One reason why exceptionally ethical organizations are rare is because people assume that being exceptionally ethical is an end state rather than an ongoing accomplishment that is achieved through continuous ethical improvement. Continuous ethical improvement is a type of organizational learning in which people consistently implement inferences drawn from experience about how to incorporate ever-more ethical behavior into organizational routines. We draw from organizational learning theory and virtue ethics to propose a model that explains what enables organizations to achieve continuous ethical improvement. This model moves us beyond stage theories to testable propositions, provides an answer to the questions of what makes organizations ethical and how they become ethical, explains how ethical behavior can be an object of organizational search, adds nuance to the concept of satisficing, and suggests new explanations for how organizations affect employees’ ethical decision making.
