Organizations confer tremendous advantages on societies: they sustain complex divisions of labor and capture economies of scale. They also provide the site of much of what we do in our waking hours. When we join organizations we assume roles, follow rules, and respond to incentives that influence our character and identity. By breaking complex tasks into manageable pieces, organizations divide the responsibility for outcomes; they thereby risk turning individuals into cogs in machines. How can we sustain our moral character and autonomy, and fulfill our ethical responsibilities, while retaining the advantages of organization? This question motivates Lisa Herzog’s pathbreaking study.
Reclaiming the System deftly integrates normative theorizing and qualitative methods. Based on interviews with managers, administrators, CEOs, traders, analysts, and other functionaries, Herzog, a political philosopher and economist, captures three complex dilemmas that all organizations face: how to prevent themselves from becoming iron cages that destroy the exercise of judgment, how to mitigate the tendency of hierarchies to breed mistrust and impede the sharing of morally relevant knowledge, and how to create organizational cultures that allow role occupants to fulfill their individual and collective responsibilities.
The starting point for Herzog’s analysis is that morality is a pervasive feature of social life and that to act morally requires supportive social contexts. Because organizations amplify the potential for moral harms, it is important that they respect basic norms. Injecting such norms into “the social spheres in which non-intentional, non-communicative forms of coordination take place” (p. 13) is what Herzog means by reclaiming the system. Institutions and organizations should not be “social realms that function exclusively according to a ‘systemic’ logic” (p. 255). What Jürgen Habermas called the colonization of the lifeworld by the system needs to be reversed: we need to moralize the system.
What basic moral norms might apply to organizations? Herzog suggests three: “respect toward all individuals…as moral equals,” avoidance of “individually caused harm to others,” and avoidance of “contributing to collectively caused harm to others” (p. 51). These norms are “endorsed by a broad variety of moral views” and thus represent an “overlapping consensus” (p. 54). Aligning organizations with them would help create a society “in which the rights of individuals are strengthened, the legal structures of organizations are adapted to their purposes, the balance of rights and responsibilities of corporations is redressed, access to knowledge is restructured, and measures for ensuring meaningful work are in place” (p. 250).
There are notable parallels between our respective books. Herzog and I both affirm the moral dimensions of organizations and institutions, attributing many of their failings to the inability to grapple with these dimensions; we identify problems arising from systemic conditions that crush moral agency; we place practice and practitioners at the center of our analyses; we are interested in character and judgment, which we want to foster and preserve; and we reflect on the self as actualized through roles and functions. The main difference is that, whereas Herzog wants individuals in organizations to be supported by norms that enable them to be morally responsible, I want institutions to orient practitioners toward appropriate goods. Despite this difference, we both acknowledge the importance of practical wisdom (or phronesis).
Although Herzog does not use this term, she is an ally of research on practical wisdom for three reasons. First, she expertly refutes situationists who claim that character and wisdom are unreliable sources of moral conduct. She provides evidence that moral agency, like any capacity, needs to be appropriately scaffolded. Human agents are neither playthings of contextual forces nor fully autonomous rational individuals. The development of our moral character demands the recognition that we have a shared responsibility to create contextual conditions that support good character: “morality is something that we need to take care of together” (p. 41, emphasis in original).
Second, Herzog shows that, although rules and incentives are organizational necessities, they are blunt instruments that, blindly applied, “can do injustice to individual cases” (p. 93). Incentives assume people respond to carrots and sticks, instead of intrinsic motivations (p. 96), which can be insulting and demoralizing. Similarly, codes of conduct may indicate a lack of respect for practitioners whose knowledge and motivation are essential to morally responsible action.
Finally, Herzog offers numerous examples of practitioners who notice morally significant events, know when to enforce and when to bend rules, use their specialized knowledge in responsible ways, and help prevent organizations from failing. She emphasizes the importance of intrinsic motivations and of balancing aims; she extols the value of reflection, perspective taking, and listening; and, above all, she stresses the importance of transformational agency, “in which individuals put the results of their reflection into action, taking moral responsibility for what they do in their jobs” (p. 193). Such stewardship can keep an organization “morally ‘on track’” (p. 194).
And yet there is a subtle difference between asking how organizations can be aligned with basic moral norms and asking how institutions can enable practitioners to attain the aims intrinsic to their activities. Herzog directly touches on this distinction, writing that “questions about basic moral norms and questions about what it means to fulfil a role well are often intertwined. This has to do with the fact that basic moral norms require application to concrete practices, which in turn requires an understanding of what these practices are—and this question can hardly be separated from the question of what these practices should be” (p. 190, emphasis in the original). In this passage, Herzog implicitly acknowledges that norms are vulnerable to the same criticism she directs at principles—namely, that most moral theories tend to agree and will often come to the same or similar conclusions in the evaluation of specific cases (pp. 46–47). It is not moral agreement that is typically lacking in the case of moral failings so much as the motivation and judgment necessary to put principles into practice. What Herzog says about principles applies mutatis mutandis to norms.
Herzog’s basic moral norms may be uncontroversial, but using them to guide decisions in an organization takes practical wisdom. Just as knowing what it means to be a good engineer, or doctor, or banker, and doing it in the right way and for the right reasons, requires practical wisdom, so too does knowing how to comply with basic norms, especially in difficult or exceptional circumstances or where those norms conflict or provide insufficient guidance. What does it mean for a doctor to respect the autonomy of a patient or for a teacher to treat a student as a moral equal? How can we balance the mitigation of harms to future generations from climate change against avoidance of harm to vulnerable communities in the present? Answers to such questions are not found in abstractions.
The practical wisdom needed to make such decisions can be integrated into Herzog’s proposals for restructuring institutions and organizations. Relaxing strictness and uniformity in the application of rules by creating what she calls “safety vaults” and “spaces for reflection” within organizations holds the promise of allowing the exercise of judgment and shared responsibility (p. 100). “Organizations,” says Herzog, “can encourage dialogue and exchange among individuals with different organizational roles and different worldviews, so that these can acquire a clearer sense of what is morally at stake, despite the partial perspectives of their role” (p. 205). Dialogue may have a value in itself, if only by slowing down the pace of events and allowing agents to step back from their activities and place them in perspective. Yet what ensures that individuals will use those spaces well? How will critical reflection on roles improve practices?
Whereas Herzog places a strong burden on dialogue and the exchange of reasons, I believe her proposals are more likely to generate the goods we want, such as the better understandings of roles, when the spaces for reflection and safety vaults she proposes engage the stewardship of wise practitioners. Such practitioners are likely to be motivated by a desire to attain the goods associated with their activities. Likewise, good organizations will promote those who exhibit character and judgment and will encourage them to provide mentoring and modeling to others in their organization. Under the aegis of transformational agents, safety vaults and spaces for dialogue may serve their purposes well. An organization, however, that rewards the ruthless pursuit of money or power at the expense of well-being or the public interest will, I suspect, neither welcome these resources nor deploy them effectively. And that is why we need good institutions.
I am pleased to have had the opportunity to reflect on both the complementarities and tensions between our books, which I hope will generate new research. Reclaiming the System is an inspiring and innovative contribution to a problem that spans a range of disciplines, debates, and literatures. It should be read by all social scientists interested in organizations, ethics, and how we can begin to reclaim the systems in which we are too often imprisoned.
