The focus of this paper is to further a discussion of codes of ethics as institutionalized organizational structures that extend some form of legitimacy to organizations. The particular form of legitimacy is of critical importance to our analysis. After reviewing various theories of legitimacy, we analyze the literature on how legitimacy is derived from codes of ethics to discover which specific form of legitimacy is gained from their presence in organizations. We content analyze a sample of codes to consider the (...) question of whether a strategic, self-interested rationale lies behind the adoption of a code of ethics. We propose that the process of employing codes of ethics in this strategic manner has become, through isomorphism, an institutionalized practice that itself confers a cognitive form of legitimacy to the organization and further distances the codes from their moral foundation. (shrink)

This study asked managers with different educational backgrounds and experience from a variety of industries of a variety of sizes representing both genders and various predominant managerial functions at different levels to “describe the skills they think are necessary to perform their jobs effectively”. In particular, they were asked to rank 178 behavioral skills presented under 22 different categories that described different aspects of management. Data were then examined first to determine the importance of ethics or integrity overall in the (...) group of managerial activities and then to explore how specific ethical activities of managers differ across various managerial and organizational characteristics. Findings indicate that ethics is still considered one of the least important skills necessary in managers’ daily work. However, once specific ethical activities are analyzed separately, significant differences are found across characteristics of managers, as well as those of the organizations at which they work. (shrink)

This paper examines whether and to what extent the overall business strategy influences the firm’s mismanagement of sustainability. Specifically, an empirical measure for the mismanagement of sustainability is developed by exploiting the newly available materiality guidelines for US firms to define industry-specific material sustainability issues. Using this measure, this paper shows that mismanagement of sustainability can represent unethical business behavior when firms intentionally perform better on immaterial issues than on material issues by diverting stakeholders’ attention from the firm’s low overall (...) sustainability performance. This paper assumes that the right business strategy can prevent such unethical actions. Based on Miles and Snow’s organizational theory, this paper distinguishes between Prospector and Defender business strategies. By employing multiple firm-level panel regressions, the findings suggest that Prospector-type firms are more likely to mismanage sustainability issues compared to Defender-type firms intentionally. The results give implications for researchers, regulators and standard setters, auditors, sustainability practitioners, and scholars. (shrink)