Ethics Value - Management

Journal of Business Ethics (2006) 64: 31–43 DOI 10.1007/s10551-005-4664-5

Ó Springer 2006

The Impact of Corporate Ethical Values and Enforcement of Ethical Codes on the Perceived Importance of Ethics in Business: A Comparison Scott J. Vitell ´ Encarnacion Ramos Hidalgo of U.S. and Spanish Managers

ABSTRACT. This two country study examines the effect of corporate ethical values and enforcement of a code of ethics on perceptions of the role of ethics in the overall success of the firm. Additionally, the impact of organizational commitment and of individual variables such as ethical idealism and relativism was examined. The rationale for examining the perceived importance of the role of ethics in this manner is to determine the extent to which the organization itself can influence employee perceptions regarding ethics and social responsibility. Results indicate that all of the variables tested, except relativism, impacted upon one’s perceptions of the importance of ethics and social responsibility. Perceptions of the importance of ethics and social responsibility also varied depending upon country of residence with the

U.S. sample having somewhat higher perceptions concerning the importance of ethics and social responsibility than their counterparts in Spain. Furthermore, when comparing the two samples, the U.S. sample had significantly higher corporate ethical values, greater enforcement of ethical codes, less organizational commitment and both lower idealism and relativism. KEY WORDS: business ethics, codes of ethics, corporate ethical values, Spain

Introduction Due to the increasing concern of the general public about ethical issues in business, especially in the U.S., many organizations have tried to control the problems by institutionalizing ethics (Gellerman, 1989; Murphy, 1989; Stevens, 1994). For example, some organizations have made structural and procedural changes such as creating new ethics positions (e.g., ethics ombudsmen and ethics

References: Abratt, R. and D. Sacks: 1988, ÔThe Marketing Challenge: Towards Being Profitable and Socially ResponsibleÕ, Journal of Business Ethics 7, 497–507. Badaracco, J. L., Jr. and A. P. Webb: 1995, ÔBusiness Ethics: A View from the TrenchesÕ, California Management Review 37(2), 8–28. Briggs, W. and T. Bernal: 1992, ÔValidating the Code of EthicsÕ, Communication World 9(6), 40–43. Cohen, Jeffrey R., Laurie W. Pant and David J. Sharp: 1995, ÔAn Exploratory Examination of International Differences in Auditors’ Ethical PerceptionsÕ, Behavioral Research in Accounting 7, 37–64. Cressey, D. R. and C. A. Moore: 1983, ÔManagerial Values and Corporate Codes of EthicsÕ, California Management Review 25(4), 53–77. Cullen, J. B., K. P. Parboteeah and B. Victor: 2003, ÔThe Effects of Ethical Climates on Organizational Commitment: A Two – Study AnalysisÕ, Journal of Business Ethics 46(2), 127–141. Etheredge, J. M.: 1999, ÔThe Perceived Role of Ethics and Social Responsibility: An Alternative Scale StructureÕ, Journal of Business Ethics 18(1), 51–64. Ferrell, O. C. and L. G. Gresham: 1985, ÔA Contingency Framework for Understanding Ethical Decision Making in MarketingÕ, Journal of Marketing 49(Summer), 87–96. Forsyth, D. R.: 1980, ÔA Taxonomy of Ethical IdeologiesÕ, Journal of Personality and Social Psychology 39(1), 175–184. Forsyth, D. R.: 1992, ÔJudging the Morality of Business Practices: The Influence of Personal Moral PhilosophiesÕ, Journal of Business Ethics 11(May), 461–470. Gellerman, S. W.: 1989, ÔManaging Ethics from the Top DownÕ, Sloan Management Review 17(Winter), 73–79. Ho, F. N., S. J. Vitell, J. Barnes and R. Desborde: 1997, ÔEthical Correlates of Role Conflict and Ambiguity in Marketing: The Mediating Role of Cognitive Moral DevelopmentÕ, Journal of the Academy of Marketing Science 25(Spring), 117–126. Hofstede, G.: 1983, ÔNational Cultures in Four Dimensions: A Research-Based Theory of Cultural Differences among NationsÕ, International Studies of Management & Organization 13(Spring/Summer), 46–74. A Comparison of U.S. and Spanish Managers Stevens, B.: 1994, ÔAn Analysis of Corporate Ethical Code Studies: Where Do We Go From Here?Õ, Academy of Management Review 11(3), 601–617. Trevino, L. K.: 1986, ÔEthical decision Making in Organizations: A Person-Situation Interactionist ModelÕ, Academy of Management Review 11, 601–617. Vitell, S. J.: 1986, Marketing Ethics: Conceptual and Empirical Foundations of a Positive Theory of Decision Making in Marketing Situations Having Ethical Content, Unpublished Doctoral Dissertation (Texas Tech University, Lubbock, TX). Vitell, S. J. and D. L. Davis: 1990, ÔThe Relationship Between Ethics and Job Satisfaction: An Empirical InvestigationÕ, Journal of Business Ethics 9, 489–494. Vitell, S. J., S. L. Nwachukwu and J. H. Barnes: 1993, ÔThe Effects of Culture on Ethical Decision-Making: An Application of Hofstede’s TypologyÕ, Journal of Business Ethics 12, 753–760. Vitell, S. J. and J. G. P. Paolillo: 2004, ÔA Cross-Cultural Study of the Antecendents of the Perceived Role of Ethics and Social ResponsibilityÕ, Business Ethics: A European Review 13(2/3), 185–199. Weiss, J. W.: 1994, Business Ethics: A Managerial, Stakeholder Approach (Wadsworth Publishing Co, Belmont, CA). 43 Wotruba, T. R.: 1997, ÔIndustry Self-Regulation: A Review and Extension to a Global SettingÕ, Journal of Public Policy & Marketing 16(1), 38–54. Scott J. Vitell, School of Business Administration, University of Mississippi, University MS, 38677, U.S.A. E-mail: [e-mail] ´ Encarnacion Ramos Hidalgo, ´n de Empresas y Marketing, Departamento de Administracio Universidad de Sevilla, ´ C/Ramon y Cajal, 1, Sevilla, 41018, Espana ˜ E-mail: [e-mail] Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.