J. Jacobs in her famous book Systems of Survival (1992) distinguishes between two ethical systems that she calls ‘moral syndromes’. The public domain is characterised by the guardian syndrome, the private domain by the commercial syndrome. The guardian syndrome involves values such as avoidance of trade and commerce, pursuit of discipline and loyalty, and respect for tradition and hierarchy. There is also a certain degree of fatalism, linked to a strong devotion to the task in hand. The commercial syndrome, by contrast, comprises values such as violence avoidance, arriving at voluntary agreements, honesty and competitiveness. Other values, such as optimism and appreciation for initiative, also play their part. There are two types of survival, according to Jacobs: tasks that are part of the state and trading that is linked to the market system. Each moral syndrome belongs to a pattern of survival and cannot be mixed without a problem. They are, according to Jacobs, mutually exclusive.

MBA students need more than professed values. They need to know that the world is morally complex and morally dangerous. They need to know that bad deeds can come from good values. They need to know that valuing integrity enough to keep one’s hands off other people’s money is only the beginning, not the end of business ethics.

There are many ethical questions in business life that we cannot answer by professing values. And the wrong answer to those questions can start us unawares down a slippery slope that quickly turns sticky. Devoting an hour or two of an MBA curriculum to moral philosophy is a good way to give students an understanding of why professed values will not protect them against such moral dangers. Yes, it’s important to make the philosophical complexities simple! And of course it is important to move quickly to practice.

But a quick look at just three moral philosophers – Aristotle, Kant, and Mill – shows why confident reliance on professed values can make for bad ethics Aristotle valued virtue or character. Kant valued rationality and duty. Mill valued utility.

All those values are good, but they often conflict in practical life. A manager may value kindness as a virtue and therefore rightly want to avoid lay offs. But the same manager may simultaneously and rightly feel a need for layoffs because he or she also values profit (utility) and duty to shareholders.

Managers in such situations where their real values conflict with each other will hardly be helped by pre-announced values claims. Rather they need to know what Aristotle, Kant, and Mill teach, together if not individually. Good values such as virtue, duty, and utility can conflict. In such cases, managers need some other things besides supposed values or even real values to help decide what’s right.

We’re incredibly good at telling ourselves stories, and these help us feel as if we are honest even when we act dishonestly.

[Philip Zimbardo’s] observations belie the standard explanation offered by business leaders when people in their organizations are caught misbehaving: Hey, there are a few bad apples in any barrel. Zimbardo argues that, in fact, ethical problems in organizations originate with the “barrel makers” — the leaders who, wittingly or not, create and maintain the systems within which participants are encouraged to do wrong. Hence, instead of companies wasting millions of dollars on ethics courses designed to exhort employees to “be good,” it would be far more effective for managers to make an effort to create corporate cultures that reward people for doing the right thing all of the time.

For a personal ethics code to be effective and useful in terms of living a better life and making better decisions, it must pass a test of reciprocity. So if you adopt an ethic, you must be OK with everybody else having this same ethic.

On what basis can we say that bribery is “wrong” or “unethical”? The immorality can be seen in the manner in which it is conducted. First, bribery is done in secret, not because it involves a trade secret, but because it is recognized as violating the explicit and implicit terms of a transaction. As such, bribery is a form of deception used to gain unfair advantage over those who act according to the norms understood to govern transactions.

If bribery were simply a cost of doing business, then the cost of the bribe ought to be stated clearly and openly in the contract. It is not done so because bribes are universally understood to be unfair and dishonest, and hence unethical.

Profit is a legitimate goal; maximizing profit is not. If it does that, it simply ignores the legitimate claims of all those who do not possess the power to affect its profitability. This would be a breach of the moral principle.

Mere work ethic is not enough. The hardened criminal exhibits an excellent work ethic. What is needed is a work ethic conditioned by ethics in work.

The person who consistently seeks to do what is "right" - not just expedient - will invariably be inspired with new ideas and useful insights.

In thinking of the mind as a set of cognitive capacities, it helps to distinguish the ethical mind from the other four minds that we particularly need to cultivate if we are to thrive as individuals, as a community, and as the human race. The first of these, the disciplined mind, is what we gain through applying ourselves in a disciplined way in school. Over time, and with sufficient training, we gain expertise in one or more fields: We become experts in project management, accounting, music, dentistry, and so forth. A second kind of mind is the synthesizing mind, which can survey a wide range of sources, decide what is important and worth paying attention to, and weave this information together in a coherent fashion for oneself and others. A third mind, the creating mind, casts about for new ideas and practices, innovates, takes chances, discovers. While each of these minds has long been valuable, all of them are essential in an era when we are deluged by information and when anything that can be automated will be.

Yet another kind of mind, less purely cognitive in flavor than the first three, is the respectful mind: the kind of open mind that tries to understand and form relationships with other human beings. A person with a respectful mind enjoys being exposed to different types of people. While not forgiving of all, she gives others the benefit of the doubt.

An ethical mind broadens respect for others into something more abstract. A person with an ethical mind asks herself, "What kind of a person, worker, and citizen do I want to be?"

It's important to clarify the distinction between the respectful and the ethical mind, because we assume that one who is respectful is ethical and vice versa. I think you can be respectful without understanding why. But ethical conceptions and behaviors demand a certain capacity to go beyond your own experience as an individual person.

When wealth is lost, nothing is lost. When health is lost, something is lost. When character is lost, everything is lost.

People raised in an environment where praise was carefully meted out typically do not try to challenge the rules; they follow them. When presented with a request that he thinks is unreasonable or unclear, the A player is most likely just to back down and try to comply rather than to question authority. That makes your superstar particularly dependent on powerful figures in situations that subject him to unclear directions or sudden shifts in the rules. Since A players have tried to appease influential people all their lives in order to "know" how to behave, they are not prepared to follow through appropriately on requests that are not straightforward.

The clash between principles and pragmatism is one of the hardest tests of a leader's character. Of course we want our leaders to be both principled and pragmatic. Principles alone qualify men and women to be preachers or saints. Pure pragmatists can open their tool kits and get down to work, but their amorality makes them dangerous. As many leaders know, sometimes the worst conflict is between two strongly held principles. Navigating that can be harder than trying to keep a balance between principles and pragmatism.

A fundamental question examined in the management arena is not only the factors that may lead people to make clearly illegal decisions, but more so the dilemma faced by individuals when confronted with legal but irresponsible or illegal but responsible behaviors. Under those conditions, what should one do? What will influence what behavior the manager chooses?

Subjective judgments do not become objective simply by translating them into numbers. More importantly, when some of the options under review require ethical considerations, we can cloud the difference between right and wrong when we translate all options into a quantitative order of dollar values. If you tell me that option A contains a moral impediment and option B is pristine, that is substantially different than if you tell me that option A has a probability adjusted present value of $2 compared to $1.50 for option B. And yet we tout the virtue of net present value analysis because it does that very thing.

Regulation is merely society's way of saying that it does not approve of the way business is operating or, that by operating the way it is, business is ignoring what the society has set as objectives and goals for itself.

Business "ethics," should not be confused with business "morality." Morality is the sum total of a particular society's or organization's current perceived traditions, beliefs, values, attitudes and norms that have been cultivated over time, institutionalized in religious doctrine, laws, regulations and codes of conduct which explicitly or implicitly suggest how an individual should behave in situations as they are encountered daily. Ethics may well include a discussion of moral trends, but morality defines primarily where we are.

There are some companies that say, Let's do whatever it takes to meet the requirements of the law. There's nothing wrong with that, but you have to recognize that the law, by definition, typically is made up of rules that have been made to address previous situations. It's tough for it to anticipate future violations that might occur. Companies that invest in building an ethical culture recognize that when new issues arise, people will need an ethical compass that will help them make the right call, or at least get help in a gray area.

Law is spelled out by consensus in society: It is a minimum standard of conduct. But ethics is not a result of consensus, not something discerned by taking a poll. Ethics is the ideal; law is the minimum.

Poker's own brand of ethics is different from the ethical ideals of civilized human relationships. The game calls for distrust of the other fellow. It ignores the claim of friendship. Cunning deception and concealment of one's strength and intentions, not kindness and openheartedness, are vital in poker. No one thinks any the worse of poker on that account. And no one should think any the worse of the game of business because its standards of right and wrong differ from the prevailing traditions of morality in our society.

Running an organization does not license a manager to violate the norms and standards of society, but instead introduces a brand-new set of moral considerations based on stakeholder obligations. In respect of normatively legitimate stakeholders (e.g. financiers, employees, customers), the ethics of business implies more obligations rather than less.

It's hard to know what is meant by business ethics. Only people, not businesses, have ethics. Ethics is me, the individual, as a person. I'm ethical or unethical. If I'm employed in a business that I think is unethical, I have a clear choice. I can get out of that business and find something else to do. It doesn't seem to me it's ethical for me to do unethical things because the business can let me do it.

Nobody really believes that it's an ethical precept that you obey every law. If you obey a law that requires you to do something that is unethical or amoral, I think everybody in the room would agree it's a proper human behavior to break that law as long as you're willing to accept the responsibility for that. That was the justification for conscientious objection during the war.

You cannot fight norms solely with laws. You need to fight norms with other norms.

I think that our culture is biased toward laws and rules. Cultures work best when there's a thick layer of moral norms - shared values and habits of behavior - undergirded by a relatively thin base of law. In the United States, we're over-lawyered, overregulated, and under-normed. We're attempting to deal with our business scandals through law. But the problem is a normative problem, and it needs to be addressed through normative means.