The Ethical Cycle

Arriving at a moral judgment is not a straightforward or linear process in which ethical theories are simply applied to cases. Instead it is a process in which the formulation of the moral problem, the formulation of possible “solutions”, and the ethical judging of these solutions go hand in hand. This messy character of moral problems, however, does not rule out a systematic approach. In this article, we describe a systematic approach to problem solving that does justice to the complex nature of moral problems and ethical judgment: the ethical cycle. Our goal is to provide a structured and disciplined method of addressing moral problems, which helps to guide a sound analysis of these problems. We will illustrate the usefulness of this cycle with an example. Further, we will discuss two general issues in applied ethics in relation to the proposed ethical cycle: the role of ethical theories and the place of individual judgment versus collective deliberation. Ibo van de Poel (1966) is Assistant Professor of Ethics and Technology at Delft University of Technology. He has done research on the dynamics of technological development, codes of conduct and professional ethics of engineers, the moral acceptability of technological risks, ethics in engineering design, and ethics and responsibiltiy in R&D networks. He has published in, among others, Science, Technology & Humans Values, Research Policy and Science and Engineering Ethics. For more information, see http://www.tbm.tudelft.nl/webstaf/ibop/. Lambèr Royakkers (1967) is Associate Professor of Ethics and Technology at Eindhoven University of Technology, The Netherlands. He studied Philosophy and Social Sciences, Technical Mathematics, and Law. He received his PhD at the Tilburg University in 1996. His dissertation was on the formalisation of normative rules with deontic logic. It has been revised rather thoroughly for the serie Law and Philosophy published by Kluwer Academic in 1998. His research interests include ethics and technology, (collective) responsibility, and logic.     

Organizational harm,legal condemnation and stakeholder retaliation: A typology,research agenda and application

The essence of the ethical issues pertinent to business activities is the harm or benefit that occurs as part of a company's resource transformation process. A typology is developed that sorts ethical issues according to three variables: (1) the nature of the harm, (2) the nature of those harmed and (3) the transformation stage where the harm occurs. Propositions are formulated that would enable analysts and practitioners to predict the degree of legal condemnation of, and stakeholder retaliation to, harms generated by questionable moral reasoning. An organizational harm analysis is then constructed as a decision making tool that could supplement cost/benefit analysis.Denis Collins is a Doctoral Candidate at the Katz Graduate School of Business of the University of Pittsburgh and a Research Associate with the BG Productivity and Gainsharing Institute. He has published several articles in the areas of business ethics, social philosophy and participatory management.     

Ethics Through an Entrepreneurial Lens: Theory and Observation

Recent work in the fields of ethics and entrepreneurship has raised the possibility that entrepreneurs may differ from other individuals in the moral issues they face, in their moral judgements and behaviors concerning those issues, and even in their level of cognitive moral development. While this work has been exploratory and its conclusions tentative, the findings raise two interesting questions: do entrepreneurs actually differ from non-entrepreneurs in their ethical orientations and, if so, why? We propose a model of ethical decision making for small business entrepreneurs. We suggest some ways in which the ethical framework of entrepreneurs may differ systematically from that of other business people and propose some areas for future research.     

Moral Agency,Profits and the Firm: Economic Revisions to the Friedman Theorem

The paper reconstructs in economic terms Friedman’s theorem that the only social responsibility of firms is to increase their profits while staying within legal and ethical rules. A model of three levels of moral conduct is attributed to the firm: (1) self-interested engagement in the market process itself, which reflects according to classical and neoclassical economics an ethical ideal; (2) the obeying of the “rules of the game,” largely legal ones; and (3) the creation of ethical capital, which allows moral conduct to enter the market process beyond the rules of the game. Points (1) and (2) position the Friedman theorem in economic terms while point (3) develops an economic revision of the theorem, which was not seen by Friedman. Implications are spelled out for an instrumental stakeholder theory of the firm. Dr. Sigmund Wagner-Tsukamoto is researcher in business ethics at the School of Management of the University of Leicester, UK. He holds two doctorates, one in social studies from the University of Oxford, UK, and one in economic studies from the Catholic University of Eichstaett, Germany. He has widely published on green consumerism and institutional economic issues that concern organization theory and business ethics theory. His publications include the books Understanding Green Consumer Behaviour (Routledge, 1997 & 2003) and Human Nature and Organization Theory (Edward Elgar, 2003).     

An Exploratory Investigation of the Effect of Ethical Culture in Activating Moral Imagination

Moral imagination is a process that involves a thorough consideration of the ethical elements of a decision. We sought to explore what might distinguish moral imagination from other ethical approaches within a complex business simulation. Using a three-component model of moral imagination, we sought to discover whether organization cultures with a salient ethics theme activate moral imagination. Finding an effect, we sought an answer to whether some individuals were more prone to being influenced in this way by ethical cultures. We found that employees with strong moral identities are less influenced by such cultures than employees whose sense of self is not defined in moral terms. David F. Caldwell is the Stephen and Patrica Schott Professor of Business in the Leavey School of Business at Santa Clara University. Dennis Moberg is the Wilkinson Professor of Management and Ethics in the Leavey School of Business at Santa Clara University.     

The Influence of Perceived Importance of an Ethical Issue on Moral Judgment,Moral Obligation,and Moral Intent

The study extends and tests the issue contingent four-component model of ethical decision-making to include moral obligation. A web-based questionnaire was used to gauge the influence of perceived importance of an ethical issue on moral judgment and moral intent. Perceived importance of an ethical issue was found to be a predictor of moral judgment but not of moral intent as predicted. Moral obligation is suggested to be a process that occurs after a moral judgment is made and explained a significant portion of the variance in moral intent. Electronic supplementary material   The online version of this article (doi: ) contains supplementary material, which is available to authorized users. Russell Haines is an Assistant Professor of Information Technology at Old Dominion University. He received his B.S. and Master of Accountancy from Brigham Young University and his Ph.D. from The University of Houston. His research interests are in laboratory experiments, ethical decision- making, supply chain decision-making, and computer- mediated communication. Marc D. Street is an Assistant Professor of Management at Salisbury University in Salisbury, Maryland. He received his B.A. from the University of Maryland, College Park (1983); his MBA from the University of Baltimore (1993); and his Ph.D. from the Florida State University (1998). His primary research interests are in the areas of decision-making and business ethics. Dr. Street’s research has been published in journals such as Organizational Behavior and Human Decision Processes, Journal of Business Ethics, and the Journal of World Business, among others. Douglas Haines is Associate Professor of Marketing and Department Chair of the Department of Business in the College of Business and Economics at the University of Idaho. Before acquiring his Ph.D. at the University of Oregon, he worked for 15 years in various positions at the H.J. Heinz company including Vice President of the Weight Watchers Foods Division of Heinz USA. His research interests include decision making, particularly in the marketing channel context, inter firm relationships, and the development of the market for biodiesel and other alternative energy sources.     

Making a Difference with a Discrete Course on Accounting Ethics

Calls for the expansion of ethics education in the business and accounting curricula have resulted in a variety of interventions including additional material on ethical cases, the code of conduct, and the development of new courses devoted to ethical development [Lampe, J.: 1996]. The issue of whether ethics should be taught has been addressed by many authors [see for example: Hanson, K. O.: 1987; Huss, H. F. and D. M. Patterson: 1993; Jones, T. M.: 1988–1989; Kerr, D. S. and L. M. Smith: 1995; Loeb, S. E.: 1988; McDonald, G. M. and G. D. Donleavy: 1995]. The question addressed in this paper is not whether ethics should be taught but whether accounting students can reason more ethically after an intervention based on a discrete and dedicated course on accounting ethics. The findings in this paper indicate that a discrete intervention emphasising dilemma discussion has a positive and significant effect on students’ moral reasoning and development. The data collected from interviews suggest that the salient influences on moral judgement development include: learning theories of ethics particularly Kohlberg’s theory of cognitive moral reasoning and development; peer learning; and moral discourse. The implications from the findings in this study suggest that moral reasoning is responsive to particular types of ethics intervention and educators should carefully plan their attempts to foster moral judgement development.     

Moral Memory: Why and How Moral Companies Manage Tradition

Recent research on the role of ethics in the organizational culture literature found practically the whole literature reduced to a debate between ethical rationalism and ethical relativism. The role of the past in the form of tradition to maintain and improve moral reflection is completely missing. To address this gap in the literature on the level of practice, the concepts of moral memory and moral tradition are applied to data on 22 companies that have long-standing moral practices. In this way, the practice of moral traditions can be explored with recent conceptual advances and a list of best practices delineated. Moral memory is the recollection of and attachment to the succession of past events and experiences that maintains moral tradition. Moral tradition is the continuing transmission and reception of related moral themes through multiple generations of employees. It is found that companies that maintain moral traditions tend to develop “family” cultures with considerable compassion for workers as persons who have non-economic needs and rights. These companies also temper the role of leadership, insisting that leaders are responsible for and are evaluated by the company’s moral traditions. Finally, moral traditions are essential mechanisms through which companies paradoxically both stimulate and limit competitive behavior. Steven P. Feldman is Associate Professor of Management Policy, Weatherhead School of Management, Case Western Reserve University. Over the last decade, Dr. Feldman’s research has explored the role of moral memory and moral tradition in the ethical aspects of organizations. His book, Memory as a Moral Decision: The Role of Ethics in Organizational Culture (2002), found that the emotional and cognitive aspects of memory to be key in establishing moral organizational cultures. The moral importance of the past in the present has received little attention in the literature on organizational culture. Winner of the Distinguished Lectureship in Business Ethics from the American Fulbright Program, Dr.␣Feldman will be carrying out research on ethical issues in American-Chinese business relations in Shanghai in 2007.     

Google,Human Rights,and Moral Compromise

International business faces a host of difficult moral conflicts. It is tempting to think that these conflicts can be morally resolved if we gained full knowledge of the situations, were rational enough, and were sufficiently objective. This paper explores the view that there are situations in which people in business must confront the possibility that they must compromise some of their important principles or values in order to protect other ones. One particularly interesting case that captures this kind of situation is that of Google and its operations in China. In this paper, I examine the situation Google faces as part of the larger issue of moral compromise and integrity in business. Though I look at Google, this paper is just as much about the underlying or background views Google faces that are at work in business ethics. In the process, I argue the following: First, the framework Google has used to respond to criticisms of its actions does not successfully or obviously address the important ethical issues it faces. Second, an alternative ethical account can be presented that better addresses these ethical and human rights questions. However, this different framework brings the issue of moral compromise to the fore. This is an approach filled with dangers, particularly since it is widely held that one ought never to compromise one’s moral principles. Nevertheless, I wish to propose that there may be a place for moral compromise in business under certain conditions, which I attempt to specify.     

Ethical Leadership for the Professions: Fostering a Moral Community

This paper examines the professions as examples of “moral community” and explores how professional leaders possessed of moral intelligence can make a contribution to enhance the ethical fabric of their communities. The paper offers a model of ethical leadership in the professional business sector that will improve our understanding of how ethical behavior in the professions confers legitimacy and sustainability necessary to achieving the professions’ goals, and how a leadership approach to ethics can serve as an effective tool for the dissemination of moral values in the organization. Dr. Linda M. Sama is Director of the Center for International Business Development and Associate Professor of Management at Pace University’s Lubin School of Business. She earned her Ph.D. in Strategic management from the City University of New York and her MBA in International Finance from McGill University. She was awarded the 1999 Lasdon Dissertation Award for her doctoral dissertation on corporate social response strategies and the Abraham Briloff Award of Best Paper in Business Ethics at the City University of New York in 1998. Dr. Sama made a transition to academe after a lengthy career in industry, where she acted as Director of Market Planning and Logistics for a major international subsidiary of Transamerica Corporation. She teaches primarily in the areas of International Business, Strategic Managements and Business Ethics, and has taught at Baruch College and the University of Texas at El Paso (UTEP) prior to coming to Pace in the fall of 2001. At UTEP, she was designated as the Skno International Business Ethics Scholar from 1999–2001. She has published numerous articles and book chapters that address issues of corporate social responsibility, business and the natural environment, integrative social contracts theory, and business ethics dilemmas in the new economy. Her research appears in journals such as The Journal of Business Ethics, Business Ethics Quarterly, Business and Society Review, The Journal of Cross-Cultural Management, and the International Journal of Value-Based Management. She has also published research for the U.S. Department of Transportation related to the effects of NAFTA on U.S. – Mexico border logistics and has consulted to business clients on Strategic Planning, Global Leadership and Business Ethics. Dr. Victoria Shoaf is an Associate Professor and Assistant Chair of the Department of Accounting and Taxation at St. John’s University. She received her Ph.D. in Business, with a specialization in Accounting, from Baruch College of the City University of New York in 1997; she was awarded the 1997 Lasdon Dissertation Award. Prior to joining St. John’s University on a full-time basis, Dr.Shoaf worked for over fifteen years in the retail industry with merchandising firms. Her expertise is in establishing effective accounting systems and controls, including operational functions such as order entry and fulfillment, inventory control, point-of-sale data transfers and sales audit, as well as financial accounting functions. She has held controllership positions at Laura Ashley, Inc., Greeff Fabrics, Inc., and Tie Rack, Inc. While working in industry and while completing her doctoral degree, Dr. Shoaf taught accounting courses as an adjunct instructor at Pace University and at Baruch College. She received a commendation from the dean at Pace University for teaching excellence, and she was awarded a Graduate Teaching Fellowship at Baruch College. She currently serves on several professional committees, and she has provided consulting services in accounting education and training programs for several large employers.     

The Questionable Use of Moral Development Theory in Studies of Business Ethics: Discussion and Empirical Findings

The topic of the article is how moral development theory can enlighten the understanding of ethical behaviour in business. It discusses previous research on the subject, and reports an empirical study of academics (engineers and business economists with a master degree) working in the private sector in Norway.Moral development theory is based on a long research tradition, and many researchers within business ethics have assumed the importance of moral reasoning in business environments. However, the truth of these assumptions has not been confirmed by previous empirical research.The article reports on my investigation into the relationship between moral reasoning, ethical attitudes and decision-making behaviour. The data were collected by a survey study among Norwegian engineers and business economists working in businesses (N = 449) in 1997.It has been hypothesised that strong ethical attitudes would have a restraining effect on moral reasoning. In order to test this, ethical attitudes were categorized into four issue categories. The assumption being that the four categories would explain the different restraints on moral reasoning. The statistical testing showed that there was a negative, but not significant, correlation between strong attitudes and good moral reasoning ability.It was also hypothesised that good ability in moral reasoning would tend to exhibit a smaller difference between Policy-decisions and Action-decisions. This hypothesis was based on the difference in behaviour explained in "espoused theory" and "theory in use". When making policy-decisions these can be based on espoused theory and nice "talk" because it is always possible to make exceptions to or reconsider a policy. Action-decisions, on the other hand, are very concrete because they immediately trigger an action. The statistical testing rejected my hypothesis but gave a significant converse result: Good ability in moral reasoning seems to imply less stability and more inconsistence.The article concludes with the fact that moral reasoning testing seems to explain some differences in moral reasoning among people in business but not what kind of behavioural effects these differences actually have.     

Moral Dilemmas in Business Ethics: From Decision Procedures to Edifying Perspectives

There have been many attempts during the history of applied ethics that have tried to develop a theory of moral reasoning. The goal of this paper is to explicate one aspect of the debate between various attempts of offering a specific method for resolving moral dilemmas. We contrast two kinds of deliberative methods: deliberative methods whose goal is decision-making and deliberative methods that are aimed at gaining edifying perspectives. The decision-making methods assessed include the traditional moral theories like utilitarianism and Kantianism, as well as second order principles, such as principlism and specified principlism. In light of this assessment, we suggest taking a closer look at two perceptive models, casuistry and particularism. These models are used for dealing with moral dilemmas that provide for edifying perspectives rather than decision-making. These perceptive models, though less scientific and not as good at prescribing an action, are more human in the sense that they enrich our moral sensibilities and enhance our understanding of the meaning of the situation. Yotam Lurie is a Senior Lecturer in Philosophy and Ethics at the Department of Management at Ben-Gurion University of the Negev, Beer-Sheva, Israel. Lurie holds a Ph.D. in Philosophy from the University of Illinois at Urbana-Champaign. His research focuses on a variety of issues in applied ethics, particularly within the context of business and professional ethics. Robert Albin is a Lecturer in Philosophy and Ethics and the Chair of the Department of Liberal Arts and Sciences at Sapir College, which is located in the Negev Region, Israel. He holds a Ph.D. in Philosophy from Ben-Gurion University of the Negev. Research interests are in the fields of Philosophy of Culture and applied ethics with a special interest in journalistic ethics. He published a book on the topic: A Chronicle of the Decline of Rationality: Ethics in the Practice of Journalism, 2004. (in Hebrew).     

Measuring moral judgment: The Moral Judgment Interview or the Defining Issues Test?

This paper compares and contrasts two distinct techniques for measuring moral judgment: The Moral Judgment Interview and the Defining Issues Test. The theoretical foundations, accompanying advantages and limitations, as well as appropriate usage of these methodologies are discussed. Adaptation and use of the instruments for business ethics research is given special attention.Dawn Elm is currently an Assistant Professor of Management at the University of St. Thomas in St. Paul, Minnesota. Dr. Elm has written and published articles on ethical decision-making, moral reasoning, defining and measuring honesty, and women's studies and ethics. She also has research interests in socialization to work, gender bias imagery in teaching business, and parental leave policies.James Weber is currently an Assistant Professor of Management at Marquette University. He has published articles focusing on managerial values and moral reasoning, teaching of ethics, and methodological issues in business ethics research inResearch in Corporate Social Performance and Policy, Human Relations, Business Ethics Quarterly, and Journal of Business Ethics.     

伦理型领导与伦理问题报告：一个多层次模型

基于社会学习理论及社会信息加工视角,文章探讨了伦理型领导激发员工报告组织内部伦理问题的多层次作用机制。文章采用两阶段问卷调查方式收集67名团队领导与302名员工调查样本,运用多层线性模型进行假设检验,结果表明,个体导向的伦理型领导对员工伦理问题报告具有显著正向影响,道德勇气在二者之间起部分中介作用。同时,团队导向的伦理型领导显著正向影响员工伦理问题报告,伦理氛围在二者之间起完全中介作用。此外,在伦理氛围更强的团队,个体导向的伦理型领导对伦理问题报告的作用更强。研究结果揭示了伦理型领导影响员工伦理问题报告的多层次作用路径及边界条件,对于加强组织的伦理管理具有重要的现实意义。     

Is Guanxi Orientation Bad, Ethically Speaking? A Study of Chinese Enterprises

Guanxi as one of the key factors leading to business success in China (PRC) has ironically been synonymous with bribery. This raises some serious questions: should Western foreign firms do business in China? How should they do business with Chinese firms? This study investigated the relationship between guanxi orientation and cognitive moral development in an attempt to determine whether the level of guanxi orientation of Chinese business people affects their ethical reasoning. Based on a classification of Chinese enterprises (Nee, 1992), it was found that Chinese enterprises rely on guanxi for business to different extents. However, their levels of cognitive moral development are not significantly different, suggesting that guanxi orientation has very little to do with ethical reasoning (as captured through an established measure of cognitive moral development). Furthermore, time in profession was found to positively affect guanxi orientation; however, age failed to predict guanxi orientation and education turned out to be a negative predictor of guanxi orientation.     

A New Perspective on Ethics,Ecology, and Economics

This paper introduces the important concept of a biophysical perspective on economics into the business ethics literature. The biophysical perspective recognizes that ecological processes determine what can be done in an economy and how best to do it. A biophysical perspective places the economic system into a larger context of the ecologic system. This changes the perception of ethical issues by identifying a larger scope of management decisions. The paper examines the changing ethical landscape in such issues as biotechnology, planned obsolescence, productivity, and international trade. The paper also examines the shift in mindset associated with the shift in economic framework. It draws on the literature on cognitive structures and moral imagination to show this new perspective can actually raise the bar for ethical decision-making and behavior. The pattern is that the ethical behavior associated with a biophysical economic framework has a greater scope of responsibility with the benefit that the required ethical behavior leads to better long-term decision making.     

The Effects of Commitment to Moral Self-improvement and Religiosity on Ethics of Business Students

Using survey methodology we examined the relationships between commitment to moral self-improvement (CMSI), religiosity, ethical problem recognition, and behavioral intentions in a sample of 242 business students. Results of the study suggest that CMSI predicts ethical problem recognition and behavioral intentions. Our findings also suggest that CMSI is positively related to religiosity. The study provides some evidence of CMSI being a mediator in the influence of religiosity on ethical problem recognition and behavioral intentions. Compared to religiosity, CMSI turned out to be a better predictor of perceived importance of ethics, ethical problem recognition, and ethical behavioral intentions. The results of the study have implications for increasing understanding of ethical decision-making, future studies of business ethics, and business ethics education.     

Managers’ Moral Reasoning: Evidence from Large Indian Manufacturing Organisations

Increased globalisation has also seen increased scrutiny of corporate behaviour by the communities. Clearly managers are under increased pressure from stakeholders not only to outperform their competitors, but also are expected to do so in an ethical manner. In order to act ethically an individual is expected to have a well-developed moral imagination and moral reasoning. Literature on ethical reasoning research indicates a positive relationship between higher levels of moral reasoning and ethical behaviour. This paper presents the findings of a study of the moral reasoning/moral development of managers working in large manufacturing enterprises situated in the state of Punjab in India. Kohlberg’s theory of Cognitive Moral Development forms the basis of the study. Moral Judgement Interview (MIG) developed by Weber, on the basis of Kohlberg’s theory was used for the study. Moral Reasoning Scores were calculated using Abbreviated Scoring Guide. More than half of the managers scored at post-conventional level of reasoning while assessing the moral dilemmas. The reasoning scores varied for the three dilemmas. Manjit Monga is a lecturer in the School of Management, at the Division of Business, University of South Australia. Her research interests are in the area of management and workplace ethics, organisational culture, research ethics and resource management. The aythor is a lecturer in the School of Mangement, at the Division of Business,University of South Australia. Her research interests are in the area of mangement and workplace ethics,organisational culture,research ethics and human resource mangement.     

Breaking the Rules: Examining the Facilitation Effects of Moral Intensity Characteristics on the Recognition of Rule Violations

This research project seeks to discover whether certain characteristics of a moral issue facilitate individuals’ abilities to detect violators of a conditional rule. In business, conditional rules are often framed in terms of a social contract between employer and employee. Of significant concern to business ethicists is the fact that these social contracts are frequently breached. Some researchers in the field of evolutionary psychology argue that there is a biological basis to social contract formation and dissolution in business. However, although it is inescapable that biological forces shaped a fixed neural structure that guides and limits humans’ abilities, we argue that characteristics of the situation in which the person finds himself or herself moderate the activation of these neural circuits in ordinary business social contract situations. Specifically, the moral intensity associated with the social contract conditional rule is likely to influence peoples’ abilities to detect violators of the rule. This study utilizes adapted versions of the Wason selection task and manipulates the issue-contingent moral intensity characteristics of magnitude of consequences, proximity, and social consensus to assess if moral intensity facilitates detection of rule violators. Results from this empirical study indicate no relationship between moral intensity characteristics and issue recognition but do provide insights into the evolutionary psychology approach. David M. Wasieleski is an Assistant Professor in the Leadership and Change Management Division of the A.J. Palumbo School of Business Administration and the John F. Donahue Graduate School of Business at Duquesne University. He received his Ph.D. from the University of Pittsburgh. David’s recent research focuses on individuals’ biological propensity for ethical behavior and its effect on workplace relationships. His other research interests include moral intensity, cognitive moral development, stakeholder agenda-building, and policy learning. Sefa Hayibor is an Assistant Professor of Management in the Sobey School of Business at Saint Mary’s University (Canada). He received his Ph.D. from the University of Pittsburgh. His research interests include business ethics and ethical decision-making, stakeholder motivation and management, charismatic leadership, and cognitive heuristics and biases.     

Moral Reasoning as a Determinant of Organizational Citizenship Behaviors: A Study in the Public Accounting Profession

This study examines the relationship between an employee's level of moral reasoning and a form of work performance known as organizational citizenship behaviors (OCB). Prior research in the public accounting profession has found higher levels of moral reasoning to be positively related to various types of ethical behavior. This study extends the ethical domain of accounting behaviors to include OCB. Analysis of respondents from a public accounting firm in the northeast region of the United States (n = 107) support a positive and significant relationship between moral reasoning and two dimensions of OCB: interpersonal helping behaviors and sportsmanship behaviors. This study controls for previously identified determinants of OCB (e.g., procedural justice) and demographic variables (age, sex, tenure and social desirability). Results suggest that moral reasoning accounts for professional behaviors that are perceived as intrinsically good by the employee and economically beneficial by the employer.