Introduction – the nature of morality

Until now, this book has focused on the legal rights and duties of those involved in the governance of companies. This chapter examines not what the law stipulates as expected of those involved in corporate governance, but the ethical responsibilities of company officers. These levels of inquiry, though often overlapping, are quite different. The ultimate aim of the law is to guide and coordinate human behaviour, normally through the threat of coercive measures for violations of legal norms. In order to be effective at shaping human conduct, legal norms must be clear and knowable.

Morality is less prescriptive than the law – there is no official sanction or censure involved with breach of moral norms. It is also generally more open-ended and less clear. This, however, should not stifle the search for moral truths or consensual moral norms. Despite the high level of disagreement about the precise content of moral norms, an important paradigm of moral judgments is that they are (apparently) used in the same manner as factual judgments.