The Dilemma of the Bi-Moral Society

John Hendry, coining the term bi-moral society, made the point that people were influenced by two obligations, the social force of morality and the rules through which they were expressed and the pursuit of self-interest, which has gained considerable legitimacy in the Me First society.

The Development of the Bi-Moral Society

The principles of traditional morality have undoubtedly dominated society and business activity from historic times. Social behaviour has for centuries been regulated by the hierarchical establishments of religion, the state and the social community; businesses have been created as hierarchical and traditional moral communities. Behaviour in business firms has been accepted as necessary for the development and growth of a society and entrepreneurs have been admired and valued for their innovative abilities and risk taking capacities. Entrepreneurial self-interest has however also been perceived to be a possible challenge and threat to the traditional conservative moral order and has been permitted only under supervision and subject to various types of regulatory safeguards. The wide acknowledgement of the agency theory has in fact resulted in the development of various types of safeguards, first through the introduction of external auditors and later through the imposition of diverse corporate governance measures in order to ensure that organisational managements did not act at great variance from the wishes of organisational shareholders.

Moral safeguards have however been progressively relaxed over the decades even as business enterprise has remained closely regulated and its social practices have been connected very closely to the moral obligations of society and its traditional morality. The rules of behaviour, at least until the 1970s mirrored behavioural rules, which were prevalent in families or local communities; traditional moral principles have however been substantially eroded in recent decades. Modern corporations, business and finance institutions have been liberated from several of the restrictions of national and global regulation and have grown tremendously, both in influence and in power. The traditional moral authorities, comprising religion, the state, the community, education and the family have been weakened substantially by developments like individual transportation and new communications technologies.

Instrumental and economic reasoning, based in the cultural ideology of the market and the principles of individual self-interest have been applied in areas hitherto been influenced by moral beliefs and feelings. Such reasoning has dominated and influenced political discourse and even altered the ways in which people think about their individual families. The morality of self-interest has developed an individual social legitimacy, which matches and counters traditional morality.

Traditional moral principles however continue to be important and influence the lives of people; people are unlikely to be less moral than they were in the past. Morals are, however, not imposed any longer by society and traditional conventions have ceased to be imperative in a wide variety of situations. People, who once followed authority have now become their individual moral authorities and balance traditional moral principles against legitimate self-interest. Thus, we have a bi-moral society.

The Implications of the Bi-Moral Society

The development of a bi-moral society has numerous implications for social and family life, as well as politics, governance, management, business ethics and corporate social responsibility. Alterations in social moral culture have changed in the structure of business corporations. Business activity is now characterised by market culture and influenced by self-interest, attributes that were concealed in the past.

The path to business success in the past rested in large scale coordination, accumulated experience and long term relationships; it was not important to assert the interests of shareholders because they could be accomplished through adherence to traditional moral principles. Alterations in the competitive environment led to the breakdown of joint and mutual interest. Business corporations continued to ask for loyalty from their employees, but it was evident that they could not afford to be loyal to their employees in return, which resulted in the development of moral dilemmas. Employees continued to focus upon commitment and loyalty but the undermining of their security however forced them to follow their self-interest for survival. This resulted in the elimination of the traditional moral compact, which was the greatest strength of orthodox bureaucracies, the collapse of these bureaucracies and the emergence of new business firms.

Most business corporations continue to retain bureaucratic elements with strong vertical dimensions. With all managers being bosses and having bosses, the vertical power differentials carry perceived moral obligations because managerial relationships occur within the framework of a society that values traditional moral principles. The majority of managers still feel morally obliged to help their superiors and serve their employers through hard work and effort maximisation. They try to take care of their juniors, people for whom they consider themselves to be financially and morally responsible.

Modern business organisations are however structured in accordance with contemporary market rules and it is expected that people will look after their self-interest. Organisational employees are expected to take care of their careers and are frequently provided employment on contracts that do not offer job security. The corporation is run by the dominant ideology of the free market. Employees are thought to be free agents and the power differentials do not carry moral obligations. All employees are thus at liberty to search for new employment and change jobs if they feel it to be good for their careers. Employers are also free to hire and fire employees in accordance with the laws of demand and supply. This results in the development of moral tensions and dilemmas.

Contemporary managers are responsible to their superiors but can now pull in different directions. Managers are responsible for organisational performance and are paid on that basis. They are accountable to their team members, who depend upon their commitment and contributions, as well as to the employees who are their juniors and depend upon their support. They are responsible to their families and to other people who depend upon their friendship; they are also responsible for pursuing their self-interest, enhancing their careers and developing and sustaining their incomes.

This results in tremendous tensions between home and work, commitment to family and job demands. Managers thus work for extremely long hours and despite such effort, are saddled with high levels of insecurity. They carry the costs of self-employment without the benefits. This results in tensions between work and home and encourages the occurrence of moral hazardThe financial crisis of 2008 was caused in substantial measure by the self-interest of managers who focused on their bonuses and their commissions, rather than on adherence with their job principles and methods of work.

Managers, in addition to being employees and team workers are also superiors. They have to engage in team management and to hire, terminate, promote, discipline, renew or refrain from renewing the contracts of employees. Whilst this is facilitated by a market culture, where commitment does not extend beyond contractual terms, the ease of taking decisions is eroded on account of power differentials and reality of relationships between people. Managers thus have to ask and demand loyalty and commitment but cannot provide it in return in substantial measure. They need to provide friendship and support and develop trusting relationships if they are to obtain satisfactory work from their employees; they have to however do all these actions knowing that they might have to go back on implicit moral contracts and take hard market decisions.

The Dilemma

Life in a bi-moral society is complicated by the need to continuously balanced traditional concepts of social morality with self-interest. Individuals have to cope with such tensions in business environments where their moral instincts and faculties are crowded out. The bi-moral society has come about and is here to stay. Managers have to individually negotiate their paths in this frequently confusing environment in order to live ethical lives and develop trusting and productive relationships with their workplace colleagues.