A comparison of five business philosophies

While the media and public opinion polls suggest that the state of business ethics is declining, surveys of corporate managers on the subject are less than conclusive. This study presents results of a survey of 487 adult, MBA, and undergraduate business students on the business philosophies of Machiavellianism, Darwinism, Objectivism, Relativism, and Universalism. The findings were consistent with earlier research which showed prospective managers to be less ethical than practicing ones and that women and those reporting a strong religious conviction tend to be more ethical. Explanations and several recommendations for improving the situation are offered. ‘If you saw Atlas... trying to hold the world aloft with the last of his strength, and the greater his effort the heavier the world bore down upon his shoulders — what would you tell him to do?’ ‘To shrug.’ —Ayn Rand, Atlas Shrugged     

Limited paternalism and the Pontius Pilate Plight

Ebejer and Morden (‘Paternalism in the Marketplace: Should a Salesman Be His Buyer's Keeper?”, Journal of Business Ethics 7, 1988) propose ‘limited paternalism’ as a sufficient regulative condition for a professional ethic of sales. Although the principle is immediately appealing, its application can lead to a counter-productive ethical quandary I call the Pontius Pilate Plight. This quandary is the assumption that ethical agents' hands are clean in certain situations even if they have done something they condemn as immoral. Since limited paternalism can give rise to this queer conclusion in the salesperson/buyer relationship, the principle is suspect. It may be a necessary condition for ethical sales, but is not sufficient. This discussion concludes by suggesting two additional criteria which, when complemented by the limited paternalism principle, are jointly sufficient.     

The leverage of foreigners: Multinationals in South Africa

This article argues that foreign multinational corporations (MNCs) in South Africa cannot evade an ethical choice, how best to exercise their leverage against apartheid? Disinvestment is only one, ambiguous option. MNCs need clear ethical goals and an effective strategy. Both arise from the political economy of the MNC (1). It involves 3 relationships, between the MNC parent and its subsidiary; the MNC home society and host society; and the MNC home state and host state. That political economy explains the MNC's dependency (1a) and modernization effects (1b). Those effects give foreigners some leverage against apartheid; but an effective and ethical MNC strategy is needed (2). It involves four goals: dismantling apartheid, a mixed economy, full democracy, and a negotiated peace (2a). It suggests a sequence of MNC/home state options from Do Nothing or Divest to More Corporate Activism, Home State Support, and International Sanctions (2b). But victory is not around the corner; rather, we are all condemned to freedom.     

The real estate code of ethics: Viable or vaporous?

Several recent articles in the field of ethics and business have raised questions concerning the viability of professional ethical codes. Are such codes serious, effective tools for promoting and enforcing an ethical standard of behavior? Or do the codes more closely resemble clever, elaborate public-relation ploys? The purpose of this paper is to analyze the content, role and efficacy of one such ethical code, namely, The Code of Ethics of the National Association of Realtors. The paper examines the ethical principles embodied, implicitly or explicitly, in this Code; it tests these principles for coherence, comprehensiveness, clarity and enforce-ability. Furthermore, it seeks to determine whether this Code articulates standards of ethical conduct that are higher than those already required by law and whether the Code successfully translates a general ethical vision down to concrete, everyday real estate practice.     

The corporation and its employees: A case story

One of the main objectives in the information society is to improve the quality of life. — Paying attention to the needs of people seems to be a key element in good ethical behaviour, says Tor Dahl, Managing Director of Manpower Scandinavia. In defining these needs, Manpower used Abraham Maslow's famous pyramid, his hierarchy of needs, as a model for trying to satisfy in practise the needs on each level. However, they went a step further, asking; what comes after Maslow? To mean something for others; togetherness and that people can be trusted and that they seek a purpose with their work, came out as answers. In his paper Mr. Dahl tells us how Manpower Scandinavia has developed a written set of values, which function as a basis for action and guidelines for behaviour, and where the key idea behind it all is to let people be self-managed. Furthermore, he shows us how Manpower has organised the company according to this conviction. — If your really have faith in people and show them trust, they will show you trust in return. Then you have a good basis for ethical behaviour, Tor Dahl concludes his paper.     

Attitudes Toward Ethically Questionable Negotiation Tactics: A Two-Country Study

Current research has identified five discrete US negotiation tactics, a traditional one considered to be ethical, and four considered to be ethically questionable. Scholars have independently used culture to explain how the endorsement of these five negotiation tactics varies across nations. They have also independently used interpersonal trust and ethics propensity to explain antecedents of the endorsement of those five negotiation tactics. This research combines all those variables into one model that investigates the influence of horizontal and vertical individualism–collectivism, ethical idealism, and trust propensity on employees’ attitudes toward ethically questionable negotiation tactics in Israel and Kyrgyzstan. A survey questionnaire was translated from English to Hebrew and Kyrgyz, and 615 responses were collected from employees in various industries in the two countries. We empirically confirmed three types of questionable negotiation tactics discovered in previous one-nation studies, namely, pretending, deceiving, and lying. Vertical individualism was found to be positively, and horizontal collectivism was found to be negatively, related to pretending, deceiving, and lying. Ethical idealism was found to be negatively related to the endorsement of the lying tactics, while trust propensity was negatively related to the pretending tactics. Compared with Israel, employees’ endorsement of ethically questionable negotiation tactics was significantly higher in Kyrgyzstan. Contribution to theory and practice is discussed.     

Alliances Between Corporate and Fair Trade Brands: Examining the Antecedents of Overall Evaluation of the Co-branded Product

This research investigates the potential for a “fair” co-branding operation. A major corporate brand is fictitiously allied with a Fair Trade labelling organization brand. The sample for the study is composed of 540 respondents, representative of the French population. By considering commercial brands and Fair Trade labels as dissimilar in terms of customers’ perceived Fair Trade orientations, this article studies (1) how this lack of similarity impacts perceived congruence between both entities (i.e. perceived relevancy and expectancy of the alliance) and (2) how prior brand attitudes and congruence influence customers’ evaluation of the co-branded product. The results of this research demonstrate that: (1) Consumer prior brand attitudes toward the partner brands influence very little customers’ evaluation. (2) Perceived similarity of the partner brands has a strong influence toward congruence of the co-branding operation. Results also indicate that congruence (measured as relevancy and expectancy) has a strong influence upon customers’ evaluation. (3) An inverted U-shaped relationship exists between perceived similarity and relevancy of the alliance, and between expectancy and customers’ evaluation. The results obtained through the test of a partial least square model, and inverted U-shaped hypothesis, represent a new insight into co-branding theory. The high discursive power of fair co-branding is a key issue: the corporate brand provides the alliance with its leading position, while the Fair Trade brand provides the ethical attribute.     

Islamic Corporate Governance: Risk-Sharing and Islamic Preferred Shares

The recent financial crises (including the Asian and subprime crises) indicated the need to reinforce corporate governance mechanisms in emerging and developing market economies. Corporate governance refers to all the factors that affect firm processes (including, among others, financing strategies). Firms must avoid debt financing instruments and adopt financing instruments that allow for “risk-sharing” rather than “risk-shifting” because all recent financial crises were, in essence, debt crises. The primary objective of this paper is to examine the principles of risk-sharing promoted by Islamic finance and study their implications for corporate governance. The secondary objective of this paper is to propose a pricing model for a new risk-sharing financial instrument (Islamic preferred shares, IPS) that was recently discussed by Zarka and Al-Suhaibani (Shariah-compatible preference shares: The Sharia Basis and Economic Rationale. Working paper, SABIC Chair for Islamic Financial Market Studies, 2012). We study the implications of this new instrument as a powerful tool for corporate governance in the case of Islamic markets. We explain the possible contribution of IPS to agency cost reduction, Sharia screening costs and ethical corporate governance.     

Plato's Statesman and the nature of business leadership: An analysis from an ethical point of view

Plato's paradigm for statesmanship in the Statesman, the “weaving” of temperate and courageous properties, provides the contemporary business ethics theorist with an aid for determining certain problems and solutions with regard to business leadership. The history of American business values manifests the destructive, and especially unethical, effects of deviating from this paradigm by over-emphasizing one or the other of the above types of qualities. However, with the aid of Plato's model for leadership in the Statesman and suggestions from Peters and Waterman's In Search of Excellence, progress can be made towards constructing an adequate model for corporate leadership, especially from an ethical standpoint.     

Do You Need a Receipt? Exploring Consumer Participation in Consumption Tax Evasion as an Ethical Dilemma

The paper focuses on the consumer side of consumption tax evasion (CTE), a subcategory of the shadow economy. The ethical dimensions of tax evasion have been effectively captured by the existent literature on tax morale, yet it fails to address the role consumers can play in CTE. Further, there is a shortage of tax morale studies that explore ethical decision making as a process composed of multiple steps and determinants. To bridge these gaps, we turned to the consumer ethics literature and Jones’ issue-contingent model of ethical decision making. We developed the conceptual model of consumer ethical decision making for CTE by incorporating four key elements from the issue-contingent model, i.e. moral recognition, moral judgement, moral intention and moral intensity, while personal moral philosophies were introduced as an antecedent to the consumer ethical decision-making process. The study was conducted on a sample of consumers from Slovenia, where CTE is a widespread phenomenon. The findings confirm that consumers’ recognition of CTE as a moral issue is influenced by their moral philosophy and perceptions regarding the magnitude of CTE’s consequences, their visibility, probability, and temporal immediacy. These perceptions also play an important role in determining consumers’ moral judgements and intentions regarding CTE. Moreover, through the process of moral recognition and moral judgement, consumers form intentions to participate in, or avoid CTE. The study holds important implications for public policy makers who are trying to reduce the tax gap in times of economic instability and fiscal crisis.     

Leadership,Pragmatism and Grace: A Review

Leadership takes a central role in the public affairs agenda. This article is a review of published works on leadership focusing on the concept of grace. It discusses the role of compassion and kindness in current leadership theory and practice and whether these attributes have value in sustainable models. Findings indicate that there is conceptual confusion regarding the definition of compassion and its application in leadership practices. Kindness is not discussed within the concept of compassion and kindness itself may be viewed as a weakness in contemporary self-selected leadership characteristics. The conclusions suggest there is disconnect between contemporary models of leadership and calls for sustainable ethical leadership in the spheres of public and business environments. Compassion and kindness remain in the side-lines yet the implications for future trust and commitment are neglected in times where discretionary effort of workers and volunteers is crucial to goal achievement.     

The role of multinationals in the NIEO

In the context of the New International Economic Order (NIEO) the developing countries are expressing more and more frequently a wish for stricter control over the multinational enterprises. What should be the features of a Code of Conduct for Multinationals?     

Collective Self-Reliance: Concept and reality

The concept of Collective Self-Reliance (CSR) has been of increasing political importance since the early seventies in the North-South negotiations and also at the South-South conferences (of non-aligned and Group of 77 countries), especially in connection with the discussions on a New International Economic Order (NIEO). Development researchers in poor and rich countries have at the same time begun to pay more attention to the concept of Self-Reliance (SR) in both its individual and its collective dimension. The concept of Collective Self-Reliance is examined in the following article as are its chances of realization.     

EC reform inch by inch

After ratification by member countries, the “Luxembourg reform package” worked out by the European Council at the end of 1985 is to provide the basis for the development of the European Community into the nineties. What are the challenges facing the EC? What opportunities do the Luxembourg reforms open up?     

A concept for an Open World Economy

One of the many new publications dealing with the reform of the International trade system is the report of the Trade Policy Research Centre “Towards an Open World Economy”. The following article analyses and criticlses the main proposals of the report.     

The “pipeline” problem in bilateral financial cooperation

It has been observed since about 1976 that financial commitments to developing countries have been disbursed more slowly than in the past. At the same time there have been increasing complaints from recipients that the commitment, appraisal and disbursement procedures of the donor countries were excessively complicated, resulting in a delay of disbursements. The Western industrialized countries, both individually and jointly in the Development Assistance Committee of the OECD, therefore initiated investigations into the importance to be assigned to this phenomenon as well as into the question of whether there are any possible ways of simplifying the administrative procedures. The following article sums up the results of such a study by the German Institute for Development Policy in respect of the Federal Republic of Germany.     

UN development strategy for the eighties

The recently held 11th Special Session of the UN General Assembly reached agreement on an international strategy for the Third Development Decade which is to be formally passed by the current 35th General Assembly. In the discussion it became obvious that the developing countries’ interest still focusses on a New International Economic Order. There are however grave doubts about the possibility of reaching, by institutional reforms, a real solution for the development problems to be faced in this decade.     

Karma-Yoga: The Indian Model of Moral Development

A comprehensive model of moral development must encompass moral sensitivity, moral reasoning, moral motivation, and moral character. Western models of moral development have often failed to show validity outside the culture of their origin. We propose Karma-Yoga, the technique of intelligent action discussed in the Bhagawad Gita as an Indian model for moral development. Karma-Yoga is conceptualized as made up of three dimensions viz. duty-orientation, indifference to rewards, and equanimity. Based on survey results from 459 respondents from two large Indian organizations, we show that the dimensions of Karma-Yoga are related to moral sensitivity, moral motivation, and moral character.     

Critical analysis of the Barre-Plan

The Commission of the European Communities, in the spring of 1970, accepted “A Plan for the Phases Establishment of An Economic and Monetary Union”, based on the Barre-Memorandum of February 12, 1969, prepared by M. R. Barre, himself a former Commission member. This article deals with the still unanswered questions which according to the author were raised.