Organizational Justice: A Behavioral Science Concept with Critical Implications for Business Ethics and Stakeholder Theory

Abstract: Organizational justice is a behavioral science concept that refers to the perception of fairness of the past treatment of the employees within an organization held by the employees of that organization. These subjective perceptions of fairness have been empirically shown to be related to 1) attitudinal changes in job satisfaction, organizational commitment and managerial trust beliefs; 2) behavioral changes in task performance activities and ancillary extra-task efforts to assist group members and improve group methods; 3) numerical changes in the quantity, quality and efficiency of divisional outputs; and—though this is far more tentative—4) eventual changes in the competitive advantage and financial performance of the full organization. The authors propose that these constructs can be applied to all stakeholders, rather than just to the current employees of the firm, and that objective determinations of fairness by the managers can be related to subjective perceptions of fairness by the stakeholders that will result in the sequential series of attitudinal, behavioral and numerical changes that will lead to performance improvements. In short, the authors propose a normative stakeholder theory of the firm, based upon ethical principles, that will have testable descriptive hypotheses derived from the behavioral constructs.