Business ethics pedagogy: A synthesis of paradigms, philosophies, and teaching methods

Jana Craft
University of Minnesota
April 2, 2011

1
Abstract
Is our job as educators to teach students how to make ethical decisions or is it to teach students
how to become innately better people, thus becoming better ethical decision-makers on the job?
This paper examines current teaching methods in business ethics. An argument for the necessity
of ethics education lays the foundation for a review of ethical philosophies, paradigms, and
methods used in business ethics education. Craggs (1997) philosophy of the ethics of doing is
applied to several teaching methods, including case study, interactive role play, and Socratic
dialogue. These methods highlight outcome-based or behavior-based education and display
characteristics of the functionalist framework and pragmatic philosophy, including objectivity,
consequentialist beliefs, experiential techniques and a focus on extrinsic results. A second
philosophy presented by Cragg, the ethics of being, is applied to methods that can alter a
students core values and are emotional in nature. These include the Moral Paradigm Test,
student honor codes, moral imagination, practical wisdom, and the use of spirituality. These
methods reflect the development of judgment and self realization and are essentially intrinsic,
which relates to the philosophy of realism. Consequentially, the methods are participant focused
and subjective, and they attempt to develop an internal dialogue focused on individual values and
morals that extend beyond the classroom.
Keywords: business ethics, pedagogy, ethics education, interactive education

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Business ethics pedagogy: A synthesis of paradigms, philosophies, and teaching methods

Teaching business ethics is tricky. Seven years ago, I started teaching business ethics at a
small two-year college as a required course in the Associate of Applied Science degree in
business management. Since then, I have found business ethics to be the one subject I
continually struggle to teach, possibly because it is a subject that is ever-changing. Ethical
problems seem to continually exist in a gray area where good and bad are not easily decided
upon rather than in black and white where right and wrong are apparent. Students struggle with
not knowing the right answer to ethical dilemmas.
As I researched philosophies and methods that support the teaching of ethics (business or
otherwise) for this paper, I began to see that I am not the only person who struggles with
teaching this subject. Numerous papers have been written about different approaches to teaching
business ethics. Arguments for adopting a case study approach have been presented by Ardalan
(2006), Buchholz and Rosenthal (2001), Falkenberg and Woiceshyn (2008), Laditka and Houck
(2006) and McWilliams and Vahavandi (2006). Interactive approaches such as such as using
classroom experiments (James & Cohen, 2004), inviting ex-criminals as guest speakers (Farrell
& ODonnell, 2005), using student created honor codes (Kidwell, 2001), Socratic dialogue
(Morrell, 2004), spirituality (Pava, 2007), practical wisdom (Roca, 2007), conversational
learning (Sims, 2004), and using product support program decisions (Zych, 1999) have been
studied in the last decade. Clearly, others in my position have also struggled with the best way to
teach their students the importance of doing business ethically.
Is our job as professors to teach students how to make decisions using a pre-determined
ethical decision-making model, or is it to teach students how to become innately better people,

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which then translates into better, more ethical decision-makers on the job? The first seems
pedagogically possible, but stale. The latter seems intrusive and beyond the scope of the
university classroom. How does an instructor train people to become more ethical without
preaching a specific set of personal values? Which philosophy or method of instruction is the
most effective? Should the instructor strive to use teaching tools to teach effective decisionmaking or actually try to influence the mindset of students to become more ethical, virtuous, or
moral? Does a professor take a case study approach, experiential, theory-based, or some
combination of the three?
This paper examines the process of current teaching methods for instruction in business
ethics and will apply the philosophical underpinnings to the methods in order to understand the
pedagogy behind ethics training. A synopsis of the connection between the philosophies,
paradigms, and methods discussed in this paper is presented Table one.
The Necessity of Ethics Education
There is no doubt that business ethics is an important part of the higher education
landscape. However, business ethics is a relatively contemporary subject. It was not officially
recognized as an applied science until after an academic conference held at the University of
Kansas in 1974. The subsequent development of the Journal of Business Ethics and Business
Ethics Quarterly resulted (De George, 2005). Recent years have seen exponential growth in the
use of terms such as corporate social responsibility, sustainability, going green, sustainable
development, social entrepreneurship, corporate ethics, the triple bottom line, as well as a variety
of other terms that imply that businesses have obligations beyond the maximization of profit
(AACSB International [AACSB], n.d.). According to the Aspen Institute, an international nonprofit organization dedicated to fostering values-based leadership, the percentage of MBA

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programs that require at least one ethics, sustainability, business and society or corporate social
responsibility course has increased from 34 percent in 2001 to 54 percent in 2005 (Aspen
Institute, 2005). Ethical missteps such as the savings and loan crises in the late 1980s and the
accounting scandals marking the entrance to the 21st century have buttressed the need for
instruction in business ethics both outside of the workplace and in higher education.
The first subject to be addressed in this paper is if ethics training is necessary. Research
related to the accounting scandals of the early 21st century reveals a multitude of published
articles about the need for ethics training. Webley and Werner (2008) argue that in order to close
the gap between designing and maintaining an ethical culture, organizations must create a well
designed ethical policy, which includes, among other things, ethics training and awareness. In a
review of ethics training in the armed services, Robinson (2007) argues the need for ethics
training because the military cannot rely on the social system to integrate new members through
some process of ethical osmosis. The training needs to be deliberate and formal. One such
training program that has been used by many organizations, especially after the ethics scandals in
early 2000 and 2001, incorporated the use of former executives who had been incarcerated for
various ethics violations including securities fraud, bank fraud, and mail fraud (Farrell &
ODonnell, 2005).
Multiple authors have cited instances in which courses in business ethics at university or
business schools do not have profound transformative effects on students attitudes about ethics
(Wynd & Mager, 1989) or on perceptions of ethical behavior (Davis & Welton, 1991), nor do
these classes affect their future professional lives (Pamental, 1989). Kraft and Singhapakdi
(1991) found that business ethics taught at the undergraduate or even graduate level were of little

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significance in an individuals overall ethics training. This begs the question: what can educators
do to improve the efficacy of education in this arena?
Philosophies and Paradigms
In order to approach the subject of understanding the methods for ethics instruction, the
philosophical foundation of ethics education must first be explored. In this paper, I focus on two
social science paradigms (functionalist/interpretive approach) and two educational philosophies
(pragmatism/realism) that provide the groundwork for the majority of instructional methods.
Both educational philosophies can be related to each of the two paradigms, which are based on
different assumptions about the nature of social science.
Philosophy in this paper refers to an analysis of the grounds of and concepts expressing
fundamental beliefs based on the definition in Websters dictionary. Discussed in this paper are
the philosophies of pragmatism and realism. Pragmatists believe in emphasizing and evaluating
actions and beliefs based on their consequences. However, there is no overarching rule that
espouses what are good and bad consequences. Pragmatism merely provides a consequentialist
framework with which to judge if an action is morally right or wrong (Michalos, 1995).
Pragmatic education is extrinsic in nature; there are no fixed or absolute conclusions drawn.
Experiential methods of instruction such as case studies and role playing are often used.
Pragmatists are concerned with projecting consequences to make judgments concerning present
actions (Anderson, 1999, p. 61).
The second philosophy, realism, is similar to pragmatism in that it emphasizes the
practical side of education. However, realism as related to ethical theory is more focused on
good being determined by intrinsic values and intuition rather than consequences. Specifically,
right action [] had intrinsic value. It did not derive its value from that of the ends (Quinton,

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1964, p. 532). Realism is not a consquentialist theory that bases right and wrong on the outcomes
of an action. Rather, it is more concerned about how moral judgments express our desires about
how people behave. The inclusion of moral judgments means there must be moral facts attached
to the interpretation of the judgment as correct or incorrect. Smith (1993) contends that in
realism, right acts tend toward social stability, whereas wrong acts are those that tend toward
social unrest (p. 404). The distribution of basic knowledge, facts, and theories can be attributed
to this philosophy. Yet, the nature of this philosophy is such that the instructional method often
includes reflective assignments and projects that help develop individual internal dialogue and
decision-making.
Paradigm is defined as a theoretical framework of a discipline in which laws and
conclusions are formed based on the results of experiments performed (Merriam-Webster Online
Dictionary, 2010). I chose to explore the philosophies first, rather than the paradigms, because
they are the grounding forces of the paradigms. Thus, the paradigms for specific methods of
ethics education are based on the philosophies that support ethics education. The two paradigms
that will be used in this paper are the functionalist and interpretive frameworks for ethics
education.
Functionalist theory is rooted in positivism, or the belief that scientific theories can be
identified, studied, and measured. The functionalist paradigm emphasizes the need for
understanding order, equilibrium, and stability in society and the way in which these can be
maintained (Ardalan, 2006, p. 263). Burrell and Morgan (1979) contend that the functionalist
paradigm has provided the main structure for academic sociology and the study of organizations.
Objectivity is used in the approach to its subject matter. Functionalist theory tends to be highly
pragmatic and is mainly concerned with the results of studies and how they can be used to

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improve performance (Drazin, Glynn, & Kazanjian, 1999). In contrast to pragmatism, however,
functionalist practitioners contend there are concrete answers that can be studied, whereas
pragmatists do not necessarily concern themselves with concrete answers. Thus, the importance
of the functionalist and pragmatist link is based in the method of delivery, which tends to be
more experiential in nature rather than theoretical and lecture based.
The second paradigm, the interpretive approach, tends to favor the emic perspective
rather than the etic perspective. In this approach, the results are based on how subjects develop
their own individual meaning rather than the interpretations of the researcher providing the
results (Denzin, 1983; Headland, 1990 & Pike, 1954). This structure relies on the self realization
and subjective conclusions of the participants to assess the learning outcomes. The researchers
frame of reference is one of participant, not observer (Ardalan, 2006).
The theory of pragmatism and the paradigm of functionalism in subsequent sections can
be paired because of the relative similarity of the oft-chosen method of experiential education. In
contrast, the philosophy of realism and the interpretive approach paradigm can be paired because
they are both intrinsically focused and are often taught using self realization and reflection. The
relation of philosophy to paradigm is important because it provides a new context in which to
critique the methods described in the research associated with business ethics education.
Methods Used in Business Ethics Education
Upon review of the literature discussing business ethics education, I discovered two
distinct categories of educational methods that encompass a variety of techniques described in
various articles. These two methods can be categorized as the ethics of doing and the ethics of
being. Based on an article by Cragg (1997), these two dimensions illustrate two ways to
categorize the different approaches to the education and training of business ethics. I chose to

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organize the approaches using Craggs labeling of ethics of doing versus ethics of being because
I find they are descriptive and appropriate labels for the methods found in the body of literature
dedicated to the training of business ethics.
Training that falls into Craggs dimension of the ethics of doing is outcome based. The
focus is on actions and outputs, with the goal being correct behavior. Values change based on a
change in behavior, not a change in character. Thus, the ethics of doing approach applies to the
pragmatism/functionalist combination in that the definition of success lies in the achievement of
the right action, which is consequentialist in nature. The right action can be measured as correct
because of an observable extrinsic behavior. Thus, methods that are categorized in the ethics of
doing group illustrate a pragmatic and functionalist approach.
Alternately, the ethics of being is focused on both inputs and outputs in addition to
character. The goals are self development and self knowledge with reflection and conversion
being the mitigating factors that change the values. Motivation to change is intrinsic; hence, I
characterize methods of instruction in the ethics of being area that are internally focused and that
rely on self discovery and reflection.
Ethics of Doing
Upon a review of the literature dedicated to teaching business ethics, The methods could
be categorize using Craggs two dimensions rather easily. On one side, the methods that fall into
the ethics of doing are related to outcome-based or behavior-based education. Cragg (1997)
discusses the earliest form of education in ethics as instruction in following Mosaic code (The 10
Commandments). In other words, if we followed the commandments set forth in the Bible, we
are a good (ethical) person. Following this notion, Kants categorical imperative and Mills
principle of utility are also based on behavioral output. The intent or inner workings of the

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individual are not brought into the mix. Good works are merely based on what is evidenced in
behavior by others, not in the moral center of a person.
Perhaps the most prevalent method of business ethics instruction is the use of cases in the
classroom. There are multiple approaches to using case studies, but the end result boils down to
the experiential approach. Multiple authors indicate that the use of the case study approach is
preferred because it actively engage(s) students in a consideration of, and discussion about,
ethical issues in management, and to learn from the experiences of others (Laditka & Houck,
2006, p. 157). The case study approach is designed to help students develop their problem
solving abilities by applying theory and philosophy to a relatively real situation. Multiple authors
contend the case study approach is a preferred method of instruction because of the authentic
nature of the experience for the students (Falkenberg & Woiceshyn, 2008; Gandz & Hayes,
1988; Laditka & Houck, 2006; McWilliams & Nahavandi, 2006).
A second approach centers on the use of inquiry and debate, also known as Socratic
dialogue. Three authors discuss the use of a Socratic form of dialogue as a channel for ethics
education in the business school. Kerlin (1997) uses the Socratic approach by using a pizza
parlor in an imagined neighborhood as the focal point for his business ethics course of
instruction. Kierlin contends that in order to understand the most difficult ethical issues, students
must understand the relationships of neighbors and be able to converse in a constructive manner
accordingly. Morrell (2004) and Sims (2004) further discuss dialogue as a tool. Morrell contends
that dialogue can serve as a conduit for the identification and testing of assumptions and tacit
beliefs (p. 383). Sims concurs, but goes further in discussing the importance of using
conversational learning in a safe and welcoming classroom environment.

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The final approach that be applied to the ethics of doing and the pragmatism/functionalist
pairing is interactive ethics education. Active experience (as opposed to passive), role playing,
and classroom experiments fall into this category. Two such examples will be presented, each
related to the idea of getting students involved in the experience of ethics. Izzo, Langford and
Vitell (2006) conducted an interactive ethics education study with over 100 real estate licensees
from four different firms. In terms of ethics education, the results suggest that participation in
interactive ethics education may contribute significantly to increases in cognitive moral
reasoning of real estate practitioners as measured by both general and industry-specific
measures (p. 243-244). Similarly, Zych (1999) created an interactive classroom approach to
business ethics in which student take on the role of Brand Manager in a fictitious organization.
The material was presented as realistic business problems rather than ethics cases. Zych (1999)
argues that allowing students to grapple with complex issues (p. 266) gives them an
opportunity to experience the interplay of business and ethical considerations and enhance their
ability to evaluate the various facets of a business problem (p. 263).
Ethics of Being
The methods applicable to the realist/interpretive pairing are categorized as methods that
can alter a students core values. Behavior is no longer the heart of the argument. In this
category, methods focus on the education of the whole person as opposed to affecting the correct
behavior. The examples in this section are personal in nature. Some might argue they are too
touchy-feely or emotional. I contend that unless students have an emotional connection to the
subject matter, most of the impact of the course will be forgotten shortly after the final exam.
Buchholz and Rosenthal (2001) argue against a prescriptive approach to business ethics. Rather,
they contend that an integrated approach to creatively mediating a plurality of conflicting

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interests can only be done by the morally perceptive [and] creative individual. Further, the
integrative approach as part of a training or education curriculum cannot make people act
morally, but it can illuminate which human capacities must be cultivated for moral decisionmaking (p. 29). Consequently, this approach fits well in the realism/interpretive category because
of the self reflective nature of the development of human aptitude rather than focusing on
behaviors. Four methods will be profiled that have unique approaches to the internal
development of individuals.
The first method in the ethics of being category is the use of a Moral Paradigm Test.
Cooley (2004) devised a test that was practical and connected students emotionally to the
concept of why morality is important in the business environment. Generally, the Moral
Paradigm Test combines the question of what a virtuous ideal person would do in a particular
situation with an emotional connection (p. 289). As stated earlier, without an emotional
connection to the subject matter, students do not actively apply the subject matter in their lives.
Especially regarding the subject of ethics, it is important for students to understand what it means
to be a virtuous person, both in their personal and professional lives. What often goes missing in
ethics education is the idea of the interconnectedness (p. 292) of values and business decisions.
Cooley explains that the greatest advantage of the Moral Paradigm Test is to make students
realize that ethics are much more than a mere abstract thought experiment in a business ethics
course (p. 290). The test created an emotional connection between each student in the class to a
person each student emulated, the embodiment of their moral paradigm, or ideal person. Public
examples such as Martin Luther King or private examples such as mom and dad were acceptable.
Students were confronted with various questions and ethical situations and asked what their
moral paradigm would do. The imagined disapproval of the moral paradigm of the students

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hypothetical unethical actions led to the establishment of the emotional connection. According to
Cooley, acting morally and ethically became more important because this emotional connection
was established.
Second, Kidwell (2001) describes a classroom approach to teaching business ethics using
the creation of student honor codes. Kidwell practices this approach with accounting students,
but the premise is the same for all business students. On the surface this method might seem like
a prescriptive, behavior approach, more appropriate for the earlier section rooted in
consequentialsim. However, Kidwell found that the process of creating an honor code resulted in
students reflecting a sense of obligation to fellow students and self, as well as to faculty, to be
honest in all endeavors (p. 48). I argue that this type of collegiality and sense of responsibility
to the larger organization is exactly what is missing in business today. Kidwell expresses hope
that this type of self reflective activity will carry forward into the careers of her students.
Third, Roca (2007) discusses the concept of using moral imagination and practical
wisdom as a method for ethics instruction. Roca argues that the immoral corporate business
environment is the result of the ideas and teaching that have emerged from business schools in
the last 25 years. She cites companies such as Enron, Parmalat, and Tyco as examples of
management practice gone awry. Rather than immediately reacting with a new slew of business
ethics and corporate social responsibility courses, the academic community should create new
pedagogical models that address the type of knowledge and process for teaching knowledge
needed in the management of organizations. Roca contends that schools should educate future
managers on the critical assessment, awareness, and responsibility of their moral values and
decisions. Thus, she proposes the idea of practical wisdom as ethics education. Practical wisdom
includes moral imagination, which helps us to grasp the moral quality of an act with we are

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13

engaged in a moral deliberation (p. 611). This perspective challenges the positivistic
knowledge within management studies (p. 614) because it teaches students how to resolve
ethical issues by balancing their awareness and attitudes with their reasoning ability. Exercises to
help develop practical wisdom often involve the use of stories, films, or complex case studies
where students are invited to experience the story personally and consider their own choices and
dilemmas depending on their own virtues, knowledge, and experiences (p. 616). Thus,
emotional connection plays a part in ethics education as displayed in the practical wisdom
model.
Finally, the most philosophical approach to business ethics education in this paper is
explored by Pava (2007) about the use of spirituality as a vehicle for teaching business ethics.
Disregarding the formulaic approach of a one-size-fits-all approach, Pava first discusses the
journey of spirituality as a building and rebuilding of a kind-of map to help me navigate through
lifes obstacles, opportunities, joys, and horrors (p. 287). In reflection, this seems to be ideally
what a person seeking growth and spiritual harmony develops throughout his or her adult life.
Road maps in the mind are created to avoid pitfalls (unethical situations, perhaps) that once
derailed their morality and virtues. Lessons are learned and passed down to younger generations.
However, because the younger generation (business students, in this case) has not experienced
the same emotional pitfalls and spiritual journey, the advice from parents, mentors, and bosses
perhaps falls on deaf ears. Dewey (1934) discusses the difference between perception and
recognition. Recognition is comprised of a routine kind of mindlessness where the answer is
easily identified based on the recall of facts and knowledge. Pava contends, based on Dewey,
that perceiving is more active and participatory. It is both cognitive and emotional (p. 291). So,
how do we mesh spirituality and ethics into business ethics pedagogy? Pava provides several

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14

suggestions. Be clear about our teaching aims and use relevant and timely material. Practice
actively listening to students and what we are saying, not what you think they are saying. Work
hard and take chances. Do not turn spirituality into an idealistic and unrealistic target. I
purposely conclude the discussion of ethics with the method involving spirituality because I
believe it bookends the argument of emotional experience as being a necessary part of ethics
education in business schools.
Conclusion
This paper attempted to answer the question of which method is best for the education of
business ethics. The method and philosophical underpinnings of business ethics education was
explored in order to determine the most effective approach to ethics training. The argument was
made to connect two sets of theories related to the education of business ethics, the ethics of
doing and the ethics of being (Cragg, 2007). A variety of educational methods were linked to the
pragmatism/functionalist combination or realism/interpretive pair. As summarized in Table 1,
methods involving the use of case studies, the Socratic Method, and interactive role playing
display characteristics of the functionalist framework and pragmatic philosophy, including
objectivity, consequentialist beliefs, experiential techniques and a focus on extrinsic results. The
second set of methods is more abstract. These include the use of the Moral Paradigm Test,
student created honor codes, moral imagination, practical wisdom, and spirituality. These
methods reflect the development of judgment and self realization and are essentially intrinsic,
which relates to the philosophy of realism. Consequentially, the methods are participant focused
and subjective, and they attempt to develop an internal dialogue focused on individual values and
morals that extend beyond the classroom.

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Table 1
Summary of analysis between philosophies, paradigms, and methods

Ethics of
doing

Ethics of
being

Philosophy

Paradigm

Methods

Pragmatism:

Functionalist:

Consequentialist
Extrinsic
Experiential

Objectivity
Order, equilibrium, stability
Concrete answers possible

Case study analysis

Socratic method
Interactive role playing

Realism:

Interpretive:

Judgment
Intrinsic
Internal dialogue

Subjective
Self realization
Participant focused

Moral Paradigm Test

Honor codes
Moral imagination &
practical wisdom
Spirituality

The question remains, which combination is the most effective for teaching business
ethics? Based on my experience and the information presented in this paper, I reiterate my earlier
statement of emotion being a necessary component in business education. When instructing on
the subject of business ethics, practitioners would be wise to develop pedagogy that impacts their
students on both emotional and practical levels. While the ethics of doing methods are most
likely best for the delivery of theories, knowledge, and history, this approach does not encourage
students to establish an emotional connection with the subject of business ethics. Rather, the
development of internal dialogue and decision-making establishes a stronger emotional
connection to the material, and the innovative methods of moral imagination, practical wisdom,
and spirituality further extend that emotional connection to the subject of business ethics. Thus, I
believe the methods related to the ethics of being are more effective and the results more longlasting for teaching business ethics.

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