Many models of (un)ethical decision making assume that people decide rationally and are in principle able to evaluate their decisions from a moral point of view. However, people might behave unethically without being aware of it. They are ethically blind. Adopting a sensemaking approach, we argue that ethical blindness results from a complex interplay between individual sensemaking activities and context factors.

Although the ethical dimension of transformational leadership has frequently been discussed over the last years, there is little empirical research on employees’ ethical behavior as an outcome of transformational leadership. This two-study investigation examined the relationship between transformational leadership and unethical yet pro-organizational follower behavior. Moreover, mediating and moderating processes were addressed. Our research yielded a positive relationship between transformational leadership and employees’ willingness to engage in UPB. Furthermore, both studies showed employees’ organizational identification to function as a mediating mechanism (...) and employees’ personal disposition toward ethical/unethical behavior to moderate the relationship between organizational identification and willingness to engage in UPB. Altogether, results indicate transformational leadership to entail a certain risk of encouraging followers to contribute to their company’s success in ways that are generally considered to be unethical. Implications regarding the ethical dimension of transformational leadership are discussed. (shrink)

The goals of this research were to (1) explore the direct effects of and interactions between magnitude of consequences and various types of proximity - social, psychological, and physical - on the ethical decision-making process and (2) investigate the influence of empathy on the ethical decision-making process. A carpal tunnel syndrome vignette and questionnaire were administered to a sample of human resource management professionals to test the hypothesized relationships. Significant relationships were found for the main effects between magnitude of consequences (...) and principle-based evaluation, cognitive empathy and principle-based evaluation, and empathy and moral intention. Physical proximity moderated the relationships between magnitude of consequences and utilitarian evaluation as well as magnitude of consequences and moral intention. Cognitive empathy moderated the relationships between magnitude of consequences and principle-based evaluation and physical proximity and utilitarian evaluation. Affective empathy marginally moderated the relationship between physical proximity and principle-based evaluation. Future research directions, management implications, and strengths and weaknesses of the research are discussed. (shrink)

ABSTRACT:To have a virtue is to possess a certain kind of trait of character that is appropriate in pursuing the moral good at which the virtue aims. Human beings are assumed to be capable of attaining those traits. Yet, a number of scholars are skeptical about the very existence of such character traits. They claim a sizable amount of empirical evidence in their support. This article is concerned with the existence and explanatory power of character as a way to assess (...) the possibility of achieving moral virtue, with particular attention paid to business context. I aim to unsettle the so-called situationist challenge to virtue ethics. In the course of this article, I shall defend four claims, namely, that virtues are more than just behavioral dispositions, that at least some virtues may not be unitary traits, that psychologists cannot infer virtues from overt behavior, and that the situationist data do not account for the observational equivalence of traits. Since it rests on a misconception of what virtue is, the situationist objection remains unconvincing. (shrink)

We add texture to the conclusion of Duchon and Drake (Journal of Business Ethics, 85, 2009, 301) that extreme narcissism is associated with unethical conduct. We argue that the special features possessed by financial accounting facilitate extreme narcissism in susceptible CEOs. In particular, we propose that extremely narcissistic CEOs are key players in a recurring discourse cycle facilitated by financial accounting language and measures. Such CEOs project themselves as the corporation they lead, construct a narrative about the corporation and themselves (...) using financial accounting measures, and then reflect on how their accounting-constructed performance is perceived by stakeholders. We do not present empirical evidence about whether the use of accounting language and measures leads to unethical behaviour by extreme narcissistic CEOs — although the conclusions of Duchon and Drake (2009) suggest empirical support is probable. Rather, we focus on developing alertness to the potential for accounting, when engaged by an extremely narcissistic CEO, to be a precursor or implement of unethical behaviour. (shrink)

This study explores the impact of mood on individuals’ ethical decision-making processes through the Graham [Graham, J. W.: 1986, Research in Organizational Behavior 8, 1–52] model of Principled Organizational Dissent. In particular, the research addresses how an individual’s mood influences his or her willingness to report the unethical actions of a colleague. Participants’ experienced an affectively charged, unrelated event and were then asked to make a decision regarding whistle-blowing intentions in a public accounting context. As expected, negative mood was associated (...) with lower intentions to report the unethical actions of others to a superior within the organization. The Graham model, which proposes that reporting intentions are impacted by the three determinants of seriousness, personal responsibility and cost, was employed to more clearly understand the nature of the affect–reporting intention relationship. The role of affect was explained by demonstrating that two determinants mediate the relationship between mood and whistle-blowing intentions. Specifically, as seriousness and responsibility have a positive impact on reporting intentions, the reduction of these perceptions by negative mood reduces the intent to report. The negative impact of personal cost on reporting intentions was significant, although not as a mediator of mood. (shrink)

According to a widely credited model in the business ethics literature, ethical decisions are a function of two kinds of factors, personal(individual) and situational, and these factors interact with each other. According to a contrary view of decision making that is widely held in some areas of business research, individuals’ decisions about ethical issues (and subsequent actions) are purely a function of their self-interest.The laboratory experiment reported in this paper provides a test of the person-situation interactionist model, using the general (...) theoretical and experimental framework used in the experimental economics literature. One individual and two situational factors relating to moral intensity were examined which may influence decisions to misrepresent information in the course of business activities.The individual and one situational variable were significantly related to participants’ actions. The interactions among individual andsituation variables were not individually significant, although the model including interactions had a much higher level of statistical significance. Gender was significant, both directly and in interaction with moral development, suggesting that it may be worthy of further examination. (shrink)

According to a widely credited model in the business ethics literature, ethical decisions are a function of two kinds of factors, personal(individual) and situational, and these factors interact with each other. According to a contrary view of decision making that is widely held in some areas of business research, individuals’ decisions about ethical issues (and subsequent actions) are purely a function of their self-interest.The laboratory experiment reported in this paper provides a test of the person-situation interactionist model, using the general (...) theoretical and experimental framework used in the experimental economics literature. One individual and two situational factors relating to moral intensity were examined which may influence decisions to misrepresent information in the course of business activities.The individual and one situational variable were significantly related to participants’ actions. The interactions among individual andsituation variables were not individually significant, although the model including interactions had a much higher level of statistical significance. Gender was significant, both directly and in interaction with moral development, suggesting that it may be worthy of further examination. (shrink)

This article explores links between the modern theory of rational choice and ethics. Ethics allows us to answer an unsolved question in modern decision theory: the structuring problem in decisions. Such a problem cannot be solved coming from the principle of expected utility. This principle can solve the problem of ‚choosing’ among given alternatives, but does not establish which alternatives should be taken into account in decision. In order to understand the structuring problem, the act of ‚choosing’ has to be (...) completed with three human acts: operating, predicting and evaluating. At the same time, the subjective criteria of rational choice – probability and utility – have to be completed with three objective criteria: efficiency, truth and goodness. Utility is a subjective value of an alternative considered in relation to another. Efficiency, truth and goodness are objective qualities of the joint alternatives in relation to the reality: the real operating possibilities of the agent, the real possibilities of his environment and the true good produced. So, the rule that guarantees a decision to be optimal would be: “do that which most certainly maximises our preferences, according to real operative resources, true knowledge and the right will”. However, this rule cannot be applied without the development of virtues, which could be seen as the main moral competences in decision-making. (shrink)

The moral ideology of banking and insurance employees in Spain was examined along with supervisor role modeling and ethics-related policies and procedures for their association with ethical behavioral intent. In addition to main effects, we found evidence supporting that the person–situation interactionist perspective in supervisor role modeling had a stronger positive relationship with ethical intention among employees with relativist moral ideology. Also as hypothesized, formal ethical polices and procedures were positively related to ethical intention among those with universal beliefs, but (...) the relationship was much weaker among relativists. Thus, firms wishing to optimally promote ethical attitudes and behavior must tailor their organization-based initiatives to the individual characteristics of their employees. (shrink)

Recent accounting scandals involving the collapse of large corporate firms have brought into question the adequacy of ethics education within accounting programs. This paper investigates the ethical decisions of accountancy students and in particular analyses the effect of group (as opposed to individual) decision-making on ethical decisions. Final year accountancy students (sample size of 165) were randomly allocated into two experimental conditions. The participants were then presented with five (5) ethical vignettes. One experimental condition involved completing the ethical decisions as (...) individuals (60). The other involved completing the ethical decision-making as a group of 3–4 participants (34). A consistent pattern of behaviour was observed in the analysis of individual versus group responses. Individuals displayed stronger tendencies than groups to take the extreme actions of acting either unethically or ethically (whistleblowing), whereas groups displayed stronger tendencies to take the safer (neutral) options. It was concluded that groups reached consensus decisions, in an ethical context, probably as a result of peer pressure. The significant implication of this finding is in relation to the emphasis accounting programs place on group work. Group work may enhance students’ abilities to work as a team. However, as revealed in this study’s results, group work may not be an effective means of producing the optimal decision in all subject matter areas, especially complex areas such as ethical decision-making. (shrink)

In this study, we examine the nature of the relationship between ethical leadership and unethical pro-organizational behavior (UPB), defined as unethical behavior conducted by employees with the aim of benefiting their organization, and whether the strength of the relationship differs between subordinates experiencing high and low identification with supervisor. Based on three-wave survey data obtained from 239 public sector employees in China, we find that ethical leadership has an inverted u-shaped (curvilinear) relationship with UPB. As the level of ethical leadership (...) increases from low to moderate, UPB increases; as the level of ethical leadership increases from moderate to high, UPB decreases. Further, we find that the strength of this inverted u-curve relationship differs between subordinates with high and low identification with supervisor. That is to say, the inverted u-shaped relationship between ethical leadership and UPB was stronger when subordinates experienced high levels of identification with supervisor. The theoretical and managerial implications of our findings for understanding how to manage UPB in an organizational context are discussed. (shrink)