The categorical imperative at work

The categorical imperative is a philosophical idea from Immanuel Kant. Kant had been wondering whether one could come up with ethical standards that would be based on pure reason, not on religious beliefs. He discovered that behaviour can be ethical if it is also generally applicable among all members of a (your) category. It is unethical if general application to all members of a category would not be considered possible or acceptable. For a street kid in Rio, stealing a bread from a rich man could still be ethical, in case you consider the rich man as belonging to a different category. Stealing a bread from another street kid however, would be unethical.

The categorical imperative is a difficult term to refer to the golden rule: don’t do to others (of the same category) what you would not like that is being done to yourself.

The question is now whether the categorical imperative is also applicable in a business context. Is there also a categorical imperative for commercial companies, or for business men who act on behalf of them? Many people will immediately say: no, because there is no mercy in business. Competition is too demanding. Applying the categorical imperative in a business context would lead to the end of the own organisation or of the person who applies it. What does religion say about the business world? The answer is simple: religions generally don't make a distinction between the personal world and the commercial world: "Respect the commandments".

If we look at the commercial world, the categorical imperative is not doing well, although companies generally try to keep a good reputation. The business world is considered as a jungle where the survival of the strongest is the only rule. Nobel Prize winner Robert Shiller claimed that companies who don’t deceive, don’t survive. The argument is often: if I don’t do it (=the evil), my competitor will do it. It is also remarkable how primitive war language is often used to describe the outcome of business meetings (battle, bloodshed, "chopped their heads off.. ").

This is the reasoning that has eventually led to the Volkswagen scandal. The same reasoning has also led to the banking crisis. We also find this reasoning in sports where athletes and cyclists have been doped to win the battle. And it is true, if we look at history, the survival logic has always been dominant where a lot was at stake in a highly uncertain (not well regulated) environment. But companies often forget the long term damage. Perhaps the categorical imperative will do better when the company environment stabilises a little and when the rules of the game get defined, imposed and accepted more widely. Until then, we will see more of these scandals.

I also refer to my earlier blog "Anständig wirtschaften".