Ethical decision-making descriptive theoretical models often conflict with each other and typically lack comprehensiveness. To address this deficiency, a revised EDM model is proposed that consolidates and attempts to bridge together the varying and sometimes directly conflicting propositions and perspectives that have been advanced. To do so, the paper is organized as follows. First, a review of the various theoretical models of EDM is provided. These models can generally be divided into rationalist-based ; and non-rationalist-based. Second, the proposed model, called (...) ‘Integrated Ethical Decision Making,’ is introduced in order to fill the gaps and bridge the current divide in EDM theory. The individual and situational factors as well as the process of the proposed model are then described. Third, the academic and managerial implications of the proposed model are discussed. Finally, the limitations of the proposed model are presented. (shrink)

The author identifies the major micro-, meso-, and macro-level financial risk shifting factors that contributed to the Great Global Recession and how the absence of a compelling moral vision of responsible financial risk management perpetuated the economic crisis and undermined the recovery by blind reliance upon insufficiently accountable bailouts. The author offers a new theoretical model of Sustainable Stakeholder Capitalism by exercising moral imagination which inclusively and moderately balances four multi-level factors: types of capitalism, moral theories, human nature drives, and (...) credit risk profiles. Finally, the author recommends micro-, meso-, and macro-level practical reforms to prevent a recurrence of the current economic freefall, to re-create systemic global financial institution integrity, and to promote responsible risk management for sustainable global prosperity for current and future generations. (shrink)

Professional associations, like the Academy of Management, exist to foster and promote scholarship, exchange among faculty, and an environment conducive to member professional ethics development. However, this last purpose of such organizations has received the least amount of attention. Moreover, previous research has demonstrated that there are differences in perceived needs for professional ethics development between tenured and untenured faculty. In the current research 260 Academy of Management members were surveyed. The research identified differences between tenured and untenured management faculty (...) with respect to expectations for the Academy of Management to provide ethics education and research with respect to the professional code of conduct. Implications of the findings are discussed from a developmental perspective. Directions for future research are provided. (shrink)

Professional associations, like the Academy of Management, exist to foster and promote scholarship, exchange among faculty, and an environment conducive to member professional ethics development. However, this last purpose of such organizations has received the least amount of attention. Moreover, previous research has demonstrated that there are differences in perceived needs for professional ethics development between tenured and untenured faculty. In the current research 260 Academy of Management members were surveyed. The research identified differences between tenured and untenured management faculty (...) with respect to expectations for the Academy of Management to provide ethics education and research with respect to the professional code of conduct. Implications of the findings are discussed from a developmental perspective. Directions for future research are provided. (shrink)

In this paper, we develop a conceptual framework of the intra-firm transfer of best practices in moral reasoning by integrating three streams of literature: internal knowledge transfer in strategic management, moral reasoning and epistemology in philosophy and business ethics, and leader–member exchange in human resource management. We propose that characteristics of moral reasoning (nature of moral knowledge, tacitness of moral reasoning and causal ambiguity), source characteristics (moral development of leaders), target characteristics (integrity capacity and moral development of subordinates), leader–member exchange (...) and internal ethical climate influence the transfer of best practices in moral reasoning. (shrink)

Applying evidence from recently available public information on Enron, I defined Enron’s culture as one rooted in agency theory by asserting that Enron’s members were predominantly agency-reasoning individuals. I then identified conditions present at Enron’s collapse: a strong agency culture with collectively non-compliant norms, a munificent rare-failure environment, and new hires with little business ethics training. Turning to four possible antidotes (selection, objectivist integrity, integrity capacity, and stewardship reasoning) to an agency culture under these conditions, I argued that the currently (...) available ethics literature would have made little difference toward averting Enron’s collapse if any of the recommendations from the relevant ethics literature had been implemented. I conclude by identifying new directions for business ethics literature in order to make it more implementable under the conditions identified at Enron. Essentially, we need a way to clearly determine (1) the difference between connivance and commitment, (2) what is meant by balance with regard to the multiple dimensions of ethics and legal theories, and (3) the proper balance between agency and stewardship reasoning. (shrink)

In order to make strategic decisions and improve their firm’s performance, top management teams must have information on the competitive context in general, and the firm’s competitors in particular. During the decision-making process, top managers can have access to “privileged information”—i.e., information of a confidential and potentially strategic nature that could ultimately confer a decisional advantage over competing parties. However, obtaining and using privileged information in a business context is often illegal—and if not, is usually deemed unethical or “against the (...) rules.” Using a quasi-experimental design, this study explores the reasons why an individual might engage in such unethical behavior. We assess the extent to which managers use privileged information with respect to perceived team cohesion and peers’ ethicality. More specifically, our results show that the use of privileged information is predicted by the decision-maker’s perceptions of their team cohesion and their peers’ ethicality. Moreover, we find that team performance, as a group-level nonself-reported factor, moderates the relationship between cohesion and the use of privileged information. The relationship between cohesion, ethical behavior, and team performance is also discussed. We draw on these findings to make some practical suggestions on how to incorporate practices that could better prevent the unethical use of privileged information in strategic decision-making processes. (shrink)

This study examines the effects of individual ethical values and organizational factors on the professional ethics of PR practitioners in Korea by considering a person–situation interactionist model. Individual ethical values are used as individual factors, and organizational factors consist of an organization’s reward and punishment for ethical/unethical behavior, the behavior of peers, and the ethical integrity of the chief ethics officer. The professional ethics of PR practitioners (the dependent variable) are classified into the following three dimensions: professional ethics for the (...) public, the client, and the PR industry. The results indicate that agency practitioners were more likely to be committed to their profession than to their organization, whereas in-house practitioners were more likely to be committed to their organization than to their profession. That is, in-house practitioners showed weak professional commitment, indicating that they perceived themselves as employees, not as PR professionals. Organizational factors such as reward, punishment, and peers’ ethical behavior had considerable influence on the professional ethics of in-house practitioners, whereas they had little influence on agency practitioners. Organizational factors as well as individual ethical values were more likely to influence the professional ethics of in-house practitioners than that of agency practitioners. Thus, to foster in-house practitioners’ professional ethics and commitment, professional associations in the PR industry should make efforts to provide in-house practitioners with more information on the PR industry and more opportunities for interacting and maintaining communication with their colleagues in the industry. (shrink)

Is there a relationship between the psychological construct of hierarchic managerial role motivation and the moral construct of role-related ethical orientation? In this study we examine this question using responses from a sample of 147 business students in Hong Kong. Managerial role motivation or motivation to manage is defined as an internal force that leads select individuals to pursue, enjoy, and succeed in management positions in relatively large hierarchical organizations. As hypothesized, respondents with higher levels of managerial role motivation demonstrated (...) greater managerial role-related ethical orientation as compared with their less managerially motivated counterparts. Similarly, respondents with higher levels of respect for authority figures, competitive games, competitive situations, assertive role, imposing wishes, and a liking for routine administrative functions possessed greater ethical orientations. The research significance, limitations and future field applications are discussed. (shrink)

In China, Buddhism and Taoism are two major religions. Using a sample of 10,363 firm-year observations from the Chinese stock market for the period of 2001–2010, I provide strong and robust evidence that religion (i.e., Buddhism and Taoism on the whole) is significantly negatively associated with owner-manager agency costs. In particular, using firm-level religion data measured by the number of religious sites within a radius of certain distance around a listed firm’s registered address, I find that religion is significantly negatively (...) (positively) associated with expense ratio (asset utilization ratio), the positive (reverse) proxy for owner-manager agency costs. This finding is consistent with the following view: religiosity has remarkable effects on the way how an individual thinks and behaves, and thereof can curb managers from unethical business practices. Moreover, my findings suggest that the negative association between religion and owner-manager agency costs is attenuated for firms with strong external monitoring mechanisms such as higher Marketization and high-quality auditors. Furthermore, after separating Buddhism from Taoism, my finding indicates that above conclusions are only available for Buddhism, suggesting that different religions may have asymmetric influence on owner-manager agency costs. Above results are robust to various measures of religiosity and a variety of robustness checks. (shrink)

In the Chinese stock market, controlling shareholders often use inter-corporate loans to expropriate a great amount of cash from listed firms, through a process called “tunneling.” Using a sample of 10,170 firm-year observations from the Chinese stock market for the period of 2001–2010, I examine whether and how Buddhism, China’s most influential religion, can mitigate tunneling. In particular, using firm-level Buddhism data, measured as the number of Buddhist monasteries within a certain radius around Chinese listed firms’ registered addresses, this study (...) provides strong evidence that Buddhism intensity is significantly negatively associated with tunneling. This finding is consistent with the view that Buddhism has important influence on corporate behavior and can serve as a set of social norms and/or an alternative mechanism to mitigate controlling shareholders’ unethical tunneling behavior. In addition, my findings also reveal that the negative association between Buddhism intensity and tunneling is attenuated for firms that have high analyst coverage. The results are robust to various measures of Buddhism intensity and a variety of sensitivity tests. (shrink)

This study explores cultural influence on corporate behavior employing the case of merchant guild culture in China and further the moderating role of Marketization. Using hand-collected data on merchant guild culture, we find that merchant guild culture is significantly negatively associated with owner-manager agency costs, suggesting that merchant guild culture in ancient China still has its continuous and remarkable effects on managerial behavior in contemporary corporations. This finding also implies that merchant guild culture motivates managers to upgrade the efficiency of (...) controlling operating costs, reduces agency conflicts between management and shareholders, and eventually mitigates owner-manager agency costs. Moreover, provincial Marketization level attenuates the negative association between merchant guild culture and owner-manager agency costs. Above results are robust to a variety of alternative measures of merchant guild culture and owner-manager agency costs. Furthermore, our findings are still valid after controlling for the potential endogeneity between merchant guild culture and owner-manager agency costs. (shrink)

This article presents an alternative rationale for corporate philanthropy based on managerial values of benevolence and integrity. On the one hand, top managers with benevolence and integrity values are more likely to spread their intrinsic concern for others into the wider society in the form of corporate philanthropy. On the other hand, top managers high in benevolence and integrity are likely to contribute to improved managerial credibility and trusting firm-stakeholder relationships, thereby improving corporate financial performance. Therefore, the article makes the (...) argument that both corporate philanthropy and corporate financial performance can better be interpreted as resulting from managers’ benevolence and integrity values. (shrink)

This paper compares two theories of the firm used to interpret firms’ corporate social strategies in order to derive new insights and questions in this research area. Researchers from many branches of strategic management agree that firms can strategically allocate resources in order to achieve both long-term social objectives and competitive advantage. However, despite some progress in investigating corporate social strategy, studies rely on fundamentally diverging theoretical approaches. This paper will identify, compare and begin to integrate two competing theories of (...) the firm implicit in corporate social strategy scholarship: the resource-based and behavioural theories of the firm. I discuss the implications of these two theories for both researchers and practitioners on key debates within corporate social strategy, and conclude by suggesting several fruitful avenues for future research based on the emerging integration of these two theories of the firm within the strategy literature. (shrink)

In March 2003, President Bush declared the start of Operation Iraqi Freedom, the anticipated commencement of intensive American-led military operations in Iraq. With this declaration, the media began intense coverage of military operations from the field. For the first time, viewers were able to see images of actual events. This was due to three developments: the advancement of technology allowing immediate transmission of text and images, the actual presence of journalists identified as "embedded journalists" at military sites, and the fierce (...) competition among networks for viewers. One result of this constant coverage was significant pressure on decision makers within the television and cable news networks to decide within a matter of seconds which images to air. In particular, producers and broadcasters of competing networks experienced this pressure. Though the radio and broadcasting industry has a published code of standards, it is "general and advisory rather than specific and restrictive." Therefore, it did not address the unique time sensitive decision-making required within this new environment. Issues such as the security of soldiers, confidentiality of troop maneuvers, and the safety of the embedded journalists were critically important. Equally serious were the concerns about the impact of the immediate airing of information and violent images to the public. This research used Patrick Primeaux's ' mind-heart-sou¾ model of decision-making as its theoretical framework. The study investigated the gender and industry experience of selected professionals in a cable news network, MSNBC, to explore how ethical codes of behavior are integrated when people make decisions. Decision-making in both their professional and personal lives was examined. It is from this perspective that their professional decisions to air/not to air material from Operation Iraqi Freedom were studied. The findings on decisions about airing/not airing material from Operation Iraqi Freedom yielded both expected and unexpected results. There was no clear gender difference regarding ethical decision-making, but there was a difference when analyzed by industry experience. When the study focused on questions regarding the respondents' personal lives, the original hypothesis that there was a gender difference was validated. (shrink)