Researchers propose a new model to solve questions surrounding the moral attribution of organizations’ actions. The key, they say, is to reframe them as subjects rather than mere instruments.

The way that we perceive and interact with organizations often defies legal definition. For example, we often blame multinational enterprises for unethical behavior by one of their local subsidiaries, even though subsidiaries are legally separate entities. Does this mean that our instinct to ascribe blame in this way is misguided? Or is there something morally important to this instinct? From a moral perspective, where does the organization stop and the rest of the world begin?

In 1937, the British economist, author and Nobel laureate Ronald Coase published an article that would come to shape to a great extent the way that we think about organizational boundaries. Coase viewed organizations as objects that people use to reduce the costs of economic cooperation. In his seminal article, he argued that organizations stop at the point where managerial direction is no longer more efficient than market exchange: that is, their boundaries are drawn so as to reduce transaction costs.  

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Article published in Esade Do Better