Insider Trading 2.0? The Ethics of Information Sales

The sale of faster access to financial market data has recently generated public controversy. NY Attorney General Eric Schneiderman has referred to such fast data feeds as “Insider Trading 2.0”. For example, Thomson Reuters sold the University of Michigan’s Consumer Sentiment Index to computerized trading firms 2 seconds before releasing its data to its other paying clients. This paper explores the ethical issues involved in the sale of such information. Is selling faster access ethically the same as traditional insider trading, which generally involves a breach of fiduciary duty or the use of misappropriated information? Such practices are extremely different from traditional insider trading as there is neither a breach of fiduciary duty nor misappropriation of inside information. The ethical issues are similar to other market segmentation and price discrimination issues, in which different prices are charged to different customers. The ability to price discriminate across segments can actually benefit large segments of the population who may receive lower prices because others, such as the high-speed traders, are paying more. The sale of faster access to information, especially by exchanges, raises additional ethical issues. There may be adverse effects on market quality that must be addressed. The moral distaste for the practice expressed by some stems from the seeming unfairness of a modern market structure that provides advantages to a small group of computerized traders.     

The Ethics of Advising on Regulatory Compliance: Autonomy or Interdependence?

Many companies are now implementing ethics and regulatory compliance programs. The growth of employment of both lawyers and specialist "compliance professionals" to advise on and facilitate implementation of these programs has expanded concomitantly. This paper examines the ethical role that should be played by these advisors. Traditional ways of conceptualising corporate lawyers' ethics are shown to be inadequate because they see the legal advisor as an autonomous adversarial advocate or an independent and aloof counsellor. Instead interviews with compliance practitioners are used to show that a superior conceptualisation of the compliance advisor's role is emerging. Compliance practitioners identify explicitly with business and, at the same time, identify with a broader ethical community of other compliance professionals, regulators and stakeholders in order to play a transformative role within the organisation. This conception recognises the interdependence between compliance advisor and corporate client.     

The State of Business Ethics in Israel: A Light Unto the Nations?

Whether the nation of Israel has become a “light unto the nations” in terms of ethical behavior among its business community remains in doubt. To examine the current state of business ethics in Israel, the study examines the following: (1) the extent of business ethics education in Israel; (2) the existence of formal corporate ethics program elements based on an annual survey of over 50 large Israeli corporations conducted over 5 years (2006–2010); and (3) perceptions of the state of business ethics based on interviews conducted with 22 senior Israeli corporate executives. In general, and particularly as a young country, Israel might be considered to have made great improvements in the state of business ethics over the years. In terms of business ethics education, the vast majority of universities and colleges offer at least an elective course in business ethics. In terms of formal business ethics program elements, many large companies now have a code of ethics, and over time continue to add additional elements. Most respondents believed they worked in ethical firms. Despite these developments, however, there appears to be significant room for improvement, particularly in terms of issues like: nepotism/favoritism; discrimination; confidentiality; treatment of customers; advertising; competitive intelligence; whistle-blowing; worker health and safety; and the protection of the environment. When compared with the U.S. or Europe, most believed that Israeli firms and their agents were not as ethical in business. A number of reasons were suggested that might be affecting the state of business ethics in Israel. A series of recommendations were also provided on how firms can better encourage an ethical corporate culture. The paper concludes with its limitations.     

A Code of Ethics for Social Marketing? Bridging Procedural Ethics and Ethics-in-Practice

We consider the role of codes of ethics in social marketing, distinguishing between “procedural ethics” and “ethics-in-practice” (after Guillemin & Gillam, 2004). We review foundations for “procedural ethics”—formal systems for ethical oversight—including moral and political philosophy, existing codes of ethics, and previous proposals for codes of ethics for social marketing. We then discuss “ethics-in-practice,” the ethical dimensions of the small moments that comprise everyday life. We connect this idea to Aristotle’s concept of phronesis, the practical wisdom to respond in just the right way to particular situations. Supporting the ethical practice of social marketing will require both procedural ethics and ethics-in-practice, iteratively related to one another. We conclude with three tasks for the profession: (1) develop and apply norms, standards, and sanctions; (2) develop formal, procedural ethics, in a just way (e.g., codes of ethics); and (3) support social marketers to develop ethics-in-practice, or phronesis.     

The Impact of Acculturation on Immigrants’ Business Ethics Attitudes

This study explores to what extent immigrants adopt the business ethical attitudes of their host country and/or maintain those of their country of origin. For countries that have significant immigration, acculturation is an important social issue. An immigrant’s acculturation is influenced through the ability to adapt his/her “ethical culture of origin” by integrating it with the host country’s ethical culture. The purpose of this study was to examine the impact of the role of acculturation on immigrant’s ethical attitudes. What happens to individuals, who have developed in one cultural context, when they attempt to live in a new cultural context? Three groups were the object of this study: (1) native students of business administration in Israel, (2) students of business administration in the Ukraine and (3) business students in Israel who had emigrated from the Ukraine. Samples of these student populations allowed the study of acculturation effects on the immigrants as they acclimated to Israeli society. Results showed that students living in the Ukraine had the lowest ethical attitudes, followed by Ukraine immigrants in Israel. Israeli-born students had significantly higher ethical attitudes than either of the two Ukrainian groups. Accordingly, the ethical perceptions of immigrant students showed that they were influenced by both their home and host cultures. According to Berry’s (Appl Psychol Int Rev 46(1): 5–68, 1997) model of acculturation strategies, integration was their preferred strategy. The implications of these results and guidelines for further research are suggested.     

The Relevance of Ancient Greeks to Modern Business? A Dialogue on Business and Ethics

What follows is a dialogue, in the Platonic sense, concerning the justifications for "business ethics" as a vehicle for asking questions about the values of modern business organisations. The protagonists are the authors, Gordon Pearson – a pragmatist and sceptic where business ethics is concerned – and Martin Parker – a sociologist and idealist who wishes to be able to ask ethical questions of business. By the end of the dialogue we come to no agreement on the necessity or justification for business ethics, but on the way discuss the uses of philosophy, the meanings of integrity and trust, McDonald's, a hypothetical torture manufacturer and various other matters.     

Downsizing and Ethics of Personnel Dismissals — The Case of Finnish Managers

The purpose of our article is to present a qualitative empirical study from the ethical viewpoint. It aims at the theoretical conceptualization concerning the managers' decision-making of personnel dismissals in downsizing organizations. First we present and seek to motivate our research task. The importance of real business ethical issues as a starting point of business ethics research is emphasized. Second the main normative ethical theories and ethical decision-making models are presented. These form the loose framework for describing and interpreting research interviews. After this the empirical findings are set forth. This part suggests that the managers explain the dismissals from different decision-making roles emphasizing different ethical orientation. The roles are called a rational and an independent manager, a marionette and an emotional individual. Our study suggests that the role of empathy in morality reveals an interesting and a necessary research topic for business ethics research.     

The Ethics of Slotting: Is this Bribery, Facilitation Marketing or Just Plain Competition?

The practice of manufacturers' payments of fees to retailers for the display and sale of their products has become a common practice. In the grocery retail business, the fees paid by manufacturers are called slotting fees, or a payment made for a slot on the shelf. The same practice is used now in the retail book industry. Large book chains command high fees from publishers for the prominent display of books. Entrepreneur's products are often precluded from stores and markets because slotting fees are prohibitive. The fees are non-uniform and often paid in cash, creating an atmosphere that has already spawned illegal activity on the part of retail executives. This article examines the ethics of slotting fees.     

Ethics Training and Businesspersons’ Perceptions of Organizational Ethics

Ethics training is commonly cited as a primary method for increasing employees ethical decision making and conduct. However, little is known about how the presence of ethics training can enhance other components of an organization's ethical environment such as employees perception of company ethical values. Using a national sample of 313 business professionals employed in the United States, the relationship between ethics training and perceived organizational ethics was explored. The results of the analysis provide significant statistical support for the notion that businesspersons employed in organizations that have formalized ethics training programs have more positive perceptions of their companies ethical context than do individuals employed in organizations that do not. The analysis also indicated that job satisfaction was related to employees attitudes about their ethical context. The managerial implications of the results are outlined, along with the limitations of the study and recommendations for future research.     

Deregulating the Interest Rate?

TaoXiang,economicsprofessoratthePeople'sUniversity:BetweenMay1,1996andJune10,1999,thePeople'sBankofChinaloweredtheinterestrateonsevenoccasions,withtheinterestrateforoneyeardepositsloweredto2.25%.Ifinterestaccountingfor20%oftheinterestrateisdeducted,theactualrateis1.8%.Sosomepeoplebelieveloweringtheinterestratetoacertainextentcanactasamarket-driveninterestrate.Butmarket-driveninterestrateisnotdecidedbyafluctuatingrate.Theinterestrateshouldbedrivenbythemarket,buttodaytheconditionsarenotsuffi…     

The Role of Business Schools in Ethics Education in Iceland: The Managers’ Perspective

This article explores managers’ views on various ways in which business schools can contribute to providing solid ethics education to their students, who will ultimately become the next generation of business leaders. One thousand top level managers of Icelandic firms were approached and asked a number of questions aimed at establishing their view on the relationship between ethics education and the role of business schools in forming and developing business ethics education. Icelandic businesses were badly hurt by the 2008 crisis, and therefore Iceland provides an interesting foundation for an empirical study of this sort as the aftermath of the crisis has encouraged managers to consciously reflect on the way their business was and should be conducted. Based on the results of the survey, a few main themes have developed. First, it appears that according to practicing managers, business schools should not be held responsible for employees’ unethical behavior. Nevertheless, managers believe that business schools should assist future employees in understanding ethics by including business ethics in teaching curricula. Second, managers believe that the workplace is not where ethics are learned, while also insisting that former students should already have strong ethical standards when entering the workplace. Third, managers call for business schools not only to contribute more to influencing students’ ethical standards, but also to reshape the knowledge and capabilities of practicing managers through re-training and continuous education. Based on the results of the study, the article also offers some recommendations on how to begin reformulating the approach to business ethics education in Iceland, and perhaps elsewhere.     

Does the Individualist Consume More? The Interplay of Ethics and Beliefs that Governs Consumerism Across Cultures

Individualism leading to more consumerism seems to be a bit of truism nowadays in the media. The USA is particularly indicted for being too individualistic and consumerist. Past research has mostly indicated a positive relationship between the two. However, past research has not suggested a negative association between individualism and consumerism. This paper offers support for such a negative relationship by showing that an individual’s ethical values can temper the consumerist nature of individualists. Data were collected in the USA and Taiwan. Structural equation models demonstrate that our hypothesized model fits our data well. A key result over the global sample is the stability of the linear path from individualism to work ethic to consumer ethic to consumerism. The two-nation comparison also supports differences in how Taiwanese and Americans differ in their belief that consumption benefits society.     

Is Cross-Cultural Similarity an Indicator of Similar Marketing Ethics?

This study compares Australian marketers with those in the United States along lines that are particular to the study of ethics. The test measured two different moral philosophies, idealism and relativism, and compared perceptions of ethical problems, ethical intentions, and corporate ethical values. According to Hofstede's cultural typologies, there should be little difference between American and Australian marketers, but the study did find significant differences. Australians tended to be more idealistic and more relativistic than Americans and the other results were mixed, making it difficult to generalize about the effects of moral philosophies on the components of ethical decision-making measured here. This is an important finding; as firms become increasingly more globalized, marketers will more often be involved in cross-cultural ethical dilemmas and it seems natural to assume that similar cultures will have similar ethical orientations. That assumption may well prove erroneous.     

The End of Religion? Examining the Role of Religiousness,Materialism, and Long-Term Orientation on Consumer Ethics in Indonesia

Various studies on the impact of religiousness on consumer ethics have produced mixed results and suggested further clarification on the issue. Therefore, this article examines the effect of religiousness, materialism, and long-term orientation on consumer ethics in Indonesia. The results from 356 respondents in Indonesia, the largest Muslim population in the world, showed that intrinsic religiousness positively affected consumer ethics, while extrinsic social religiousness negatively affected consumer ethics. However, extrinsic personal religiousness did not affect consumer ethical beliefs dimensions. Unlike other studies in developed countries, materialism and long-term orientation influenced only a few of the consumer ethical beliefs dimensions in this study. To date, the study is one of the first empirical studies to explore the impact of religiousness on consumer ethics in Indonesia. The study contributes to the debate on the impact of religiousness on consumer ethics and can assist managers and public policymakers in their effort to mitigate unethical consumer activities in Indonesia.     

The Buyer–Supplier Relationship: An Integrative Model of Ethics and Trust

Dialogues between companies and actors of society often start as a result of a public scandal or in a situation of crisis. They can lead to short-term public relations activism or to long-term reputation gains. On the basis of cases and of a typology of forms of dialogues, the author develops ethical criteria and conditions for a successful dialogue – the ethical basis for such criteria being values such as equality, freedom and participation. A special focus is put on challenges that often result from dialogues such as the ethical judgment of compromises. This article proposes ethical criteria to evaluate compromises. This leads to a model of ethical dialogue.     

The Hunt–Vitell General Theoryof Marketing Ethics: Can it Enhance our Understanding of Principal-Agent Relationships in Channels of Distribution?

This paper advances the Hunt–Vitell General Theory of Marketing Ethics as a framework for enriching current understanding of both long-term marketing relationships in general, and principal-agent associations specifically. Under economic models of agency theory, manufacturer-distributor relationships are conceptualized as principal-agent associations where both parties are assumed be motivated exclusively by short-term financial self-interest within the logical constraints of zero-sum game conditions. As a general model of ethical decision making and behavior in marketing, the Hunt–Vitell theory illustrates how ethical decisions are predicated not only upon estimations of potential benefits or outcomes (using teleological criteria), but also deontological evaluations which invoke norms and values. Furthermore, the recent ideas advanced in "relationship marketing" perspectives suggest that distribution channel associations premised upon non-zero-sum or symbiotic assumptions may be more effective and more jointly profitable. Based upon the Hunt–Vitell model, propositions are formulated that complement the understanding of agency theory within the context of marketing channel relationships, and thus, may represent a basis for more effective agency selection and interaction in marketing practice.     

The Effect of Normative Expectations on Employees’ Intrinsic Interest in Creativity: Is There also a Mediating Mechanism?

As the core element of a firm’s innovation capabilities and the source of firm growth, increasing employee creativity is a primary goal of organizations. Based on social cognitive theory, role theory, and creativity theory, this paper investigates the relationship between perception of normative expectations and employees’ intrinsic interest in creativity, as well as explores the role of self-efficacy in this relationship. We use data from a survey questionnaire of 2,035 employees from 185 firms in different geographic locations across China. Our empirical findings reveal that when employees perceive a normative expectation coming from leaders, family or customers, coupled with the fear of failing to satisfy the expectations of those referent groups, it positively and significantly affects their intrinsic interest in creativity. In addition, self-efficacy not only positively and significantly affects employees’ intrinsic interest in creativity, but also plays a partially mediating role in the relationship between the perception of expectation and employees’ intrinsic interest in creativity.