Lynn S. Paine

Does Ethics Pay

The relationship between ethics and economics has never been easy. Opponents in a tug of war, friends in a warm embrace, ships passing in the night—the relationship has been highly variable. In recent years, the friendship model has been gaining credence, particularly among U.S. corporate executives. Increasingly, companies are launching ethics programs, values initiatives, and community involvement activities premised on management’s belief that “Ethics pays.”

Corporate policy and the ethics of competitor intelligence gathering

Competitor intelligence, information that helps managers understand their competitors, is highly valued in todays marketplace. Firms, large and small, are taking a more systematic approach to competitor intelligence collection. At the same time, information crimes and litigation over information disputes appear to be on the rise, and survey data show widespread approval of unethical and questionable intelligence-gathering methods. Despite these developments, few corporations address the ethics of intelligence gathering in their corporate codes of conduct. Neither managers nor management educators have paid sufficient attention to this topic. From a review of questionable intelligence-gathering practices reported in various literatures, the author identifies some important ethical principles to help managers draw the line between legitimate and illegitimate methods of information acquisition. The paper also discusses the costs of failure to heed these principles and suggests steps managers can take to provide ethical leadership in this area.

Ideals of Competition and Today’s Marketplace

The ethics of competition is a much neglected topic. In a highly aggressive marketplace, temptations to exceed the bounds of fair competition are great. Indeed, there is a temptation to relax, or even abandon, the very notions of fair play and ethical limits on competition and to adopt the position that “anything goes” in the struggle for competitive advantage. The object of this chapter is to describe an ideal of competition that I believe is reflected in traditional law governing business competition and in our common consciousness about fair competition in many competitive enterprises. Thoughts about the principles constituting this ideal are based on my own reflections on competitive activities and on my readings in the law of unfair competition.2

The Corporation’s Evolving Personality

If the value shift we see in many companies around the world cannot be wholly explained in purely financial terms, can a better explanation be provided? A more satisfactory account begins with an appreciation for a subtle but striking development in what has sometimes been called the “personality” of the corporation—the pattern of attributes thought to define its essential nature. This change in the character of the corporation has affected how companies are thought about, what’s expected of them, and how they are evaluated. Seen in broad historical context, this development is nothing short of revolutionary, though its gradual nature, unfolding across the last century, has somewhat obscured its significance.