Human Dignity and the Common Good: The Institutional Insight

AuthorKenneth Goodpaster
Published date01 March 2017
Date01 March 2017
Human Dignity and the
Common Good: The
Institutional Insight
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:
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
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
represents McCoy’s lament about his own leadership.
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.
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
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.

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