Ethical Ideology and Ethical Judgments in the Portuguese Accounting Profession

The purpose of the present study is to examine the attitudes of Portuguese chartered accountants with respect to questions of ethical nature that can arise in their professional activity. Respondents were asked to respond to the Ethics Position Questionnaire developed by Forsyth (Journal of Personality and Social Psychology 39(1), 175–184, 1980), in order to determine their idealism and relativism levels. Subsequently, they answered questions about five scenarios related to accounting practices, with the objective of measuring their ethical judgments. Based on the idealism and relativism levels of our respondents, they were classified into one of four groups, representing different ethical ideologies (absolutism, exceptionism, subjectivism, and situationism). The results indicated that age was the major determinant of relativism. Contrary to previous research, older respondents revealed themselves significantly more relativistic than younger ones. Gender seems to be the most important determinant of ethical judgments; against expectations, men evidenced significantly stricter judgments than women in two of the five scenarios. Findings also indicated that respondents’ ethical judgments did not differ significantly based on their ethical ideology, supporting the idea that ethical ideology is not an important determinant of ethical judgments.     

Ethical Dilemmas in Performance Measurement

In this article we discuss the ethical dilemmas facing performance evaluators and the "evaluatees" whose performances are measured in a business context. The concepts of role morality and common morality are used to develop a framework of behaviors that are normally seen as the moral responsibilities of these actors. This framework is used to analyze, based on four empirical situations, why the implementation of a performance measurement system has not been as effective as expected. It was concluded that, in these four cases, unethical behavior (i.e. deviations from the ethical behaviors identified in the framework) provided, at least to some extent, an explanation for the lower than expected effectiveness of the performance measurement procedures. At the end of the paper we present an agenda for further research through which the framework could be further developed and systematically applied to a broader set of cases.     

The Moderating Effect of Individuals' Perceptions of Ethical Work Climate on Ethical Judgments and Behavioral Intentions

Dimensions of the ethical work climate, as conceptualized by Victor and Cullen (1988), are potentially important influences on individual ethical decision-making in the organizational context. The present study examined the direct and indirect effects of individuals' perceptions of work climate on their ethical judgments and behavioral intentions regarding an ethical dilemma. A national sample of marketers was surveyed in a scenario-based research study. The results indicated that, although perceived climate dimensions did not have a direct effect on behavioral intentions, there were significant moderating effects. Climates perceived as emphasizing social responsibility and rules/codes moderated the individual ethical judgment-behavioral intentions relationship such that individuals were less likely to say that they would engage in a questionable selling practice even when they themselves did not believe the practice to be unethical. Respondents were somewhat more likely to form intentions consistent with their judgment that the questionable practice was morally acceptable when the ethical climate was characterized by an emphasis on team/friendship.     

Comparing Attitudes Toward Ethical Dilemmas in Small Business

Abstract

This paper presents a comparative analysis of attitudes between Russian and U.S. undergraduate students on ethical issues in managing Russian small firms engaged in business transactions with U.S. firms. Based on the real life situations, Russian and American respondents were asked to select decision alternatives dealing with ethical dilemmas. Significant differences were found between the two groups. Russians do not recognize significant differences between various alternatives, despite the disparity in the severity of these alternatives for resolving business problems. Russians, compared to Americans, tend to prefer more forceful decision alternatives resorting to business practices that would be considered unethical in the U.S. This is attributable to differences in the countries' history, political, legal, and cultural environment. The transitional nature of the Russian economy affects decision-making and business ethics.     

Ethical Cycles and Trends: Evidence and Implications

Recent high-profile corporate scandals are reminiscent of the corporate raider scandals of the 1980s, suggesting that ethical scandals may occur in waves. This article provides a framework for analysis of this question by suggesting that ethical attitudes may be cyclical about long-term secular trends. We provide some empirical evidence from previously published work for the existence of cycles as well as a potential mechanism for their propagation, namely widespread publicity about a particularly salient event, e.g., Enron. Further, we posit that long-run secular trends would be affected through more deliberate, cognitive means, e.g., instruction in business ethics. We also discuss an important research implication, namely that traditional cross-sectional “book-end” studies surveying ethical attitudes at two different points in time may be unable to disentangle short-run cyclical movements from long-term secular trends.      

A Proposed Infrastructural Model for the Establishment of Organizational Ethical Systems

We define ethical system infrastructure as being composed of three major factors – means, motivation, and opportunity. Means are defined as organizational rules, policies, and procedures. Motivation focuses upon the values and the interests being pursued by the position occupant and the organizational value system, while opportunity is discussed in terms of the environment in which the dilemma occurs, proposing that position in the hierarchy presents its own unique set of ethical dilemmas. Ethical breeches are discussed in terms of the interactional processes among means, motivation, and opportunity. Finally, a sequential process is suggested to use the infrastructural components to institutionalize organizational ethics training and subsequent behavior.     

Influences Upon Organizational Ethical Subclimates: A Replication Study of a Single Firm at Two Points in Time

This research replicates Weber's 1995 study of a large financial services firm that found that ethical subclimates exist within multi-departmental organizations, are influenced by the function of the department and the stakeholders served, and are relatively stable over time. Relying upon theoretical models developed by Thompson (1967) and Victor and Cullen (1998), hypotheses are developed that predict the ethical subclimate decision-making dimensions and type for diverse departments within a large steel manufacturing firm and that these ethical subclimate types will be stable across the two periods of time when the data were collected. Employees were surveyed in 1995 and again in 1999 using Victor and Cullen's Ethical Climate Questionnaire. Response rates of 88 and 94 percent were achieved. Contrary to Weber's findings, our results imply that, in both samples, ethical subclimates may be determined by the strength of an organization's overall ethical climate, rather than the department's function. However, we did find support for Weber's earlier contention that these subclimates are relatively stable. Our results also suggest that differences may exist across industries, that is when comparing a large steel manufacturer, as we did in our study, with a large financial services organization, as Weber did in his 1995 study.     

Business Ethics Index: Measuring Consumer Sentiments Toward Business Ethical Practices

The present study describes the development of an ongoing and systematic index to measure consumers’ sentiments towards business ethical practices. The Business Ethics Index (BEI) is based on the well established measurements of consumer sentiments, namely the ICS (Index of Consumer Sentiment) and CBCCI (Conference Board Consumer Confidence Index). The BEI is comprised of 4 measurements representing the dimensions of “personal-vicarious” and “past-future.” Data from 503 telephone interviews were used to calculate a BEI of 107. This indicates an overall positive consumer sentiment towards the ethical behavior of business. Future calculations of the BEI are planned which will allow for the estimation of the latent dynamics of trends in consumer sentiments toward American business ethics.     

The Hypothesized Relationship Between Accountability and Ethical Behavior

Unethical behavior is important to study because it may have an adverse influence on organizational performance. This paper is an attempt to better understand why individuals behave as they do when faced with ethical dilemmas. We first explore the definition, theories and models of ethical behaviors and accountability. This discussion of societal ethics and accountability as forms of social control segues into a discussion of how accountability may influence ethical behaviors. Based on the business ethics and accountability literatures, we suggest a number of research questions and hypotheses that need to be tested, as well as an appropriate research strategy.     

‘The Impact of Corporate Ethical Values and Enforcement of Ethical Codes on the Perceived Importance of Ethics in Business: A Comparison of U.S. and Spanish Managers’

This two country study examines the effect of corporate ethical values and enforcement of a code of ethics on perceptions of the role of ethics in the overall success of the firm. Additionally, the impact of organizational commitment and of individual variables such as ethical idealism and relativism was examined. The rationale for examining the perceived importance of the role of ethics in this manner is to determine the extent to which the organization itself can influence employee perceptions regarding ethics and social responsibility. Results indicate that all of the variables tested, except relativism, impacted upon one’s perceptions of the importance of ethics and social responsibility. Perceptions of the importance of ethics and social responsibility also varied depending upon country of residence with the U.S. sample having somewhat higher perceptions concerning the importance of ethics and social responsibility than their counterparts in Spain. Furthermore, when comparing the two samples, the U.S. sample had significantly higher corporate ethical values, greater enforcement of ethical codes, less organizational commitment and both lower idealism and relativism.     

Determinants of Ethical Decision Making: The Relationship of the Perceived Organizational Environment

This study attempts to help explain the ethical decision making of individual employees by determining how the perceived organizational environment is related to that decision. A self- administered questionnaire design was used for gathering data in this study with a sample size of 245 full-time employees. Perceived supervisor expectation, formal policies, and informal policies were used to assess the expressed ethical decision of the respondents. The findings indicate that the perceived organizational environment is significantly related to the ethical decision of the respondent.     

Bridging Ethics and Self Leadership: Overcoming Ethical Discrepancies Between Employee and Organizational Standards

In spite of extensive study and efforts to improve business ethics and increase corporate social responsibility, a quick review of almost any business publication will show that breaches of ethics are a common occurrence in the business community. In this paper we explore reasons for potential discrepancies or gaps between organizational and individual ethical standards, the consequences of such discrepancies, and possible methods of reducing the detrimental effects of these differences. The concept of self-leadership, as constructed through social learning theory is examined, and shown to be a potentially valuable tool for employees' use in making reasoned decisions in varying organizational ethical climates. Specifically, the authors will show how the practice of self-leadership can be employed as an important means to improve moral action within the firm.     

伦理问题、道德强度与供应商伦理管理

供应商的伦理问题涉及人权、环境、多样化、慈善与安全等方面,不同伦理问题的道德强度不同,企业决策者对供应商不同伦理问题的重视程度也不同。运用层次分析法,给出道德强度的结果严重度、社会共识、结果发生可能性、时间急迫性、接近性、结果集中度等六个维度的相对权重,根据道德强度各维度的相对重要性,对供应商不同的伦理权重进行排序。     

Exposure to Ethics Education and the Perception of Linkage between Organizational Ethical Behavior and Business Outcomes

This study focused on the effects of individual characteristics and exposure to ethics education on perceptions of the linkage between organizational ethical practices and business outcomes. Using a stratified sampling approach, 817 students were randomly selected from a population of approximately 1310 business students in an AACSB accredited college of business. Three hundred and twenty eight of the subjects were freshmen, 380 were seniors, and 109 were working managers and professionals enrolled in a night-time MBA program. Overall, the respondents included 438 male students and 379 female students. Exposure to ethics in the curriculum had a significant impact on student perceptions of what should be the ideal linkages between organizational ethical practices and business outcomes. Gender based differences were found with female students having a higher expectation regarding what should be the “ethics practices and business outcomes” link. Exposure to ethics in the curriculum had a positive moderating influence on the gender-based effects on perceptions of ideal ethical climate. The interaction effect showed that exposure to ethical education may have a positive impact on males and allow them to catch up with females in their ethical sensitivities concerning the ideal linkage between organizational ethical behavior and business outcomes. Further, consistent with the literature, the study found that gender differences in ethical attitudes regarding the ideal ethical climate, while significant for undergraduates, appeared to narrow considerably for the working professionals who were part-time MBA students. Harsh Luthar is an Associate Professor of Management at Bryant University. He received his Ph.D. from Virginia Polytechnic University, Pamplin College of Business, in the Department of Management. His research interests include international differences and cross-cultural issues impacting global human resource practices, ethical attitudes of students, and the nature of spiritual leadership. Ranjan Karri is an Assistant Professor of Management at Bryant University. He received his Ph.D. in strategic management from Washington State University. His research interests include corporate and business strategies, enterpreneurship, ethical leadership and corporate governance.     

The Role of Law in Models of Ethical Behavior

In attempting to improve ethical decision-making in business organizations, researchers have developed models of ethical decision-making processes. Most of these models do not include a role for law in ethical decision-making, or if law is mentioned, it is set as a boundary constraint, exogenous to the decision process. However, many decision models in business ethics are based on cognitive moral development theory, in which the law is thought to be the external referent of individuals at the level of cognitive development that most people have achieved. Other theoretical bases of ethical decision models, social learning, and experientialism, also imply a role for law that is rarely made explicit. Law is a more important aspect of ethical decision-process models than it appears to be in the models. This paper will derive explicit roles for the law from the cognition, experientialism, and social learning theories that are used to build ethical decision-making models for business behavior. Sandra Christensen is Professor of Management at Eastern Washington University, where she teaches courses in Business & Society, International Business, and Leadership & Ethics. She has published in Business and Society, Business Ethics Quarterly, the Journal of Business Ethics, and the Academy of Management Review.     

Reinforcing Ethical Decision Making Through Organizational Structure

In this paper I examine how the constituent elements of a firm's organizational structure affect the ethical behavior of workers. The formal features of organizations I examine are the compensation practices, performance and evaluation systems, and decision-making assignments. I argue that the formal organizational structure, which is distinguished from corporate culture, is necessary, though not sufficient, in solving ethical problems within firms. At best the formal structure should not undermine the ethical actions of workers. When combined with a strong culture, however, the organizational structure may be sufficient in promoting ethical conduct. While helpful, ethics training and corporate codes are neither necessary nor sufficient in promoting ethical behavior within firms.     

Ethical Challenges in the Two Main Segments of the Insurance Industry: Key Considerations in the Evolving Financial Services Marketplace

Based on the findings of several research studies of professionals in both the property-liability insurance industry and the life insurance industry, the paper makes and supports several important points. First, ethical challenges in the insurance industry involve not only a series of ethical dilemmas frequently faced by those working in the business, but also a variety of factors that hinder those working in the industry as they seek to resolve the ethical dilemmas encountered in the course of their work. Both of these two components of ethical challenges must be understood by those in the financial services industry who will deal with insurance operations in the future. Second, whereas the life insurance business and the property-liability insurance business have traditionally been viewed as being quite different from one another and still are in terms of operations and regulation, the research findings show that they are no longer very different in terms of the key ethical challenges faced by those working in the two segments of the industry. The paper shows how during the past decade the ethical challenges in the property-liability insurance industry have become quite similar to those in the more troubled life insurance industry.     

The Effect of Moral Intensity on Ethical Judgment

Following an extensive review of the moral intensity literature, this article reports the findings of two studies (one between-subjects, the other within-subject) that examined the effect of manipulated and perceived moral intensity on ethical judgment. In the between-subjects study participants judged actions taken in manipulated high moral intensity scenarios to be more unethical than the same actions taken in manipulated low moral intensity scenarios. Findings were mixed for the effect of perceived moral intensity. Both probable magnitude of consequences (a factor consisting of magnitude of consequences, probability of effect, and temporal immediacy) and social consensus had a significant effect; proximity did not. In the within-subject study manipulated moral intensity had a significant effect on ethical judgment, but perceived moral intensity did not. Regression of ethical judgment on age, gender, major, and the three perceived moral intensity factors was significant between-subjects, but not within-subject. Ethical judgment was found to be a more robust predictor of intention than perceived moral intensity using a within-subject design. Joan M. McMahon is an Assistant Professor of Management in the Luter School of Business at Christopher Newport University, teaching courses in Organizational Behavior, Leadership, and Human Resources. She has a B.A. in Speech from the State University of New York, College at Oneonta; an M. Ed. in Early Childhood Education from James Madison University; and an M.S. and Ph.D. in Industrial/Organizational Psychology from Virginia Polytechnic Institute and State University. Robert J. Harvey is an Associate Professor of Psychology at Virginia Polytechnic Institute and State University. He has a B.A. in Psychology and an M.A. in Experimental Psychology from the University of Missouri at Kansas City, and a Ph.D. in Industrial/Organizational Psychology from Ohio State University. Dr. Harvey has authored a number of articles in the Journal of Applied Psychology, the Journal of Personality Assessment, Personnel Psychology, and others. He is the author of the chapter on job analysis in the Handbook of Industrial and Organizational Psychology.     

Ethical Decisions About Sharing Music Files in the P2P Environment

Digitized information and network have made an enormous impact on the music and movie industries. Internet piracy is popular and has greatly threatened the companies in these industries. This study tests Hunt-Vitell’s ethical decision model and attempts to understand why and how people share unauthorized music files with others in the peer-to-peer (P2P) network. The norm of anti-piracy, the ideology of free software, the norm of reciprocity, and the ideology of consumer rights are proposed as four deontological norms related to using P2P systems. The model is tested using a scenario survey with four alternatives; the results indicate that the deontological norm of anti-piracy is not a main factor in affecting P2P users’ ethical considerations regarding sharing files with others. This finding suggests that to protect their property rights, record companies should try to realize the consumer benefits brought via new digital and network technology, instead of simply declaring their intellectual property and resisting the innovations resulting from new technologies.     

Ethical Commitment,Financial Performance,and Valuation: An Empirical Investigation of Korean Companies

A variety of stakeholders including investors, corporate managers, customers, suppliers, employees, researchers, and government policy makers have long been interested in the relationship between the financial performance of a corporation and its commitment to business ethics. As a subject of research, the relations between business ethics and corporate valuation has yet to be thoroughly quantified and investigated. This article is an effort to amend this inadequacy by demonstrating a statistically significant association between ethical commitment and corporate valuation measures. Consistent with anecdotal evidence, we have found a significant association between the ethical commitment of Korean companies and their valuation on the Korean stock market. However, the result reveals that the association between ethical commitment and financial performance is not significantly supported. Tae Hee Choi received Ph.D. from the Ohio State University, Ohio, USA. Presently working as Assistant Professor in accounting at the KDI School of Public Policy and Management. Research interests are business ethics, capital market, financial accounting, managerial accounting, and valuation. Jinchul Jung received Ph.D. from Kent State University, Ohio, USA. Presently working as Assistant Professor of Business Administration Department in the College of Business at Chosun University. Research interests are business ethics, family-supportive program, and organizational commitment.