Competitive Markets, Corporate Firms, and NewGovernance - An Ordonomic Conceptualization

The purpose of this article is to develop an ordonomic conceptualization of corporate citizenshipand new governance that (a) provides a framework for positively explaining thepolitical participation of companies in new governance processes and (b) does not weakenbut instead strengthens the functional role of corporations as economic actors in the marketsystem of value creation. To this end, we develop our ordonomic approach in a critical discussionof Milton Friedman’s stance on the social responsibility of business in three steps.(1) The ordonomic perspective on the economics ethics of competitive markets argues thatthe social responsibility of business does not lie in maximizing profits but in addressingsocietal needs through the mutually advantageous creation of value. (2) The ordonomicapproach to the business ethics of corporate actors claims that corporate firms can use moralcommitments as a factor of production. (3) The ordonomic perspective on the process ethicsof new governance holds that companies can act not only as economic actors but also participateas political and moral actors by taking ordo-responsibility in processes of new governance.This role of corporate citizens in the new governance does not weaken but, instead,strengthens the role of business firms as economic agents for value creation.