Research by academics, professional organizations, and businesses on ethics in the workplace often relies on surveys that ask employees to report how frequently they have observed others engaging in unethical behavior. But what do these frequencies in observer-reports say about the frequencies of committed unethical behavior? This paper is the first to address this question by empirically exploring the relationship between observer- and self-reports. Our survey research among the Swiss working population shows that for all 37 different forms of unethical (...) behavior investigated, observer-reports show higher frequencies than self-reports. Ratios of observer- to self-reports vary substantially among these forms, ranging from 1.46 for improperly gathering competitor’s confidential information to 6.4 for engaging in (sexual) harassment or creating a hostile work environment. The results indicate that researchers should not assume that the frequency in self-reports can generally be approximated by the frequency in observer-reports. Four possible explanations are presented for the differences in ratios, with recommendations for future research. (shrink)

The purpose of this empirical study is to investigate the effect of paternalistic leadership (PL) on ethical climate and the moderating role of trust in leader. Convenience sampling is used as a sampling procedure and the data were obtained from 227 Turkish employees. The findings indicated that PL had some effect on ethical climate. Furthermore, partial support was found for the moderating effect of trust in leader on the relationship between PL and ethical climate. The results of the study showed (...) the importance of PL on employees in following company rules and procedures and showing a sense of responsibility and care to customers, community, and others in the organization. (shrink)

The relationship between unethical peer behavior and observers’ unethical behavior traditionally has been examined from a social learning perspective. We employ two additional theoretical lenses, social identity theory and social comparison theory, each of which offers additional insight into this relationship. Data from 600 undergraduate business students in two universities provide support for all the three perspectives, suggesting that unethical behavior is influenced by social learning, social identity, and social comparison processes. Implications for managers and future research are discussed.

With massive corruption uncovered in numerous recent corporate scandals, investigating psychological processes underlying unethical behavior among employees has become a critical area of research for organizational scientists. This article seeks to explain why people engage in deceptive and fraudulent activities by focusing on the use of moral-disengagement tactics or rationalizations to justify egregious actions at work. In addition, participation in goal-setting is argued to attenuate the relationship between moral disengagement and unethical behavior. Across two studies, a lab simulation and field (...) survey, a measure of moral disengagement was developed for use with working adults. The hypothesized main and interactive effects of moral disengagement, participation, and unethical behavior were tested and largely confirmed. (shrink)

Drawing on signaling theory, we suggest that a supplier’s enforcement of ethical codes sends signals about the supplier that affect a buyer’s decision to continue their commitment to the supplier. We then draw on side-bet theory to hypothesize how switching costs influence the importance of a supplier’s enforcement of ethical codes in predicting a buyer’s continuance commitment to a supplier. We empirically test our model with data from 158 purchasing managers across three manufacturing industries. Results confirm the connection between ethical (...) code enforcement and continuance commitment, but suggest that a supplier’s enforcement of ethical codes matter less when switching suppliers is perceived as too costly. (shrink)

This review summarizes and critiques the empirical ethical decision-making literature from 1996-2003. One hundred and seventy-four articles were published in top business journals during this period. Tables are included that summarize the findings by dependent variable - awareness, judgment, intent, and behavior. We compare this review with past reviews in order to draw conclusions regarding trends in the ethical decision-making literature and to surface directions for future research.

This study introduces the concept of moral imagination in a work context to provide an ethical approach to the controversial relationships between dirty work and dirty workers. Moral imagination is assessed as an essential faculty to overcome the stigma associated with dirty work and facilitate the daily work lives of workers.The exercise of moral imagination helps dirty workers to face the moral conflicts inherent in their tasks and to build a personal stance toward their occupation. Finally, we argue that organizations (...) with dirty work groups should actively adopt measures to encourage their employees' exercise of moral imagination. This study investigates how organizations might create conditions that inspire moral imagination, particularly with regard to the importance of organizational culture as a means to enhance workers' moral sensitivity. Furthermore, this investigation analyzes different company practices that may derive from a culture committed to moral imagination. (shrink)

This paper discusses the criticisms that exist about corporate use of ethics advice by bioscience companies and offers suggestions on how ethics advisors can be used so as to maximize their utility and avoid the criticism.

Effective corporate social responsibility policies are a requirement for today's companies. Policies have not only to be formulated, they also have to be delivered by corporate employees. This paper uses existing research findings to identify two types of factors that may impact on employee motivation and commitment to CSR ‘buy-in’. The first of these is contextual: employee attitudes and behaviours will be affected by organizational culture and climate, by whether CSR policies are couched in terms of compliance or in terms (...) of values, and by whether such policies are integrated into business processes or simply an ‘add-on’ that serves as window-dressing. The second set of factors is perceptual. Motivation and commitment will be affected by the extent to which they can align personal identity and image with that of the organization, by their perceptions of justice and fairness both in general and in terms of how CSR performance is rewarded, and by their impressions concerning the attitude of top management to CSR issues and performance. (shrink)

To date, theory and research on corruption in organizations have primarily focused on its static antecedents. This article focuses on the spread and growth of corruption in organizations. For this purpose, three downward organizational spirals are formulated: the spiral of divergent norms, the spiral of pressure, and the spiral of opportunity. Social Identity Theory is used to explain the mechanisms of each of these spirals. Our dynamic perspective contributes to a greater understanding of the development of corruption in organizations and (...) opens up promising avenues for future research. (shrink)

While a number of studies are being done on ethical leadership, little is known about the role of ethical ideology and organizational justice in the relation of the ethical leadership behavior and individual behaviors such as work engagement and organizational misbehavior has tended to be neglected in ethics literature. This study examines the mediating effects of organizational justice on the relations of ethical leadership, work engagement and organizational misbehavior. Also, it investigates the moderating effect of ethical ideology on the relationships (...) among these variables. It proposes that managers’ ethical values and organizational members’ ethical perspectives such as absolutism, exceptionism, situationism, and subjectivism have the potential to be agents of virtue within the organizations. Employee attributions and emotional reactions to the unethical behavior of their leaders are important factors on individual behavior outcomes. So, in this study it is hypothesized that ethical leadership behavior affects organizational justice perception and this, respectively, affects organizational members’ work engagement and organizational misbehavior. It is also hypothesized that ethical ideology would moderate the relationship between the ethical leadership and organizational justice. Results indicate that ethical leadership has both direct and indirect influence on work engagement and organizational misbehavior. Finally, practical implications are discussed, and suggestions for the future research are made. (shrink)

Retaliation against whistleblowers is a well-recognized problem, yet there is little explanation for why uninvolved peers choose to retaliate through ostracism. We conduct two experiments in which participants take the role of a peer third-party observer of theft and subsequent whistleblowing. We manipulate injunctive norms and descriptive norms. Both experiments support the core of our theoretical model, based on social intuitionist theory, such that moral judgments of the acts of wrongdoing and whistleblowing influence the perceived likeability of each actor and (...) ultimately influence intention to ostracize each actor and indicate more willingness to ostracize the whistleblower than the wrongdoer. When we vary norms for the wrongdoing in Experiment 1, we find that descriptive and injunctive norms indirectly influence intentions to ostracize both the wrongdoer and whistleblower. These relationships are serially mediated by the observers’ moral judgments of the act and likeability of the actor. When we vary norms for whistleblowing in Experiment 2, the injunctive norm manipulation affected moral judgment of the action of whistleblowing, and we do not observe any other significant effects of the norm manipulations on moral judgments of the actions of wrongdoing or whistleblowing. (shrink)

ABSTRACT:Scholars studying organizational justice have been slow to incorporate insights from behavioral ethics research, despite the fields’ conceptual affinities. We maintain that this stems from differences in the paradigmatic approaches taken by scholars in each area. First, justice research historically has assumed that individuals are motivated by a desire for instrumental control of worthwhile outcomes or by a concern with social status, while behavioral ethics has paid more attention to the role of internalized moral convictions and duties. Second, organizational justice (...) researchers have investigated one set of individual differences, behavioral researchers have examined another. Third, justice scholars focus on social identities while behavioral ethics scholars also investigate moral identities. As an impetus to future inquiry, our review attends to contemporary organizational justice research that takes into account concepts derived from behavioral ethics. In so doing we hope to highlight an avenue for integrative scholarship that will further our understanding of organizational justice. (shrink)

Humility is increasingly recognized as an essential attribute for individuals at top management levels to build successful organizations. However, research on CEO humility has focused on how humble chief executive officers (CEOs) shape collective perceptions through their interactions and behaviors with other organizational members while overlooking CEOs’ critical role in making strategic decisions. We address this unexplored aspect of CEO humility by proposing that humble CEOs influence decision-making decentralization at the top management team (TMT) and subsequently promote an organizational ethical (...) culture. Using a sample of CEOs and TMT members from 120 small- and medium-sized enterprises, we find strong support for our hypotheses. We discuss important implications for research on CEO humility and strategic leadership. (shrink)

This study examines the impact of various ethical climate types, dependency factors, and ethical training on ethical optimism of purchasing professionals (n = 151) in India. Instrumental and independence climate types had a significant negative impact on ethical optimism. Other climate types (professional, caring, rules, and efficiency) had no significant impact on ethical optimism. Among the dependency factors, while task uncertainty had a significant positive impact, monitoring had a significant negative impact on ethical optimism. None of the other factors significantly (...) impacted ethical optimism. (shrink)

Effective corporate social responsibility policies are a requirement for today's companies. Policies have not only to be formulated, they also have to be delivered by corporate employees. This paper uses existing research findings to identify two types of factors that may impact on employee motivation and commitment to CSR ‘buy‐in’. The first of these is contextual: employee attitudes and behaviours will be affected by organizational culture and climate, by whether CSR policies are couched in terms of compliance or in terms (...) of values, and by whether such policies are integrated into business processes or simply an ‘add‐on’ that serves as window‐dressing. The second set of factors is perceptual. Motivation and commitment will be affected by the extent to which they can align personal identity and image with that of the organization, by their perceptions of justice and fairness both in general and in terms of how CSR performance is rewarded, and by their impressions concerning the attitude of top management to CSR issues and performance. (shrink)

Effective corporate social responsibility policies are a requirement for today's companies. Policies have not only to be formulated, they also have to be delivered by corporate employees. This paper uses existing research findings to identify two types of factors that may impact on employee motivation and commitment to CSR ‘buy-in’. The first of these is contextual: employee attitudes and behaviours will be affected by organizational culture and climate, by whether CSR policies are couched in terms of compliance or in terms (...) of values, and by whether such policies are integrated into business processes or simply an ‘add-on’ that serves as window-dressing. The second set of factors is perceptual. Motivation and commitment will be affected by the extent to which they can align personal identity and image with that of the organization, by their perceptions of justice and fairness both in general and in terms of how CSR performance is rewarded, and by their impressions concerning the attitude of top management to CSR issues and performance. (shrink)

We suggest that understanding unethical behavior in organizations involves understanding how people view themselves and their relationships with others, a concept known as self-construal. Across multiple studies, employing both field and laboratory settings, we examine the impact of three dimensions of self-construal (independent, relational, and collective) on unethical behavior. Our results show that higher levels of relational self-construal relate negatively to unethical behavior. We also find that differences in levels of relational self for men and women mediate gender differences in (...) unethical behavior. We discuss both the theoretical and practical implications of these findings. (shrink)

Abstract:The literature contains many recommendations, both explicit and implicit, that suggest how an ethics program ought to be designed. While we recognize the contributions of these works, we also note that these recommendations are typically based on either social scientific theory or data and as a result they tend to discount the moral aspects of ethics programs. To contrast and complement these approaches, we refer to a theory of the right to identify the characteristics of an effective ethics program. We (...) draw from Kant’s ethical theory to identify three guiding principles of a moral ethics program and then apply those principles to the specific components of ethics programs as discussed in the Federal Sentencing Guidelines. Doing so provides insights as to how an ethics program ought to be designed from a moral point of view and sparks discussion of the moral aspects of ethics programs. (shrink)

Given the prevalence of corporate frauds and the significance of whistle blowing as a mechanism to report about the frauds, the present study explores the impact of ethical leadership and leader–member exchange (LMX) on whistle blowing. Additionally, the article also explores the moderating role of the moral intensity [studied as magnitude of consequences (MOC)] of the issue on this relationship. The article reports results of three experimental studies conducted on the postgraduate students of a premier technology institute in India. Ethical (...) leadership, LMX, and moral intensity are manipulated through scenarios. Study one ( n = 81) manipulates ethical leadership (ethical/unethical) and quality of LMX (low and high) as independent variables; study two ( n = 80) manipulates ethical leadership and moral intensity (high and low MOC), and study three ( n = 87) manipulates LMX and MOCs to assess their individual and joint effects on whistle blowing. Results show that not only do ethical leadership and LMX predict whistle blowing, but these relationships get moderated by the moral intensity of the issue as well. (shrink)

When successful and ethical managers are alerted to possible organizational wrongdoing, they take corrective action before the problems become crises. However, recent research [e.g., Rynes et al. (2007, Academy of Management Journal50(5), 987–1008)] indicates that many organizations fail to implement evidence-based practices (i.e., practices that are consistent with research findings), in many aspects of human resource management. In this paper, we draw from years of research on whistle-blowing by social scientists and legal scholars and offer concrete suggestions to managers who (...) are interested in encouraging internal reporting of problems requiring attention, and to observers of questionable activity who are considering reporting it. We also identify ways that research suggests policy-makers can have a more positive influence. We hope that these suggestions will help foster evidence-based practice regarding whistle-blowing. (shrink)

ABSTRACT:U.S. Organizational Sentencing Guidelines provide firms with incentives to develop formal ethics programs to promote ethical organizational cultures and thereby decrease corporate offenses. Yet critics argue such programs are cosmetic. Here we studied bank employees before and after the introduction of formal ethics training—an important component of formal ethics programs—to examine the effects of training on ethical organizational culture. Two years after a single training session, we find sustained, positive effects on indicators of an ethical organizational culture (observed unethical behavior, (...) intentions to behave ethically, perceptions of organizational efficacy in managing ethics, and the firm’s normative structure). While espoused organizational values also rose in importance post-training, the boost dissipated after the second year which suggests perceptions of values are not driving sustained behavioral improvements. This finding conflicts with past theory which asserts that enduring behavioral improvements arise from the inculcation of organizational values. Implications for future research are discussed. (shrink)

There are three types of solutions to the problems deriving from companies' ethical, social and environmental responsibilities: those based on regulation by an authority or agency; those deigned to create market incentives; and those that rely on self-regulation by companies themselves. In the specific field we are concerned with here, regulation has significant costs and drawbacks that make it particularly desirable that companies should set up their own ethical, social and environmental management systems or programmes. The purpose of this article (...) is twofold. On the one hand, it explains how implementing voluntary ethical, social and environmental management systems or programmes may help to develop and sustain ethical behaviour in organizations, overcoming the conflict between compulsory regulation and occasional ethical practices. On the other hand, it shows that conditions must be met for an ethical management programme to be effective. (shrink)

Leadership studies on corporate ethical behavior and practices have grown considerably, contributing significant knowledge on ethical leadership challenges that are organizational and industry focused. However, complex socio-ecological systems are placing pressure on organizational culture and old patterns of leadership behavior that play a role in organizational justice. In this study, we argue that scholars of business ethics must consider the role of organizational justice and use person-organization fit (P–O fit). To address this, our study investigates the mediating effect of organizational (...) justice on the relationship between ethical leadership and employees’ ethical behavior. We also examine the moderating role of P–O fit on the relationship between organizational justice and employee’s ethical behavior. The study survey focused on 295 employees belonging to organizations in Iraq. We show that ethical leadership positively influences employees’ ethical behavior, and this relationship is shaped by organizational justice. The findings reflect the positive impact of organizational justice on ethical behavior, and this relationship is more pronounced in employees with high rather than low P–O fit. This study clarifies the importance of employee’s P–O fit and its impact on organizational processes for creating a positive impact on ethical behavior in the workplace. We also share practical implications of the study and recommend systemic research that explores this area. (shrink)

This paper develops a typology of moral problems in business. The cross-classification of two fundamental dimensions of ethical conduct: judgment and motivation, is employed to distinguish four types of moral problems: genuine dilemmas, compliance problems, moral laxity, and no-problem problems. Actual cases are brought to illustrate each type of problem, and corresponding coping strategies are presented. The paper highlights the need to design a dynamic strategy that will take into account the relationships among different types of ethical problems. In its (...) capacities as both an analytical tool for identifying and clarifying an ethical problem and a strategic tool for handling it, the typology has direct implications for developing ethical awareness, assigning accountability, and unfolding typical rationalizations in business activity. (shrink)

This research illustrates dangers inherent in the gap created when organizations decouple ethics program adoption from implementation. Using a sample of 182 professionals in the pharmaceutical and financial services industries, we examine the relationship between structural decoupling of formal ethics programs and individual-level perceptions and behavior. Findings strongly support the hypothesized relationships between decoupling and organizational members’ legitimacy perceptions of the ethics program, psychological contract breach, organizational cynicism, and unethical behavior.

ABSTRACT:U.S. Organizational Sentencing Guidelines provide firms with incentives to develop formal ethics programs to promote ethical organizational cultures and thereby decrease corporate offenses. Yet critics argue such programs are cosmetic. Here we studied bank employees before and after the introduction of formal ethics training—an important component of formal ethics programs—to examine the effects of training on ethical organizational culture. Two years after a single training session, we find sustained, positive effects on indicators of an ethical organizational culture (observed unethical behavior, (...) intentions to behave ethically, perceptions of organizational efficacy in managing ethics, and the firm’s normative structure). While espoused organizational values also rose in importance post-training, the boost dissipated after the second year which suggests perceptions of values are not driving sustained behavioral improvements. This finding conflicts with past theory which asserts that enduring behavioral improvements arise from the inculcation of organizational values. Implications for future research are discussed. (shrink)

As corporate scandals proliferate, organizational researchers and practitioners have made calls for research providing guidance for those wishing to influence positive moral decision-making and behavior in the workplace. This study incorporates social cognitive theory and a vignette-based cognitive measure for moral imagination to examine (a) moral attentiveness and employee creativity as important antecedents of moral imagination and (b) creativity as a moderator of the positive relationship between moral attentiveness and moral imagination. Based on the results from supervisor–subordinate dyadic data (N (...) = 162) obtained from employed students, hypotheses were largely supported as expected. Implications are discussed. (shrink)

Since time immemorial, the phenomenon of leadership and its understanding has attracted the attention of the business world because of its important role in human groups. Nevertheless, for years efforts to understand this concept have only been centred on people in leadership roles, thus overlooking an important aspect in its understanding: the necessary moral dimension which is implicit in the relationship between leader and follower. As an illustrative example of the importance of considering good morality in leadership, an empirical study (...) is conducted in which a good performance of the "leader-follower" relationship is reflected when individuals perceive ethical leadership in higher hierarchical managerial levels. To be precise, findings of this study demonstrate that follower job response is improved through an ethics trickle-down partial effect from the Top Manager to the immediate supervisor, and also reveal both key aspects and managerial level on which the practice of ethical leadership should rest upon to have a stronger effect on the follower positive job response. Practical implications of these findings and directions for future research are finally presented. (shrink)

This paper discusses the criticisms that exist about corporate use of ethics advice by bioscience companies and offers suggestions on how ethics advisors can be used so as to maximize their utility and avoid the criticism.

This review summarizes and critiques the empirical ethical decision-making literature from 1996–2003. One hundred and seventy-four articles were published in top business journals during this period. Tables are included that summarize the findings by dependent variable – awareness, judgment, intent, and behavior. We compare this review with past reviews in order to draw conclusions regarding trends in the ethical decision-making literature and to surface directions for future research.

Organizations are faced with the question, not only whether to adopt an ethics program, but also which components to adopt when. This study shows that unethical behavior occurs less frequently in organizations that have an ethics program than in organizations that do not have an ethics program. Nine components of ethics programs were identified and examined. The results show that there is a direct relationship between the number of components adopted and the frequency of observed unethical behavior. No relationship was (...) found between pre-employment screening and unethical behavior, while the strongest relationship was discerned between accountability policies and unethical behavior. The study further reveals that the best sequence for adopting components of an ethics program is a code of ethics, ethics training and communication, accountability policies, monitoring and auditing, and investigation and correction policies—all of which are directly related to less unethical behavior—followed by an ethics office, ethics report line, and incentive policies—all of which are indirectly related to less unethical behavior. With the exception of pre-employment screening, this sequence corresponds closely to the pattern of adoption of organizations in the U.S. (shrink)

Despite the prevailing discourses on the importance of top management ethical leadership, related theoretical and empirical developments are lacking. Drawing on institutional theory, we propose that top management ethical leadership contributes to organizational outcomes by promoting firm-level ethical and procedural justice climates. This theoretical framework was empirically tested using multi-source data obtained from 4,468 employees of 147 Korean companies from various industries. The firm-level analysis shows that top management ethical leadership significantly predicts ethical climate, which then results in procedural justice (...) climate that fully mediates the effects of top management ethical leadership on two organizational outcomes, namely, firm-level organizational citizenship behavior and firm financial performance. The present study provides a plausible theoretical account and empirical validation of a mechanism through which top management ethical leadership enhances organizational performance. (shrink)

Three ethics program components, a code of ethics, ethics training initiatives and ethics-oriented performance appraisal content, were examined for their relationship to ethical intent using a sample of 525 employees from the Spanish financial services industry. As expected, all three components contributed to the prediction of ethical intent. Importantly, clusters of employees who reported experiencing distinct combinations of the program components were identified and compared for their level of ethical intent. Employees who perceived all three components to be strongly implemented (...) reported significantly higher levels of ethical intent relative to those who viewed the components as either all weakly implemented or not present. Combinations including training initiatives plus one other element had a similar impact to the fully implemented approach. Contrary to expectations, ethics-oriented performance appraisal content did not relate more strongly to ethical intent than codes of ethics. (shrink)

We build on limited research concerning the mediation processes associated with the relationship between ethical culture and employee outcomes. A multidimensional measure of ethical culture was examined for its relationship to overall Person-Organization (P–O) fit and employee response, using a sample of 436 employees from social economy and commercial banks in Spain. In line with previous research involving unidimensional measures, ethical culture was found to relate positively to employee job satisfaction, affective commitment, and intention to stay. New to the literature, (...) ethical culture was also found to be associated positively with employee willingness to recommend the organization to others. These effects were observed even when perceptions of P–O fit were controlled. Importantly, ethical culture was also positively related to overall P–O fit, which in turn, partially mediated the relationship between ethical culture and employee outcomes. Our findings add to studies that focus on the importance of the degree of ethical congruence between the individual employee and the organization. They suggest that ethical culture, with its expected impact on virtuousness and emotional well-being, will positively influence outcomes independently of the degree to which there is a match between employee and organizational values. (shrink)

Research shows that the effects of creative personality on moral disengagement and unethical behaviors are mixed. To reconcile the disparate findings, we draw on interdependence theory to unravel how and when creative personality is related to moral disengagement through countervailing pathways. Specifically, we propose competitive motivation and prosocial motivation as two distinct mechanisms that explain the double-edged effects of creative personality on moral disengagement and subsequent unethical behaviors. Furthermore, we hypothesize a cross-level moderating effect of competitive climate on the relationships (...) between competitive/prosocial motivation and moral disengagement. Results based on three-wave data from 753 employees showed that creative personality increased moral disengagement and subsequent unethical behaviors through competitive motivation but decreased moral disengagement and subsequent unethical behaviors through prosocial motivation. In addition, competitive climate weakened the negative relationship between prosocial motivation and moral disengagement and the negative indirect relationship between creative personality and unethical behaviors via prosocial motivation and moral disengagement. (shrink)

To understand how compliance develops both in everyday and corporate environments, it is crucial to understand how different mechanisms work together to shape individuals’ (non)compliant behavior. Existing compliance studies typically focus on a subset of theories (i.e., rational choice theories, social theories, legitimacy theories, capacity theories, and opportunity theories) to understand how key variables from one or several of these theories shape individual compliance. The present study provides a first integrated understanding of compliance, rooted in complexity science, in which key (...) elements from these theories are considered simultaneously, and their relations to compliance and each other are explored using network analysis. This approach is developed by analyzing online survey data (_N_ = 562) about compliance with COVID-19 mitigation measures. Traditional regression analysis shows that elements from nearly all major compliance theories (except for social theories) are associated with compliance. The network analysis revealed groupings and interconnections of variables that did not track the existing compliance theories and point to a complexity overlooked in existing compliance research. These findings demonstrate a fundamentally different perspective on compliance, which moves away from traditional narrow, non-network approaches. Instead, they showcase a complexity science understanding of compliance, in which compliance is understood as a network of interacting variables derived from different theories that interact with compliance. This points to a new research agenda that is oriented on mapping compliance networks, and testing and modelling how regulatory and management interventions interact with each other and compliance within such networks. (shrink)

Senior managers are important to the successful management of ethics in organizations. Therefore, their perceptions of organizational ethics are important. In this study, we propose that senior managers are likely to have a more positive perception of organizational ethics than lower level employees do largely because of their managerial role and their corresponding identification with the organization and need to protect the organization’s image as well as their own identity. By contrast, lower level employees are more likely to be cynical (...) about the organization’s ethics. In order to compare senior managers’ and lower level employees’ perceptions of ethics in the organization, we surveyed randomly selected senior managers and lower level employees in three firms. We found that perceptions of ethics in the organization differed predictably across levels, with senior managers’ perceptions being significantly more positive and lower level employees’ perceptions being more negative. Implications for practice and research are discussed. (shrink)

Due to the frequent occurrence of ethical transgressions and unethical employee behaviors, there has lately been an increasing interest in the ethical foundations of contemporary organizations. However, large-scale comprehensive analyses of organizational ethics are still comparatively limited. Our study contributes to both management control and business ethics literature by empirically examining potential antecedents as well as resulting effects of ethical work climates on organizational-level outcomes. Based on a cross-sectional survey among 295 large- and medium-sized companies, we find that more informal (...) means of control constitute important elements of a broader organizational control context that are strongly related to the emergence of coherent ethical work climates with an increased awareness of ethical issues. Moreover, our results show that the relationship between ethical work climates and organizational performance can be considered as rather indirect as it is fully mediated by increased mutual trust among employees. Overall, our study thus supports the particular importance of ethical work climates and identifies appropriate means to encourage ethical conduct. (shrink)

Despite universal agreement that corruption is norm-deviant, the criteria required to ascertain deviance remain elusive. The problem is even more pronounced for organizational corruption, not least because the construct remains somewhat ambiguous and is often conflated with proximate management constructs like antisocial or unethical organizational behavior. In this article, I identify the suitable criteria for the determination of deviance in organizational corruption and determine whether it is, indeed, antisocial or unethical. In order to minimize ambiguity, I first limit the scope (...) of organizational corruption to corruption within, rather than by, organizations, which is most conceptually challenging insofar as the aforementioned questions are concerned. I then conclude that organizational corruption should be specified solely with respect to the focal organization’s normative framework; it is anti-organizational rather than antisocial. Higher level normative prescriptions that arise from the organization’s embedding within its social context remain relevant, but only insofar as they are incorporated within the organization’s normative framework. Moreover, I argue that organizational corruption is not necessarily unethical, since the moral evaluation of an organizational act is, in principle, distinct from the determination of its deviance to organizational norms. (shrink)

Nowadays there is a growing interest in business ethics, both in academia and professionally. However, moral lapses continue to happen in business activities, leading academicians and professionals to rethink what is being done and reinventing new strategies to successfully manage ethics in business organisations. Thus, whereas efforts to promote ethics are basically oriented to using and developing explicit, written formal mechanisms, the literature suggests that other instruments are also useful and necessary to achieve this. Thus, studying the role of the (...) Human Resource Management (hereafter, HRM) in promoting ethics is an emerging research topic due to the heavy influence that HRM practices are thought to have on employees. This paper is aimed at developing a thorough analysis of HRM's role in promoting ethics, and specifically at focusing on one of its practices, training. As an illustrative example of the utility of this practice, an empirical study was conducted on a range of Spanish banking companies in which an impact was found on the employees' ethical behaviour when ethics training was being provided inside the organisation. Finally, the practical implications of these findings and directions for future research are presented. (shrink)

A vast majority of marketing theory and research has focused on relativism and idealism in order to understand ethical behavior. However, making ethical assessments that in turn influence behavior is much more complicated than it appears. One of the most important developments in contemporary philosophy has been the renewed interest in epistemic virtue. Epistemologists contend that belief is an ethical process that is susceptible to the intellectual virtue or vice of one’s own life and personal experiences. Open-mindedness, curiosity, careful thinking, (...) creativity, and intellectual courage are the foundations of epistemic virtues. Closed-mindedness, intellectual overconfidence, unimaginativeness, intellectual conformity, and wishful thinking are among epistemic vices. The purpose of this investigation is to introduce epistemology to marketing ethics by linking it to personal moral philosophies (idealism and relativism) and optimism to explain various ethically challenging organizational behaviors. The items of epistemology were developed and pretested by the lead author of this study. Structural equations (LISREL) analyses found that epistemic virtues and vices are better predictors of ethical behavior than were personal moral philosophies (idealism and relativism), and their influence on mild and severe levels of unethical behaviors was enhanced by the moderator variable, optimism. Implications are designed to develop suggestions for improving ethical behavior in the workplace. (shrink)

ABSTRACT:U.S. Organizational Sentencing Guidelines provide firms with incentives to develop formal ethics programs to promote ethical organizational cultures and thereby decrease corporate offenses. Yet critics argue such programs are cosmetic. Here we studied bank employees before and after the introduction of formal ethics training—an important component of formal ethics programs—to examine the effects of training on ethical organizational culture. Two years after a single training session, we find sustained, positive effects on indicators of an ethical organizational culture (observed unethical behavior, (...) intentions to behave ethically, perceptions of organizational efficacy in managing ethics, and the firm’s normative structure). While espoused organizational values also rose in importance post-training, the boost dissipated after the second year which suggests perceptions of values are not driving sustained behavioral improvements. This finding conflicts with past theory which asserts that enduring behavioral improvements arise from the inculcation of organizational values. Implications for future research are discussed. (shrink)

Research suggests a direct negative relationship between peers’ unethical behavior and employees’ ethical intention. But several possible mechanisms might explain this relationship in more detail. For example, Machiavellianism is a personality trait characterized by interpersonal manipulation and the use of unethical means to achieve certain self‐interested ends, whether useful or pleasant. This article adopts an Aristotelian understanding of philia, related to three goods on which human relationships rest: useful, pleasant, and honest. We propose that Machiavellianism, a self‐interested, pragmatic personality orientation, (...) might explicate the relationship between peers’ unethical behavior and ethical intention. The results of a structural equation model applied to a sample of 436 banking employees in Spain reveals that Machiavellianism partially mediates the relationship between peers’ unethical behavior and employees’ ethical intention. We also find that with a greater level of peers’ unethical behavior, the negative effect of Machiavellianism on ethical intention increases, and that when peers’ unethical behavior is nonexistent, the negative effect of Machiavellianism on ethical intention disappears. These findings advance current literature by revealing that unethical peers can indirectly influence ethical intention, through shaping Machiavellianism. Our study is also the first to show that pairing high Machiavellians with ethical peers can help to cancel out the negative influence of Machiavellianism on ethical intention. (shrink)

ABSTRACT:Organizations adopt formal sanctioning systems to deter ethical violations, but the formal systems’ effectiveness may be undermined by informal sanctioning systems which promote violations. I conducted an ethnographic study of six trading crowds on two financial exchanges to understand how informal and formal sanctioning systems, which are grounded in different interpretations of equity, interact to affect trader deviance from rules established by the financial exchange (exchange deviance). To deter informal trader norms that conflict with exchange rules, the exchanges formally prohibit (...) traders’ informal sanctions. The exchanges, however, underestimate traders’ informal sanctions related to ostracism and social rejection, which are not only difficult for the exchanges to detect, but also interpersonally hurtful and harmful to trader performance. Consequently, the traders’ informal social sanctions lead to secondary sanctions from trading firms. Ultimately, the informal sanctioning system evades the formal sanctioning system by exploiting what the exchanges deem to be minor rule violations. (shrink)

Abstract:The literature contains many recommendations, both explicit and implicit, that suggest how an ethics program ought to be designed. While we recognize the contributions of these works, we also note that these recommendations are typically based on either social scientific theory or data and as a result they tend to discount the moral aspects of ethics programs. To contrast and complement these approaches, we refer to a theory of the right to identify the characteristics of an effective ethics program. We (...) draw from Kant’s ethical theory to identify three guiding principles of a moral ethics program and then apply those principles to the specific components of ethics programs as discussed in the Federal Sentencing Guidelines. Doing so provides insights as to how an ethics program ought to be designed from a moral point of view and sparks discussion of the moral aspects of ethics programs. (shrink)

To identify the boundary conditions for proactive employees making whistle-blowing decisions, we developed a cross-level model comprising employee proactive personality and two types of whistle-blowing intentions that incorporates the influences of organizational- and individual-level attributes. Analyses of data collected from 432 Chinese employees in 32 companies indicated that proactive personality was positively related to internal whistle-blowing intention and even more positively related to external whistle-blowing intention when individuals were working in organizations characterized by an instrumental ethical climate and employees with (...) a high level of moral identity. (shrink)

Senior managers are important to the successful management of ethics in organizations. Therefore, their perceptions of organizational ethics are important. In this study, we propose that senior managers are likely to have a more positive perception of organizational ethics than lower level employees do largely because of their managerial role and their corresponding identification with the organization and need to protect the organization’s image as well as their own identity. By contrast, lower level employees are more likely to be cynical (...) about the organization’s ethics. In order to compare senior managers’ and lower level employees’ perceptions of ethics in the organization, we surveyed randomly selected senior managers and lower level employees in three firms. We found that perceptions of ethics in the organization differed predictably across levels, with senior managers’ perceptions being significantly more positive and lower level employees’ perceptions being more negative. Implications for practice and research are discussed. (shrink)