Human Dignity and the Common Good: The Institutional Insight

• Published date: 01 March 2017
• DOI: http://doi.org/10.1111/basr.12107
• Date: 01 March 2017

Human Dignity and the

Common Good: The

Institutional Insight

KENNETH GOODPASTER

ABSTRACT

In this article, I develop the idea of the “institutional insight”

as a pathway to two foundational values for applied ethics:

human dignity and the common good. I explore—but do not

offer a definitive analysis of—these two values that I believe

are critical to the progress of business ethics (indeed to the

progress of applied ethics generally). In several previous

articles (Goodpaster 1991, 2009, 2012, 2013), I have alluded

to this theme, but here I hope to show that human dignity

and the common good underlie both (1) management’s fidu-

ciary duty to shareholders, and (2) management’s obligations

to “stakeholders.” Indeed, it may be that the frequently

observed tension between the latter two normative para-

digms can be resolved only by engaging in the comprehensive

moral thinking afforded by the institutional insight.

“Why were we so reluctant to try the lower path, the

ambiguous trail? Perhaps because we did not have

a leader who could reveal the greater purpose of

the trip to us.”

–Bowen McCoy, The Parable of the Sadhu

Kenneth Goodpaster is the David and Barbara Koch Endowed Chair in Business Ethics, Emer-

itus, University of St. Thomas, St. Paul, MN. E-mail: kegoodpaster@stthomas.edu.

V

C2017 W. Michael Hoffman Center for Business Ethics at Bentley University. Published by

Wiley Periodicals, Inc., 350 Main Street, Malden, MA 02148, USA, and 9600 Garsington

Road, Oxford OX4 2DQ, UK.

Business and Society Review 122:1 27–50

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The Parable of the Sadhu is a story and a Harvard Business Review

article that has become an icon in the teaching of business ethics over

the past 30 years. Author Bowen McCoy describes a mountain climb-

ing expedition in the Himalayas during which his decision making

may have cost the life of a Hindu holy man (Sadhu) who was found

alongtheway.Thequotationaboveisfromtheendofthearticleand

represents McCoy’s lament about his own leadership.

1

In this article, I offer an interpretation of what McCoy calls

revealing “the greater purpose of the trip” as a central responsibili-

ty of corporate leadership. To do this, I will develop the idea of the

“institutional insight” as a pathway to the two foundational values

for applied ethics: human dignity and the common good.

TWO MORAL PROVISOS

In 2010, the Editor-in-Chief of Business Ethics Quarterly,ontheocca-

sion of the twentieth anniversary of the journal, asked past and pre-

sent Editorial Board Members and Associate Editors for “Anniversary

Reflections” on the present and future course of the field of Business

Ethics. My contribution was entitled: “Business Ethics: Two Moral

Provisos”

2

and in it I argued that there were two “provisos” in business

ethics rather than the single proviso that many assumed, namely,

The Shareholder Proviso. Corporate responsibility rests

upon a fiduciary obligation to stockholders, shareholders, or

owners, but this responsibility is provisional. It is limited by

other obligations: to employees, to customers, to suppliers, to

local communities—and even to the environment.

My argument was that stakeholder thinking was also subject to a

moral proviso:

The Stakeholder Proviso. Responsibilities to stakeholders

are provisional as well, calling for ethical boundaries. Stake-

holder thinking may or may not be morally necessary, but it

is not morally sufficient.

The point of the latter argument was that the pursuit of stakehold-

er satisfaction is no more immune to moral critique than the pur-

suit of shareholder satisfaction.

28 BUSINESS AND SOCIETY REVIEW