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Showing papers in "Journal of Business Ethics in 2005"


Journal ArticleDOI
TL;DR: In this article, a review summarizes and critiques the empirical ethical decision-making literature from 1996 to 2003, concluding that one hundred and seventy-four articles were published in top business journals during this period.
Abstract: This review summarizes and critiques the empirical ethical decision-making literature from 1996–2003. One hundred and seventy-four articles were published in top business journals during this period. Tables are included that summarize the findings by dependent variable – awareness, judgment, intent, and behavior. We compare this review with past reviews in order to draw conclusions regarding trends in the ethical decision-making literature and to surface directions for future research.

1,355 citations


Journal ArticleDOI
TL;DR: In this paper, the determinants of corporate reputation within a sample of large UK companies drawn from a diverse range of industries were analyzed, focusing on the role that philanthropic expenditures and policies may play in shaping the perceptions of companies among their stakeholders.
Abstract: This paper analyzes the determinants of corporate reputation within a sample of large UK companies drawn from a diverse range of industries. We pay particular attention to the role that philanthropic expenditures and policies may play in shaping the perceptions of companies among their stakeholders. Our findings highlight that companies which make higher levels of philanthropic expenditures have better reputations and that this effect varies significantly across industries. Given that reputational indices tend to reflect the financial performance of organizations above other factors (Fryxell, G. E. and J. Wang: 1994, Journal of Management 20, 1–14) and that elements of the literature emphasise that discretionary aspects of social responsibility, including corporate donations, may not be in the financial interests of organizations (e.g. Friedman, M.: 1970, “The Social Responsibility of Business is to Increase its Profits”, New York Times Magazine, September 13), this is a significant finding. It suggests that philanthropic expenditures may play a significant role in stakeholder management and may, in particular, lead to stakeholders holding more positive impressions of philanthropic corporations.

799 citations


Journal ArticleDOI
TL;DR: In this article, the authors lay the groundwork for an empirical analysis of the question of how far sustainable development can be achieved through stakeholder relations management (SRM) through which corporations are confronted with economic, social, and environmental stakeholder claims.
Abstract: Sustainable development (SD) – that is, “Development that meets the needs of current generations without compromising the ability of future generations to meet their needs and aspirations” – can be pursued in many different ways. Stakeholder relations management (SRM) is one such way, through which corporations are confronted with economic, social, and environmental stakeholder claims. This paper lays the groundwork for an empirical analysis of the question of how far SD can be achieved through SRM. It describes the so-called SD–SRM perspective as a distinctive research approach and shows how it relates to the wider body of stakeholder theory. Next, the concept of SD is operationalized for the microeconomic level with reference to important documents. Based on the ensuing SD framework, it is shown how SD and SRM relate to each other, and how the two concepts relate to other popular concepts such as Corporate Sustainability and Corporate Social Responsibility. The paper concludes that the significance of societal guiding models such as SD and of management approaches like CSR is strongly dependent on their footing in society.

688 citations


Journal ArticleDOI
TL;DR: In this paper, a meta-analytic examination of 193 correlations obtained from 26 samples (N = 18,781) reveals differences in the correlates of whistleblowing intentions and actions.
Abstract: Whistleblowing on organizational wrongdoing is becoming increasingly prevalent. What aspects of the person, the context, and the transgression relate to whistleblowing intentions and to actual whistleblowing on corporate wrongdoing? Which aspects relate to retaliation against whistleblowers? Can we draw conclusions about the whistleblowing process by assessing whistleblowing intentions? Meta-analytic examination of 193 correlations obtained from 26 samples (N = 18,781) reveals differences in the correlates of whistleblowing intentions and actions. Stronger relationships were found between personal, contextual, and wrongdoing characteristics and whistleblowing intent than with actual whistleblowing. Retaliation might best be predicted using contextual variables. Implications for research and practice are discussed.

635 citations


Journal ArticleDOI
TL;DR: In this paper, the authors adopt a multi-dimensional perspective of social responsibility, and carry out market research to determine the perceptions of users of mobile telephone services about economic, legal, ethical and social aspects of their operating companies.
Abstract: The study of corporate social responsibility has been the object of much research in recent decades, although there is a need to continue investigating its benefits as a marketing tool. In the current work we adopt a multi-dimensional perspective of social responsibility, and we carry out market research to determine the perceptions of users of mobile telephone services about economic, legal, ethical and social aspects of their operating companies. With these data we determine the structure and components of the concept of social responsibility. Subsequently, this is related with the overall evaluation of the service and loyalty by means of a model of structural equations, in order to determine the influence of corporate social responsibility on these concepts, and hence its benefits as a commercial tool.

564 citations


Journal ArticleDOI
TL;DR: In this article, a conceptual framework is put forward and it is suggested that individuals may be categorized as Active or Frustrated Corporate Social Entrepreneurs; Conformists or Apathetics, distinguished by their individualistic or collectivist personal values.
Abstract: The literature acknowledges a distinction between immoral, amoral and moral management. This paper makes a case for the employee (at any level) as a moral agent, even though the paper begins by highlighting a body of evidence which suggests that individual moral agency is sacrificed at work and is compromised in deference to other pressures. This leads to a discussion about the notion of discretion and an examination of a separate, contrary body of literature which indicates that some individuals in corporations may use their discretion to behave in a socially entrepreneurial manner. My underlying assumption is that CSR isn’t solely driven by economics and that it may also be championed as a result of a personal morality, inspired by employees’ own socially oriented personal values. A conceptual framework is put forward and it is suggested that individuals may be categorized as Active or Frustrated Corporate Social Entrepreneurs; Conformists or Apathetics, distinguished by their individualistic or collectivist personal values. In a discussion of the nature of values, this paper highlights how values may act as drivers of our behavior and pays particular attention to the values of the entrepreneur, thereby linking the existing debate on moral agency with the field of corporate social responsibility.

466 citations


Journal ArticleDOI
TL;DR: In this paper, the authors outline the parameters of an Islamic model of normative business ethics, and explain how this ethics model seeks to balance the needs of multiple stakeholders, and discuss its enforcement mechanisms.
Abstract: In spite of a renewed interest in the relationship between spirituality and managerial thinking, the literature covering the link between Islam and management has been sparse - especially in the area of ethics. One potential reason may be the cultural diversity of nearly 1.3 billion Muslims globally. Yet, one common element binding Muslim individuals and countries is normative Islam. Using all four sources of this religion's teachings, we outline the parameters of an Islamic model of normative business ethics. We explain how this ethics model seeks to balance the needs of multiple stakeholders, and discuss its enforcement mechanisms. This Islamic approach to business ethics is centered around criteria that are in common with stakeholder theory such as justice and balance, and includes unique additional criteria such as trust and benevolence.

427 citations


Journal ArticleDOI
TL;DR: In this paper, the authors argue that the deep distrust towards tobacco companies is linked to the lethal character of their products and the dubious behavior of their representatives in recent decades, and that tobacco companies are not in the CSR business in the strict sense.
Abstract: Tobacco companies have started to position themselves as good corporate citizens. The effort towards CSR engagement in the tobacco industry is not only heavily criticized by anti-tobacco NGOs. Some opponents such as the the World Health Organization have even categorically questioned the possibility of social responsibility in the tobacco industry. The paper will demonstrate that the deep distrust towards tobacco companies is linked to the lethal character of their products and the dubious behavior of their representatives in recent decades. As a result, tobacco companies are not in the CSR business in the strict sense. Key aspects of mainstream CSR theory and practice such as corporate philanthropy, stakeholder collaboration, CSR reporting and self-regulation, are demonstrated to be ineffective or even counterproductive in the tobacco industry. Building upon the terminology used in the leadership literature, the paper proposes to differentiate between transactional and transformational CSR arguing that tobacco companies can only operate on a transactional level. As a consequence, corporate responsibility in the tobacco industry is based upon a much thinner approach to CSR and has to be conceptualized with a focus on transactional integrity across the tobacco supply chain.

347 citations


Journal ArticleDOI
TL;DR: In this article, an empirical study carried out for 112 Spanish family firms gives support to our initial assumption about these organizations not being a homogeneous group in terms of their orientation towards corporate social responsibility.
Abstract: Despite the economic relevance and distinctiveness of family firms, little attention has been devoted to researching their nature and functioning. Traditionally, family firms have been associated both to positive and negative features in their relationships with the stakeholders. This can be linked to different orientations toward corporate social responsibility. Thus, this research aims to identify the approaches that Spanish family firms maintain about social responsibility, based on the model developed by Quazi and O’ Brien Journal of Business Ethics 25, 33–51 (2000). An empirical study carried out for 112 Spanish family firms gives support to our initial assumption about these organizations not being a homogeneous group in terms of their orientation towards corporate social responsibility. The differences in perceptions do not seem to be associated to biographical characteristics. These results lead to some relevant academic and practical implications that suggest interesting lines for future research.

325 citations


Journal ArticleDOI
TL;DR: In this article, a detailed summary of the management systems used by multinational enterprises in the Code implementation process is provided, and a framework for analysis based on the elements of -the creation of a vision, the development of understanding and ability, integration into operations and feedback, improvement and remediation is presented.
Abstract: Amongst a backdrop of debate regarding Codes of Conduct and their raison d’etre this paper provides a detailed summary of the management systems used by multinational enterprises in the Code implementation process. It puts forth a framework for analysis based on the elements of – the creation of a vision, the development of understanding and ability, integration into operations and feedback, improvement and remediation – and then applies it across the sports footwear, apparel and retail sectors in order to firstly, demonstrate the complexities of the Code implementation process and secondly, to provide useful examples and lessons-learned to companies, policy-makers and others interested in implementing their own Code of Conduct or who are actively involved in this field.

289 citations


Journal ArticleDOI
TL;DR: Corruption is a major problem in many of the world's developing economies today as discussed by the authors and it has a dampening effect on development and it could result in the production of inferior goods as companies find ways to accommodate under-thetable payments.
Abstract: Corruption is a major problem in many of the world’s developing economies today. World Bank studies put bribery at over $1 trillion per year accounting for up to 12 of the GDP of nations like Nigeria, Kenya and Venezuela. Though largely ignored for many years, interest in world wide corruption has been rekindled by recent corporate scandals in the US and Europe. Corruption in the developing nations is said to result from a number of factors. Mass poverty has been cited as a facilitating condition for corruption just as an inability to manage a sudden upsurge in mineral revenues has been credited with breeding corruption and adventurous government procurement among public officials in countries like Nigeria and Venezuela. Virtually all developing nations that have serious corruption problems also have very limited economic freedom and a very weak enforcement of the rule of law. In such nations, corruption represents a regressive taxation that bears hard on the poor. It has a dampening effect on development and it could result in the production of inferior goods as companies find ways to accommodate under-the-table payments. Finally, corruption is a dangerous threat to the legitimacy of the governments of some of the developing nations themselves. It is suggested that new urgent initiatives are needed to deal with the dangers posed by corruption in the developing economies. They include making the economies of these nations more open by the withdrawal of the government from the productive sector and by the abolition of unnecessarily stringent restrictions on business conduct. The rule of law needs to be strengthened in these nations and those countries like Nigeria and Venezuela should ignore scruples over sovereignty and seek foreign assistance in the management of their oil wealth. Finally, multinationals should be made to disclose all the payments they make in developing nations to such organizations like International Chamber of Commerce or Transparency International where they can be reviewed by anyone interested.

Journal ArticleDOI
TL;DR: In this article, the authors developed and empirically tested a model examining the antecedents of consumer attitude and behavioral intention toward music piracy behavior and found that attributive satisfaction, perceived prosecution risk, magnitude of consequence, and social consensus are very important in influencing customers' attitude and behavioural intention toward two types of music piracy behaviour, unauthorized duplication/download and pirated music product purchasing.
Abstract: Piracy is the greatest threat facing the music industry worldwide today. This study developed and empirically tested a model examining the antecedents of consumer attitude and behavioral intention toward music piracy behavior. Two types of music piracy behavior, unauthorized duplication/download and pirated music product purchasing, were examined. Based on a field survey in Taiwan, the results showed that attributive satisfaction, perceived prosecution risk, magnitude of consequence, and social consensus are very important in influencing customers’ attitude and behavioral intention toward two types of music piracy behavior. In addition, singer/band idolization can affect the attitude and behavioral intention in the case of pirated music product purchasing. Perceived proximity was found to affect the attitude and behavioral intention in the case of pirated music product purchasing. However, it only influenced behavioral intention in the case of unauthorized duplication/download.

Journal ArticleDOI
TL;DR: In this paper, the authors developed the notion of corporate social responsibility as a real option and its implications for risk management, and used real options theory for a strategic view of Corporate social responsibility.
Abstract: The relationship of corporate social responsibility to risk management has been treated sporadically in the business society literature. Using real options theory, I develop the notion of corporate social responsibility as a real option its implications for risk management. Real options theory allows for a strategic view of corporate social responsibility. Specifically, real options theory suggests that corporate social responsibility should be negatively related to the firm’s ex ante downside business risk.

Journal ArticleDOI
TL;DR: This paper found that idealism is negatively correlated with employee deviance while relativism will be positively related, and that there will only be a relationship between idealism and deviance when relativism is higher.
Abstract: Ethical ideology is predicted to play a role in the occurrence of workplace deviance. Forsyth’s (1980) Ethics Position Questionnaire measures two dimensions of ethical ideology: idealism and relativism. It is hypothesized that idealism will be negatively correlated with employee deviance while relativism will be positively related. Further, it is predicted that idealism and relativism will interact in such a way that there will only be a relationship between idealism and deviance when relativism is higher. Results supported the hypothesized correlations and idealism and relativism interacted to predict organizational deviance. Idealism was a significant predictor of interpersonal deviance, but no interaction was found.

Journal ArticleDOI
TL;DR: In this article, the authors examined the association between long-term compensation and corporate social responsibility (CSR) for 90 publicly traded Canadian firms and found a significant relationship between the longterm compensation with total CSR weakness as well as the product/environmental weakness dimension of CSR.
Abstract: This paper examines the association between long-term compensation and corporate social responsibility (CSR) for 90 publicly traded Canadian firms. Social responsibility is considered to include concerns for social factors and the environment (e.g. Johnson, R. and D. Greening: 1999, Academy of Management Journal 42(5), 564-578; Kane, E. J. (2002, Journal of Banking and Finance 26:, 1919-1933; McGuire, J. et al. 2003, Journal of Business Ethics 45 (4), 341-359). Long-term compensation attempts to focus executives’ efforts on optimizing the longer term, which should direct their attention to factors traditionally associated with socially responsible executives (Mahapatra, S. 1984, Journal of Financial Economicsit 20, 347-376). As hypothesized, we found a significant relationship between the long-term compensation and total CSR weakness as well as the product/environmental weakness dimension of CSR. In addition, we found a marginally significant relationship between long-term compensation and total corporate responsibility. Our findings are that executives’ long-term compensation is associated with a firm’s environmental actions, and that firms that utilize long-term compensation are more likely to mitigate product/environment weaknesses than those that do not. Implications for practice and research are discussed.

Journal ArticleDOI
TL;DR: In this article, the authors examined the influence of personal, social and organizational factors on ethical intentions of public accountants, including attitudes, subjective norms, perceived behavioral control, moral sensitivity and ethical climate.
Abstract: The purpose of this study is to expand our understanding of the factors that influence ethical behavioral intentions of public accountants. Recent scandals have dominated the news and have caused legislators, regulators and the public to question the role of the accounting profession. Legislative changes have brought about major structural changes in the profession and continued scrutiny will surely lead to further changes. Thus, developing an understanding of the personal and contextual factors that influence ethical decisions is critical. An extension of the theory of planned behavior [Ajzen, I.: 1985, Action Control-From Cognition to Behavior (Springer, Heidelberg)], the model used in this study examined the influence of personal, social and organizational factors on ethical intentions. Specifically, the individual level model tested direct effects of attitudes, subjective norms, perceived behavioral control, moral sensitivity and ethical climate. Professionals from five accounting firms completed a survey that measured responses to ethical dilemmas related to the public accounting domain. To minimize the potential impact of common method bias, the survey instrument was administered in two phases. Hypotheses were evaluated using a structural modeling technique, partial least squares. Results show strong support for a direct relationship between attitudes and ethical intentions. The proposed direct effect of subjective norms was not supported. However, a significant relationship between subjective norms and attitudes was found. Professionals’ attitudes towards ethical issues clearly influence intentions. Moreover, this study illustrates the potential influence of social factors in attitude formation. Future research should explore the factors in the public accounting domain that most strongly influence attitude formation. This study suggests that the theory of reasoned action offers a useful framework for exploring these issues.

Journal ArticleDOI
TL;DR: In this paper, the authors compared college students with other adults in terms of the Muncy-Vitell consumer ethics scale and found that there was a significant difference between these two groups.
Abstract: This study compares college students with other adults in terms of the Muncy–Vitell (1992) consumer ethics scale. Further, the study updates the Muncy–Vitell consumer ethics scale with modifications that include rewording and the addition of new items. These new items can be grouped into three distinct categories – (1) downloading/buying counterfeit goods, (2) recycling/environmental awareness and (3) doing the right thing/doing good. The study also compares these two groups in terms of their attitude toward business. Results show that there is indeed a significant difference between these two groups in terms of ethical perceptions, but not in terms of the “recycling” items and the “doing good” items. There was also little difference between the groups in terms of their attitude toward business indicating that attitude toward business does not explain their different ethical perspectives.

Journal ArticleDOI
TL;DR: In this article, the authors proposed a framework for a code of ethics for corporate boards and individual directors based on six universal core ethical values: (1) honesty; (2) integrity; (3) loyalty, responsibility, fairness, and (6) citizenship.
Abstract: Recent corporate scandals have focused the attention of a broad set of constituencies on reforming corporate governance. Boards of directors play a leading role in corporate governance and any significant reforms must encompass their role. To date, most reform proposals have targeted the legal, rather than the ethical obligations of directors. Legal reforms without proper attention to ethical obligations will likely prove ineffectual. The ethical role of directors is critical. Directors have overall responsibility for the ethics and compliance programs of the corporation. The tone at the top that they set by example and action is central to the overall ethical environment of their firms. This role is reinforced by their legal responsibilities to provide oversight of the financial performance of the firm. Underlying this analysis is the critical assumption that ethical behavior, especially on the part of corporate leaders, leads to the best long-term interests of the corporation. We describe key components of a framework for a code of ethics for corporate boards and individual directors. The proposed code framework is based on six universal core ethical values: (1) honesty; (2) integrity; (3) loyalty; (4) responsibility; (5) fairness; and (6) citizenship. The paper concludes by suggesting critical issues that need to be dealt with in firm-based codes of ethics for directors.

Journal ArticleDOI
TL;DR: In this paper, the authors investigated the role that religiosity plays in determining consumer attitudes/beliefs in various situations regarding questionable consumer practices and found that an intrinsic religiousness was a significant determinant of consumer ethical beliefs, but extrinsic religiousness is not related to those beliefs.
Abstract: This article presents the results of an exploratory study that investigated the role that religiosity plays in determining consumer attitudes/beliefs in various situations regarding questionable consumer practices. Two dimensions of religiosity – intrinsic and extrinsic religiousness – were studied. Results indicated that an intrinsic religiousness was a significant determinant of consumer ethical beliefs, but extrinsic religiousness was not related to those beliefs.

Journal ArticleDOI
TL;DR: In this paper, the authors apply the theory of planned behavior to corporate managers' decision making as it relates to fraudulent financial reporting and find that the theory predicts whether managers' decisions are ethical or unethical.
Abstract: This research applies the theory of planned behavior to corporate managers’ decision making as it relates to fraudulent financial reporting. Specifically, we conducted two studies to examine the effects of attitude, subjective norm and perceived control on managers’ decisions to violate generally accepted accounting principles (GAAP) in order to meet an earnings target and receive an annual bonus. The results suggest that the theory of planned behavior predicts whether managers’ decisions are ethical or unethical. These findings are relevant to corporate leaders who seek to improve ethical work climates of organizations and to many regulators, accountants, corporate governance officials and investors.

Journal ArticleDOI
TL;DR: In this article, the authors explore the nature of stakeholder relationships reported across leading FTSE companies and the importance they attach to communicating both social and business outcomes, and draw the general conclusion that building stronger stakeholder relationship through CSR programs is not currently a priority for most companies.
Abstract: Although it is now widely recognised by business leaders that their companies need to accept a broader responsibility than short-term profits, recent research suggests that as corporate social responsibility (CSR) and social reporting become more widespread, there is little empirical evidence of the range of stakeholders addressed through their CSR programmes and how such programmes are reported. Through a CSR framework which was developed in an exploratory study, we explore the nature of stakeholder relationships reported across leading FTSE companies and the importance they attach to communicating both social and business outcomes. It is evident from the hypotheses tested that the bigger FTSE companies, particularly extraction companies and telecoms, are more adept at identifying and prioritising their stakeholders, and linking CSR programmes to business and social outcomes. However, we draw the general conclusion that building stronger stakeholder relationships through CSR programmes – other than with customers – is not currently a priority for most companies. We also conclude that a limited sophistication in managing multiple stakeholders may compromise the impact of CSR upon business and social results. Finally, the managerial implications and the contribution of our study are discussed before closing with an acknowledgement of the limitations of this work and suggestions for further research.

Journal ArticleDOI
TL;DR: In this article, a survey-based field study of supervisors in a multinational pharmaceutical company that has publicly professed a goal of ecological sustainability was conducted. And they created a theoretical framework for supervisor sustainability support behavior based on the value-belief-norm (VBN) theory.
Abstract: Undoubtedly, multinational corporations must play a significant role in the advancement of global ecological ethics. Our research offers a glimpse into the process of how goals of ecological sustainability in one multinational corporation can trickle down through the organization via the sustainability support behaviors of supervisors. We asked the question “How do supervisors in a multinational corporation internalize their corporation’s commitment to ecological sustainability and, in turn, behave in ways that convey this commitment to their subordinates?” In response, we created a theoretical framework for supervisor sustainability support behavior based on Stern et al., Human Ecology Review 6(2), 81-97 (1999) value-belief-norm (VBN) theory. We then tested our framework by performing a survey-based field study of supervisors in a multinational pharmaceutical company that has publicly professed a goal of ecological sustainability.

Journal ArticleDOI
Mark S. Schwartz1
TL;DR: In this article, a set of universal moral values is generated by considering three sources: (1) corporate code of ethics, (2) global codes of ethics; and (3) the business ethics literature.
Abstract: How can one establish if a corporate code of ethics is ethical in terms of its content? One important first step might be the establishment of core universal moral values by which corporate codes of ethics can be ethically constructed and evaluated. Following a review of normative research on corporate codes of ethics, a set of universal moral values is generated by considering three sources: (1) corporate codes of ethics; (2) global codes of ethics; and (3) the business ethics literature. Based on the convergence of the three sources of standards, six universal moral values for corporate codes of ethics are proposed including: (1) trustworthiness; (2) respect; (3) responsibility; (4) fairness; (5) caring; and (6) citizenship. Relying on the proposed set of universal moral values, implications are discussed as to what the content of corporate codes of ethics should consist of. The paper concludes with its limitations.

Journal ArticleDOI
TL;DR: Workplace bullying is the pattern of destructive and generally deliberate demeaning of co-workers or subordinates that reminds us of the activities of the schoolyard bully as discussed by the authors.
Abstract: Workplace bullying has a well-established body of research internationally, but the United States has lagged behind the rest of the world in the identification and investigation of this phenomenon. This paper presents a managerial perspective on bullying in organizations. The lack of attention to the concept of workplace dignity in American organizational structures has supported and even encouraged both casual and more severe forms of harassment that our workplace laws do not currently cover. The demoralization victims suffer can create toxic working environments and impair organizational productivity. Some methods of protecting your organization from this blight of bullying are proposed. Bullying has always been part of the human condition; history is rife with references to abuse of power and unnecessary or excessive force. The classic bully story is of Joseph and his brothers, a tale of envy and hostility. The refinement of bullying to include various forms of legally defined social harassment is a relatively late phenomenon, however, dating to the Civil Rights Act of 1964. In the United States, bullying is not illegal, whereas it is illegal in many other countries. Bullying is not about benign teasing, nor does it include the off-color jokes, racial slurs, or unwelcome advances that are the hallmarks of legally defined harassment. Workplace bullying is the pattern of destructive and generally deliberate demeaning of co-workers or subordinates that reminds us of the activities of the schoolyard bully. Unlike the schoolyard bully, however, the workplace bully is an adult, usually (but not always) aware of the impact of his or her behavior on others. Bullying in the workplace, often tacitly accepted by the organizational leadership, can create an environment of psychological threat that diminishes corporate productivity and inhibits individual and group commitment. The two examples that follow will help to clarify the difference between harassment and bullying.

Journal ArticleDOI
TL;DR: In this article, the authors suggest an improvement of the most commonly used corporate environmental management tool, the Life Cycle Assessment (LCA), which includes two stages: more phases are added to the life-cycle of a product.
Abstract: This papers attempts to bridge business ethics to corporate social responsibility including the social and environmental dimensions. The objective of the paper is to suggest an improvement of the most commonly used corporate environmental management tool, the Life Cycle Assessment (LCA). The method includes two stages. First, more phases are added to the life-cycle of a product. Second, social criteria that measure the social performance of a product are introduced. An application of this “extended” LCA tool is given.

Journal ArticleDOI
TL;DR: In this paper, the authors make a distinction between legal and ethical compliance mechanisms and show that the former has clearly proven to be inadequate as it lacks the moral firepower to restore confidence and the ability to build trust.
Abstract: 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.

Journal ArticleDOI
TL;DR: In this article, the authors argue that an exclusionary, and even a primary, focus on short-term financial criteria is no longer a viable option, and therefore they must opt for a strategy of emphasizing investment criteria that encourage companies to take into account long-term aspects of their operations in terms of their impact on environment, sustainability and community welfare.
Abstract: >With assets of over US$1.0 trillion and growing, public pension funds in the United States have become a major force in the private sector through their holding of equity positions in large publicly traded corporations. More recently, these funds have been expanding their investment strategy by considering a corporation’s long-term risks on issues such as environmental protection, sustainability, and good corporate citizenship, and how these factors impact a company’s long-term performance. Conventional wisdom argues that the fiduciary responsibility of the pension funds’ trustees must be solely focused on their beneficiaries and, therefore, their investment criteria must be based strictly on narrowly defined financial measures. It is also asserted that well-established financial measurements of corporate performance already include long-term risk assessment through discounted present value of future flow of earnings. Consequently, all other criteria are contrary to the best interest of the pension funds’ beneficiaries. In this paper, we assert that, contrary to conventional wisdom, pension funds, and for that matter other mutual funds, must be concerned with the long-term survival and growth of corporations. These measures are generally referred to “socially responsible investing’’ (SRI) and when applied to corporations, it is termed “socially responsible corporate conduct (SRCC).” We demonstrate that current measurement of future risk assessment invariably understates, and quite often completely overlooks, these long-term risks because of the inherent bias towards short-run on the part of financial intermediaries whose compensation depends greatly on short-term results. Furthermore, there is ample evidence to suggest that these intermediaries have been engaging in self-serving practices and thus failing in their duties to serve their clients’, i.e. pension funds’, best interests. Because of their large holdings in the total market as well as individual companies, these funds cannot easily divest from poorly performing companies without destabilizing the companies’ stock and overall markets. Hence, they must opt for a strategy of emphasizing investment criteria that encourage companies to take into account long-term aspects of their operations in terms of their impact on environment, sustainability, and community welfare, to name a few. We argue that an exclusionary, and even a primary, focus on short-term financial criteria is no longer a viable option. It also calls for the pension funds to encourage greater transparency and accountability of the entire corporate sector through improved corporate governance. Thus socially responsible investing practices are not merely discretionary and desirable activities; they are a necessary imperative, which both the corporations and public pension funds, and other large institutional holders, will ignore at serious peril to themselves. Finally, the paper considers some of the recent developments where corporations have been responding to these challenges and how their actions might be strengthened through greater disclosure and transparency of corporate activities. It also makes recommendations for the pension funds to support further research in creating new measurement standards that further refine the concept of socially responsible investing as a necessary ingredient of long-term corporate survival and growth in the context of a changing economic, environmental and socio-political dynamic.

Journal ArticleDOI
TL;DR: In this article, a virtue character scale was developed to assess the link between organizational level virtue and organizational performance, financial or non-financial based upon three theoretical assumptions, multiple studies were conducted; the content analysis of 158 Fortune Global 500 firms’ ethical values and a survey of 2548 customers and employees were identified through confirmatory factor analysis, and validated against satisfaction measure.
Abstract: Virtue ethics has often been regarded as complementary or laissez-faire ethics in solving business problems This paper seeks conceptual and methodological improvements by developing a virtue character scale that will enable assessment of the link between organizational level virtue and organizational performance, financial or non-financial Based upon three theoretical assumptions, multiple studies were conducted; the content analysis of 158 Fortune Global 500 firms’ ethical values and a survey of 2548 customers and employees Six dimensions of organizational virtue (Integrity, Empathy, Warmth, Courage, Conscientiousness and Zeal) are identified through confirmatory factor analysis, and validated against satisfaction measure Strategic implications of virtue characters are discussed

Journal ArticleDOI
TL;DR: In this paper, the authors describe the theory and process of global business citizenship (GBC) and apply it in an analysis of characteristics of company codes of business conduct, and identify and illustrate the three attributes of a code of conduct that would reflect a GBC approach.
Abstract: This article describes the theory and process of global business citizenship (GBC) and applies it in an analysis of characteristics of company codes of business conduct. GBC is distinguished from a commonly used term, “corporate citizenship,” which often denotes corporate community involvement and philanthropy. The GBC process requires (1) a set of fundamental values embedded in the corporate code of conduct and in corporate policies that reflect universal ethical standards; (2) implementation throughout the organization with thoughtful awareness of where the code and policies fit well and where they might not fit with stakeholder expectations; (3) analysis and experimentation to deal with problem cases; and (4) systematic learning processes to communicate the results of implementation and experiments internally and externally. We then identify and illustrate the three attributes of a code of conduct that would reflect a GBC approach. The three attributes are orientation, implementation, and accountability. The various components of these attributes are specified and illustrated, using website examples from six global petroleum companies.

Journal ArticleDOI
TL;DR: In this paper, an empirical investigation of the internal effects of employee volunteering conducted amongst employees of the Dutch ABN-AMRO bank was carried out, which showed that socio-demographic characteristics from employee volunteers markedly differ from those of non-volunteers and community volunteers and that employee volunteering seems to have positive effects on attitudes and behavior towards the organization.
Abstract: One of the new ways used by companies to demonstrate their social responsibility is to encourage employee volunteering, whereby employees engage in socially beneficial activities on company time, while being paid by the company The reasoning is that it is good for employee motivation (internal effects) and good for the company reputation (external effects) This article reports an empirical investigation of the internal effects of employee volunteering conducted amongst employees of the Dutch ABN-AMRO bank The study showed that (a) socio-demographic characteristics from employee volunteers markedly differ from those of non-volunteers and community volunteers and (b) employee volunteering seems to have positive effects on attitudes and behavior towards the organization