The Shaping of a Society’s Economic Ethos: A Longitudinal Study of Individuals’ Morality of Profit-Making Worldview

This study investigates the processes involved in the shaping of a society’s economic ethos. The discussion of ethics and economics has a very long history across multiple disciplines. The founder of modern economics, Adam Smith, likewise had a keen interest in this topic. However, with the development of economic science, scholarly assessment has shifted toward positive analysis while normative analysis has been left mainly to philosophers. By utilizing the newly developed morality of profit-making scale (MPM), the authors sought to understand how respondents’ economic ethical worldview shifts over time. Specifically, we theorized that the news media’s copious negative coverage of the gasoline price crisis of 2006 would significantly impact individuals’ MPM worldview. The results show that respondents’ explicit attitudes toward MPM were significantly impacted. However, respondents’ more deeply held, implicit economic ethical worldview was only slightly impacted. The authors argue that only patient, long-term explanation and argumentation can permanently affect a society’s economic ethos. Implications and future research directions for business researchers are outlined.     

Understanding Consumer’s Responses to Enterprise’s Ethical Behaviors: An Investigation in China

The response of consumers to a firm’s ethical behavior and the underlying factors influencing/forming each consumer’s response outcome is analyzed in this article based on information obtained through interviews. The results indicate that, in the Chinese context, the responding outcome can be boiled down to five types, namely, resistance, questioning, indifference, praise, and support. Additionally, consumers’ responses were mainly influenced by the specific consumer’s ethical consciousness, ethical cognitive effort, perception of ethical justice, motivation judgment, institutional rationality, and corporate social responsibility–corporate ability (CSR–CA) belief. Based on these results, a generalized framework of consumer’s ethical responses is developed which provides a number of insightful suggestions upon how to motivate a consumer’s support of a firm’s ethical behavior and to transfer this kind of support into truly positive purchasing behavior.     

Linking international entrepreneurship to uncertainty,opportunity discovery,and cognition

In this paper, we suggest a model of international entrepreneurship that links cognition, noticing opportunities, absorbing uncertainty, and bearing uncertainty, to international entrepreneurial action, which is important because of the increased interest in international entrepreneurship. The ways in which cognition affects opportunity identification are discussed to show how international entrepreneurs’ cognitive processes work in terms of identifying opportunities. We also explore the role of cultural differences, with respect to tolerance for bearing uncertainty, on international entrepreneurship. Finally, the model is used to identify areas for future international entrepreneurship research.     

Internationalization processes of small- and medium-sized enterprises—a matter of attitude?

Scholars suggest that when it comes to the role owner-managers of SME play in terms of their companies’ internationalization, their attitudes have a major impact. However, little is known on how exactly they lead to international entrepreneurial behavior. This paper sheds light on this relationship by making use of the Theory of Planned Behavior (TPB). Besides attitudes, other cognitive factors are examined for relevance. The study is based on empirical data which have been gathered from owner-managers from Austria, Switzerland, Liechtenstein, and Germany. The study yielded several interesting results. First, TPB clearly is applicable to investigate the cognitive antecedents of SME owner-managers’ international business activities. More specifically, the understanding of how decision-makers’ motivation to do business abroad is determined has been deepened. Second, some extensions proved to be useful in order to increase the approach’s predictive strength. From these results several conclusions can be drawn. Cognitive aspects are a promising starting point for increasing the knowledge on decision-making in the context of SME internationalization. Thus, the intersection of international entrepreneurship (IE) and entrepreneurial cognition deserves further attention. On the other hand, traits-based research seems to contribute little to a better understanding of IE. Policies supporting SME should be extended: pure resource-based approaches seem to be insufficient. Furthermore, entrepreneurship courses should reflect the relevance of attitudinal and other cognitive influences.     

What Plato Knew About Enron

This paper applies Plato’s cave allegory to Enron’s success and downfall. Plato’s famous tale of cave dwellers illustrates the different levels of truth and understanding. These levels include images, the sources of images, and the ultimate reality behind both. The paper first describes these levels of perception as they apply to Plato’s cave dwellers and then provides a brief history of the rise of Enron. Then we apply Plato’s levels of understanding to Enron, showing how the company created its image and presented information to support that image, and how the public eventually emerged from the cave to realize the truth about Enron’s actual accounting practices and financial state, which led to the corporation’s downfall. We find Plato’s allegory both useful in analyzing the relationship between Enron and the public and instructive about the power and moral responsibility of Enron’s executives.     

Does ‘Best Practice’ in Setting Executive Pay in the UK Encourage ‘Good’ Behaviour?

We examine how UK listed companies set executive pay, reviewing the implications of following best practice in corporate governance and examining how this can conflict with what shareholders and other stakeholders might perceive as good behaviour. We do this by considering current governance regulation in the light of interviews with protagonists in the debate, setting out the dilemmas faced by remuneration-setters, and showing how the processes they follow can lead to ethical conflicts.Current ‘best’ practice governing executive pay includes the use of market benchmarks to determine salary and bonus levels, significant levels of performance-related pay, the desire for executives to hold equity in their companies, the disclosure of total shareholder return compared to an index, and a perceived need for conformity, in order to grant legitimacy to policies. Whilst each of these may in some circumstances lead to good practice, each has the potential to cause dysfunctional behaviour in executives. Overall, we conclude that although best practice might drive good executive behaviour that coincides with the company’s and key stakeholders’ objectives, there are many reasons why it should not.     

Organizational Role and Environmental Uncertainty as Influences on Ethical Work Climate in Military Units

In addition to a person’s character and training, the organization’s ethical work climate (EWC) can assess how the organization influences an individual’s ethical decision-making process by examining the individuals’ perception of “what is the right thing to do” in a particular organizational environment. Relatively little research has explored which EWCs dominate military units and the impact of organizational role and environmental uncertainty on individuals in the military and their ethical decision making. In this study, we examined the predominant EWCs among military units and found that certain organizational influences are associated with the specific EWCs. Based on these discoveries, we discuss the implications of EWC studies and the influence of organizational role and environmental uncertainty for researchers, as well as military leaders.     

A Common Pitch and The Management of Corporate Relations: Interpretation, Ethics and Managerialism

This paper examines how good management can repair fractured relationships within organisations, addressing problems that if left unattended will threaten the future existence of many of these companies. It analyses why there is a mood for change in management thinking, and what direction that change can take. Part of the challenge is how managers can best satisfy the objectives of corporate social responsibility initiatives, and repair organisational and fractured community relationships. A possible role for management is to examine alternative ways of thinking about the potential benefits for the organisation that can be achieved by enhancing employee relationships. In this regard, this paper offers strategies to examine management’s adverse affects on workers’ life-plans. The art of interpretation is used to expose how bureaucratic logic ignores workers’ rights and potentially damages the corporation’s longevity. Interpretation, as opposed to procedure, suggests that organisations are not simply profit mechanisms, but active and dynamic civil societies. By better understanding the facilitating processes of administrative and management thinking, it is possible that we can develop alternative strategies that empower individuals to circumvent the negative consequences of instrumental rationality and enable them to act more responsibly in the public interest. Glen Lehman is Associate Professor, School of Commerce University of South Australia. He has published articles in Philosophy and Social Criticism Accounting, organization and society as well as Critical Perspective on Accounting.     

Assessing the Impact of Public–Private Partnerships in the Global South: The Case of the Kasur Tanneries Pollution Control Project

This paper makes a contribution to ongoing debates about whether and how we can empirically assess the potential, limitations, and actual impacts of public–private partnerships (PPPs) in developing countries. Several United Nations and bilateral aid agencies have called for the development of impact assessment (IA) methodologies that can help clarify when, how, where, and for whom partnerships work. This paper scrutinizes some of the key assumptions underlying this debate, arguing that no objective ‹truth’ about the effects of PPPs can be discovered through the use of such methodologies. The paper then investigates what can actually be known about a PPP’s effects by testing a PPP IA framework that is recommended by the Organization for Economic Cooperation and Development. This is done using a case study from Pakistan. The paper shows that IA methodology may provide an indication of how well a PPP has fared, but not why the PPP has turned out the way it has. At the same time, win–win and win–lose outcomes may exist simultaneously, even for the same stakeholder in the PPP. While the importance of ensuring proper design, monitoring, and IA of PPPs cannot be denied, their effects must be seen as an outcome of struggles between a␣variety of actors over the distribution of social and environmental hazards associated with broader processes of economic development and industrialization.     

Stakeholder Perspectives and Business Risk Perception

Stakeholder theory calls for decision makers to balance stakeholder interests, but before this can happen, management must understand how other parties view its decisions. Effective stakeholder dialogues convened to reach this understanding require management to appreciate how others perceive the risks posed by their decision. Although understanding others’ risk perception is crucial for effective communications, we do not have a clear idea of how viewing a situation from multiple stakeholder perspectives affects risk perception. Based on a technique derived from risk perception studies of health and environmental issues, an experiment with 224 business students examined how an individual’s risk perception can account for both managerial and customer perspectives. Factors described as customer participation, extent of the effect, and management input, together with the respondent’s self-assessed understanding of the decision process, help categorize overall risk perceptions and are shown to be associated with behaviors based on the decision’s riskiness. Discussion includes implications for designs of business communications, including their content and transparency, and for understanding the audience for these communications.     

When does Ethical Code Enforcement Matter in the Inter-Organizational Context? The Moderating Role of Switching Costs

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.     

Organisational Control and the Self: Critiques and Normative Expectations

This article explores the normative assumptions about the self that are implicitly and explicitly embedded in critiques of organisational control. Two problematic aspects of control are examined – the capacity of some organisations to produce unquestioning commitment, and the elicitation of ‹false’ selves. Drawing on the work of Rom Harré, and some examples of organisational-self processes gone awry, I investigate the dynamics involved and how they violate the normative expectations that we hold regarding the self, particularly its moral autonomy and authenticity. The article concludes by arguing that, despite post-structuralist challenges, some notion of a ‹core’ or ‹real’ self still holds salience for employees negotiating their identities within regimes of control. The assumptions and expectations surrounding this aspect of self are also a pivotal element in the western intellectual tradition that promotes and enables critique.     

The Value of Corporate Philanthropy During Times of Crisis: The Sensegiving Effect of Employee Involvement

Recent research suggests that philanthropy’s value to the firm is largely mediated by contextual factors such as managers’ assumed motives for charity. Our article extends this contingency perspective using a “sensegiving” lens, by which external actors’ interpretations of organizational actions may be influenced by the way in which the organization communicates about those actions. We consider how sensegiving features in philanthropy-related press releases affect whether investors value those donation decisions. For the empirical investigation in this study, we analyze abnormal returns to announcements by U.S. Fortune 500 firms documenting their donations to Hurricane Katrina disaster relief in 2005. We expect that in general, donation decisions would be controversial given the uncertainty surrounding the hurricane’s economic effects at the time. However, we also propose that announcements emphasizing employee involvement in the donation send investors positive signals about the firm’s ability to bounce back from the disaster’s adverse effects. We find empirical support for the proposed hypotheses, and discuss the implications for theory and practice.     

Hume’s Theory of Business Ethics Revisited

Hume’s examination of the conventions of property, trade, and contract addresses the moral foundations that make business possible. In this light, Hume’s theory of justice is also a foundational work in business ethics. In Hume’s analysis of these conventions, both philosophers and game theorists have correctly identified “proto” game-theoretic elements. One of the few attempts to offer a Humean theory of business ethics rests on this game-theoretic interpretation of Hume’s argument. This article argues that game-theoretic reasoning is only one part of a Humean business ethics and this can be shown by further analyzing Hume’s theory of justice. As we examine his theory, it becomes clear that Hume is not trying to show how it is always rational to respect the rules of business. Hume is not engaging in, or attempting, a reconciliation project and neither is a Humean business ethics. The final section of the article is a brief Humean analysis of the effectiveness of codes of ethics. The purpose of this section is not to decide the issue but to show how a Humean approach is both useful, relevant, and involves more than reconciling rationality and morality.     

Implementing Supplier Codes of Conduct in Global Supply Chains: Process Explanations from Theoretic and Empirical Perspectives

Western buying companies impose Supplier Codes of Conduct (SCC) on their suppliers in developing countries; however, many suppliers cannot fully comply with SCC and some of them even cheat in SCC. In this research, we link contract characteristics – price pressure, production complexity, contract duration – to the likelihood of supplier’s commitment to SCC through a mediating process: how the buying companies govern their suppliers. Our structural equation model analysis shows that the hierarchy/relational norms governance is a perfect mediator of contract characteristics’ effects on the likelihood of supplier’s commitment; the market governance, an insignificant one. The managerial implications are provided for successfully implementing SCC in global supply chains.     

The Principled Legal Firm: Insights into the Professional Ideals and Ethical Values of Partners and Lawyers

Understanding how the professional ideals and values of partners influence lawyers’ everyday life is a relatively unexplored area given the inherent difficulties of gaining access to lawyers. This case study sheds light on the professional ideals and ethical values of partners and lawyers in a mid-tier Sydney law firm. Semi-structured interviews with partners and lawyers/legal clerks reveal how partners’ professional ideals and ethical values play a pivotal role in: (1) upholding positive normative evaluations of lawyer/firm propriety (moral legitimacy), (2) stressing the importance of a balanced working life (cognitive legitimacy) and (3) satisfying younger lawyers’ needs for personal support, autonomy and responsibility (pragmatic legitimacy). The principled actions of partners are portrayed as the cornerstone of shaping a moral community in legal practise.     

Women’s Careers at the Start of the 21st Century: Patterns and Paradoxes

In this article we assess the extant literature on women’s careers appearing in selected career, management and psychology journals from 1990 to the present to determine what is currently known about the state of women’s careers at the dawn of the 21st century. Based on this review, we identify four patterns that cumulatively contribute to the current state of the literature on women’s careers: women’s careers are embedded in women’s larger-life contexts, families and careers are central to women’s lives, women’s career paths reflect a wide range and variety of patterns, and human and social capital are critical factors for women’s careers. We also identify paradoxes that highlight the disconnection between organizational practice and scholarly research associated with each of the identified patterns. Our overall conclusion is that male-defined constructions of work and career success continue to dominate organizational research and practice. We provide direction for a research agenda on women’s careers that addresses the development of integrative career theories relevant for women’s contemporary lives in hopes of providing fresh avenues for conceptualizing career success for women. Propositions are identified for more strongly connecting career scholarship to organizational practice in support of women’s continued career advancement.     

The battleship strategy: The complementing role of born globals in MNC’s new opportunity creation

In the high-tech industries, new innovations affect a multinational company’s (MNC’s) competitive advantage. This article empirically explores why and how MNCs complement their in-house R&D by forming strategic alliance constellations with small, innovative born globals. We focus on loose, non-equity opportunity-seeking co-opetitive relationships. We call this approach the battleship strategy. The critical elements of an MNC’s battleship strategy include an open innovation commercialization strategy and creation of forums for facilitating open innovation and capturing ideas generated externally. Hence, we suggest that MNCs may externalize some of their innovation activities while gaining a competitive advantage through access to open innovation. This article contributes in several ways to earlier research focusing on the strategic alliances and networks formed between MNCs and born globals by examining the relationship from an MNC’s perspective.     

The Effects of Ownership and Governance on SMEs’ International Knowledge-based Resources

Small- and medium-sized enterprises (SMEs) play an important role in today’s global economy. However, there are significant differences in how they respond to the opportunities and threats in international markets. This study␣suggests SMEs’ ownership and governance systems significantly influence the development of knowledge-based resources necessary for internationalization. Using a sample of 384 US SMEs, we find a positive relationship between both the equity held by top management team members and venture capitalists and the development of these important resources. This positive association is further accentuated by the presence of independent outside directors on SMEs’ boards, supporting their monitoring and enterprising roles.