Thomas Donaldson

Thomas Donaldson
  • Mark O. Winkelman Professor
  • Professor of Legal Studies & Business Ethics

Contact Information

  • office Address:

    644 Jon M. Huntsman Hall
    3730 Walnut Street
    Philadelphia, PA 19104

Research Interests: business ethics, corporate compliance, corporate governance, leadership

Links: CV

Overview

Education

PhD, University of Kansas, 1976; BS, University of Kansas, 1967

Recent Consulting

Walmart; Goldman Sachs; BP; KPMG. Areas: Ethics, leadership, and corporate governance.

Career and Recent Professional Awards; Teaching Awards

Outstanding Teacher of the Year award in both 2005 and 1998 and Excellence in Teaching Awards for 2011, 2010, 2009, 2007, 2006, 2005, 2002, 2001, 2000, 1999 , and 1998); Outstanding Teacher of the Year, Georgetown University; Distinguished Researcher of the Year, Georgetown University School of Business, 1995; Named most influential “thought leader” in Ethisphere Magazine’s 2009 ranking of the 100 Most Influential People in Business Ethics.  Winner: Aspen Institute’s Pioneer Award for Lifetime Achievement, 2009.

Academic Positions Held

Wharton: 1996-present (named Mark O. Winkelman Professor, 1996). Previous appointments: The John Connolly Professor, Georgetown University 1990-1996; The C. Stewart Sheppard Professor , Darden School, University of Virginia 1988-89; The Henry J. Wirtenberger Professor of Ethics, Department of Philosophy, Loyola University of Chicago; 1984-88; Asst. and Assoc. Professor, Loyola University of Chicago, 1976-1984.

Professional Leadership

Associate Editor, Academy of Management Review, 2003-2007; Chair, Social Issues in Management Division of the Academy of Management, 2008; Director, Wharton PhD Program in Ethics and Legal Studies, 2002-2008; Co-founder and past president of the Society for Business Ethics.

Corporate and Public Sector Leadership

Appointed member of the National Adjudicatory Council of the Financial Industry Regulatory Authority FINRA (formerly the NASD) (2004-2009). Trustee, Carnegie Council on Ethics and International Affairs (1992-present); Chair, FTSE4Good US Committee (2002-present)

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Research

  • Thomas Donaldson and J. P. Walsh (2016), Toward a Theory of Business, Research in Organizational Behavior, 35, pp. 181-207.

  • Thomas Donaldson, Thomas Jones, R. E. Freeman, J. Harrison, C. Leana, J. T. Mahoney, J. Pearce (2016), Management Theory and Social Welfare: Contributions, Extensions, and Challenges, Academy of Management Review, 41 (2), pp. 216-228.

  • Thomas Donaldson (2015), Where the Facts End: Richard De George and the rise of business ethics, Journal of Business Ethics, 127 (4), pp. 783-787.

  • Thomas Donaldson, P. Schreck, D. van Aaken (2013), Positive Economics and the Normativistic Fallacy: Bridging the Two Sides of CSR,, 23 (2).

    Abstract: Abstract In response to criticism of empirical or “positive” approaches to corporate social responsibility (CSR), we defend the importance of these approaches for any CSR theory that seeks to have practical impact. Although we acknowledge limitations to positive approaches, we unpack the neglected but crucial relationships between positive knowledge on the one hand and normative knowledge on the other in the implementation of CSR principles. Using the structure of a practical syllogism, we construct a model that displays the key role of empirical knowledge in fulfilling a firm’s responsibility to society, paying special attention to the implications of the “ought implies can” dictum. We also defend the importance of one particular class of empirical claims; namely, claims from the field of economics. Even positive economic theory, which is often criticized for endorsing profits rather than values, can cooperate in intriguing ways with non-economic concepts in the implementation of CSR goals.

  • Thomas Donaldson (2012), The Epistemic Fault Line in Corporate Governance, Academy of Management Review, 37, pp. 256-271.

    Abstract:   An epistemic fault line underlies theories of corporate governance that separates positive from normative concepts.  I analyze this fault line in order to show the importance of clarifying normative assumptions in governance models.  I formulate an impossibility theorem for corporate governance that demonstrates how contemporary theories neglect normative concepts.  Applying the theorem clears the way both for the better use of existing models and for the design of more epistemologically sophisticated models in the future.

  • Thomas Donaldson (2012), Three Ethical Roots of the Economic Crisis, Journal of Business Ethics, 106 (1), pp. 5-8.

  • Thomas Donaldson and John Core (2010), An Economic and Ethical Approach to Charity and to Charity Endowments, Review of Social Economy, 68, pp. 261-284.

    Abstract: We examine how and why donors divide gifts between people in the present (across distance) and between the present and future (across time). US donors tend to give less to charities that benefit the poor and more to charities that benefit the non-poor (such as museums, universities, and arts organizations). Many of these wealthier charities have created endowments that benefit not only present persons, but also future persons. We develop a shorthand framework for linking time to distance in charitable allocations that incorporates a "proximity preference," i.e., charity that prefers those who are nearer to us whether by reason of physical distance, psychic-identity, or temporal distance. Even though ethical considerations suggest that recipients' level of need should be the dominant factor in allocating gifts, donors also express preferences, ceteris paribus, for benefits arriving sooner rather than later, and for recipients who are ''closer'' rather than farther away. 

  • Thomas Donaldson (2009), Compass and Dead Reckoning: The Dynamic Implications of ISCT, Journal of Business Ethics, 88 (4), pp. 659-664.

    Abstract: The dynamic relationship between hypernorms and microsocial contracts can explain novel, evolutionary changes in economic life. The conceptual machinery of Integrative Social Contracts Theory (ISCT) can be expanded in order to understand dynamic moments in the evolution in economic life such as the economic crisis of 2008-2009. When a transition in the ethical interpretation of economic events occurs over time, it can be understood as a transition from the opaqueness of hypernorms to the relative clarity of microsocial contracts. This phenomenon deserves more study than it has received, and entails, at a minimum, the application of an enhanced, more dynamic interpretation of ISCT.

  • Thomas Donaldson (2009), A frustrated quest for community, Journal of the Academy of Marketing Science, 37 (1), pp. 44-48.

    Abstract: Most people knew Peter Drucker as the practical sage who gave how-to advice on stubborn problems in the real world. But few knew the other Drucker, an idealistic thinker who tried to solve one of the biggest puzzles of modern humanity. Drucker engaged in a lifelong quest to discover the key for integrating community into the business world, and the word, "community," was the single term that Drucker struggled most to fathom throughout his career. In the end he abandoned even markets as the solution for community and acknowledged defeat. Yet his final failure to connect community to business is instructive for it tells us not only about Peter Drucker, but about our current business/social dilemma

  • Thomas Donaldson (2008), Hedge Fund Ethics, Business Ethics Quarterly, 18 (3), pp. 405-416.

    Abstract: Hedge funds are targets of mounting ethical criticism. The most salient focuses on their opacity. Hedge funds are structured to block transparency for strategic reasons: that is, they systematically deny information to their own investors and to governments in order to protect their competitive advantage, even though the information they hide holds tremendous significance for the interests of both groups. In this article I will detail the ethical allegations made against hedge funds, showing why their opacity creates intractable conflicts that cannot be resolved through government regulation. Sometimes opacity be regulated away; but with hedge funds I show why it cannot because of `regulatory recalcitrance." In the end a form of voluntary moral coordination, a form of "microsocial contract" instituted as an industry standard, is required relief. In a word, the solution to hedge fund opacity is ethical.

Teaching

Current Courses

  • LGST611 - Responsibility In Global Management

    This course uses the global business context to introduce students to important legal, ethical and cultural challenges they will face as business leaders. Cases and materials will address how business leaders, constrained by law and motivated to act responsibly in a global context, should analyze relevant variables to make wise decisions. Topics will include an introduction to the basic theoretical frameworks used in the analysis of ethical issues, such as right-based, consequentialist-based, and virtue-based reasoning, and conflicting interpretations of corporate responsibility. The course will include materials that introduce students to basic legal (common law vs. civil law) and normative (human rights) regimes at work in the global economy as well as sensitize them to the role of local cultural traditions in global business activity. ,Topics may also include such issues as comparative forms of corporate governance, bribery and corruption in global markets, human rights issues, diverse legal compliance systems, corporate responses to global poverty, global environmental responsibilities, and challenges arising when companies face conflicting ethical demands between home and local, host country mores. The pedagogy emphasizes globalized cases, exercises, and theoretical materials from the fields of legal studies, business ethics and social responsibility. ,Format: class participation, midterm and final exams. Materials: coursepack.

    LGST611002 ( Syllabus )

    LGST611004 ( Syllabus )

Past Courses

  • LGST100 - Ethics and Social Responsibility

    This course explores business responsibility from rival theoretical and managerial perspectives. Its focus includes theories of ethics and their application to case studies in business. Topics include moral issues in advertising and sales; hiring and promotion; financial management; corporate pollution; product safety; and decision-making across borders and cultures.

  • LGST299 - Seminar in Law and Society

    A study of the nature, functions, and limits of law as an agency of societal policy. Each semester an area of substantive law is studied for the purpose of examining the relationship between legal norms developed and developing in the area and societal problems and needs.

  • LGST611 - Responsibility in Global Management

    This course uses the global business context to introduce students to important legal, ethical and cultural challenges they will face as business leaders. Cases and materials will address how business leaders, constrained by law and motivated to act responsibly in a global context, should analyze relevant variables to make wise decisions. Topics will include an introduction to the basic theoretical frameworks used in the analysis of ethical issues, such as right-based, consequentialist-based, and virtue-based reasoning, and conflicting interpretations of corporate responsibility. The course will include materials that introduce students to basic legal (common law vs. civil law) and normative (human rights) regimes at work in the global economy as well as sensitize them to the role of local cultural traditions in global business activity. ,Topics may also include such issues as comparative forms of corporate governance, bribery and corruption in global markets, human rights issues, diverse legal compliance systems, corporate responses to global poverty, global environmental responsibilities, and challenges arising when companies face conflicting ethical demands between home and local, host country mores. The pedagogy emphasizes globalized cases, exercises, and theoretical materials from the fields of legal studies, business ethics and social responsibility. ,Format: class participation, midterm and final exams. Materials: coursepack.

  • LGST920 - Ethics in Business and Economics

    The seminar explores the growing academic literature in business ethics. It also provides participants an opportunity to investigate an ethical issue of their choosing in some depth, using their field of specialty as context. The seminar assumes no previous exposure to business ethics. Different business ethics theories and frameworks for investigating issues will be discussed, including corporate social responsibility, corporate moral agency, theories of values, and corporate governance. In turn, these theories will be applied to a range of issues, both domestic and international. Such issues include: corruption in host countries, the management of values in modern corporations, the ethical status of the corporation, ethics in sophisticated financial transactions (such as leveraged derivative transactions), and gender discrimination in the context of cultural differences. ,Literature not only from business ethics, but from professional and applied ethics, law, and organizational behavior will be discussed. Often, guest speakers will address the seminar. At the discretion of the class, special topics of interest to the class will be examined. Students will be expected to write and present a major paper dealing with a current issue within their major field. The course is open to students across fields, and provides integration of ideas across multiple business disciplines.

Awards and Honors

  • Wharton Undergraduate Teaching Award, 2014
  • Teaching Awards, 1995-2011 Description

    Outstanding Wharton Teacher of the Year award in both 2005 and 1998 (Class of 1984 Award); Excellence in Teaching Awards for 2011, 2010, 2009, 2007, 2006, 2005, 2002, 2001, 2000, 1999 , and 1998); David W. Hauck Award for Outstanding Teaching, Wharton School, 2002; Outstanding Teacher of the Year, Georgetown University, 1995.

  • Excellence in Teaching Award for MBA Core Curriculum, 2011 Description

    The Excellence in Teaching Awards are awarded annually to eight (8) MBA faculty members who receive the highest average instructor rating on their course evaluation forms over the three prior semesters. The course evaluation forms are filled out by the students at the conclusion of every course.

  • Aspen Institute’s Pioneer Award for Lifetime Achievement, 2009
  • Most influential “thought leader” by Ethisphere Magazine’s ranking of the 100 Most Influential People in Business Ethics., 2009
  • Excellence in Teaching, 2009 Description

    The Excellence in Teaching Awards are awarded annually to eight (8) MBA faculty members who receive the highest average instructor rating on their course evaluation forms over the three prior semesters. The course evaluation forms are filled out by the students at the conclusion of every course.

  • Excellence in Teaching, 2007 Description

    The Excellence in Teaching Awards are awarded annually to eight (8) MBA faculty members who receive the highest average instructor rating on their course evaluation forms over the three prior semesters. The course evaluation forms are filled out by the students at the conclusion of every course.

  • Excellence in Teaching, 2006 Description

    The Excellence in Teaching Awards are awarded annually to eight (8) MBA faculty members who receive the highest average instructor rating on their course evaluation forms over the three prior semesters. The course evaluation forms are filled out by the students at the conclusion of every course.

  • Class of 1984 Award, 2005 Description

    The Class of 1984 Award is awarded to the faculty member with the highest average instructor rating over the same time period. The faculty member must have taught at least one semester’s worth of course hours during the prior academic year in order to be eligible. A WGA subcommittee, the Excellence in Teaching Committee, calculates the award winners, along with a selected faculty advisor. Each of the recipients is awarded a plaque.

  • Excellence in Teaching, 2005 Description

    The Excellence in Teaching Awards are awarded annually to eight (8) MBA faculty members who receive the highest average instructor rating on their course evaluation forms over the three prior semesters. The course evaluation forms are filled out by the students at the conclusion of every course.

  • Excellence in Teaching, 2002 Description

    The Excellence in Teaching Awards are awarded annually to eight (8) MBA faculty members who receive the highest average instructor rating on their course evaluation forms over the three prior semesters. The course evaluation forms are filled out by the students at the conclusion of every course.

  • Excellence in Teaching, 2001 Description

    The Excellence in Teaching Awards are awarded annually to eight (8) MBA faculty members who receive the highest average instructor rating on their course evaluation forms over the three prior semesters. The course evaluation forms are filled out by the students at the conclusion of every course.

  • Excellence in Teaching, 1999 Description

    The Excellence in Teaching Awards are awarded annually to eight (8) MBA faculty members who receive the highest average instructor rating on their course evaluation forms over the three prior semesters. The course evaluation forms are filled out by the students at the conclusion of every course.

  • Award for Outstanding Book, SIM Division of the Academy of Management (Given for Ethics in International Business, Oxford University Press), 1998
  • Class of 1984 Award, 1998 Description

    The Class of 1984 Award is awarded to the faculty member with the highest average instructor rating over the same time period. The faculty member must have taught at least one semester’s worth of course hours during the prior academic year in order to be eligible. A WGA subcommittee, the Excellence in Teaching Committee, calculates the award winners, along with a selected faculty advisor. Each of the recipients is awarded a plaque.

  • Excellence in Teaching, 1998 Description

    The Excellence in Teaching Awards are awarded annually to eight (8) MBA faculty members who receive the highest average instructor rating on their course evaluation forms over the three prior semesters. The course evaluation forms are filled out by the students at the conclusion of every course.

  • Miller-Sherrerd MBA Core Curriculum Teaching Award, 1997
  • Distinguished Researcher of the Year, Georgetown University School of Business, 1995

In the News

Knowledge @ Wharton

Activity

Latest Research

Thomas Donaldson and J. P. Walsh (2016), Toward a Theory of Business, Research in Organizational Behavior, 35, pp. 181-207.
All Research

In the News

Tightening the Noose: Can the SEC and Its New Chairman Be Tougher on Wall Street?

Although the SEC has always been the federal government's chief guardian of integrity in the financial markets, critics have a long list of grievances, including claims that the agency is too unsophisticated and too soft on wrongdoers. Assuming she is confirmed as the new SEC chairman, Mary Jo White will need almost superhuman skills to make the SEC more effective, some observers suggest.

Knowledge @ Wharton - 2013/03/13
All News

Awards and Honors

Wharton Undergraduate Teaching Award 2014
All Awards