Context shapes negotiators’ actions, including their willingness to act unethically. Focusing on negotiators use of deception, we used a simulated two-party negotiation to test how three contextual variables—regulatory focus, power, and trustworthiness—interacted to shift negotiators’ ethical thresholds. We demonstrated that these three variables interact to either inhibit or activate deception, providing support for an interactionist model of ethical decision-making. Three patterns emerged from our analyses. First, low power inhibited and high power activated deception. Second, promotion-focused negotiators favored sins of omission, (...) whereas prevention-focused negotiators favored sins of commission. Third, low cognition-based trust influenced deception when negotiators experience fit between power and regulatory focus, whereas affect-based trust influenced deception when negotiators experience misfit between these structural context variables. We conclude that regulatory focus primes different moral templates: promotion-focused negotiators’ decision to deceive is determined by moral pragmatism, whereas prevention-focused negotiators’ decision to deceive is determined by opportunism. Because each combination of power and regulatory focus was tied to a specific subcomponent of trust, we further conclude that negotiators engage in motivated information search to determine whether they should deceive their opponents. (shrink)

Previous studies show evidence of double standards in terms of individuals being more tolerant of questionable consumer practices than of similar business practices. However, whether these double standards are necessarily due to the fact that one party is a business company while the other is a consumer was not addressed. The results of our two experimental studies, conducted among 277 (Study 1) and 264 (Study 2) participants from a Western European country by means of an anonymous self-administered online survey, demonstrate (...) that the respondents were not only harsher in their judgments of unethical business (vs. consumer) behavior, but also harsher in their judgments of unethical behavior by prosperous (vs. non-prosperous) consumers and prosperous (vs. non-prosperous) business companies (Study 1). Further, they were also less tolerant of unethical behavior by consumers (vs. one's best friend) and business companies with which they have a less than good (vs. a good) relationship (Study 2). These results indicate that double standards are due to differences in perceived wealth between subjects and in the individual's relationship with subjects. These two factors imply that double standards are not strictly reserved to consumer-business relations, but might also be used in business-business and consumer-consumer relations. Further, these results indicate that companies need to be aware of the fact that good financial figures may backfire as they might lead individuals to be more critical of a company's deceptive practices. Moreover, these findings point to the importance of businesses investing resources-and to keep investing resources-in developing a good relationship with stakeholders as these good relationships lead to stakeholders being less prone to make moral condemnations. (shrink)

Previous studies show evidence of double standards in terms of individuals being more tolerant of questionable consumer practices than of similar business practices. However, whether these double standards are necessarily due to the fact that one party is a business company while the other is a consumer was not addressed. The results of our two experimental studies, conducted among 277 (Study 1) and 264 (Study 2) participants from a Western European country by means of an anonymous self-administered online survey, demonstrate (...) that the respondents were not only harsher in their judgments of unethical business (vs. consumer) behavior, but also harsher in their judgments of unethical behavior by prosperous (vs. non-prosperous) consumers and prosperous (vs. non-prosperous) business companies (Study 1). Further, they were also less tolerant of unethical behavior by consumers (vs. one’s best friend) and business companies with which they have a less than good (vs. a good) relationship (Study 2). These results indicate that double standards are due to differences in perceived wealth between subjects and in the individual’s relationship with subjects. These two factors imply that double standards are not strictly reserved to consumer–business relations, but might also be used in business–business and consumer–consumer relations. Further, these results indicate that companies need to be aware of the fact that good financial figures may backfire as they might lead individuals to be more critical of a company’s deceptive practices. Moreover, these findings point to the importance of businesses investing resources—and to keep investing resources—in developing a good relationship with stakeholders as these good relationships lead to stakeholders being less prone to make moral condemnations. (shrink)

Prior studies have shown that powerful individuals are more unethical than powerless individuals. In real life, power is unstable, and multiple social interactions may cause loss of power. However, extant research has assumed the power structure to be stable and thus overlooked the potential interaction of power and stability in affecting unethicality. Using the approach-inhibition theory of power, we predicted that stability of power moderates power’s effect on unethical behavior. Results from four studies revealed that powerful individuals showed more unethical (...) behavior than powerless individuals only when power was stable, but not when it was unstable. The higher level of unethical behavior under the condition of stable power was explained by attitude toward risk. Our results highlight that the link between power and unethicality is broken when power is unstable. Powerful individuals are no more unethical than powerless individuals when they face a greater possibility of losing their power. (shrink)

This paper argues that consumer demand for unethical behavior such as fraud can impact employee turnover through market and psychological forces. Widespread conditions of unethical demand can improve career prospects for employees of unethical firms through higher income and stability associated with firm financial health. Similarly, unethical employees enjoy increased tenure from the financial and psychological rewards of prosocial behavior toward customers demanding corrupt or unethical behavior. We specifically examine the well-documented unethical demand for fraud in the vehicle emissions testing (...) industry, and its impact on employee tenure. We use data from tests conducted by several thousand licensed inspectors to demonstrate that fraudulent employees and employees of fraudulent firms enjoy longer tenure. These results suggest further work to separate the multiple psychological and economic mechanisms likely driving our findings. (shrink)

The development of behavioral ethics has brought forth a detailed understanding of the processes of moral perception, decision-making and behavior within and beyond organizations and communities. However, prescriptive recommendations of behavioral research regarding how to support an ethical environment often underestimate the specifics of organizational characteristics that may encourage the occurrence and persistence of dishonesty, especially regarding deception as a desired action in some instances by some employees and managers. Furthermore, behavioral research does not adequately recognize the notion that dishonesty (...) can be sometimes viewed as an acceptable cost for some expected traits or skills of an employee such as intelligence or creativity. Under some conditions, deception can be even considered a moral, prosocial activity. Finally, formal ethics systems and situational measures to promote honesty may be inefficient or directly harmful. This article highlights questions of how to assess such factors in research on (un)ethical behavior within organizations. (shrink)

The revival of virtue ethics in contemporary moral philosophy had a major impact on business ethicists, among whom the virtues have become a staple subject of inquiry. Aristotle’s phronēsis is one of those virtues, and a number of texts have examined it in some detail. But analyses of phronēsis in business ethics have neglected some of its most significant and interesting elements. In this paper, I dissect two neglected components of practical wisdom as outlined in Book VI of the Nicomachean (...) Ethics: sunesis, a capacity to perceptively evaluate testimony, and gnomē, a capacity to rightly discern exceptions to ‘universal’ moral rules. Practical wisdom is a product of experience, so I examine the role that experience plays in the development of these deliberative capacities, asking what it is that the practically wise will have taken away from their experiences. It is, in particular, everyday, ‘mundane’ experience that begets these excellences, so I concentrate specifically on that kind of experience in the domains of sunesis and gnomē as I search for insights about how we develop phronēsis and how we might better do what is right. (shrink)

Perceived supervisor support is widely studied in terms of its positive outcomes. This paper, in contrast, investigates employees’ unethical pro-supervisor behavior as a negative consequence of perceived supervisor support. Drawing upon the multifoci approach of social exchange theory and the reciprocity principle, we hypothesized that perceived supervisor support can engender unethical pro-supervisor behavior via employees’ feelings of reciprocity towards the supervisor. Building on the instrumental reasons that underlie social exchanges, we further hypothesized that this mediation relationship is stronger for employees (...) high in Machiavellianism. We collected data for three experimental studies from full-time MBA students of a European business school and from U.S. working professionals, and the results provided consistent support for our proposed model. Taken together, the current study highlights the “dark side” of perceived supervisor support, in that it can lead to unethical behavior and that this effect can be accentuated by employees’ Machiavellianism. (shrink)