In a recent paper Allen Buchanan makes a basic distinction between two types of ethical problems which arise in business: “genuine ethical dilemmas, in which the problem is to discover what one ought to do, when two or more valid ethical duties (or values orprinciples) conflict, and compliance problems, which occur when one knows what one’s moral obligations are, but experiences difficulty in fulfilling them due to pressures of self-interest or loyalty to group or organization.” Buchanan argues that most business (...) ethicists believe that this simple dichotomy is exhaustive. He claims it is not and argues that there is a third area of concern that involves perfecting imperfect duties, or coming to “have definite ethical duties, where before there were at best vague ethical goals.” However, I wish to argue that there is a further area of concern in business ethics and this area does not involve deciding between competing moral principles, values etc, attempting to comply with known principles, or imparting determinate content to vague, non-specific imperfect principles of obligation (the subject of Buchanan’s recent paper). This sort of problem occurs frequently in the third world in circumstances in which the agent entirely fails to recognize the normative structure that underpins the considered options. (shrink)

The literature states that both situational and individual factors contribute to corrupt behavior. This study investigates the influence of rarely empirically investigated situational factors - the size of the bribe, time pressure, and the degree of abstractness of the business code - on the Model of Corrupt Action that describes the subjective decision making process of corrupt actors. To test the effects, I used an experimental simulation design. Only few effects were found. Thus, my results show a certain robustness of (...) corrupt behavior against the examined situational influences. Based on these results, I discuss implications for the prevention of corruption in organizations. (shrink)

In a recent paper Allen Buchanan makes a basic distinction between two types of ethical problems which arise in business: “genuine ethical dilemmas, in which the problem is to discover what one ought to do, when two or more valid ethical duties (or values orprinciples) conflict, and compliance problems, which occur when one knows what one’s moral obligations are, but experiences difficulty in fulfilling them due to pressures of self-interest or loyalty to group or organization.” Buchanan argues that most business (...) ethicists believe that this simple dichotomy is exhaustive. He claims it is not and argues that there is a third area of concern that involves perfecting imperfect duties, or coming to “have definite ethical duties, where before there were at best vague ethical goals.” However, I wish to argue that there is a further area of concern in business ethics and this area does not involve deciding between competing moral principles, values etc, attempting to comply with known principles, or imparting determinate content to vague, non-specific imperfect principles of obligation (the subject of Buchanan’s recent paper). This sort of problem occurs frequently in the third world in circumstances in which the agent entirely fails to recognize the normative structure that underpins the considered options. (shrink)

The problem this article focuses on is not the isolated individual act of corruption, but the systematic, pervasive sub-system of corruption that can and has existed across historical periods, geographic areas, and political-economic systems. It is important to first understand how corrupt and unethical subsystems operate, particularly their network nature, in order to reform and change them while not becoming what we are trying to change. Twelve key system elements are considered that include case examples from Asia, Latin America, the (...) Mediterranean, and North America. A key operating feature of corruption sub-systems is that they are relatively stable networks rather than exceptional, independent, individual events. Drawing on social network, social movement, and action-learning theories, six theory building propositions concerning ethical corruption reform are developed. (shrink)

Globalization has increased the need for managers (and future managers) to predict the potential for country corruption. This study examines the relationship between Hofstede''s cultural dimensions and how country corruption is perceived. Power distance, individualism and masculinity were found to explain a significant portion of the variance in perceived corruption. A significant portion of country''s risk, trade flow with U.S.A., foreign investment, and per capita income was explained by perceived corruption.

Corruption Perceptions Index (CPI) scores for 47 countries reported by Transparency International were used to ascertain determinants of bribe taking in international business. Two sets of independent variables – economic and cultural – were used in a multiple regression analysis. Results indicate that bribe taking was more likely to be prevalent in countries with low per capita income and lower disparities in income distribution. Cultural factors such as high power distance and high masculinity in a country were also likely to (...) be associated with high level of bribe taking. Both economic and cultural factors were important explanatory factors of bribery. Implications of the findings for combating bribery are discussed. (shrink)

Abstract: The systemic role of corruption and its link to low human development is explored. The extractive resource industry is presented as an arena where conditions for corruption—monopoly and discretion without accountability—are especially intense. Corruption is maintained by a self-reinforcing cycle. Multiple stakeholders are involved in the maintenance of and/or opposition to the cycle: investing corporations, host country regimes and officials, inter-governmental bodies like the OECD, industry associations, non-governmental organization (NGO) watchdogs like Transparency International, and international agencies facilitating global investment (...) like the World Bank. Complementarity of interests between the demand and supply sides provides strong incentives for entrenched players to maintain corruptive relationships, to protect past gains and sustain current ones. Compulsory international regulation, maximum transparency, effective detection, and enforcement are recommended to enhance accountability, thereby reversing the cycle. It is also necessary to create a corporate culture built on integrity, if regulation itself is to succeed. (shrink)

ABSTRACT:The literatures of business ethics and international business have generally had little influence on each other. Nevertheless, the decline in the power of nation states, the emergence of non-governmental organizations, the proliferation of self-regulatory bodies, and the changing responsibilities, roles, and structure of multinational corporations make constructive engagement between these two disciplines imperative. This changing institutional landscape creates many areas of common concern. In this article, we describe the changing institutional context of global business and suggest ways in which both (...) business ethics and international business may inform each other more fruitfully. (shrink)

People who teach business ethics seem locked between two general approaches: an applied philosophy approach that emphasizes the application of abstract ethical theories and principles to specific cases, and the case method approach that leaves the students without any more general theoretical framework with which to approach ethical issues. Classical American Pragmatism, understood as a school of philosophical thought, links these two approaches by providing a new grounding for moral theory in which moral rules are understood as working hypotheses abstracted (...) from concrete situations and moralreasoning demands the return to concrete situations as the foundation for moral decision making that is inherently contextual. Thus moral decision making is bottom up rather than top down, and a sense of moral rightness comes not from the indoctrination of abstract principles but from attunement to the way in which moral beliefs and practices must be rooted naturally in the very conditions of human existence. (shrink)

This paper views corruption as a form of contracting amenable to analysis from the viewpoint of transaction-cost economics. Concepts such as transaction, bounded rationality, opportunism, and asset specificity are shown to apply to cases of corruption. Both market and parochial corruption are hypothesized to vary in accordance with changes in the specificity of assets invested to support the corruption transaction. Evidence from a number of different studies tends to support the hypothesized relation. The implications of the transaction-cost perspective are developed (...) for policy makers and directions for future research are suggested. (shrink)

This paper views corruption as a form of contracting amenable to analysis from the viewpoint of transaction-cost economics. Concepts such as transaction, bounded rationality, opportunism, and asset specificity are shown to apply to cases of corruption. Both market and parochial corruption are hypothesized to vary in accordance with changes in the specificity of assets invested to support the corruption transaction. Evidence from a number of different studies tends to support the hypothesized relation. The implications of the transaction-cost perspective are developed (...) for policy makers and directions for future research are suggested. (shrink)

Literature on ethical behavior has paid little attention to the mechanism between macro-environmental variables and environmental performance. This study aims at constructing a model to examine the relationships which link cultural values, population growth, economic development, and environmental performance by incorporating the mediating role of education. The multiple linear regression model was employed to test the hypotheses on a 3-year-pooled sample of 51 countries. Empirical results conclude that national culture, economic development, and population growth would significantly influence environmental performance directly. (...) In addition, through the mediating effect of education, population growth and national culture would significantly affect environmental performance indirectly. These findings provide theoretical and managerial implications for constructing the mechanism of cultural values and ethical behavior in general and environmental management in particular. (shrink)

This study examines the impact of culture on regulation and corruption. Our empirical results suggest that cultural values have significant effects on countries’ regulatory policies, levels of corruption, and economic development. Contrary to the conclusions drawn by others, this study shows no significant relationship between the regulatory policies of countries and their perceived levels of corruption. Thus, evidence of the “public choice view” toward entry regulation derived in related studies seems to be at least attenuated.

This study explores the general problems associated with marketing across international markets and focuses specifically on the role of corruption in deterring international marketing success. The authors do this by introducing a broader conceptualization of corruption. The dimensions of corruption and their importance in explaining the exporters’ successes in international markets are developed empirically. Partial Least Squares formative indicators are used in a comprehensive model including consumer resources (wealth and information resources), physical distance (kilometers and time zones), and cultural distance (...) (linguistic and values differences) as alternative explanatory variables. Finally, differences in the model’s performance across data from three exporting countries (France, Japan, and the US) are delineated and discussed. For example, the successes of French and Japanese exporters in international markets are in part determined by the levels of corruption in target countries. Alternatively, corruption in target countries does not appear to affect the successes of American exporters in global markets. The conceptualization of corruption in this study extends the more narrow view of corruption solely as bribery. (shrink)

In global business, business organizations and their representatives frequently encounter corruption and may be the perpetrators, victims, or simply participants in such acts. While international corruption has existed in multiple forms for several years, many individuals, companies, nations, and international organizations are currently attempting to reduce or eliminate corrupt acts because of their harmful effects on local economies and the quality of life of citizens. Several of these corruption curtailment efforts have been directed toward the supply-side of corruption, i.e., those (...) who make corrupt payments. In developing an understanding of corruption, however, and formulating strategies for its reduction, consideration must also be given to the demand-side of corruption, i.e., those who demand and accept corrupt payments. Accordingly, this study examined the demand-side of corruption and several related factors in the categories of government, economy and poverty, education, geography, and culture. Analysis of these factors employed the Corruption Perceptions Index (CPI), formulated annually by Transparency International (TI), and other sources. Several factors in each of the five categories were found to correlate significantly with perceived corruption, and strategies for addressing these issues were developed and discussed. (shrink)