The Moral Minimum: A Complex Standard

The Moral Minimum: A Complex Standard

Each person has a set of personal values and morals that they hold themselves accountable to, whether for religious reasons or the result of years of environmental conditioning. These standards of behavior often go above and beyond the laws set in place by government. Just like individuals, a business entity chooses a standard of moral behavior to uphold. A difficult task to undertake, considering businesses are comprised of people with varying behavioral standards, but a necessary one nonetheless. Businesses are required to act with a moral minimum, defined as the minimum degree of ethical behavior expected of a business, or more specifically, compliance with the law . Most businesses go above this moral minimum however, weighing decisions beyond profitability and legality, and analyzing what constitutes right and wrong behavior. With information rapidly available to investors, social responsibility is in constant check. Going above the standards set by law can actually increase profitability, ease capital attainment, and in turn, increase the stock price. In a world where environmental concern is mounting, businesses are being called to act righteously and hold itself to the highest standard: that of natural law. In this paper, the concept of moral minimum will be further developed through the work of Hart, a positive and natural law theorist, accompanied by an analysis of the responsibilities facing business today, specifically the standards they should hold themselves to.

H.L.A Hart defines law on two different levels; primary and secondary. Primary rules are driven by a natural demand for conformity and based on behaviors alone, typical of a pre-legal system, such as a community or tribe. Secondary rules however, are directed at primary rules, and supplement them by alleviating the uncertain, static, and inefficient characteristics of a pre-legal system. According to Hart, the two rules together form the foundation of law. From this framework, Hart goes on to describe two viewpoints commonly held; internal and external. The internal viewpoint is held by someone who accepts the standards for behavior set by law, whereas a person who holds an external viewpoint does not accept the law as the standard and instead observes patterns of behavior to determine acceptableness. The difference between these two viewpoints is further distinguished through the concept of “legal validity”. An external thinker only accepts laws upon reinforcement, while an internal thinker sees validity in a law outside of its reinforcement. Law is enforced because it is valid. It is not valid because it is enforced. A person with an internal viewpoint holds themselves to a higher standard. They do not wait for reinforcement of a law to honor its validity and necessity in society.

Businesses that hold an internal viewpoint hold themselves to a higher moral standard than those with an external viewpoint. They see validity in laws immediately, whereas, some �externally thinking’ companies will test the waters and see if a law is being strictly enforced or not. They would be willing to evade a law if loopholes were found. The concept of moral minimum obviously overlaps with this external/internal viewpoint developed by Hart. An organization without a clear structure, strategy, and ethical culture, is comprised of individuals acting on varying viewpoints. It is not wrong for individuals to vary in their interpretation of law, but in the workplace, these viewpoints need to be aligned. This viewpoint should be that of an internal viewpoint, higher than the moral minimum required by law. Employees should not wait to see whether management is enforcing the ethical standards set by the company, they should abide by them without question.

Defining what behavior constitutes �above the moral minimum’ is difficult to do. For instance, take a company who is exposed to wage increase pressures. If the company honors these pressures, increasing the wage, it is viewed by the public as a �kind employer’. These wage increases are costs that have to absorbed however, whether by achieving learning curve benefits or passing the costs on as price increases to customers. If prices have to be raised, it typically cuts into revenues, especially if the product has readily available substitutes. This could lead to job cuts. So, how does a company determine what is morally right? Retaining jobs, giving price-sensitive customers the chance to own its products, or ensuring its employees have a higher standard of living?

In Joel Feinberg’s “Harmless Wrongdoing: The Moral Limits of the Criminal Law”, he discusses the moral criteria that labels certain behavior as wrongdoings, despite the lack of negative effect those behaviors have on society. They are “free-floating”