Business ethics crisis: reconciling profit maximization and moral maximization through models, trade-offs, and decision criteria

Mario Bogdanović, Walter Block and Zoran Čekerevac
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Mario Bogdanović: IV - Istrian University of Applied Sciences
Walter Block: Loyola University, New Orleans
Zoran Čekerevac: Independant Researcher

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Abstract: This paper addresses a central paradox in business ethics: the tension between profit maximization and moral maximization. The dilemma arises from the apparent incompatibility of two fundamental value systems—instrumental, egoistic values oriented towards efficiency and profit, and intrinsic, humanistic values oriented towards justice, altruism, and prosocial conduct. Because both cannot be maximized simultaneously, it is widely believed business ethics faces a persistent crisis of coherence and application. Four principal models are examined as possible responses to this paradox. First, profit and morality are treated as separate systems, with capitalism understood as an amoral framework in which legal regulation substitutes for ethics. Second, profit and morality are conceived as identical systems, allowing for a composite but often hypocritical integration. Third, the two systems are balanced through compromise, yielding suboptimal but pragmatic solutions that vary in emphasis on moral or instrumental values. Fourth, profit maximization is considered inherently moral, particularly within laissez-faire capitalism, where voluntary exchange is deemed ethically sufficient. That is to say, there is no real gap between ethics, on the one hand, and greed, capitalism, and self-seeking, on the other. The supposed divide between the two of them is an error. This is the Austro-libertarian position. Each model reveals strengths and weaknesses, underscoring the difficulty of reconciling economic imperatives with ethical ideals. The paper concludes that while no definitive resolution yet exists, recognizing and managing this paradox is essential for advancing both theoretical and practical approaches to business ethics. The principal contribution of this paper is to explore whether the apparent conflict between profit maximization and moral maximization can be reconciled, and, if not, to provide a conceptual framework for analyzing possible resolutions.

Keywords: Business ethics; Profit maximization; Moral maximization; Ethical paradox; Value systems; Hypocrisy; Compromise models; Capitalism and morality,Business ethics,Profit maximization,Moral maximization,Ethical paradox,Value systems,Hypocrisy,Compromise models,Capitalism and morality (search for similar items in EconPapers)
Date: 2026-07-14
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