Juridification of business ethics stand in the way of true ethics

January 28 2022
Research

Ethics in business is mainly reflected in codes and procedures. It is because of this juridification that reflection and human beings are pushed to the background. A recent example of this phenomenon is the allowance affair. This is one of the main conclusions from the research conducted by Bart Jansen, who graduates today at Nyenrode Business University. “If you approach and practice ethics from a juridical standpoint, you assess behavior based on rules. That is a very narrow approach, since you surpass the fact that a human being is more than a bearer of rights and duties”, according to Jansen.

“Codes of conduct, corporate governance codes, the Banking Code: these are all constructs of rules that companies must adhere to, designed to make businesses more socially responsible, diverse, inclusive or sustainable. Once a procedure or code is in place, it gives the impression that the company is assured of ethical conduct.” But according to Jansen, this form of ethics is more like law. It is a juridification of ethics. The result? “You get stuck in rules and procedures and you take too little account of the human side and all the circumstances. Take for example the allowance affair, where everything was put into a, for a citizen, abstract legal system and there no longer was any room to look at the person and the circumstances outside the rules.”

Not meant for your comfort

During his research, Jansen conducts a number of substudies, where he makes juridical thinking in ethics visible. First he analyzes the relationship between business ethics and law. Both include obligations, opportunities and ideals, but assess those in different ways. Jansen indicates: “There is this idea about ethics that it serves to solve all kinds of practical problems. This is, however, a simplistic juridical interpretation. Law is characterized by the fact that a problem is manipulated towards a solution. Ethics on the other hand, is meant to serve as a reflection on problems, what can cause problems to become bigger. Ethics is not meant to serve your comfort”.

He notes that there currently is a tendency in business ethics to adopt legal language and argumentation. We see this reflected, for example, in forms of self-regulation, such as ethical codes and forms of alternative dispute resolution. Self regulation gives the impression that it should encourage ethics in business. Employers' umbrella organization Confederation of Netherlands Industry and Employers (VNO-NCW) does this, for example. But self-regulation actually gives the government more opportunities to intervene in the private sphere than statutory regulation does. This self-regulatory tendency fits within a broader concept of Western-inspired liberal ways of carrying out public administration. Adherence to self-regulation is useful, but it has nothing to do with ethics.

Distrust

“The juridical way of thinking when it comes to ethics, strengthens a cynical attitude and distrust with regard to ‘doing good’ by companies,” Jansen adds. “It increases the illusion that we practice ethics. But in reality, these self-imposed rules of decency hide economic motivations. After all, they are aimed at improving economic performance. Earning money and ethical reflection simply do not often go hand in hand. And that is not a bad thing. The task of ethics is to look for these kinds of impasses and to be very clear about it.”

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