Does East Meet West in Business Ethics: An Introduction to the Special Issue

This article introduces and summarizes selected papers from the first World Business Ethics Forum held in Hong Kong and Macau in November 2006, co-hosted by the Hong Kong Baptist University and by the University of Macau. Business Ethics in the East remain distinct from those in the West, but the distinctions are becoming less pronounced and the ethical traffic flows both ways. Gabriel D, Donleavy is Professor and Dean of the Faculty of Business Administration at the University of Macau teaching Business Ethics, Business Negotiation and Advanced Management. His work has been published in Critical Perspectives in Accounting, Corporate Governance, the Journal of Business Ethics, Advances in Applied Business Strategy, the Journal of Higher Education Policy and Management, Long Range Planning and the Asian Review of Accounting which he co-founded. Kit-Chun Joanna LAM is Professor in Department of Economics of the Hong Kong Baptist University. She is also Guest Professor in the Centre for Business Ethics of the Shanghai Academy of Social Sciences, China. She received her Ph.D. degree in economics from Harvard University. Her work has appeared in the Journal of Business Ethics, Journal of Labor Economics, Canadian Journal of Economics, Economica, Journal of Comparative Economics, and Labour Economics. Simon S.M. Ho is Dean and Professor at the School of Business and Director for Corporate Governance and Financial Policy, Hong Kong Baptist University. He founded the Asia-Pacific Corporate Governance Conference and the world’s first master programme in corporate governance & directorship in 2004. He published over 40 academic refereed articles in leading journals such as Journal of Accounting, Accounting & Finance, Journal of Accounting & Public Policy, and Journal of Corporate Finance.     

Information Ethics across Information Cultures

Information cultures consist of the values, beliefs and behaviour relating to information ownership and management, while information ethics applies to the moral application of data. The author's experience of Russia and its information culture provides a striking case study of the disastrous social and business consequences of an absence of information ethics. This paper was delivered in its original form at the First World Congress of Business, Economics and Ethics of the International Society of Business, Economics and Ethics (ISBEE), held in Reitaku University, Tokyo, in July 1996. The author is Associate Professor of Information Systems in the School of Business, Fairfield University, Fairfield, Connecticut 06430–5195.     

Ethics vs. economics: The issue of free trade with Mexico

The authors, one an ethicist and the other an economist, look at the issue of free trade with Mexico and other low wage rate countries from the viewpoints of their disciplines. The conclusion of the paper is that these disciplines differ on their priorities and analytical methods, not on their objectives.LaRue Tone Hosmer is professor of Corporate Strategy and Managerial Ethics at the Graduate School of Business Administration of the University of Michigan. He is the author ofMoral Leadership in Business (Irwin, 1993),The Ethics of Management, 2nd Edition (Irwin, 1991), andStrategic Management (Prentice-Hall, 1984).Scott E. Masten is associate professor of Business Economics and Public Policy at the Graduate School of Business Administration of the University of Michigan. His work has appeared in theAmerican Economic Review, theJournal of Institutional and Theoretical Economics, and theJournal of Law, Economics, and Organization.     

Window on Eastern Europe: Current Issues in Business Ethics in the Czech Republic

Our Associate Editor, who is head of the Center for Ethics in Economics and Business, CERGE-EI, in Prague, writes of a macabre case of brand copying as one illustration of the difficulties of achieving fair competition in the CR.     

Building an Ethical Organisation

How can one in practice go about introducing ethical values systematically into a business organisation? The process described here was presented to the annual meeting of European Business Ethics Centres, held in Prague in 1993. Dr Di Toro is Research Fellow in Business Administration, Environmental and Social Sciences Department, School of Economics, University of Siena, Piazza S. Francesco 17, 53100 Siena, Italy.     

The market ethic: Moral dilemmas and microeconomics

Brief cases written as multiple choice questions can provide the basis for a classroom game based on business ethics. This teaching note describes the organization of such a game and provides five sample cases.Julianne Nelson is an Assistant Professor of Economics at the Stern School of Business of New York University. She has also taught at the Ecole Superieure de Commerce in Tours, France. Her publications have appeared in theInternational Economic Review, Economics Letters, theJournal of Regulatory Economics, theJournal of Business Ethics, andJapan and the World Economy.I would like to thank my students for their suggestions and support of this project. This research was supported by a grant from the Rundin Foundation.     

Ethics,Income and Religion

This paper investigates the relationship between ethics and income among individuals of different religions in the HKSAR of China. The presence of both traditional Chinese religion and Christianity from the West makes our study particularly interesting. The content of ethical beliefs varies with religion and thus the effect of ethics on income may also vary across religion. Furthermore, a reverse causal relationship may run from income to ethics. Since culture and taste affect the consumption behavior of a person, depending on the religion of the person, a person with a higher income may or may not like to ‘acquire’ more ethics. Our empirical results find that there is indeed a simultaneous relationship between income and being ethical so that a single equation estimation of income on ethics and vice versa generates biased estimates. Using a two-stage instrumental variable estimation, our study finds that being ethical contributes to higher income for Christians and the non-religious group, but lowers it for people of traditional Chinese religion. On the other hand, an increase in income increases the likelihood of a person’s being ethical for both Christians and the people of traditional Chinese religion, but reduces it for the non-religious group. Dr. Kit-Chun LAM is Professor in Economics Department of the Hong Kong Baptist University. She is also Guest Professor in the Centre for Business Ethics of the Shanghai Academy of Social Sciences, China. Her work has appeared in the Journal of Business Ethics, Journal of Labor Economics, Journal of Comparative Economics, Canadian Journal of Economics, Economica and Labour Economics. Dr. Bill Hung is Associate Professor in Economics Department of the Hong Kong Baptist University. His work has appeared in the Journal of International Money and Finance, Journal of Business Finance and Accounting, Pacific-Basin Finance Journal, Atlantic Economic Journal, Asia Pacific Journal of Management, etc.     

Assessing the application of cognitive moral development theory to business ethics

Cognitive moral development (CMD) theory has been accepted as a construct to help explain business ethics, social responsibility and other organizational phenomena. This article critically assesses CMD as a construct in business ethics by presenting the history and criticisms of CMD. The value of CMD is evaluated and problems with using CMD as one predictor of ethical decisions are addressed. Researchers are made aware of the major criticisms of CMD theory including disguised value judgments, invariance of stages, and gender bias in the initial scale development. Implications for business ethics research are discussed and opportunities for future research delineated.John Fraedrich is an Assistant Professor of Marketing at Southern Illinois University of Carbondale. His areas of interest include ethical decision making and international marketing. He has published inJournal of Macromarketing, Journal of Business Ethics, Journal of Academy of Marketing Science, Journal of Business Research, Journal of Marketing Management, International Journal of Value Based Management, andJournal of International Consumer Marketing. Dr. Fraedrich is co-author of a textbookBusiness Ethics: Ethical Decision Making and Cases, Second Edition.Debbie M. Thorne is an Assistant Professor of Marketing at the University of Tampa. Her areas of interest include business ethics, social network analysis, and cultural issues in organizations. She received a Ph.D. in 1993 and has published in theJournal of Teaching in International Business and numerous conference proceedings.O. C. Ferrell is Interim Dean and Distinguished Professor of Marketing and Business Ethics in the Fogelman College of Business and Economics at Memphis State University. Dr. Ferrell was chairman of the American Marketing Association Ethics Committee that developed the current AMA Code of Ethics. He has published articles on business ethics in theJournal of Marketing, Journal of Marketing Research, Journal of Business Research, Journal of Macromarketing, Human Relations, Journal of Business Ethics, as well as others. He has co-authored ten textbooks includingBusiness Ethics: Ethical Decision Making and Cases, Second Edition, and a tradebook,In Pursuit of Ethics.     

Blind man's bluff: The ethics of quantity surcharges

Empirical evidence, including a recent field study in Northwest Indiana, indicates that supermarkets and other retail merchants frequently incorporate quantity surcharges in their product pricing strategy. Retailers impose surcharges by charging higher unit prices for products packaged in a larger quantity than smaller quantity of the same goods and brand. The purpose of this article is to examine the business ethics of such pricing strategy in light of empirical findings, existing government regulations, factors that motivate quantity surcharges and prevailing consumer perceptions.Omprakash K. Gupta is an Associate Professor of Management in the Division of Business & Economics at Indiana University Northwest. His research interests are in Operations Management, Management Science, Mathematical Modeling of Business Systems and Business Ethics. He has published several articles in national and international journals. He has also reviewed papers for many journals and edited special issues.Anna S. Rominger is an attorney, a mediator, and an Assistant Professor of Business Administration in the Division of Business & Economics at Indiana University Northwest. Her research interests are negotiation, alternative dispute resolutions, labor management relations, business ethics and professional liability. She has published articles in several of these areas.     

The Mediating Role of Anticipated Guilt in Consumers’ Ethical Decision-Making

In this paper, we theorize that the anticipation of guilt plays an important role in ethically questionable consumer situations. We propose an ethical decision-making framework incorporating anticipated guilt as partial mediator between consumers’ ethical beliefs (anteceded by ethical ideology) and intentions. In the first study, we compared several models using structural equation modeling and found empirical support for our research model. A second experiment was set up to illustrate how these new insights may be applied to prevent consumers from taking advantage of the seller. Results showed that enhancing the anticipation of guilt (by making the interpersonal consequences of the unethical act more salient) increased consumers’ ethical intentions, controlling for ethical beliefs. Together these two studies might have important theoretical and managerial contributions.Sarah Steenhaut is research assistant and doctoral candidate at Ghent University, Faculty of Economics and Business Administration, Research Center for Consumer Psychology and Marketing (Belgium). Her research interests lie in the area of ethical aspects and marketing, more specifically, consumers’ ethical beliefs, attitudes and behavior. She has recently published in Journal of Business Ethics.Patrick Van Kenhove is Professor of Marketing at Ghent University, Faculty of Economics and Business Administration, Department of Marketing (Belgium). He has recently published in Journal of Business Ethics, Psychology & Marketing, Journal of Retailing, Advances in Consumer Research, Journal of Economic Psychology, Journal of Health Communication and The International Review of Retail, Distribution and Consumer Research.     

Business Dilemmas and Religious Belief: An Explorative Study among Dutch Executives

This paper explores the relationship between religious belief and the dilemmas Dutch executives confront in daily business practice. We find that the frequency with which dilemmas arise is directly related to various aspects of religious belief, such as the belief in a transcendental being and the intensity of religious practice. Despite this relationship, only 17% of the dilemmas examined involve a religious standard. Most dilemmas originate from a conflict between moral and practical standards. We also find that 79% of the identified dilemmas stem from a conflict between two or more internalized standards of the executive.Johan Graafland is a Professor of Economics, Business and Ethics at Tilburg University and Director of the Centre for Corporate Social Responsibility at the Department of Philosophy of Tilburg University. He has published articles in The Journal of Business Ethics, Business Ethics: A European Review, Philosophia Reformatica, Journal of Corporate Citizenship, Applied Economics, Economics Letters, Oxford Bulletin of Economics and Statistics, Empirical Economics, Journal of Policy Modelling, Public Finances/Finances Publique, Economic Modeling, Journal of Public Economics and others. His current research interests are corporate social responsibility and philosophy of economics.Muel Kaptein is a Professor of Business Ethics and Integrity Management at the RSM Erasmus University, where he chairs the Department of Business-Society Management. Muel is also a Director at KPMG Integrity and Investigation Services. He has published articles in a number of journals, including The Journal of Business Ethics, Business & Society Review, Organization Studies, Academy of Management Review and European Management Journal. His most recent books are The Six Principles of Managing with Integrity (Spiro Press) and The Balanced Company (Oxford University Press). His research interests include the management of ethics, the measurement of ethics and the ethics of management. Muel is a Section Editor of the Journal of Business Ethics.Corrie Mazereeuw-van der Duijn Schouten is a senior researcher at the Centre for Corporate Social Responsibility at Tilburg University, the Netherlands. She has several years of experience as business consultant in the field of organizational change and group processes within organizations. Her research interests include leadership, religion and corporate social responsibility. She is currently working on a PhD thesis on religion and leadership.     

Business Ethics in South Africa

In this paper an assessment will be made of the state of Business Ethics as an academic discipline as well as on the extent to which theory on Business Ethics has been translated into practice within the South African society. First the way in which Business Ethics is defined will be examined. Then the issues within the field of Business Ethics that is considered to be most important will be addressed, as well as the reasons why it is believed to be important to address them. From there the attention will be shifted to the way in which Business Ethics has been institutionalised at tertiary education level. An overview of important initiatives taken by the business sector themselves will also be reviewed. Then co-operation between business and academia on Business Ethics will be discussed. Finally an assessment will be made of what can be learned from Business Ethics elsewhere in the world and what can be offered in this regard. Also some future prospects of Business Ethics in South Africa will be explored.     

Factors Affecting Ethical Attitudes in Mainland China and Hong Kong

In this article, we analyzed the effect of various factors on moral judgment and ethical attitudes of working persons. It was found that the effect of various socio-demographic factors on ethical attitudes varied between the two different categories of ethical issues under study, issues which involve explicit violation of laws vis-à-vis issues which involved social concerns. Our results did not support the implication of Callahan’s hypothesis that males are more sensitive to rule-based ethical issues while women are to issues involving social concerns; it was found that females have a lower acceptability of unethical behaviors related to both categories of issues in Hong Kong, whereas gender effect was not statistically significant in Mainland China. University education also had no significant effect on ethical attitudes. Religion played an important role in affecting ethical attitudes, however, its effect varied with different types of religions; Christianity was found to be most favorable to higher ethical standards, but people of traditional Chinese religion had a higher acceptability of unethical behaviors involving social concerns compared to people with no religion. Our finding also indicated that employees in state-owned enterprises, private employees, employees in foreign-investment firms, and employers in Mainland China all had a higher acceptability of unethical law-breaking behaviors compared to workers in collectives, throwing doubt on the validity of convergence theory in Mainland China. Kit-Chun LAM is Professor in Department of Economics of the Hong Kong Baptist Universty. she is also Guest professor in the Centre for Business Ethics of the Shanghai Academy of Social Sciences, China. She received her Ph.D. degree in economics from Harvard University. Her work has appeared in the Journal of Business Ethics, Journal of Labor Economics, Canadian Joural of Economics, Journal of Comparative Economics, Economica and Labour Economics. Guicheng Shi is Assistant Professor in Faculty of Management and Administration of Macau University of Science and Technology     

The Corporate Social Performance Content of Innovation in the U.K.

This article investigates the influence of innovation on the relationship between corporate strategy and social issues. Specifically, we employ firm-level data for a large sample of U.K. companies drawn from a diverse range of industrial sectors to investigate, given innovation, the determinants of both the probability that the innovation brings reduced environmental impacts and/or improved health and safety, and the strength of this effect. In this connection, we find evidence of a dichotomy between product and process innovations, and roles for firm size, industrial sector, a foreign market presence, access to various information sources (e.g. universities and government research organisations) and the extent to which activities are constrained by regulation. Furthermore, we find a tendency for the influences of many of these factors to vary between older and newer firms. Stephen Pavelin is a Reader in Economics at the University of Reading, UK. His current research agenda focuses upon the application of economic analysis to key issues relating to corporate social responsibility, such as the effect of corporate social performance on the reputation and financial performance of firms. Recent publications include articles in the Journal of Management Studies, the Journal of Business Research, the International Journal of Industrial Organisation, the Journal of Business Ethics, Financial Management, the Journal of Business Finance and Accounting, Business Ethics: A European Review and the European Management Journal. Lynda A. Porter is a Lecturer in Economics at the University of Reading, UK. Her current research agenda focuses upon public policy issues in international economics, including FDI promotion and international competition in corporate tax rates, but also encompasses corporate social responsibility- largely focussing upon CSR issues that pertain particularly to international business. Her most recent publication appeared in the Journal of Business Research.     

Ethical Decision-Making: A Case for the Triple Font Theory

This paper discusses the philosophical argument and the application of the Triple Font Theory (TFT) for moral evaluation of human acts and attempts to integrate the conceptual components of major moral theories into a systematic internally consistent decision-making model that is theoretically driven. The paper incorporates concepts such as formal and material cooperation and the Principle of Double Effect (PDE) into the theoretical framework. It also advances the thesis that virtue theory ought to be included in any adequate justification of morality and the need to integrate or coordinate notions of virtue into various act-oriented or principles-based ethics. The TFT offers a comprehensive and practical approach to ethical decision-making and is a useful alternative embedded in traditional wisdom. This paper provides a more general framework of the TFT than traditionally presented. Practical judgment is shown to play a constitute role in providing a guide for right action and is the “glue” that integrates the various components of the TFT. Surendra Arjoon is an Associate Professor of Business Ethics at the University of the West Indies, Trinidad. He has served as Chair, Department of Management Studies and as Associate Dean, Faculty of Social Sciences. He is also Vice President of the Trinidad & Tobago Economics Association. His work has appeared in the Journal of Business Ethics, Journal of Markets and Morality, Global Development Studies, Applied Financial Economics, and Social and Economic Studies.     

The Effectiveness of Business Codes: A Critical Examination of Existing Studies and the Development of an Integrated Research Model

Business codes are a widely used management instrument. Research into the effectiveness of business codes has, however, produced conflicting results. The main reasons for the divergent findings are: varying definitions of key terms; deficiencies in the empirical data and methodologies used; and a lack of theory. In this paper, we propose an integrated research model and suggest directions for future research. Muel Kaptein is Professor of Business Ethics and Integrity Management at the Department of Business-Society Management at RSM Erasmus University. His research interests include the management of ethics, the measurement of ethics and the ethics of management. He has published papers in the Journal of Business Ethics, Business & Society, Organization Studies, Academy of Management Review, Business & Society Review, Corporate Governance, Policing, Public Integrity, and European Management Journal. He is the author of the books Ethics Management (Kluwer Academic Publishers, 1998),The Balanced Company (Oxford University Press, 2002), and The Six Principles of Managing with Integrity (Spiro Press, 2005). Muel is also director at KPMG Integrity, where he assisted more than 40 companies in developing their business code. Mark S. Schwartz is Assistant Professor of Goverance, Law and Ethics at the Atkinson School of Administrative Studies at York University (Toronto). His research interests include corporate ethics programs, ethical leadership, and corporate social responsibility. He has published papers in the Journal of Business Ethics, Business & Society, Business Ethics Quarterly, Professional Ethics, and the Journal of Management History, and is a co-author of the textbook Business Ethics: Readings and Cases in Corporate Morality (McGraw Hill). He is also a Research Fellow of the Center of Business Ethics (Bentley College) and the Business Ethics Center of Jerusalem (Jerusalem College of Technology).     

An Empirical Investigation of the Ethical Perceptions of Future Managers with a Special Emphasis on Gender – Turkish Case

This study presents an empirical investigation of the ethical perceptions of the future managers – Turkish university students majoring in the Business Administration and Industrial Engineering departments of selected public and private Turkish universities – with a special emphasis on gender. The perceptions of the university students pertaining to the business world, the behaviors of employees, and the factors leading to unethical behavior are analyzed. The statistically significant differences reveal that female students have more ethical perceptions about the Turkish business climate, behavior of employees, and the ethicalness of the behavior of the employees in comparison with their male counterparts. M.G. Serap Atakan is an Assistant Professor at the Department of Business Administration of Istanbul Bilgi University, Turkey. She is teaching and conducting researches on business ethics, corporate social responsibility and retailing. She has two co-authored articles published in the Journal of Business Ethics. Sebnem Burnaz is an Associate Professor of Marketing at Istanbul Technical University. She holds Ph.D. degree in management with major in marketing. Her teaching and research interests are in the field of Marketing, Retailing, Decision Making, and Business Ethics. She has published articles which have appeared in Advances in International Marketing, Sex Roles: A Journal of Research, Journal of Multi-Criteria Decision Analysis. Y. Ilker Topcu is an Associate Professor of decision sciences in Istanbul Technical University. He has finished his Ph.D. studies in I.T.U., Faculty of Management. His teaching and research specialties are in the field of Operations Research/Management Science, Multiple Criteria Decision Making, Logistics, Transportation Planning, and Business Ethics. He has published papers which have appeared in Journal of the Operational Research Society, European Journal of Operational Research, Journal of Multi-Criteria Decision Analysis, Journal of Global Optimization, Transportation Research Part A, Lecture Notes in Economics and Mathematical Systems, Energy, and Building and Environment.     

FOCUS: New Ethics in a Future Dutch Health Market

Changes being introduced to deregulate the Dutch health care system after decades of extensive state control are to be welcomed, and will in future require consumers to be 'well-informed, cost-conscious and assertive patients, who are aware of their responsibility for their own health.' R.B. Kool MD, PhD and E.J.J.M. Kimman PhD are attached to the Department of Business Ethics in the Faculty of Economics and Econometrics at The Free University, P.O. Box 7161, 10107 MC Amsterdam.     

Corporate Governance: An Ethical Perspective

This paper discusses corporate governance issues from a compliance viewpoint. It makes a distinction between legal and ethical compliance mechanisms and shows that the former has clearly proven to be inadequate as it lacks the moral firepower to restore confidence and the ability to build trust. The concepts of freedom of indifference and freedom for excellence provide a theoretical basis for explaining why legal compliance mechanisms are insufficient in dealing with fraudulent practices and may not be addressing the real and fundamental issues that inspire ethical behavior. The tendency to overemphasize legal compliance mechanisms may result in an attempt to substitute accountability for responsibility and may also result in an attempt to legislate morality which consequently leads to legal absolutism. The current environment of failures of corporate responsibility are not only failures of legal compliance, but more fundamentally failures to do the right (ethical) thing. Surendra Arjoon is an Associate Professor of Business Ethics at the University of the West Indies, Trinidad. He served as Chair, Department of Management Studies (2002–2005) and as Associate Dean, Faculty of Social Sciences (1996–2002). He is also the Vice-President of the Trinidad and Tobago Economics Association. His work has appeared in the Journal of Business Ethics, Journal of Markets and Morality, Global Development Studies, Applied Financial Economics, and Social and Economic Studies.     

The Relevance and Value of Confucianism in Contemporary Business Ethics

This article examines the relevance and value of Confucian Ethics to contemporary Business Ethics by comparing their respective perspectives and approaches towards business activities within the modern capitalist framework, the principle of reciprocity and the concept of human virtues. Confucian Ethics provides interesting parallels with contemporary Western-oriented Business Ethics. At the same, it diverges from contemporary Business Ethics in some significant ways. Upon an examination of philosophical texts as well as empirical studies, it is argued that Confucian Ethics is able to provide some unique philosophical and intellectual perspectives in order to forge a richer understanding and analysis of the field of contemporary Business Ethics. Gary Kok Yew Chan is Assistant Professor of Law at Singapore Management University. Apart from Business Law, he teaches Ethics and Social Responsibility. He has obtained an LL.B (National University of Singapore) and LL.M (School of Oriental and African Studies, University of London) respectively and has published in several reputable law journals including Journal of Business Law, Cambridge Law Journal, Australian Journal of Asian Law, Hong Kong Law Journal and Singapore Journal of Legal Studies. In addition, he holds an M.A. in Southeast Asian Studies (National University of Singapore) and a B.A. in Philosophy (University of London).