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Business ethics pedagogy: A synthesis of paradigms, philosophies, and teaching methods Jana Craft University of Minnesota April 2, 2011

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  • 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

  • Running Head: BUSINESS ETHICS PEDGAOGY 2

    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,

  • Running Head: BUSINESS ETHICS PEDGAOGY 3

    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 decision-

    making 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 non-

    profit organization dedicated to fostering values-based leadership, the percentage of MBA

  • Running Head: BUSINESS ETHICS PEDGAOGY 4

    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

  • Running Head: BUSINESS ETHICS PEDGAOGY 5

    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,

  • Running Head: BUSINESS ETHICS PEDGAOGY 6

    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

  • Running Head: BUSINESS ETHICS PEDGAOGY 7

    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

  • Running Head: BUSINESS ETHICS PEDGAOGY 8

    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

  • Running Head: BUSINESS ETHICS PEDGAOGY 9

    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.

  • Running Head: BUSINESS ETHICS PEDGAOGY 10

    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

  • Running Head: BUSINESS ETHICS PEDGAOGY 11

    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 decision-

    making (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

  • Running Head: BUSINESS ETHICS PEDGAOGY 12

    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

  • Running Head: BUSINESS ETHICS PEDGAOGY 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

  • Running Head: BUSINESS ETHICS PEDGAOGY 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.

  • Running Head: BUSINESS ETHICS PEDGAOGY 15

    Table 1

    Summary of analysis between philosophies, paradigms, and methods

    Philosophy Paradigm Methods

    Ethics of

    doing

    Pragmatism:

    Consequentialist

    Extrinsic

    Experiential

    Functionalist:

    Objectivity

    Order, equilibrium, stability

    Concrete answers possible

    Case study analysis

    Socratic method

    Interactive role playing

    Ethics of

    being

    Realism:

    Judgment

    Intrinsic

    Internal dialogue

    Interpretive:

    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 long-

    lasting for teaching business ethics.

  • Running Head: BUSINESS ETHICS PEDGAOGY 16

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