, will make us. Hence it
is not easy to know what sort of life you can enjoy.
We can begin to teach our students the necessary
self-knowledge and self-control by encouraging
them to reflect on their assumptions about what
will make them happy.
What should their reflection tell them about
choosing a conception of the good life if it cannot
be done just on the basis of self-interest? The Aristotelian view is that a wise person will choose to
be rational and social because that is the nature of
the human being. Indeed, we would probably reject the life of an animal or a happy idiot as being
unworthy of a human being, and would probably
not choose a life so barren that the smallest gains
make us feel wealthy and the most humdrum activities excite us (see Sen, 1987: 45f). Aristotle sees
no necessary connection between desire fulfillment and happiness, and he would invite us to
infer that we are better off consulting human nature, rather than our own unreliable expectations
and desires, on the question of what will make us
happy. In any case, a life empty of what is characteristically human falls short of Aristotle’s conception of happiness—and ours too, since few of us
envy happy idiots.
Even if we can never agree on an appropriate
conception of the good life, our consideration of the
issue shows how facile is the usual talk about
one’s interests and one’s pursuit of them, and helps
undermine students’ unreflective assumptions
about them. Perhaps under the influence of economists, we tend to believe that interests are fixed
and easily identified. We also tend to believe that
ethics is opposed to self-interest—that if Jones is
an ethical person, he characteristically puts others’ interests ahead of his own. (And if Smith does
Academy of Management Learning & Education
the same, how will she and Jones deal with each
other?) These tendencies make it easy for our students to assume that success is a matter of satisfying one’s greed and that it has little to do with
Coherence and Integrity as Reasons for
Good Character
Whatever life you choose, Aristotle believes, it
should have a certain wholeness, as he suggests
in saying that the continuation of character is the
continuation of one’s life. Just as a substance is not
a mere pile of stuff but has a certain form and
purpose, as Aristotle argues in the Metaphysics, so
a life is more than just a succession of experiences.
Part of his message is that happiness requires
desires that are consistent with one another and
with one’s values, and actions that are consistent
with one’s desires (so he says at NE IX 4: 1066b7–
11). In this he is echoed by psychologists like Festinger (1957), who argues that people desire coherence in their views. Chaiken, Giner-Sorolla, and
Chen (1996: 557) argue, similarly, that one wants all
of one’s attitudes and beliefs to be “congruent with
existing self-definitional attitudes and beliefs.”
If you are in that state of coherence, we would
say, you have integrity. If not, you will sometimes
desire, and may get, what you do not value. Valuing courage, you wish that you looked forward to
making the crucial presentation or did not dread
giving the boss negative feedback, but you are less
courageous than you would like to be. You are
better off as well as more virtuous if your values
and desires are consistent throughout. Most of us,
alas, are not like that. Valuing good health and
attractiveness, we wish the doughnut were not so
tempting. Valuing success, we envy those who look
forward to the required challenges. Or worse, as
Luban (2003, esp. 281–283) has argued, we may rearrange our desires and even restate our values to
rationalize our actions. That is the kind of coherence that Luban finds in Festinger. What is required, and difficult, is choosing values rationally
and with some detachment from what is immediately attractive and then acting on them—or at
least, when we have not acted on them, accepting
that we have not.
Integrity in this sense is probably not sufficient
for good character or for happiness, but it goes
some distance in the right direction. It is not possible to be both stupid and wise, or both irrationally risk-averse and courageous. On causal
rather than logical grounds, there are difficulties
in prizing both idleness and personal achievement, or heavy drinking and fitness, or feeling free
to be offensive and having many friends. But can’t
you do well if you hide your hostility or rapacity?
Aristotle says no. If you do it for strategic reasons,
as when people are watching, you will be doing
something that you don’t enjoy (NE IX 4: 1066b7–14).
In any case, like it or not, you are a communal
being, and your happiness depends in part on your
being a productive and congenial member of the
community. So you have good reason to be virtuous, and not merely to act sometimes as though
you were.
Most of us would recognize a greater variety of
possibly satisfying lives than does Aristotle. In
fact, most of us think that the room for choice
among possible lives is itself a good thing. At the
same time we respect the limits on that variety that
are implied by the requirements of our nature. As
our students plan their lives, we should encourage
them to consider their strengths and limitations,
their opportunities, and what they can and cannot
learn to enjoy. Some of them really will turn out to
enjoy a life of intense competition and high risk,
but we should not let them thoughtlessly assume
ahead of time either that whatever they happen to
want is possible or that they will enjoy it if they get
it or that it would be a good thing if they did.
Community and Culture
Organizations Affecting Character
We are essentially social creatures, and our character is malleable and vulnerable to some degree,
for organizations exert a powerful socializing and
sometimes corrupting influence. Sennett (1998) argues that this influence is usually inhospitable to
good character, but it need not always be. We can
teach our students how corporate culture, as well
as structures and systems, can be deployed to encourage and accommodate good character. Aristotle argues in NE I 2 that politics is the culmination
of ethics insofar as it creates a state that teaches
and supports good characters (see Walton, 2001,
2004, and Moore, 2003, against Koehn, 1998, on this
point). A community goes a long way toward determining its citizens’ values—what they count as
success, for example—for better or worse. By providing role models and in other ways, the culture of
a community may make a citizen want to be a
certain kind of person, motivated by certain considerations and not others. We can say the same of
corporate communities, and perhaps infer that
management rather than politics is today the culmination of ethics.
There is voluminous evidence that organizations
support or oppose ethical behavior. Fritzsche (1991)
argues that organizational forces may drive decisions more than personal values do and (2000) that
organizational climate can raise or lower the probability of ethical decisions. Jones and Hiltebeitel
(1995) find evidence of the effects of organizational
expectations on ethical choices. Sims and Keon
(1999) argue that the organizational characteristics
that most influence employees are situationally
determined, so the organization can foster both
ethical and unethical decision making. Trevino,
Butterfield, and McCabe (2001) offer a detailed and
complex account of the effects of ethical climate. I
have argued (1994, 1996) that corporate culture can
affect an employee’s second-order as well as firstorder desires: People in the grip of a powerful
culture adopt the local values and definition of
success and want to be motivated by what motivates their colleagues.
So great is the influence of the organizational
setting on employee behavior that Harman (2003)
and Doris (2002) argue that character does not matter. They base their conclusion in part on the arguments of social psychologists such as Nisbet and
Ross (1991) and invoke the familiar works of Milgram (1974) and Haney, Zimbardo, and Banks
(1973). But as Solomon (2003) points out, even in the
Milgram experiment there were a number of people who walked away. Trevino (1986) seems judicious in arguing that both organizational and personal attributes affect behavior. Many of the
arguments of those who dismiss character as an
independent variable would work equally well
against the concept of rationality, which Aristotle
takes to be a great part of good character (see
Rabin, 1998, and especially Haidt, 2001: 827f.). That
people act irrationally in ways not emphasized by
most economists is a familiar truth with a huge
literature attached (Kahneman & Tversky, 2000, are
preeminent on this issue) but not one that leads us
to discount it in all explanations.
We teach our students about organizational culture because we believe that as employees they
will be able to respond to it by recognizing it and
taking its possible effects into account. Few people
who know of the Milgram experiment would be so
obedient if they were subjects in a rerun of it.
Former students who have learned about the experiment in a business ethics course testify that
they do sometimes think of it when they are in
similar situations, and act accordingly. Beaman,
Barnes, Klentz, and McQuirk (1978) show that people can be inoculated against crowd-induced culpable indifference by being taught to recognize the
crowd’s influence and to act appropriately despite
it (see Slater, 2004: 109f.).
One might object that the available evidence
shows only that one’s behavior and immediate desires are affected by the ambient culture; one’s
character is a different matter, a harder thing to
change and hard to measure as well. But what
Aristotle means by character encompasses not
only values but also the readiness to act on them
and the ability to see how to do so in a particular
situation, however complex or difficult it may be.
Some people sincerely espouse a certain value—
say, the importance of courage—but do not act on it
because they do not recognize that speaking one’s
mind in this situation is what courage requires.
They are sincere, but they are not courageous. An
organization can do that to you. On the basis of a
number of studies of the impact of corporate culture, Chen, Sawyers, and Williams (1997) conclude that ethical behavior depends on the employee’s ability to recognize ethical issues and
that this ability appears to be a function of corporate culture more than of individual employees’ attributes.
Ethical behavior depends on the
employee’s ability to recognize ethical
issues and this ability appears to be a
function of corporate culture more than
of individual employees’ attributes.
This is an important finding about culture and
character. According to Aristotle, understanding
morally complex situations under salient descriptions and having the appropriate emotional reactions to them are central to character.
Character and Its Development
Ethical Knowledge and How It Fails
Aristotle says that having a virtue entails knowing
(though not necessarily being able to state) a principle of the form “It is a good thing for a person to
act in a certain way.” For example, “It is a good
thing for a person to eat dry food.” This is not to say
that Aristotle believes that dry food is appropriate
for all human beings in all circumstances, or that
in general his first premises are foundational or
unexceptionable principles of either nutrition or
morality. Specifications of principles of that sort
typically function as first premises of practical syllogisms. So you may start your deliberation with
this thought: “Eating dry food is good (i.e., nourishing) for a human being.” Since Aristotle assimilates the prudent and the ethical, he would also
accept as a first premise “Respecting other peo-
Academy of Management Learning & Education
ple’s property is good (i.e., just) for a human being.”
But Aristotle wants to explain a phenomenon that
we may regard as a mystery: We can claim with
apparent sincerity to value something—to know
that it is good— but intentionally act against our
Imagine a person well informed about nutrition
having breakfast. The choices are granola and a
doughnut. The breakfaster knows that granola is
better for human beings than are doughnuts, but
eats the doughnut because it is delicious. Similarly, the person who knows that it is good to respect others’ property may dump some garbage in
the neighbor’s field even though s/he knows that
that is no way to achieve long-term psychic satisfaction, just as eating doughnuts is no way to
achieve long-term health. In both cases the agent
acts against his or her values.
What has gone wrong? According to Aristotle,
one can intentionally do what one does not value
because there is something to be said for, as well
as against, eating doughnuts and running from the
enemy. One common form of weakness of the will
is a matter of acting on the wrong one of conflicting
principles. Indeed, in ethics, multiple considerations push us in conflicting directions, and there
is no algorithm for choosing the right principle
every time. That is a problem about ethics based
on principles. If you are a loyal employee of a
generally good company in which people whom
you respect decide to do something that you consider sleazy, how do you apply appropriate moral
principles as you decide what you should do about
it? That one should be loyal to one’s generally
good employer and that one should be courageous
in confronting immoral behavior are two good
moral principles, good v-principles in Hursthouse’s
sense. According to Aristotle, in many such cases
the best we can do is to rely on the intuitions of an
experienced person with a good moral track
record—that is, a person of practical wisdom (phronesis; the word is sometimes translated as prudence). If s/he says, “I’m just not comfortable with
that,” Aristotle takes the discomfort seriously, for
that emotion has cognitive weight.
One can act on a wrong principle as a result of
choosing an action under a description that, although accurate as far as it goes, is inappropriate,
often because it focuses on the short term and the
narrow gauge. If I had practical wisdom in Aristotle’s sense, I would not crave the doughnut so
much, because I would not focus so much on its
positive properties; hence, I would not act on the
principle, “If something will taste delicious, one
should eat it.” In the same way, Arthur Andersen’s
auditors might have described their misdeeds in
the Enron case as “good client service” or “aggressive accounting” or even “billing a lot of hours.”
Those characterizations were accurate, but less
salient than “misrepresenting the financial position of the firm.” It is common enough: Darley (1996)
describes the phenomenon of ethical rationalization, which Jones and Ryan (2001) attribute to a
desire to be, and be considered, moral. Auditors
with higher professional standards would act on
the ethically salient description of the action. Most
auditors could not have offered a coherent argument from their own values that the short-term
gain made by giving good client service justified
misrepresenting the financial position of the firm.
So why did the Arthur Andersen auditors do it?
Because they were ignoring the salient descriptions and focusing on the ethically inessential
ones, as one might wolf down a delicious, satisfying doughnut without giving adequate attention to
one’s need to lose weight.
Perceiving Correctly
It is Aristotle’s view that the person of good character perceives a situation rightly—that is, takes
proper account of the salient features of a situation. As you perceive that a particular figure is a
triangle, so you perceive that a particular act is a
betrayal, though the latter is harder to do with
assurance. According to Aristotle, perception involves imagination (the standard translation of the
Greek phantasia): The faculty of imagination is
operating when you understand what a perceived
object is, or when you grasp the moral quality of an
act; in either case you grasp the essence of the
item. You are morally responsible for understanding the act correctly. If you get it wrong—that is,
fail to apprehend the morally salient features of
the situation—then you have a character flaw (NE
III 5: 1114a32– b3). A person of good character will
perceive that a certain act is courageous rather
than foolhardy, generous rather than vainglorious,
right rather than wrong, and will act accordingly.
An irascible or phlegmatic person will take offense, or not, inappropriately. Moral imagination is
the faculty that correctly “frames” morally significant states and events. Johnson (1993) has an influential book on the subject. Werhane (1999), Moberg
and Seabright (2000), and Hartman (2001) assess its
importance for business ethics. Vidaver-Cohen
(1997) considers how organizations can encourage
moral imagination. Chen, Sawyers, and Williams
(1997), noted earlier, show how they can do the
One advantage that persons of good character
have in assessing a complex situation is that they
have certain fairly inflexible v-principles to apply.
For example, a consultant may be honest and
therefore have a personal rule against ever lying
to a client. When a situation arises in which failing
to lie would damage the consultant’s relationship
with the client and lead to avoidable bad consequences for the client, the consultant must take
“lying to the client” to be a salient description of
any action of which it is true. “Preserving the relationship” or “preventing consequences A, B, and C”
cannot be salient for such a person. This inflexibility may not give the best result in every case,
but it is best in the long run for the agent’s character, and it is a barrier to rationalization (see
Luban, 2003: 307f.).
Moral imagination involves intelligence and rationality, although it is not a matter of finding an
algorithm for deciding among moral considerations. That is all right with Aristotle, who, though
he distinguishes intellectual virtues from moral
ones, understands how closely they are related.
Practical wisdom shows up in both moral and prudential guises. He does not give points merely for
meaning well. The Aristotelian position gets support from Haidt (2001), who relies on the findings of
Blasi (1980) and Kohlberg (1969) to argue that intelligence is a causal factor in good moral reasoning
and behavior.
Ethical Vocabulary and Perception
Vocabulary is one of the prime vehicles of culture,
as Schein (1985) and others have argued. In an
organization in which people are called decisive
and risk accepting with approval, the culture may
create peer pressure that encourages shortsighted
disregard of possible costs. One who acts on impulse will be called strong. One who prefers moderation or consideration of alternatives will be
known as a wimp. A European at Salomon Brothers
who goes home at the end of the afternoon rather
than stay and be seen working late is a Eurofaggot
(Lewis, 1989: 71).
A person of good character in Aristotle’s sense
knows genuine strength and cowardice when s/he
sees it. The ethical manager cannot readily
change an employee’s character, but s/he can help
that person to consider the difference between
(say) courage and the readiness to succumb to
macho peer pressure. A business ethics course can
begin that educational process. One of its most
important functions is to help students become
more fluent in the language of right and wrong, of
virtues and vices, without which their moral imagination will be impoverished, and there is little
chance that they will give salient descriptions of
morally significant situations.
The vocabulary of character is not a foreign language to businesspeople, despite what they have
been taught in economics courses about utility and
rationality and other such concepts. Most businesspeople do regard honor, courage, and respect
for fellow workers and competitors as virtues. Most
would say that it is the legitimate purpose of financial statements to give a clear picture of the
financial condition of a firm. But some people in
Enron who might have objected on ethical grounds
if a secretary had taken some office paper home
did not see anything wrong with creating special
purpose entities whose special purpose was to
hide losses.
A good business ethics course can give students
practice in seeing and describing states and
events in ethical terms, as a first step toward understanding their morally salient features. Questions like “Would I want my act to be publicly
known?” invite students to consider how others
might describe the action. But such questions, like
the principles that they presuppose, must be accompanied by a mature sense of right and wrong
and of what is salient in a particular case. That
sense needs to be exercised and developed, given
a language, and sharpened by critical analysis.
Even then it may be overridden by social pressure
or inattention or anything that causes people to
perceive and describe their actions inadequately,
particularly if the corporate vocabulary and emotional reaction become their own. The Milgram
experiment shows how readily people deal with
conflicts between their values and some immediate pressure. So if their moral language is impoverished or insufficiently exercised, they may latch
on to some other, nonsalient description of the situation: “I am helping Dr. Milgram, who knows
what he’s doing,” rather than “I am torturing innocent people.” They may ignore their emotional reaction, and in due course it will go away.
Virtues and Principles: Dialectic and
Reflective Equilibrium
This may leave us still wondering how, exactly, a
virtuous person is supposed to act. Telling someone to be honest sounds like good advice, but in
the absence of quite specific principles there
may be a question about what an honest person
should do in this or that difficult case, such as
To begin with, as I have stated, Aristotle does not
reject principles, which in his case are typically
essential descriptions of virtues. So, for example,
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to act courageously entails acting because one
understands that a certain act needs to be done in
spite of the risks involved, although the principle
identifying this act as courageous may not come
explicitly to mind at the moment of action. Our
account thus far suggests that Aristotle believes
that one ought to act on principles consistently,
that the principles themselves should remain in
force over time, and that a good person’s principles
form a coherent body. He does not, however, believe that their application is always straightforward. He takes them seriously as a carpenter or a
navigator (NE III 3: 1112a5–7) or a physician or a
comedian (NE IV 8: 1028a23–34) must take seriously
the principles of carpentry or navigation or medicine or comedy, but not as the geometer takes
seriously the principles of geometry (NE I 7:
1098a29 –34). The difference is important: We know
just how to apply the principles of geometry to a
geometry problem, even a problem in actual space
and time. But although ethics is not geometry, Aristotle believes that principles have something to
do with sound moral judgments. Many present-day
virtue ethicists agree. Nussbaum (1990), Hursthouse (1999), Foot (1997), and others argue that we
can apply principles but must be wise about it.
McDowell (1997) dismisses principles, but his is a
minority view.
Aristotle holds that one arrives at acceptable
principles—necessary but not sufficient conditions
of acting out of good character— by the process of
dialectic. This process usually starts with common
opinions, with the intention of finding as moral
premises principles that are consistent with those
opinions and explain them, or improve on them
insofar as they can be proved wrong (see NE VII 1:
1145b4 – 8, for example).
One wants to reach a state in which one’s beginnings (archai) form a coherent whole. When Aristotle speaks of beginnings, he sometimes has in
mind what we would consider moral principles,
while at other times he is thinking of particular
moral judgments. The ambiguity is confusing, but
he explicitly claims that a starting point of an
argument that leads to a principle is called a beginning while the principle itself is a beginning in
a different sense: It is the starting point of the
justification of a particular judgment (see NE I 4:
1095b6 and I 7: 1098b2, for example). Here we may
think of Rawls’s (1971: 48 –51) reflective equilibrium: One compares one’s principles and one’s considered judgments about particular cases and adjusts both in an effort to make them consistent.
Neither the principles nor the judgments are prior;
each is subject to adjustment by reference to the
other. If our principles are nothing more than the
result of rationalizing the intuitions on which we
act, as Luban (2003) is led by Festinger (1957) and
others to think may often be the case, then our
intuitions are prior in an impermissible way, and
likely not very good. In the case of wide reflective
equilibrium, so called by Daniels (1979), we bring
in pertinent science, settled beliefs about human
nature, and other facts as background.2 Wide equilibrium seems to represent Aristotle’s views pretty
well. At our moral best we have a set of background beliefs, intuitions, and principles that cohere, with emotions to match.
Hursthouse (1999) and Irwin (1988) take an approach similar to reflective equilibrium as a way of
thinking about virtues. We might say, in the spirit
of Aristotle, that a person is virtuous when s/he has
intuitions and perceptions and emotions and principles that cohere, and acts in a way that expresses them. Rawls has in mind logical rather
than psychological coherence, whereas Aristotle
seems to be thinking of both, although he does not
sharply distinguish them. When Aristotle says that
understanding should be part of our perception, he
implies that the intuitions of a moral person will
incorporate the right principles into a particular
judgment. Arras (1991) makes a similar point in
discussing the advantages of casuistry in medical
ethics. Among business ethicists Nielsen (2001)
sounds similar to Aristotle here, as does Van Hooft
We do not make sound moral judgments by beginning with a certain notion of, say, fairness and
then applying it to business or politics or any other
area of life. The notion of fairness has little substantive content if separated from all these areas.
Suppose we say that it is unfair to treat talented
people differently from the way we treat untalented ones. So those whose talent lets them contribute more to the economy do not deserve more
votes. But many of us do think that employees
should be paid according to what they contribute
to the bottom line—a principle that is utilitarian in
that it creates an incentive to do what they can to
contribute. Whether they deserve better medical
care is not immediately obvious. In fact, philosophers have always struggled with the notion of
desert. If we ever do reach a consensus, it will be
hard-won from experience.
Reflective equilibrium should have some appeal
for both principle and virtue ethicists. While the
former emphasize principles, the latter have an
interest in judgments—in Aristotle’s case, those of
See Calkins (2004: 34f.) for an application to wide equilibrium
to virtue ethics.
wise and experienced people—about particular
situations. Aristotle holds that virtuous people
must trust their intuitions where principles compete or are hard to apply. People of inferior character often do the wrong thing not because they
have bad principles, though many do, but because
their intuitions do not lead them to apprehend the
situation under the right principle. They may act
on a principle that social pressure forces on them,
or one that rationalizes their previous behavior.
Experience and Its Wisdom: Learning and Living
Aristotle does not claim that dialectic is either
necessary or sufficient for good character. The
usual process of moral growth is a gradual one,
part of a life lived in a good community. Experience of that sort is the best teacher. There were
some wise old heads at Arthur Andersen who did
grasp the salient descriptions of the sleazy actions
of their auditors and others at Enron (see Chicago
Tribune, 2002) and no doubt had emotional reactions that supported their view. Unfortunately in
the Enron case the winning intuitions were those of
people of bad character, who acted on the principles that were not morally salient.
If Aristotle is right, business ethicists should
have great respect for the opinions of intelligent
people of good character who are experienced in
business. The moral philosophers’ contribution
will be to compare these intuitions to one another
and to moral principles with a view to sharpening
both. We want our students to have values that are
coherent and achievable without catastrophic cost.
We want them to have principles and intuitions
that form a fairly coherent set, and to learn how to
apply the principles appropriately with the help of
the right emotional reactions. We also want them
to have desires that are consistent with their values insofar as possible. An accountant of good
character will value both good client service and
transparency for the benefit of the public, but will
normally give the second consideration priority
when they conflict.
How does one come to apprehend courage? One
is told as a child that this or that act is courageous,
or not courageous but cowardly. Over a period of
time one comes to have a pretty good sense of what
courage looks like, and then through dialectic—
that is, roughly, philosophical conversation about
the concept— one acquires a real understanding of
courage and its contraries, cowardice and foolhardiness, and reliably identifies instances of them. In
the best case, the moral intuitions are consistent
with the principles— for example, definitive statements about courage and cowardice—although
one’s understanding of courage will never lead
one to a principle that gives the precise necessary
and sufficient conditions of courage, since that
kind of precision cannot be expected in ethics (NE
I 3: 1094b23–27). So Aristotle says (NE VI 11:
1143a35– b5) that the correct perception (aisthesis)
of a particular act as being the sort of act that it
is—say, perceiving that a certain act is cowardly, hence not to be done—involves the faculty
of understanding (nous). In the ethical case it
also involves emotion, which entails cognition:
The emotions of a person of good character are
an indicator of the moral quality of an actual or
possible act. So, for example, an unjust injury to
a courageous person provokes his or her indignation, which leads to a response that is appropriate given the risks involved.
From this we might infer, as Aristotle does, that
a long life in a good community is a necessary
condition of becoming a person of good character.
So what does a course in business ethics do to help
in developing the kind of character that generates
morally salient descriptions of complex situations
with emotions and motivations to match? It plays
the part that dialectic plays in Aristotle’s understanding of moral education. First, we offer students case studies that sharpen their moral perception much as experience does, and we offer
analysis of them based on wide reflective equilibrium, and we thereby enhance moral maturation.
Second, we encourage students to engage in critical analysis of their values with an eye to what is
coherent and sustainable. As a result of this
analysis, our students will be better equipped to
choose courses of action, and even a career path,
that will support rather than undermine or alter
their values.
Ethics and Strategy: The Value of Case Studies
We already have at hand a way of teaching business ethics so that our students begin to learn to
see business issues as moral issues and grasp
their salient features. The case study method suits
business ethics as it suits strategy, both of which
require practical wisdom in Aristotle’s sense. In a
typical strategy course the students read a text and
then consider case studies that challenge them to
apply the principles in the text to a real situation.
This is the beginning of the process of developing
their intuitions about strategy. In real-life corporate strategy, as I learned as a management consultant, there is much to be said for trusting the
intuitions of an intelligent and experienced person
with a good track record. When a manager makes
decisions about the strategies to be undertaken by
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certain strategic business units, there will be some
easy cases. Where the market is teeming with opportunity and the SBU is stronger than any of its
competitors in all important respects, the strategy
of reinvesting for growth is obvious. But there are
nonobvious cases, as when a group of weak SBUs
can together achieve economies of scale or use
slack resources. Even if there were an algorithm
permitting the strategist to infer the correct strategy from the available numbers, it is not clear that
the value of finding the algorithm would justify its
cost. At a certain point the experienced and wise
manager must satisfice and make an intuitive decision.3 Some managers are consistently better
than others at knowing which of the many accurate
descriptions of a strategic situation is the salient
one, although they often cannot say in any detail
how they do it. Their track record is evidence of
their practical wisdom.
By using case studies we give students experience that supports the development of their moral
imagination. We teach them the warning signs of
rationalization and ethical anesthesia. We show
them cases in which machismo and courage are
opposites. When one of our former students goes
on to join an organization that is an ongoing Milgram experiment, we hope that there will be a
spark of recognition. Complex case studies exercise their moral judgment about particulars, as
when justice and economic efficiency conflict. In
looking at a case and considering what its salient
features are, we are helping students develop
moral imagination and thus practical wisdom and
thus good character.
When one of our former students goes on
to join an organization that is an ongoing
Milgram experiment, we hope that there
will be a spark of recognition.
Authors of textbooks do not usually alter the
principles that they espouse to accommodate the
complexities of business. A business with high
entry barriers is not always more profitable than
one in which growth quickly attracts new competitors, but we do not expect Porter (1980) to try to list
all of the possible exceptions to his general principles. Most virtue ethicists acknowledge that
there are situations in which (say) lying would be a
useful move for all concerned, but most of them
would say that one should not lie even then, be3
Simon (1954) invented the concept of satisficing; Winter (1971)
argued that we must satisfice in deciding when to satisfice.
cause it is bad to be a liar. An analogue in strategy
would be the advice that an organization should
usually stick to doing what it does best even when
the organization does business in a suboptimal
way but change would be disorienting.
Our objective is to help our students get better at
answering the question, “What shall I do?” The
moral imagination required to put one’s values
into practice is a necessary but not sufficient condition of an adequate answer to the question. The
students need a critical understanding of their actual and possible values.
An Aristotelian would take the view that in business, as anywhere else, a life of integrity is a
fulfilling life on which one will be able to look back
with satisfaction. In spite of the advantages of
good character, however, choosing one’s character
is no easy task under any circumstances. One cannot readily choose which desires to have: Many
people are tempted by doughnuts; some are
tempted by dishonesty. We can, however, ask students to reflect on what is most important to them
and how to protect it. Reading Michael Lewis’s
Liar’s Poker (1989), for example, provides an opportunity for this. Does Dash Riprock lead a good life?
Is the Human Piranha’s approval a good thing? Is
selling equities in Dallas inappropriate for anyone
with any self-respect? Why? How does Salomon
Brothers of that era differ from the Milgram experiment? Knowing about Salomon or Milgram may
enable one later to stop and reflect on one’s situation, and to do a little moral reasoning rather than
There is some encouraging evidence about the
possibility of doing that. Beaman et al. (1978) show
that people who are taught certain effects of social
pressure will act better thereafter. Nickerson (1994)
argues that little of the moral reasoning that is
taught in the classroom is transferred, but Lieberman (2000) claims that continued discussion in an
appropriate environment—what Aristotle would
call dialectic in a good polis— can make a positive
difference. At least we can disabuse the students
of the notion that ethics is by its nature opposed to
their interests, show how certain virtues are compatible with a good life, and argue that integrity is
a necessary condition of it. If, as I suggested earlier, students tend to have some good values already, that should not be impossible.
Fairly Hopeful Conclusion: Choosing a Job and
Choosing a Character
Even for those who remember Milgram, corporate
culture may be very powerful. By holding out a
certain notion of success, a bad culture can thwart
people’s ability to reflect on their values and to
identify salient characteristics, as it can thwart the
strategist’s attempt to maintain a long-term perspective and see events from that perspective. But
if a strong organizational culture can affect one’s
character in that way, then the choice of an employer is a most important one. Having been in a
certain organization for a while, I may like being
the sort of person who enjoys acting ruthlessly, or
perhaps the sort of person who takes satisfaction
in maintaining a professional attitude. If Aristotle
is right, by acting ruthlessly or professionally I can
become that kind of person. For some of our students, choosing an employer (or a career; that is a
different essay) will in effect be choosing which
desires to cultivate, hence choosing a character.
The least that we can do is help students understand the importance of that choice and not make it
thoughtlessly. If Harman and Doris are right, advocating that form of adaptive preference formation may also be the most that we can do. Aristotle
would not accept that choosing the right polis is
a sufficient condition of developing a good character, but he does believe that it is a necessary
We can intervene here. We can help students
examine what their values really are at the moment of choice of a job. We can raise questions
about why someone would want to pursue a certain sort of career or join a certain sort of firm, and
about whether getting a certain job will be as
satisfying as one has anticipated. In so doing, we
may help expose the reasons given as incoherent
or based on self-ignorance or peer pressure.
Think of Smith, who is considering entry-level
positions as she completes her MBA. She has two
options: a job in finance at a large manufacturing
firm known for good ethics, or a job in an investment banking house known for its competitive environment and its contempt for its customers. Call
them Johnson and Johnson and Salomon Brothers.
Maybe she is already the sort of person who will be
happy in one of those environments but not the
other. Maybe, on the other hand, Smith is wrong in
thinking that she could not be happy if she were
not making a lot of money as the biggest swinging
dick in the house. Maybe she has bought into the
pecking order in her second-year MBA cohort without considering what sort of life in business would
satisfy her. She might indeed go with the investment house and come to feel contempt for those
who settle for equities in Dallas, or she might take
a job in a high-ethics company and come to enjoy
it and be quite happy that she did not go with the
investment house. But if Lewis is right about life at
Salomon Brothers and the researchers on affective
forecasting are right in general, she might achieve
success at Salomon Brothers but never find it quite
satisfying. Like Dash Riprock, she might always
be looking for the next fix. But by the time she
learns this about herself, she may not be the sort
of person who could enjoy life at Johnson and
Johnson, either.
We cannot choose her job for her, but we can
help her think about whether a prospective career
and even a prospective life can be compatible with
values that will sustain her happiness. After she
has made the choice, we hope that she maintains
the values appropriate to good character and the
moral imagination to put them into practice.
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Edwin M. Hartman is professor
in the business school and the
philosophy department at Rutgers. He directs the Prudential
Business Ethics Center. He has
degrees from Haverford, Oxford, and Wharton, and a PhD
from Princeton. Hartman’s most
recent book is Organizational
Ethics and the Good Life (Oxford).

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