The employees who have been terminated, as well as the survivors, are suddenly faced with the meaning of loyalty. An inquiry into corporate loyalty raises fundamental issues about the priorities and philosophy of business management. There is a conflict between the popular ideal of entrepreneurial freedom and traditional managerial loyalty to corporate interests. Recent business scandals have shaken public confidence in the business community. Employees and the general public are now demanding ethical behaviour from corporate and political leaders.
Loyalty is emotional rather than logical or intellectual.
It attaches to individuals, and through them to institutions. The survival of loyalty in the corporate community has practical implications, and it is these that make an exploration of the concept and its contexts worthwhile. Any consideration of corporate loyalty must review a number of important legal questions. Laws to govern corporate behaviour are necessary to ensure that our entire economic system remains effective. The rules cannot be so restrictive as to impose unrealistic limits on corporate risk-taking.