On the basis of an interdisciplinary approach linking taxation, marketing, and corporate social responsibility, the present research investigates the effects of media reports on aggressive and responsible corporate tax strategies (CTSs) on corporate success with consumers. By means of two laboratory experiments (N = 150, 360), we analyze the effects of the CTSs on corporate reputation, consumer purchase intention, and the consumer’s willingness to pay. Our results suggest that aggressive CTSs diminish corporate success with consumers, whereas responsible CTSs enhance it. (...) Nevertheless, consumers are not willing to pay a price premium for products sold by responsible tax-planning companies, but rather punish aggressive tax-planning companies through a slightly lower willingness to pay. Finally, consumers’ tax morale and their attitude toward tax avoidance are important moderating variables. Given the growing level of media interest in taxation, our findings are crucial for assessing consumer-related non-tax costs and the benefits of different CTSs. (shrink)

The paper focuses on the consumer side of consumption tax evasion (CTE), a subcategory of the shadow economy. The ethical dimensions of tax evasion have been effectively captured by the existent literature on tax morale, yet it fails to address the role consumers can play in CTE. Further, there is a shortage of tax morale studies that explore ethical decision making as a process composed of multiple steps and determinants. To bridge these gaps, we turned to the consumer ethics literature (...) and Jones’ issue-contingent model of ethical decision making. We developed the conceptual model of consumer ethical decision making for CTE by incorporating four key elements from the issue-contingent model, i.e. moral recognition, moral judgement, moral intention and moral intensity, while personal moral philosophies were introduced as an antecedent to the consumer ethical decision-making process. The study was conducted on a sample of consumers from Slovenia, where CTE is a widespread phenomenon. The findings confirm that consumers’ recognition of CTE as a moral issue is influenced by their moral philosophy and perceptions regarding the magnitude of CTE’s consequences, their visibility, probability, and temporal immediacy. These perceptions also play an important role in determining consumers’ moral judgements and intentions regarding CTE. Moreover, through the process of moral recognition and moral judgement, consumers form intentions to participate in, or avoid CTE. The study holds important implications for public policy makers who are trying to reduce the tax gap in times of economic instability and fiscal crisis. (shrink)

While much of the empirical accounting literature suggests that, if differences do exist, Big Four employees are more ethical than non-Big Four employees, this trend has not been evident in the recent media coverage of Big Four tax practitioners acting for multinationals accused of aggressive tax avoidance behaviour. However, there has been little exploration in the literature to date specifically of the relationship between firm size and ethics in tax practice. We aim here to address this gap, initially exploring tax (...) practitioners’ perceptions of the impact of firm size on ethics in tax practice using interview data in order to identify the salient issues involved. We then proceed to assess quantitatively whether employer firm size has an impact on the ethical reasoning of tax practitioners, using a tax context-specific adaptation of a well-known and validated psychometric instrument, the Defining Issues Test. (shrink)

The objective of this paper is to provide an overview of corporate social responsibility (CSR) in Greece and present the challenges that need to be met in order to further promote socially responsible business behaviour in the domestic economy. This is the first attempt to provide a systematic analysis of CSR in Greece and adds to the existing pool of knowledge of CSR embeddedness in countries where CSR awareness is still rather low, a literature field that is still quite limited. (...) Drawing from prior literature, the paper is built around three basic questions in relation to the Greek context: how is CSR perceived by Greek business professionals? How is CSR practised in Greece? And which issues evident in the modern domestic environment act as underlying barriers to the broader dissemination of CSR in Greece? The extant empirical work suggests that, while CSR in Greece appears to be developing, there is still scope for improvement and further diffusion of relevant practices. While some of the patterns shaping CSR in Greece have been analysed, much work still remains to be carried out in extending and deepening our knowledge in this part of Europe. (shrink)

How can codes of ethics acquire legitimacy—that is, how can they lay down obligations that will be seen by their subjects as morally binding? There are many answers to this question, reflecting the fact that moral agents have a host of different bases on which they may acknowledge code duties as ethically binding—or, alternatively, may reject those duties as morally irrelevant or actively corrupt. Drawing on a wide literature on legitimacy in other practical fields, this paper develops a multidimensional legitimacy (...) framework, describing ten distinct sources of legitimacy. It illustrates how these sources can be seized, not only by the code’s content, but by opportunities presented in the main stages of code development, adoption and implementation. In so doing, it aims to provide practical resources for code developers and ethics reformers in organizations and industries to avoid critical missteps, and to maximize the impact and efficacy of their work. (shrink)

Qualitative studies are an important component of business ethics research. This large amount of research covers a wide array of factors and influences on ethical decision making published between 2004 and 2014. Following the methodology of past critical reviews, this work provides a synopsis of the diverse array of qualitative studies in ethical decision making within the business ethics literature. We highlight the distinct and investigative nature of qualitative research, synthesize and summarize findings, and suggest opportunities for future research. We (...) conclude with a recommendation for developing qualitative studies in business ethics and a call for an increased openness when considering this valuable and underrepresented strategy of inquiry. (shrink)

The objective of this paper is to provide an overview of corporate social responsibility (CSR) in Greece and present the challenges that need to be met in order to further promote socially responsible business behaviour in the domestic economy. This is the first attempt to provide a systematic analysis of CSR in Greece and adds to the existing pool of knowledge of CSR embeddedness in countries where CSR awareness is still rather low, a literature field that is still quite limited. (...) Drawing from prior literature, the paper is built around three basic questions in relation to the Greek context: how is CSR perceived by Greek business professionals? How is CSR practised in Greece? And which issues evident in the modern domestic environment act as underlying barriers to the broader dissemination of CSR in Greece? The extant empirical work suggests that, while CSR in Greece appears to be developing, there is still scope for improvement and further diffusion of relevant practices. While some of the patterns shaping CSR in Greece have been analysed, much work still remains to be carried out in extending and deepening our knowledge in this part of Europe. (shrink)

Anecdotal evidence often suggests that multinational enterprises operating in developing countries “exploit their multinationality” to avoid paying taxes to host governments. This article explores the concept of “responsible tax” as a corporate social responsibility issue for MNEs, based on the notion that MNEs face considerable variation in the extent, monitoring, and application of tax laws internationally. This variation creates a “moral free space” as to which tax payments to make. Using firm-level data from three important sectors in India, the authors (...) explore whether foreign MNE subsidiaries pay higher taxes than local firms, and whether, in the case of MNEs, there are differences between subsidiaries of MNEs with and without a reputation for CSR. The results show that MNEs pay considerably higher effective tax rates than do local firms, and MNE subsidiaries known for CSR pay more tax than do MNE subsidiaries less known for CSR. This set of findings suggests that MNEs operating in India see taxation in developing countries in relation to CSR. (shrink)

This qualitative field study is based on interviews with 20 experienced audit partners in France and documents the dialogical dimension of ethical deliberation in auditing. We ask: do audit partners consult each other when faced with an ethical dilemma at work? Who among their peers do they prefer to consult and why? Our analysis provides evidence that audit partners do not deliberate alone, contrary to what psychological experimental research on audit ethics usually postulates. When faced with an uncertain situation in (...) terms of professional ethics, they seek reassurance by consulting colleagues. Not just any colleagues, however. Whom they consult depends on whether they wish to avoid or take measured ethical risks. Overall, we find that audit partners approach ethics as a personal and collective risk that must be managed in specific ways. This study enriches what we know about auditor ethics by helping to shed light on what is usually inaccessible to researchers: the questions that audit partners ask their peers when faced with uncomfortable ethical issues in client engagements before making a decision they find acceptable. (shrink)