What motivates an individual’s moral behaviour? See this week’s research articles for some insights.

The effect of cognitive moral development on honesty in managerial reporting 
This study examines whether truth-telling in the form of honest reporting is associated with cognitive moral development. Conventional agency theory assumes that people are self-interested and willing to tell a lie to increase their personal payoffs, while recent empirical evidence shows that some people give up monetary rewards to tell the truth (e.g., Evans et al., Account Rev 76:537–559, 2001).

The social psychology literature suggests that cognitive moral development influences individuals’ ethical decisions. Chung and Hsu carried out an experiment whereby participants submitted managerial reports in which truth-telling decreased their monetary payoff. Despite the fact that their decisions were not subject to monitoring, auditing, or reputation effects, some participants reported honestly or partially honestly.

The authors find the relationship between honest reporting and cognitive moral development to be both positive and linear. Compared with those at lower stages of cognitive moral development, participants at higher stages of cognitive moral development were more likely to submit an honest report and give up potential monetary gains from lying. Chung and Hsu further examine the economic impact of honest reporting on the firm’s profit. With the assumption of self-interest and profit maximisation, Antle and Eppen (Manag Sci 31:163–174, 1985) suggest that a contract with a hurdle-rate feature reduces managers’ information rent. They find that in comparison with the expected outcome of a hurdle contract, the firm can yield higher profits with a trust contract by hiring managers with a P-score higher than 16.67.

Janne O. Y. Chung and Sylvia H. Hsu. 2017.  The Effect of Cognitive Moral Development on Honesty in Managerial Reporting.
Journal of Business Ethics, 145(3), 563–575.


The psychological microfoundations of CSR
This article aims to consolidate the psychological microfoundations of corporate social responsibility (CSR) by taking stock and evaluating the recent surge of person-focused CSR research. With a systematic review, the authors identify, synthesise, and organise three streams of micro-CSR studies—focused on (i) individual drivers of CSR engagement, (ii) individual processes of CSR evaluations, and (iii) individual reactions to CSR initiatives—into a coherent behavioral framework.

This review highlights significant gaps, methodological issues, and imbalances in the treatment of the three components in prior micro-CSR research. It uncovers the need to conceptualise how multiple drivers of CSR interact and how the plurality of mechanisms and boundary conditions that can explain individual reactions to CSR might be integrated theoretically.

By organising micro-CSR studies into a coherent framework, this review also reveals the lack of connections within and between substreams of micro-CSR research; to tackle them, this article proposes an agenda for further research, focused on six key challenges.

Gond, J.-P., El Akremi, A., Swaen, V., and Babu, N. 2017. The psychological microfoundations of corporate social responsibility: A person-centric systematic review. 
Journal of Organizational Behavior, 38(2), 225–246.


Moral reasoning in adaptation to climate change 
Moral foundations theory argues that moral reasoning is widely observed and fundamental to the legitimacy of relevant governance and policy interventions. A new analytical framework to examine and test how moral reasoning underpins and legitimises governance and practice on adaptation to climate change risks is proposed.

It develops a typology of eight categories of vulnerability-based and system-based moral reasoning that pertain to the dilemmas around adaptation and examines the prevalence of these moral categories in public discourse about specific adaptation issues. The framework is tested using data on climate change impact, adaptation, and societal responsibility, drawn from 14 focus groups comprising 148 participants across the UK. Participants consistently use moral reasoning to explain their views on climate adaptation; these include both vulnerability-based and system-based framings.

These findings explain public responses to adaptation options and governance, and have implications for the direction of adaptation policy, including understanding which types of reasoning support politically legitimate interventions.

Read this article in full online for free. 

W. Neil Adger, Catherine Butler and Kate Walker-Springett. 2017. Moral reasoning in adaptation to climate change. 
Environmental Politics, 26(3), 371-390.


Face-saving or fair-minded: What motivates moral behaviour?  
Cappelen et al. study the relative importance of intrinsic moral motivation and extrinsic social motivation in explaining moral behaviour. The key feature of their experiment is that they introduce a dictator game design that manipulates these two sources of motivation. In one set of treatments, the researchers manipulate the moral argument for sharing, in another they manipulate the information given to the recipient about the context of the experiment and the dictator’s decision.

The paper offers two main findings. First, it provides evidence of intrinsic moral motivation being of fundamental importance. Second, it shows that extrinsic social motivation matters and is crowding-in with intrinsic moral motivation. The authors also show that intrinsic moral motivation is strongly associated with self-reported charitable giving outside the lab and with political preferences.

Alexander W. Cappelen, Trond Halvorsen, Erik Ø. Sørensen and Bertil Tungodden. 2017.  Face-saving or fair-minded: What motivates moral behavior? 
Journal of the European Economic Association, Volume 15, Issue 3, 1 July 2017, 540–557.


What sparks ethical decision making?  
Recent theories on cognitive science have stressed the significance of moral intuition as a counter to and complementary part of moral reasoning in decision making. Thus, the aim of this paper is to create an integrated framework that can account for both intuitive and reflective cognitive processes, in order to explore the antecedents of ethical decision making.

To do that, Zollo et al. build on Scholasticism, an important medieval school of thought from which descends the main pillars of the modern Catholic social doctrine. Particularly, the focus will be on the scholastic concept of synderesis, which is an innate human faculty that constantly inclines decision makers toward universal moral principles.

Managerial implications are discussed, stressing how a rediscovery of decision makers’ intuitive moral judgments could be relevant in the reflective thinking practice of managers’ ethical reasoning, thus saving them from rational insensitivity to ethical dilemmas.

Lamberto Zollo, Massimiliano Matteo Pellegrini and Cristiano Ciappei. 2017. What Sparks Ethical Decision Making? The Interplay Between Moral Intuition and Moral Reasoning: Lessons from the Scholastic Doctrine.  
Journal of Business Ethics, 145(4), 681–700.


The common good of the firm and humanistic management: Conscious Capitalism and Economy of Communion 
Businesses have long been admonished for being unduly focused on the pursuit of profit. However, there are some organisations whose purpose is not exclusively economic to the extent that they seek to constitute common good.

Building on Christian ethics as a starting point, this article shows how the pursuit of the common good of the firm can serve as a guide for humanistic management. It provides two principles that humanistic management can attempt to implement: first, that community good is a condition for the realisation of personal good, and second, that community good can only be promoted if it is oriented towards personal good.

To better understand which community good can favour personal good and how it can be achieved, Frémeaux and Michelson examine two recent humanistic movements—Conscious Capitalism and Economy of Communion—that strive to participate in the common good. From the analysis of these two movements, the authors identify a shared managerial willingness to adopt the two principles. Moreover, the writers also reveal that Conscious Capitalism and Economy of Communion present different ways of linking community good and personal good, and therefore, different means exist for firms to participate in the common good.

Sandrine Frémeaux and Grant Michelson. 2017. The Common Good of the Firm and Humanistic Management: Conscious Capitalism and Economy of Communion. 
Journal of Business Ethics, 145(4), 701–709.