The Philosophical, Ethical and Economic Foundations of Ethical Investment

Ethical awareness is growing and the word itself seems to be spreading to all walks of life. In medicine and economics a myriad of ethical committees have sprouted in an attempt to control the potential excesses of science or business transactions. How can one explain this craze for a word that was hardly ever used ten years ago? It is from an economic perspective that we shall try to explain this new, many-sided phenomenon : sound corporate governance, ethical investment funds, sustainable development, equitable commerce, etc. Our goal is not to prove the efficiency or inefficiency of these types of activities. We do not see things strictly from an American utilitarian perspective that considers ethics as an economic instrument for improving the world we live in. Our research leads to a more ontological view of ethics considering it as an essential element of mankind and of human dignity. The logic behind this desire for ethics could be summarized as follows: The harsh reality of the world requires urgent measures to be taken. The 'theory of justice' makes us believe that each individual is responsible for the life of other people whereas for the supporters of a liberal economy, the productive selfishness of each individual produces riches for the community as a whole. But this could reveal itself to be destructive of wealth in the long term. To survive and expand capitalism will have to be supported by moral education and the preservation of the natural resources. The decision to follow this path is both individual and collective. However, collectively speaking, the nation states no longer act as the locomotive for the social adjustment of capitalism and our deserted churches no longer exert any influence on the consciences of people. The emancipated but solitary individual recognizes that the victims of the collective system are scapegoats. Therefore, recent developments in the changing capitalistic system which is trying nowadays to take into account the altruistic aspirations of the individual offer a pragmatic solution.