How Virtue Fits
Within Business Ethics
ABSTRACT. This paper proposes that managers add
an attention to virtues and vices of human character
as a full complement to moral reasoning according
to a deontological focus on obligations to act and a
teleological focus on consequences (a balanced tri-
partite approach). Even if the criticisms of virtue
ethics cloud its use as a mononomic normative theory
of justification, they do not refute the substantial
benefits of applying a human character perspective –
when done so in conjunction with also-imperfect
act-oriented perspectives. An interactive tripartite
approach is superior for meeting the complex require-
ments of an applied ethic. To illustrate how deficien-
cies of a “strong” virtue ethics formulation can be
overcome by a balanced tripartite approach, this paper
compares normative leadership paradigms (each based
on a combination of virtue, deontology, or conse-
quentialist perspectives) and the dangers inherent in
each. The preferred paradigm is servant leadership,
grounded in a tripartite ethic. Effective application
J. Thomas Whetstone, Assistant Professor of Management,
Davis College of Business, Jacksonville University,
Jacksonville, Florida, teaches MBA and Executive MBA
courses in business ethics and undergraduate courses in
management, organization theory, organizational
behavior, and business strategy. He worked for ten years
in corporate management in the energy industry. He also
is a Presbyterian minister and public speaker on man-
agement ethics and history. His doctoral dissertation is
“The Manager as a Moral Person: Exploring Paths to
Excellence” (1995). Publications include: “Teaching
Ethics to Managers: Contemporary Problems and a
Traditional Solution” (1998) in C. J. Cowton and R.
S. Crisp, editors: Business Ethics: Perspectives on
the Practice of Theory (Oxford University Press,
Oxford), and “Ethics and Leadership: Searching for a
Comfortable Fit” (1997) in G. Moore, editor: Business
Ethics: Principles and Practice (Business Education
Publishers, Sunderland, U.K.).
Journal of Business Ethics 33: 101–114, 2001.
© 2001 Kluwer Academic Publishers. Printed in the Netherlands.
J. Thomas Whetstone
of such an ethics approach in contemporary organi-
zations requires further empirical research to develop
a greater understanding of the moral language actually
used. Meeting this challenge will allow academics
better to assist practicing managers lead moral devel-
opment and moral reasoning efforts.
KEY WORDS: act-oriented theories, character,
ethical manager, leadership, moral language, servant
leadership, tripartite ethics, vice, virtue, virtue
ethics
Introduction
What is the appropriate role for an ethic of
virtues in managers’ moral development and
moral reasoning? An ethic of virtues (and vices)
emphasizes the process of personal moral char-
acter development. Donaldson and Werhane
(1999) note that some philosophers are reluctant
to accept fully the “human nature” approach,
believing that consequentialism and deontology
exhaust all possible modes of ethical reasoning.
On the other hand, virtue ethics proponents
often imply that the personal character perspec-
tive is more fundamental than act-oriented
theories, favoring a “strong” view of virtue
ethics. In An Introduction to Business Ethics (1996),
Jackson argues that, of the three basic approaches,
only a virtues-based approach is able to make
sense of the importance of morality and thus good
practice. In A Primer of Modern Virtue Ethics
(1995, p. 1), Duncan states his objective of
beginning a full-scale project to reconstruct
morality as a whole on the basis of an ethics of
the virtues so as to present a credible alternative
to the other great traditions in ethics.
Is one of these views preferable? No, according
102 J. Thomas Whetstone
to Robert Louden (1984). He argues that virtue
ethics must be included in any adequate justifi-
cation of morality, along with deontological and
teleological approaches, proposing that his fellow
philosophers
need to begin efforts to coordinate irreducible or
strong notions of virtue along with irreducible or
strong conceptions of the various act notions into
our conceptual scheme of morality. This appeal for
coordination will not satisfy those theorists who
continue to think in the single-element of
mononomic tradition (a tradition which contem-
porary virtue-based theorists have inherited from
their duty-based and goal-based ancestors), but I
do believe it will result in a more realistic account
of our moral experience. The moral field is not
unitary, and the values we employ in making moral
judgments sometimes have fundamentally different
sources. No single reductive method can offer a
realistic means of prioritizing these different values.
There exists no scale by means of which disparate
moral considerations can always be measured,
added and balanced. The theoretician’s quest for
conceptual economy and elegance has been won
at too great a price, for the resulting reductionist
definitions of the moral concepts are not true to
the facts of moral experience. It is important now
to see the ethics of virtue and the ethics of rules
as adding up, rather than as canceling each other
out (Louden, 1984, p. 191).
Mononomics has not ceased since the 1984
publication of Louden’s appeal in the American
Philosophical Quarterly, possibly because of
presuppositional differences between virtue and
act-oriented theories. But as Crisp (1998, p. 19)
observes, much of contemporary moral philos-
ophy, business ethics included, operates on a
mistaken scientific model. In business ethics it is
not necessary to explain our actions, as scien-
tific models require, but to justify them. One can
have more than one reason for doing something.
One can read a journal for pleasure as well as to
stay informed; one can attend a dinner to eat and
to socialize. But many philosophers have been
tempted to think that one must pick one ethics
theory in order to justify a particular course of
action. Moral reasons can include both the duty
to act and the consequences expected from the
act as well as the belief that so acting is charac-
teristic of the kind of person one wants to be.
One might refrain from cheating because this is
the right way to act, and because so acting will
create a better world, and because one is an
honest person. It is not necessary to choose a
single theory and stick with it; it is sometimes
even better to take what seems most plausible
from several theories and seek insights from all
theories (Bowie, 1982, p. 7). For proper balance,
the theorist needs to add virtue ethics as a fully-
equal complement to deontological theories that
focus on obligations and teleological ones that
place greatest priority on the consequences of
acts. This is an important thesis that philosophers
need to debate with renewed vigor, but one
needing much more space (books?) and philo-
sophical rigor than is attempted in this paper. As
Rosalind Hursthouse (1997, p. 237) admits,
defending virtues theory against all possible
criticisms would be a lifelong task. This paper
focuses on the application of theory by business
managers and leaders in terms of moral devel-
opment and moral reasoning.
But a rehearsal of Louden’s thesis establishes
the context for the main proposition of this
paper, which focuses on the practical application
of ethics theory, its role in the moral develop-
ment and moral reasoning of managers, rather
than on the formal philosophical justification of
normative ethics theories. The proposition of this
paper is that managers need to add virtue ethics,
or more precisely an attention to virtues and
vices of human character, as a fully-equal com-
plement to moral reasoning according to
deontological or consequentialist teleological
formulations.
This paper supports this claim using a variety
of approaches. It begins by noting that principle-
based ethics (PBE) alone often has proven inad-
equate for practicing managers, who have thus
not adopted it. Virtue ethics has recently
reemerged among moral philosophers, but its fit
in terms of practical application is debatable.
Certainly a “strong” virtue ethic, where act-
oriented theories are subordinated, is an inade-
quate theory (see Boatright, 1995). This paper
proposes a complementary approach, using a
tripartite ethics formulation (balancing character
considerations with a deontological focus on
 How Virtue Fits Within Business Ethics 103

obligations to act and a teleological focus on the
consequences of acts) as a more fitting guide for
applying normative ethics theories to decision
making and moral development. This balanced
formulation enhances the realization of the
benefits identified with the addition of a char-
acter perspective.
Indeed, organizational field research finds that
virtue and vice concepts are necessary to describe
what is meant by an excellent manager; his or
her productivity and principled-behavior are not
sufficient. Whether the principles are objective
and absolute or are developed via social-
construction within a community, an applied
ethic requires normative standards or decision
principles in some form to be used to assess
behaviors as right or wrong or good or bad.
Applying via negationis, this paper illustrates how
deficiencies of a “strong” virtue ethics formula-
tion can be overcome by a more balanced
tripartite approach, referring to several norma-
tive leadership paradigms (each based on a
combination of virtue, deontology, or conse-
quentialist teleology ethics perspectives) and the
dangers inherent in each. The most balanced and
thus favored leadership paradigm is servant
leadership, grounded in a tripartite ethic. The
value of the complementary or balanced tripar-
tite approach is further illustrated using a
complex situation from American literature. Just
as it begins with a challenge to continue philo-
sophic debate of Louden’s appeal for abandoning
mononomic conceptions or ethics theory, this
paper concludes with a challenge to empiricists
to develop a more current descriptive under-
standing of the moral language used by practicing
business managers.
The modernist commitment to
act-oriented theories
Table I summarizes three ethics theories: conse-
quentialist teleology, deontology, and virtue
ethics, highlighting the fundamental differences
in their perspectives. According to principle-
based ethics (PBE), successful managers do not
rely solely on either a consequentialist or a deon-
tological theory but try to balance the influences
of each of these act-oriented theories, positing
that people have a duty to bring about the best
consequences. The basic premise is that man-
agement and management ethics are primarily a
cognitive matter of rational decision making
concerning particular ethical dilemmas. However,
some critics claim that North American
managers have not adopted PBE models, cer-
tainly not for routine business applications,
because such formulations are too abstract and
use philosophical language foreign to the business
community (Stark, 1993; Monast, 1994). A prin-
ciple-based ethic by its nature does not focus
directly on the psychological influences on
motivation, does not always point to clearly
preferable courses of action in the hard cases, and
cannot resolve issues in which the recommen-
dations of utilitarianism and deontology conflict
(Horvath, 1995). It is impersonal and abstract,
and draws on an incomplete view of human
nature. Nevertheless, business people can use a

TABLE I
Three ethics perspectives

Consequentialist teleology Deontology Virtue

Primary focus: Consequences; Duties: Moral obligations Character development

Costs vs. Benefits
– of the act
A right action: Promotes the best
consequences in which
happiness is maximized
– re the act
Is in accordance with a
moral principle required
by God, natural law, or
rationality
– for the person
Is one that a virtuous agent
is disposed to make in the
circumstances in order to
flourish or live well
104 J. Thomas Whetstone
principle-based ethic profitably to guide ethical
behavior, if they do so while exercising wise
judgment and demonstrating certain character
qualities in order to act appropriately, given the
situation and cultural context (Larmore, 1987).
The reemergence of virtue ethics
Starting with Elizabeth Anscomb (1958), a
growing number of scholars have now moved
toward a more personal ethic, one requiring
serious attention to the human dimension
(Niebuhr, 1963; MacIntyre, 1985; Des Jardins,
1984; Williams, 1984; De George, 1987; Walton,
1988; Mahoney, 1990; Nash, 1990; Goodpaster,
1991; Sommers, 1991; Solomon, 1992; Collier,
1995; Hartman, 1998). This paper defines a
virtue to be a qualitative characteristic, gener-
ally considered part of a person’s character,
something within the person, although neither
materially nor biologically identifiable. A virtue
is closer to an internal value, something of the
spiritual essence of the person. Aristotle’s
approach is more psychological than philosoph-
ically abstract and analytical, being meant to
discover how a good person is to act (Barnes,
1976, p. 17). What is a fully virtuous act, one
that is done as a virtuous person would do it?
According to Aristotle, it must satisfy three
conditions: (1) the virtuous person does the act
knowingly, aware of the pertinent facts and the
practical wisdom needed to apply the act so as
to fit its appropriate purpose; (2) the motive for
choosing the act must be simply because it is
virtuous, not for personal advantage or other
non-ideal motives; and (3) the act must be as a
result of a steady state of character disposition,
not a one-off or impulsive act, but irrespective
of particular times and persons. A virtuous act is
thus a rational act based on a wise, purposeful
assessment of the factual situation, chosen for a
pure motive and consistent with a steady dis-
position of the actor’s character.
Whatever the ontology of virtue, it is not a
subject for scientific proof, although virtue and
vice apply to behavior of biological persons.
Virtues and vices dispose one to certain
behaviors in the material world. To have good
character suggests the presence of virtues and the
absence of vices, manifest in the moral behav-
iors referred to by Foot (1978). Indeed, the
“how” of virtue is more understandable, and
more meaningful, for ethics research and
teaching, than is the “what.”
Benefits of a virtue perspective
Adding a virtue perspective as a complement to
act-oriented perspectives can expand the scope
and perspectives of ethical analysis and under-
standing. This is because an Aristotelian (as
opposed to Platonic) ethic of virtue:
1. is personal;
2. focuses on the motivations of the actor and
the sources of action, bringing a dynamic
to ethical understanding;
3. is contextual, highlighting the importance
of understanding the environment as it
affects both actor and his or her acts; and
4. complements other disciplines addressing
human behavior.
These potential benefits, each of which are vital
for moral development and moral reasoning by
managers and their management of complex
human organizations, are briefly discussed
below.
1. An ethics of virtue is personal. If ethics is to
answer the Socratic question of how one should
live, it needs to be sensitive to the nuances of
human life, to what human nature is really like.
Consequentialist and deontological approaches
tend to be impersonal. Hawerwas (1974),
MacIntyre (1985), and Pincoffs (1987) offer
variations to virtue theory in order to add
the personal perspective. Moral properties or
qualities do not pertain to choices, but more
fundamentally to persons, in the interpersonal
world of the moral community. Even if virtue
ethics proponents tend to overstate the relative
importance of their position, their arguments
lend support to a complementary role for this
personal perspective.
2. An ethic of virtue focuses on the motivations of
the actor and the sources of action, bringing a dynamic
to ethical understanding. The Aristotelian under-
 How Virtue Fits Within Business Ethics
standing of human nature is that the supreme
good is the well functioning of the human being
as a human; functioning well is nothing other
than activity in accordance with virtue
(excellence) (Broadie, 1991, p. 57). One mark
of a good life is harmony between one’s motives
and one’s reasons, values, and justifications.
Virtues are not static; they are corrective. They
help guide, motivate, or correct moral delibera-
tion and behavior. By promoting and facilitating
methods of moral education, character develop-
ment, and emotional well-being of the actor, an
ethic of virtue can serve as a framework for
implementing positive change in behavior.
3. An ethic of virtue is contexual, highlighting the
importance of understanding the environment as it
affects both the actor and his or her acts. Virtues and
vices are fully understood only by considering
the overall context of life and work. A virtue is
not merely a principle. The practice of an ethic
of virtue requires that a person have perceptive
insight concerning the context of each act. What
is most right to do depends on the situation,
including recognition of coercive pressures and
intentions for acting. Act-oriented approaches
also require consideration of the situational
context (O’Donovan, 1986, pp. 137–138), but a
virtue perspective enriches such analysis.
4. An ethic of virtue, by requiring the actor to seek
to understand himself or herself as a person, comple-
ments other disciplines addressing human behavior. As
critical as culture and environment are, they
constitute only part of the contextual problem.
The perspective of virtue, because it concerns the
nature and normative behavior of humans, also
points to questions of philosophy and theology
beyond the normally-accepted sphere of social
science.
Having a good moral character suggests the
presence of virtues or moral excellences and the
absence of vices. The dispositions of character
termed virtues are beneficial to personal actors
and to the others affected by their acts. They help
to meet holistic needs; some motivate, some
guide, some correct moral deliberation and
behavior. The virtue ethics perspective attempts
to help the person as actor understand himself
and develop the moral capacities to live and work
well in all situations, both ordinary ones and
105
crises. When the discipline of ethics includes the
evaluation and development of character, its
subject matter begins to look less impersonal and
the responsibilities of people look less intermit-
tent (Kupperman, 1991, p. 12).
A “strong” virtue ethic
Some even claim that virtue ethics should be
viewed as being more fundamental or superior
to act-oriented theories (Duncan, 1995; Jackson,
1996). Koehn (1995, pp. 536–538) says that
taking virtue ethics seriously will probably mean
that one ultimately must choose one system over
the other, because there are profound differences
in how the various ethical systems understand
concepts of practical reasoning and the truly
good act, and their views may be mutually
exclusive. Indeed, philosophers still tend to
approach business ethics from only one of the
three perspectives, even if they note the contri-
butions of all three (Bowie, 1999). But is a
reductive, even bifurcating, insistence to choose
between virtue and act theory the best approach
for ethical practice? Gareth Morgan (1996) shows
how using several different paradigms of organi-
zations can increase understanding of these social
systems. Likewise, considering multiple perspec-
tives, based on admittedly different, but well-
considered, assumptions and worldviews, can be
helpful for understanding complex ethical issues.
A virtue ethic does have theoretical problems.
Virtue theory’s concept of eudaimonia is difficult
and obscure. It is criticized for its cultural
relativism because different people and cultures
can consider different character traits as virtues,
although Hursthouse (1997, p. 222) notes that
act-oriented theories also have this problem.
Indeed, Velazquez (2000) argues against the
validity of hypernorms for global ethics
(Donaldson and Dunfee, 1999) because of the
cultural imperialism of Western moral theory.
Different virtues sometimes point to conflicting
actions, but rule deontology sometimes suffers
from the same problem. The deontological rule
to preserve life can lead to contradictory
instructions in some cases, such as that of justi-
fying abortion to save the mother’s life.
106 J. Thomas Whetstone

If business grows due to entrepreneurial ini-
tiative of individuals rather than merely through
social evolution, an Aristotelian virtue ethic is
inadequate on a stand-alone basis. Boatright
(1995) suggests that Solomon’s (1992)
Aristotelian approach needs to be supplemented
with a set of fundamental human rights grounded
in human nature. It does inadequately credit
what Nesteruk (1995) calls the creative benefits
of constraints, including laws and rules (also note
Giddens, 1984). More generally, a virtue ethic
needs more than a telos that organizes the set of
virtues into a concept of the good; it also needs
a deontological standard of right and wrong
behavior. Furthermore, to be practical, an ethic
applied to business needs to help the business
manager solve specific problems in a real time sit-
uation and context.
Even if they undermine ready acceptance of a
“strong virtue” theory, the serious criticisms of
virtue ethics as a normative theory do not
necessarily refute the above benefits of applying
a virtue ethics perspective – when done so in
conjunction with also-imperfect act-oriented
perspectives. Instead, they point to the need for
an interactive tripartite approach. Table II lists
criteria or guidelines for a comprehensive
approach. Neither a virtue ethic nor a deonto-
logical ethic nor a consequentialist teleology can
satisfy all the postulated criteria, but all are met
when as Louden (1987) suggests, the perspectives
of virtue and the act-oriented theories are viewed
as additive. Moral knowledge is the sort of
knowledge that is to be applied with the most
delicate and sensitive judgment, something
acquired from the experiences of life. The
important question for practicing managers is not
which theory is superior, but what positive
benefits result for personal moral development
and moral reasoning. But how can a tripartite
approach be implemented in an organization?
Adding virtue ethics as a full complement
to the act theories
A comprehensive tripartite theory combines a
focus on cognitive decision making of individual
acts simultaneously with the deliberate process of
developing the moral character of actors. To be
fully tripartite, the deontological principles are
objective, not socially-constructed ones that
emerge from a culture of virtuous people. Such
a theory needs to recognize the tension between
adherence to universal objective standards and the
free will of people who must interpret and apply
those standards in each situation. Donaldson and
Dunfee’s (1999) concept of hypernorms, as used
to constrain decisions made on the basis of social
contracts at the local level, is somewhat analo-
gous to this formulation. A business manager,
properly exercising his or her role at the intuitive
level of practice, exercises and hones virtues such
as courage, temperance, humility, trustworthiness,
diligence, love, patience, and practical judgment
in applying a principle-grounded ethic to work-
place decisions.
An ethic of virtue highlights the need for each
person to seek a social identity and to seek the
purpose for his or her life. People act ethically
or unethically in the world as they face challenges
that change continuously over time. Because

TABLE II
Guidelines for applying ethics to business

An ethics theory as applied within an organization should:

1. Offer normative recommendations that are grounded empirically;
2. Be concerned with forming and developing values and thus with actually changing behaviors;
3. Recognize the importance of the persons who act as well as the acts themselves;
and
4. Consider the context, the environmental situation and cultural milieu, as they affect actors and acts.
 How Virtue Fits Within Business Ethics
improvement and correction of mistakes is more
realistic and ultimately more advantageous than
seeking to optimize each decision and action, the
distinctive perspectives provided by a virtue ethic
are needed to complete a practical ethic. Without
neglecting the need to analyze individual acts
one-by-one, a virtue perspective can provide a
learning process highlighting the continuous
dynamic of action and development of the
motivational dispositions of human persons to act
within the broad environmental and community
context. The normative aim is to move toward
the standard set by a concept of the good orga-
nization.
The excellent manager overcomes pressures to
compromise even newly acquired values, at times
even opposing and then changing his or her
habitual behavior. Field research in the Southeast
U.S. found that those managers most admired by
peers and subordinates had successfully rejected
values ingrained in them as youths in the period
of racial segregation, adopting new habits of
language and behavior toward other races
(Whetstone, 1995). As organizations and their
activities increasingly become more global, the
benefits of a virtue ethics perspective will
increase. Flatter and geographically dispersed
organizations especially need to rely upon the
moral character of their managers.
Realistically, a truly virtuous manager is an
unrealizable ideal, but nevertheless represents a
set of virtuous character dispositions toward
which a real – and necessarily imperfect –
manager can strive. This is an abstract as well as
optimistic description, but one based on empir-
ical findings concerning what a specific set of
contemporary managers envision as their most
admired managers.
In summary, a complete ethic is person-
centered and act-focused, dynamic as well as
static, developmental and decision-focused, and
contextually adaptable. A Western conception of
morality requires consideration of the motives of
the agent, the extent of his or her knowledge of
the situation, and the conditions under which he
or she acted, as well as the rightness or wrong-
ness of the act itself (Barnsley, 1972, p. 50). It
makes more sense for the practical aims of moral
development and moral reasoning if approached
107
using a complementary tripartite ethics formu-
lation.
How virtue ethics fits with other theories
How can a manager, as a leader, incorporate a
deliberate character or virtues perspective?
Tables III and IV are presented to facilitate
engagement of this most practical issue, featuring
some dangers arising from using normative and
thus ethical leadership paradigms that put greatest
focus on one, two, or three of the major ethics
perspectives of Table I. Table III includes
leadership approaches that subordinate or neglect
the character of the actor. The dangers associated
with each are meant to represent extreme
outcomes, not necessarily the most likely ones.
Whether or not a person must be moral to be a
leader (Bowie, 2000), these tables suggest that too
narrow a perspective encourages pressures that
inhibit ethical practice. Each of the leadership
paradigms in Table IV combine a human char-
acter focus with either a deontological or a
teleological orientation.
Consequentialist teleology
Application of a teleological ethic, whether in
the form of utilitarianism or egoism, tends
toward pragmatism in striving for the goals set
according to the mission or vision (Friedman,
1970; Drucker, 1974). At the extreme, any means
can be rationalized if the intended end is judged
to maximize the overall good. An example is
Rost’s (1993, 1995) post-industrial leadership
paradigm, a teleological descendant of participa-
tive management approaches. The telos is the
process of interrelationship defined in terms of
non-coercive influence and mutuality. This
suggests that an act is okay, if people can agree
that it is okay. In addition to a measurement
problem, this paradigm’s pragmatic and social
constructionist orientation denies the meaning-
fulness of universal deontic principles and values
and offers no role for personal virtues.
108 J. Thomas Whetstone

TABLE III
Leadership risks
– Dangers of focusing too much on a particular act theory

Consequentialist teleology Deontology Virtue Principle-based ethic

Example: Postmodern leadership “Rules of the game” U-R-J Model

Dangers: Relativism; Legalism; N.A. Moral schizophrenia;
Pragmatic ends over means “Political correctness” Non use?

TABLE IV
Leadership risks
– Dangers of focusing too much on a particular combination of perspectives

Consequentialist Deontology Virtue Principle-based

teleology and virtue as primary ethic
and virtue and virtue

Example: Transformational Principle-centered “Strong” Servant

leadership leadership virtue ethic leadership
Dangers: Tyranny; Stoicism; Too Subjective; Ignorance of
Cultism Pietism; Irrational decisions virtue language;
Legalism Manipulation by
those served

Deontology Principles-based ethics (PBE)

At least at the extreme, a deontological ethic, one
that places its primary emphasis on behavior in
terms of obligations, rights, principles, rules or
codes, in application can become legalistic,
operating strictly by the “rules of the game”
(e.g., Carr, 1968). The rule of law becomes the
law of rules. Historically, universalist ethics have
sometimes led to legalistic practices. This
occurred in New Testament biblical times, in the
Middle Ages, and in the seventeenth century
among the English and American Puritans, as
well as on contemporary university campuses in
the form of “political correctness.” A personal,
relational complement is needed to humanize the
abstract.
Combination ethics such as the DU Model or
Janus-faced ethic (Brady, 1985; 1990), and the
U-R-J Model (Cavanagh et al., 1981) have the
admirable aim of combining the benefits of
deontological and teleological perspectives.
However, at the intuitive level of business ethics,
their application can lead to moral schizophrenia
(Stocker, 1976; Kreeft, 1992) when the indicated
actions conflict (MacIntyre, 1985). Even though
such conflicts may not be frequent (Green, 1994),
they do occur, leading to moral dilemmas that
undermine the credibility of business ethics
theory in the eyes of business practitioners (Stark,
1993).
But a principles-based ethic can be very useful
when applied in proper context by one using
virtuous judgment. On a prima facie basis,
adding a character perspective improves an
impersonal ethic. Horvath (1995) even claims
 How Virtue Fits Within Business Ethics
that only a person of virtue can successfully
implement a principle-based ethic. The leader-
ship paradigms referenced in the cells of Table IV
add a deliberate character orientation, with
greater focus on the process of personal moral
development.
Virtue and teleology
Virtue ethics involves reevaluation of the nature
of a telos (purpose or desired end) for life and
behavior in the business context (Solomon,
1992). Such a conception combines the teleo-
logical focus on visionary ends with a focus on
character formation and motivation for achieving
the vision. Although business people, in the daily
press of activity, may not often stop to reflect on
their telos (Stewart, 1970; Mintzberg, 1971), they
could benefit thereby (see Hartman, 1996, and
Werhane, 1999). To enable such reflection,
Moberg and Calkins (1999) propose a disciplined
approach based on the five hundred years old
Spiritual Exercises of Ignatius Loyola, one offering
renewal and growth in clear-headedness,
meaning, and wisdom to business leaders and
employees at every level. The intended outcome
is for each exercitant to formulate a response –
ideally a specific commitment he or she is
prepared to make as a result of the process.
Duncan (1995) classifies the ethics of virtue
as a non-rule-governed teleological theory, one
beginning with a conception of the best kind of
life for a human. This view allows recognition of
moral rules, for example the use of casuistry, but
is this sufficient for a comprehensive ethic? Some
leadership models suggest not, at least pointing
to significant risks. For example, transformational
leadership (Burns, 1978; Bass, 1985) incorporates
a joint focus on virtue and teleology, being
concerned with changing the behavior of people
by first changing their character. Transforma-
tional leadership can be dangerous because it is
deficient in constraints as to personal rights and
responsibilities (Keeley, 1995). The resulting
sense of “political correctness” can lead to
tyranny as Madison and other American
founding fathers feared. At the extreme,
unchecked transformational leaders can become
109
dictators or cult leaders with followers who are
willing to go to frightening excess. Napoleon
Bonaparte, Adolph Hitler, David Koresh of the
Waco incident, and Marshall Applewhite or Doe,
who led thirty-eight intelligent and skilled pro-
fessionals to commit suicide in California, each
exemplify the dark side of transformational lead-
ership.
Virtue and deontology
Neglecting or even subordinating the individual
or the community visionary perspective also can
be dangerous. Corporations are well-advised to
develop ethics codes, but the companies who rely
most on written codes are not always the most
ethical (Sorell and Hendry, 1994); they may just
want a document declaring their integrity,
without being willing to abide by it ( Jennings,
1999, p. 3). A code can beneficially impact the
ethical culture of the organization provided the
moral standards obviously apply to everyone, not
just the personnel at the operating level, and
provided the Board of Directors and CEO address
the moral problems actually faced by employees
at the divisional and operating levels (Hosmer,
1996, p. 150). The code needs to be democrat-
ically derived and applied in a virtuous or good
community culture, such as Hartman’s (1996)
good organization or Goodpaster’s (2000) ethical
culture.
Stephen Covey’s (1991) principle-centered
leadership paradigm combines a deontic focus on
objective principles for behavior with serious
attention to development of one’s moral char-
acter qualities. Instead of the process focus of
transformational leadership, Covey stresses certain
universal principles – described by him as self-
evident, self-validating laws of nature. Each
person is a product of her choices and, in turn,
character and conscience are what matter for her
choices. This leadership approach recalls the
world and life perspective of stoics such as
Marcus Aurelius, employing traditional virtue
language to describe objective and external prin-
ciples, presuming that men and women become
virtuous through a knowledge that enables them
to live harmoniously within their environment.
110 J. Thomas Whetstone
But Viktor Frankl (1962) observes that man
does not behave morally for the sake of having
a good conscience but for the sake of a cause to
which he commits himself or for a person whom
he loves or for the sake of his God. Those who
autonomously have a good conscience as their
motivation can become legalistic. Principle-
centered leadership tends to promote the existing
system, focusing on “heal thyself ” techniques and
influencing one’s close circle of relationships
rather than on addressing the systemic factors of
business (Nash, 1994, p. 30). This may be a
reason why many corporate managers teach
Covey’s philosophy to their employees. A person
needs to be oriented critically toward a mean-
ingful corporate or societal telos; otherwise one
may well withdraw into stoicism or pietism or
legalism.
Teleology and deontology and virtue – as
complements
For a more balanced ethic, all three ethics
perspectives are needed. Servant leadership
(Greenleaf, 1977; Spears, 1995) exemplifies the
tripartite ethics approach. A servant leader has
the character of a servant who seeks to lead
others toward a meaningful telos, but only
according to highly principled means. The
antithesis of institutional bureaucracy, servant
leadership is characterized by behavioral infor-
malities, offering empathetic support for ethical
behavior, and finding creative ways to do things
better. For example, John Woolman was a servant
leader in the eighteenth century, successfully
investing over thirty years to persuade other
American Quakers to abandon slavery. Aung Suu
Kyi of Burma is a contemporary servant leader,
displaying an engaging sense of humor along
with a steely seriousness and deep commitment
(Horne, 1997) in spite of the persecutions of
house arrest, separation from family, and physical
danger. The servant leader formulation attempts
to bring together the conceptual and intuitive
levels of ethics, offering a focus on developing
people fit to make the ethical choices and to
implement them one-by-one – while continuing
to improve over time. As Bowie (2000) notes, the
servant leader can be subject to manipulation;
he or she thus needs a strong vision, objective
principles, and virtue to minimize this risk.
The advantage of a comprehensive tripartite
approach is most apparent when one is faced
with the toughest dilemmas, those which may
require use of narrative to explore adequately
(Nash, 2000; Freeman, 2000). Christiana and
Fred Sommers (1993) point to the classic
dilemma posed in Melville’s novel Billy Budd: do
we punish people for the evil they do or for what
they are? Does Billy Budd’s exceptionally pure
and good character excuse or even mitigate his
act of accidentally killing an evil man? This is a
clash between the military duty to execute a
capital offender and the moral obligation to show
compassion to a virtuous man caught up in tragic
circumstances. In the novel, the virtuous man,
Billy Budd, is convicted and hanged without
opportunity for appeal. Does the deontological
morality prevail over virtue ethics in this case?
Or is Budd’s character enhanced with greater
honor than ever before? Both questions can be
answered “yes.”
The reality of complex issues suggests a need
for developing a practical, user-friendly decision
model combining act-oriented approaches with
attention to the virtues and vices of human
character. Several that move in this direction have
been proposed, including Hosmer’s (1994)
multiple analysis that asks the decision-maker to
consider ethical problems from the various per-
spectives of ten principles, including virtue;
Cavanaugh, Moberg, and Velasquez’s (1995)
utility-rights and duties-justice-caring model;
and DeGeorge’s (1999) “Steps of a General
Moral Analysis.” This is a positive trend that
will help managers committed to enhancing
moral development and moral reasoning, espe-
cially as the following challenge is successfully
addressed.
The need for relearning the language of
virtues and vices
Adding an attention to the virtues and vices of
human character as a full complement to rea-
soning according to deontological and conse-
 How Virtue Fits Within Business Ethics
quentialist teleological formulations can offer
benefits in terms of moral development and
moral reasoning. However, the traditional
language of virtue, going back to the ancient
Greeks and medieval scholastics, may no longer
be adequate for contemporary business people.
Deciding upon what values are most important
and what personal character qualities are needed
by actors is thus essential at the intuitive level of
ethical practice. But MacIntyre (1985, p. 244)
observes that since the Enlightenment, there has
been an inability even to agree upon a catalogue
of virtues and, even more fundamentally, an
inability to agree upon the relative importance
of virtue concepts within a moral scheme in
which notions of rights and utility also have a
key place.
However, the perceived inadequacy of
language presents a challenge rather than a
roadblock for scholars interested in business
ethics. Indeed, field observation and interviews
of managers in their workplaces, food stores in
Mississippi, Tennessee, and Arkansas in 1993 and
1994 (Whetstone, 1995), disputes the view that
people in the workplace are “morally mute”
(Bird and Waters, 1989). The food store
managers interviewed use a moral language of
virtues and vices freely and articulately. However,
this language is not that of abstract deontolog-
ical or teleological philosophy or even the same
virtue and vice language, after translation, of
classical Greece and medieval Europe.
What Bird and Waters (1989) found is that
contemporary managers, perhaps because they
are educated to be, or to pretend to be, morally
neutral, treat almost as taboos the use of “right”
and “wrong” and “good” and “bad” in assessing
persons. Taboos of language are not necessarily
descriptive of reality, however. Ancient German
peoples did not have a word for “bear” because
of their fears and Victorians were enculturated to
avoid sexual references, even substituting “limb”
for a piano’s “leg” (Dooling, 1999). But the
Germans killed bears and the Victorians
reproduced.
The implication is that business leaders can
indeed encourage “good conversation,” although
as Trevino and Nelson (1995, p. 212) observe,
explicit use of terms such as “moral” and
111
“ethical” is not always well received. Managers
as leaders can be bold in speaking in moral terms,
and can more openly acknowledge the fact
that people in organizations have valued moral
orientations. The problem for contemporary
business leaders is not primarily the lack of
articulation of moral concerns (Maclagan, 1998,
p. 6), but that of understanding the language
people actually use. A message and challenge for
business ethicists is that more research is needed
on the subject of contemporary virtue and vice
language as well as on developing further helpful
ways of combining the application of virtue
and act-oriented perspectives by practicing
managers.
Conclusion
How does virtue ethics fit within business ethics?
Robert Louden’s thesis is that virtue ethics
theory should be included in any adequate
justification of morality. It fits very well if added
as a full complement to both deontological and
consequentialist teleological act theories. This
paper does not claim to prove Louden’s thesis
according to formal philosophical argument, but
focuses on the practical application of ethics
perspectives by business managers and leaders
seeking to promote moral development and
moral reasoning. It proposes that business
managers need to add virtue ethics, or more
precisely an attention to virtues and vices of
human character, as a fully-equal complement
to moral reasoning according to a deontological
focus on obligations to act and a teleological
focus on the consequences of acts. There are
beneficial reasons for doing so.
Adding a virtue perspective as a complement
to act-oriented perspectives can expand to scope
and perspectives of ethical analysis and under-
standing. This is because an Aristotelian virtue
perspective is personal; focuses on the motiva-
tions of the actor and the sources of action,
bringing a dynamic to ethical understanding; is
contextual, highlighting the importance of
understanding the environment as it affects both
actor and his or her acts; and complements other
disciplines addressing human behavior.
112 J. Thomas Whetstone
Even if the criticisms of virtue ethics success-
fully cloud its use as a mononomic or “strong”
normative theory of ethical justification, they do
not refute the above benefits of applying a virtue
ethics perspective – when done so in conjunc-
tion with also-imperfect act-oriented perspec-
tives. Instead, they point to a need for an
interactive tripartite approach in order to meet
the complex requirements of an applied ethic in
terms of human moral development and moral
reasoning concerning specific behavioral deci-
sions. In practice, a complete ethic needs to be
person-centered and act-focused, dynamic as well
as static, developmental and decision-focused,
and contextually adaptable. Without neglecting
the need to analyze individual acts one-by-one,
a complementary virtue perspective can provide
a learning process highlighting the continuous
dynamic of action and development of the
motivational dispositions of human persons to act
within the broad environmental and community
context. The fully complementary formulation
does not eliminate the risk of relativism some-
times attributed to virtue ethics because it
involves subjective judgments informed by
community culture, but minimizes relativism by
relying on objective deontological principles
applied with phronesis.
To illustrate how deficiencies of a “strong”
virtue ethics formulation can be overcome by a
more balanced tripartite approach, this paper
refers to several normative leadership paradigms
(each based on a combination of virtue, deon-
tology, or consequentialist teleology ethics per-
spectives) and the dangers inherent in each. The
most balanced and thus favored leadership
paradigm is servant leadership, grounded in a
tripartite ethic.
Just as it begins with a challenge to continue
philosophic debate of Louden’s appeal for
abandoning mononomic conceptions of ethics
theory, this paper concludes with a challenge to
empiricists to develop a more current descriptive
understanding of the moral language used in
contemporary organizations. This, along with the
continuing development of user-friendly decision
models combining act-oriented approaches with
deliberate attention to human virtues and vices,
can assist practicing managers lead moral
development and moral reasoning efforts.
References
Anscomb, E.: 1958, ‘Modern Moral Philosophy’,
Philosophy 33, 1–19.
Aristotle: 1976, The Nicomachean Ethics, translated by
J. Thomson, revised with note and appendices by
H. Tredennick, introduction and bibliography by
J. Barnes (Penguin, London).
Barnes, J.: 1976, Introduction to The Nicomachean Ethics
(Penguin, London).
Barnsley, J. H.: 1972, The Social Reality of Ethics
(Routledge & Kegan Paul, London).
Bass, B. M.: 1985, Leadership and Performance Beyond
Expectations (Free Press, NY).
Bird, F. and J. Waters: 1989, ‘The Moral Muteness
of Managers’, California Management Review 32(1),
73–88.
Boatright, J. R.: 1995, ‘Aristotle Meets Wall Street:
The Case for Virtue Ethics in Business’, Business
Ethics Quarterly 5(2), 353–359.
Bowie, N.: 1982, Business Ethics (Prentice-Hall,
Englewood Cliffs, NJ).
Bowie, N.: 1999, Business Ethics: A Kantian Perspective
(Blackwell, Oxford).
Bowie, N.: 2000, ‘Business Ethics, Philosophy, and
the Next 25 Years’, Business Ethics Quarterly 10(1),
7–20.
Broadie, S.: 1991, Ethics With Aristotle (Oxford
University Press, Oxford).
Burns, J. M.: 1978, Leadership (Harper & Row, NY).
Carr, A. Z.: 1968, ‘Is Business Bluffing Ethical?’,
Harvard Business Review 46 ( January-February),
143–153.
Cavanagh, G. F., D. J. Moberg and M. Velasquez:
1981, ‘The Ethics of Organizational Politics’,
Academy of Management Review 6, 363–374.
Cavanagh, G. F., D. J. Moberg and M. Velasquez:
1995, ‘Making Business Ethics Practical’, Business
Ethics Quarterly 5(3), 399–418.
Collier, J.: 1995, ‘The Virtuous Organization’,
Business Ethics: A European Review 4(3), 143–149.
Covey, S. R.: 1991, Principle-Centered Leadership
(Simon & Schuster, NY).
Crisp, R.: 1998, ‘A Defence of Philosophical Business
Ethics’, in C. Cowton and R. Crisp (eds.), Business
Ethics: Perspectives on the Practice of Theory (Oxford
University Press, Oxford), pp. 9–25.
 How Virtue Fits Within Business Ethics
DeGeorge, R. T.: 1987, ‘The Status of Business
Ethics: Past and Future’, Journal of Business Ethics
6, 201–211.
DeGeorge, R. T.: 1999, Business Ethics, 5th ed.
(Prentice Hall, Upper Saddle River, NJ).
DesJardins, J. R.: 1984, ‘Virtues and Business Ethics’,
in M. Hoffman, J. M. Moore and A. Fredo (eds.),
Corporate Governance and Institutionalizing Ethics
(D. C. Heath, Lexington, MA).
Donaldson, T. and T. Dunfee: 1999, Ties That Bind:
A Social Contracts Approach to Business Ethics
(Harvard University Business School Press, Boston).
Donaldson, T. and P. Werhane: 1999, Ethical Issues in
Business: A Philosophical Approach, 6th edition,
(Prentice Hall, Upper Saddle River, NJ).
Dooling, R.: 1999, ‘From Swearing By to Swearing
At’, The Wall Street Journal ( July 6), A14.
Drucker, P. F.: 1974, Management: Tasks, Respon-
sibilities, and Practices (Heinemann, London).
Duncan, S. M.: 1995, A Primer of Modern Virtue Ethics
(University Press of America, Lanham, MD).
Foot, P.: 1978, Virtues and Vices and Other Essays in
Moral Philosophy (Basil Blackwell, Oxford).
Frankl, V.: 1962, Man’s Search for Meaning: An
Introduction to Logotherapy, translated by I. Lasch
(Hodder & Stoughton, London).
Freeman, R. E.: 2000, ‘Business Ethics at the
Millennium’, Business Ethics Quarterly 10(1),
169–180.
Friedman, M.: 1970, ‘The Social Responsibility of
Business Is to Increase Its Profits’, New York Times
Magazine (September 13) in Hoffman, W. M. and
J. M. Moore (eds.), 1990, Business Ethics: Readings
and Cases in Corporate Morality (McGraw-Hill, NY).
Giddens, A.: 1984, The Constitution of Society: Outline
of the Theory of Structuration (Polity Press,
Cambridge).
Goodpaster, K. E.: 1991, ‘Ethical Imperatives and
Corporate Leadership’, in R. E. Freeman (ed.),
Business Ethics: The State of the Art (Oxford
University Press, NY).
Goodpaster, K. E.: 2000, ‘Conscience and Its
Counterfeits in Organizational Life: A New
Interpretation of the Naturalistic Fallacy’, Business
Ethics Quarterly 10(1), 189–201.
Green, R. M.: 1994, The Ethical Manager: A New
Method for Business Ethics (Macmillan College
Publishing Company, NY).
Greenleaf, R. K.: 1977, Servant Leadership (Paulist
Press, NY).
Hartman, E. M.: 1996, Organizational Ethics and the
Good Life (Oxford University Press, NY).
113
Hartman, E. M.: 1998, ‘The Role of Character in
Business Ethics’, Business Ethics Quarterly 8(3),
547–559.
Hauerwas, S.: 1974, Vision and Virtue (Notre Dame
Press, Notre Dame, IN).
Horne, A.: 1997, ‘Battle in Burma’, The Wall Street
Journal (March 17), A18.
Horvath, Charles M.: 1995, ‘Excellence v.
Effectiveness: MacIntyre’s Critique of Business’,
Business Ethics Quarterly 5(3), 499–532.
Hosmer, L. T.: 1994, Moral Leadership in Business
(Irwin/McGraw-Hill, Boston, MA).
Hosmer, L. T.: 1996, The Ethics of Management, 3rd
edition (Irwin, Chicago, IL).
Hursthouse, R.: 1997, ‘Virtue Theory and Abortion’,
in R. Crisp and M. Slote (eds.), Virtue Ethics
(Oxford University Press, Oxford), pp. 217–238.
Jackson, J.: 1996, An Introduction to Business Ethics
(Blackwell, Oxford).
Jennings, M.: 1999, ‘The Evolution-and Devolution-
of Journalistic Ethics’, Imprimis 28, 7.
Keeley, M.: 1995, ‘The Trouble with Trans-
formational Leadership: Toward a Federalist Ethic
for Organizations’, Business Ethics Quarterly 5(1),
67–96.
Koehn, D.: 1995, ‘A Role for Virtue Ethics in the
Analysis of Business’, Business Ethics Quarterly 5(3),
533–539.
Kreeft, P.: 1992, Back to Virtue (Ignatius, San
Francisco).
Kupperman, J.: 1991, Character (Oxford University
Press, NY).
Larmore, C. E.: 1987, Patterns of Moral Complexity
(Cambridge University Press, Cambridge).
Louden, R. B.: 1984, ‘On Some Vices of Virtue
Ethics’, in R. Crisp and M. Slote (eds.), 1997,
Virtue Ethics (Oxford University Press, Oxford).
MacIntyre, A.: 1985, After Virtue: A Study in Moral
Theory, 2nd edition (Duckworth, London).
Maclagan, P.: 1998, Management and Morality (Sage,
London).
Mahoney, J.: 1990, Teaching Business Ethics in the U.K.,
Europe and the U.S.A.: A Comparative Study
(Athlone Press, London).
Mintzberg, H.: 1971, ‘Managerial Work: Analysis
from Observation’, Management Science 17, 97–110.
Moberg, D. J. and M. Calkins: 1999, ‘Reflection in
Business Ethics: Insights from St. Ignatius’ Spiritual
Exercises’, presented August 7 at the 1999 Annual
Conference of the Society for Business Ethics,
Chicago, IL.
Monast, J. H.: 1994, ‘What Is (and Isn’t) the Matter
114 J. Thomas Whetstone
with “What’s the Matter. . . .” ’, Business Ethics
Quarterly 4(4), 499–512.
Morgan, G.: 1996, Images of Organization, 2nd edition
(Sage, Thousand Oaks, CA).
Nash, L. L.: 1990, Good Intentions Aside: A Manager’s
Guide to Resolving Ethical Problems (Harvard
Business School Press, Cambridge, MA).
Nash, L. L.: 1994, Believers in Business (Thomas
Nelson, Nashville, TN).
Nash, L. L.: 2000, ‘Intensive Care For Everyone’s
Least Favorite Oxymoron: Narrative in Business
Ethics’, Business Ethics Quarterly 10(1), 277–290.
Nesteruk, J.: 1995, ‘Law and the Virtues’, a review
of Ethics and Excellence by R. C. Solomon, Business
Ethics Quarterly 5(2), 361–369.
Niebuhr, H. R.: 1963, The Responsible Self (Harper &
Row, NY).
O’Donovan, O.: 1986, Resurrection and Moral Order:
An Outline for Evangelical Ethics (Inter-Varsity:
Leicester, U.K.).
Pincoffs, E.: 1986, Quandaries and Virtues: Against
Reductionism in Ethics (University of Kansas Press,
Lawrence, KS).
Rost, J. C.: 1993, Leadership for the Twenty-first Century
(Praeger, Westport, CT).
Rost, J. C.: 1995, ‘Leadership: A Discussion About
Ethics’, Business Ethics Quarterly 5(1), 129–142.
Solomon, R. C.: 1992, Ethics and Excellence:
Cooperation and Integrity in Business (Oxford
University Press, NY).
Sommers, C. H.: 1991, ‘Teaching the Virtues’,
Imprimis 20 (November).
Sommers, C. H. and F. Sommers: 1993, Virtue and
Vice in Everyday Life (Harcourt Brace, Ft. Worth,
TX).
Sorell, T. and J. Hendry: 1994, Business Ethics
(Butterworth-Heinemann, Oxford).
Spears, L. C. (ed.): 1995, Reflections on Leadership
( John Wiley & Sons, NY).
Stark, A.: 1993, ‘What’s the Matter with Business
Ethics?’, Harvard Business Review 71(3), 38–48.
Stewart, R.: 1970, Managers and Their Jobs (Pam Piper,
London).
Stocker, M.: 1976, ‘The Schizophrenia of Modern
Ethical Theories’, Journal of Philosophy 73,
453–466.
Trevino, L. K. and K. Nelson: 1995, Managing
Business Ethics ( John Wiley, NY).
Velasquez, M.: 2000, ‘Globalization and the Failure
of Ethics’, Business Ethics Quarterly 10(1), 343–352.
Walton, C.: 1988, The Moral Manager (Harper & Row,
NY).
Werhane, P. H.: 1999, Moral Imagination and
Management Decision Making (Oxford University
Press, NY).
Whetstone, J. T.: 1995, ‘The Manager as a Moral
Person: Exploring Paths to Excellence’, unpub-
lished D.Phil thesis, Oxford University.
Williams, O. F.: 1984, ‘Who Cast the First Stone?’,
Harvard Business Review 62 (September-October),
151–160.
Davis College of Business,
Jacksonville University,
4484 Charter Point Boulevard,
Jacksonville, FL 32277,
U.S.A.
E-mail: twhetst@ju.edu