Skip to main content Accessibility help
×
Hostname: page-component-76fb5796d-zzh7m Total loading time: 0 Render date: 2024-04-29T00:35:39.684Z Has data issue: false hasContentIssue false

Part II - Building and Sustaining Ethical Business Cultures

Published online by Cambridge University Press:  19 October 2017

Douglas Jondle
Affiliation:
Bains Jondle & Associates LLC
Alexandre Ardichvili
Affiliation:
University of Minnesota
Get access

Summary

Abstract

Using the Ethical Perceptions Index, this chapter reviews employees’ varying perceptions of ethical business practices across 22 of the world’s largest economies. The chapter addresses two important research questions: Do perceptions of ethical business practices relate to important organizational outcomes? And, How do we create and sustain ethical business practices? In answering these questions, we draw on an extensive, globally representative sample of employees, and show that organizations operating with higher levels of ethics and integrity are more likely to succeed, both with respect to the way employees feel about their work environment as well as multiple indicators of organizational-level business performance. Finally, we explore the main drivers of ethical business cultures, and demonstrate that organizations that build a climate for diversity and inclusion, communicate transparently, codify and regulate important work processes, and hire and advance managers who act with a high degree of interpersonal justice, will score the highest on the Ethical Perceptions Index. We conclude by offering suggestions for leaders who seek to improve their organization’s ethical standing amongst employees.

Type
Chapter
Information
Publisher: Cambridge University Press
Print publication year: 2017

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

Additional Reading

Ardichvili, A., Jondle, D., Kowske, B., Cornachione, E., Li, J., & Thakadipuram, T. (2012). Ethical cultures in large business organizations in Brazil, Russia, India, and China. Journal of Business Ethics, 105(4), 415428.Google Scholar
Brown, M. E., & Mitchell, M. S. (2010). Ethical and unethical leadership: Exploring new avenues for future research. Business Ethics Quarterly, 20(4), 583616.Google Scholar
Folger, R., & Cropanzano, R. (1998). Organizational justice and human resource management. Thousand Oaks, CA: Sage Publications.Google Scholar
Herdman, A. O., & McMillan-Capehart, A. (2010). Establishing a diversity program is not enough: Exploring the determinants of diversity climate. Journal of Business and Psychology, 25(1), 3953.CrossRefGoogle Scholar

References

Alesina, A., Devleeschauwer, A., Easterly, W., Kurlat, S., & Wacziarg, R. (2003). Fractionalization. Journal of Economic Growth, 8(2), 155194.Google Scholar
Ardichvili, A., Jondle, D., & Kowske, B. (2010). Dimensions of ethical business cultures: comparing data from 13 countries of Europe, Asia, and the Americas. Human Resource Development International, 13(3), 299–315.Google Scholar
Bailey, W., & Spicer, A. (2007). When does national identity matter? Convergence and divergence in international business ethics. Academy of Management Journal, 50(6), 14621480.Google Scholar
Beehr, T. (1976). Perceived situational moderators of the relationship between subjective role ambiguity and role strain. Journal of Applied Psychology, 61(7), 3540.Google Scholar
Cohen, D. (1993). Creating and maintaining ethical work climates: Anomie in the workplace and implications for managing change. Business Ethics Quarterly, 3(4), 343358.Google Scholar
Cropanzano, R., & Mitchell, M. S. (2005). Social exchange theory: An interdisciplinary review. Journal of Management, 31, 874900. doi: 10.1177/0149206305279602Google Scholar
Cropanzano, R., Prehar, C. A., & Chen, P. Y. (2002). Using social exchange theory to distinguish procedural from interactional justice. Group & Organization Management, 27(3), 324351.Google Scholar
DeCelles, K. A., DeRue, D. S., Margolis, J. D., & Ceranic, T. L. (2012). Does power corrupt or enable? When and why power facilitates self-interested behavior. Journal of Applied Psychology, 97(3), 681.Google Scholar
Emerson, R. M. (1976). Social exchange theory. Annual Review of Sociology, 2, 335362.Google Scholar
Ferrel, J., & Herb, K. (2012). Improving communication in virtual teams. Society for Industrial Organizational Psychology, Inc.Google Scholar
Gelfand, M. J., Nishii, L. H., Raver, J., & Schneider, B. (2005). Discrimination in organizations: An organizational level systems perspective. In Dipboye, R. & Colella, A. (Eds.), Discrimination at work: The psychological and organizational bases (pp. 89116). Mahwah, NJ: Erlbaum.Google Scholar
Gino, F., Ayal, S., & Ariely, D. (2009). Contagion and differentiation in unethical behavior: The effect of one bad apple on the barrel. Psychological Science, 20, 393398.Google Scholar
Gonzalez, J. A., & DeNisi, A. S. (2009). Cross-level effects of demography and diversity climate on organizational attachment and firm effectiveness. Journal of Organizational Behavior, 30(1), 2140.Google Scholar
Gouldner, A. W. (1960). The norm of reciprocity: A preliminary statement. American Sociological Review, 25, 161178.Google Scholar
Greenbaum, R. L., Mawritz, M. B., & Piccolo, R. F. (2015). When leaders fail to “walk the talk”: Supervisor undermining and perceptions of leader hypocrisy. Journal of Management, 41(3), 929956.CrossRefGoogle Scholar
Guillaume, Y. R., Dawson, J. F., Woods, S. A., Sacramento, C. A., & West, M. A. (2013). Getting diversity at work to work: What we know and what we still don’t know. Journal of Occupational and Organizational Psychology, 86 (2), 123141.CrossRefGoogle Scholar
Gupta, V., and Hanges, P. (2004). Regional and climate clustering of societal cultures. In House, R., P. Hanges, M. Javidan, P. W. Dorfman, & V. Gupta (Eds.), Culture, leadership, and organizations: The GLOBE study of 62 societies (pp. 178210). Thousand Oaks, CA: Sage.Google Scholar
Harter, J. K., Schmidt, F. L., & Hayes, T. L. (2002). Business-unit-level relationship between employee satisfaction, employee engagement, and business outcomes: A meta-analysis. Journal of Applied Psychology, 87(2), 268.Google Scholar
Jackson, T. (2001). Cultural values and management ethics: A 10-nation study. Human Relations, 54(10), 12671302.Google Scholar
Jondle, D., Shoemake, R., & Kowske, B. (2009). Assessing an ethical culture. EvolveHR, 3(2), 5661.Google Scholar
Kaplan, D. M., Wiley, J. W., & Maertz, C. P. (2011). The role of calculative attachment in the relationship between diversity climate and retention. Human Resource Management, 50(2), 271287.Google Scholar
Kiersch, C. E., & Byrne, Z. S. (2015). Is being authentic being fair? Multilevel examination of authentic leadership, justice, and employee outcomes. Journal of Leadership & Organizational Studies, 22(3), 292303.CrossRefGoogle Scholar
King, E., & Gilrane, G. (2015). Social science strategies for managing diversity: Industrial and organization opportunities to enhance inclusion, SHRM-SIOP Science of HR White Paper Series.Google Scholar
Kish-Gephart, J. J., Harrison, D. A., & Treviño, L. K. (2010). Bad apples, bad cases, and bad barrels: Meta-analytic evidence about sources of unethical decisions at work. Journal of Applied Psychology, 95(1), 1.CrossRefGoogle ScholarPubMed
Landy, F. J., & Conte, J. M. (2016). Work in the 21st century, binder ready version: An introduction to industrial and organizational psychology. Hoboken, NJ: John Wiley & Sons.Google Scholar
Lawler, E. E., Hall, D. T., & Oldham, G. R. (1974). Organizational climate: Relationship to organizational structure, process and performance. Organizational Behavior and Human Performance, 11(1), 139155.Google Scholar
Macey, W. H., & Schneider, B. (2008). The meaning of employee engagement. Industrial and Organizational Psychology, 1(1), 3–30.CrossRefGoogle Scholar
Mayer, D. M., Kuenzi, M,. Greenbaum, R., Bardes, M., & Salvador, R. (2009). How low does ethical leadership flow? Test of a trickle-down model. Organizational Behavior and Human Decision Processes, 108, 113.Google Scholar
Mayer, D. M., Nurmohamed, S., Treviño, L. K., Shapiro, D. L., & Schminke, M. (2013). Encouraging employees to report unethical conduct internally: It takes a village. Organizational Behavior and Human Decision Processes, 121, 89103.Google Scholar
Mayer, R. C., Davis, J. H., & Schoorman, F. D. (1995). An integrative model of organizational trust. Academy of Management Review, 20(3), 709734.Google Scholar
McKay, P. F., Avery, D. R., & Morris, M. A. (2008). Mean racial-ethnic differences in employee sales performance: The moderating role of diversity climate. Personnel Psychology, 61(2), 349374.Google Scholar
McKay, P. F., Avery, D. R., Tonidandel, S., Morris, M. A., Hernandez, M., & Hebl, M. R. (2007). Racial differences in employee retention: Are diversity climate perceptions the key? Personnel Psychology, 60(1), 3562.CrossRefGoogle Scholar
Morris, C. D., Bransford, J. D., & Franks, J. J. (1977). Levels of processing versus transfer appropriate processing. Journal of Verbal Learning and Verbal Behavior, 16(5), 519533.CrossRefGoogle Scholar
Muchinsky, P. M. (1977). Organizational communication: Relationships to organizational climate and job satisfaction. Academy of Management Journal, 20(4), 592607.Google Scholar
Norman, S. M., Avolio, B. J., & Luthans, F. (2010). The impact of positivity and transparency on trust in leaders and their perceived effectiveness. Leadership Quarterly, 21(3), 350364.CrossRefGoogle Scholar
Reave, L. (2005). Spiritual values and practices related to leadership effectiveness. Leadership Quarterly, 16(5), 655687.Google Scholar
Reynolds, S. J. (2008). Moral attentiveness: Who pays attention to the moral aspects of life? Journal of Applied Psychology, 93(5), 1027.CrossRefGoogle Scholar
Rizzo, J., House, R., & Lirtzman, S. (1970). Role conflict and ambiguity in complex organizations. Administrative Science Quarterly, 15, 150163.CrossRefGoogle Scholar
Rockstuhl, T., Dulebohn, J. H., Ang, S., & Shore, L. M. (2012). Leader–member exchange (LMX) and culture: A meta-analysis of correlates of LMX across 23 countries. Journal of Applied Psychology, 97, 10971130. doi.org/10.1037/a0029978CrossRefGoogle ScholarPubMed
Salas, E., Wilson, K. A., Priest, H. A., & Guthrie, J. W. (2006). Design, delivery, and evaluation of training systems. In Salvendy, D. (Ed.), Handbook of human factors and ergonomics (3rd ed., pp. 472–512). Hoboken, NJ: John Wiley & Sons, Inc.Google Scholar
Schein, E. H. (1990). Organization culture. American Psychologist, 45(2), 109119.Google Scholar
Schein, E. H. (2006). So how can you assess your corporate culture? In Gallos, J. (Ed.), Organization Development: A Jossey-Bass Reader (pp. 614633). San Francisco, CA: Jossey-Bass.Google Scholar
Scott, B. A., Colquitt, J. A., & Paddock, E. L. (2009). An factor-focused model of justice rule adherence and violation: The role of managerial motives and discretion. Journal of Applied Psychology, 94, 756769. doi: 10.1037/a0015712Google Scholar
Spence, A. M. (1974). Market signaling: Informational transfer in hiring and related screening processes. Cambridge, MA: Harvard University Press.Google Scholar
Treviño, L. K., den Nieuwenboer, N. A., & Kish-Gephart, J. J. (2014). (Un)ethical behavior in organizations. Annual Review of Psychology, 65, 635660.Google Scholar
van Knippenberg, D. V., De Dreu, C. K. W., & Homan, A. C. (2004). Work group diversity and group performance: An integrative model and research agenda. Journal of Applied Psychology, 89, 10081022. doi: 10.1037/ 0021-9010.89.6.1008Google Scholar
Wiley, J. (2010). Strategic employee surveys: Evidence-based guidelines for driving organizational success. San Francisco, CA: Jossey-Bass.Google Scholar
Wiley, J. (2014). Using employee opinions about organizational performance to enhance employee engagement surveys: Model building and validation. People and Strategy, 36(4), 38.Google Scholar
Wiley, J., & Kowske, B. (2011). Respect: Delivering results by giving employees what they really want. San Francisco, CA: Jossey-Bass.Google Scholar

References

Ardichvili, A., Mitchell, J., & Jondle, D. (2009). Characteristics of ethical business cultures. Journal of Business Ethics, 85, 445451.Google Scholar
Associated Press in Dhaka. (2015, June 1). Rana Plaza collapse: dozens charged with murder. The Guardian.Google Scholar
Center for Ethicial Business Cultures. (2017, June 13). CEBCGLOBAL.org.Google Scholar
Duty, D. (2015, July 16). Building successful coalitions for greater social impact. TriplePundit.com.Google Scholar
Goodpaster, K. (2007). Conscience and corporate culture. Malden, MA: Blackwell.Google Scholar
Greenhouse, S., & Harris, E. (2014, April 21). Battling for safer Bangladesh. New York Times.Google Scholar
Jondle, D., Ardichvili, A., & Mitchell, J. (2014). Modeling ethical business culture: Development of the Ethical Business Culture Survey and its use to validate the CEBC Model of Ethical Business Culture. Journal of Business Ethics, 119, 2943.CrossRefGoogle Scholar
Ryan, L. (2005). Codes of ethics. In Werhane, P. & Freeman, E. (Eds.), The Blackwell encyclopedia of management: Business ethics (2nd ed., pp. 80–83). Oxford: Blackwell.Google Scholar
Schein, E. (2004). Organizational culture and leadership (3rd ed.). San Francisco, CA: Jossey-Bass.Google Scholar

Save book to Kindle

To save this book to your Kindle, first ensure coreplatform@cambridge.org is added to your Approved Personal Document E-mail List under your Personal Document Settings on the Manage Your Content and Devices page of your Amazon account. Then enter the ‘name’ part of your Kindle email address below. Find out more about saving to your Kindle.

Note you can select to save to either the @free.kindle.com or @kindle.com variations. ‘@free.kindle.com’ emails are free but can only be saved to your device when it is connected to wi-fi. ‘@kindle.com’ emails can be delivered even when you are not connected to wi-fi, but note that service fees apply.

Find out more about the Kindle Personal Document Service.

Available formats
×

Save book to Dropbox

To save content items to your account, please confirm that you agree to abide by our usage policies. If this is the first time you use this feature, you will be asked to authorise Cambridge Core to connect with your account. Find out more about saving content to Dropbox.

Available formats
×

Save book to Google Drive

To save content items to your account, please confirm that you agree to abide by our usage policies. If this is the first time you use this feature, you will be asked to authorise Cambridge Core to connect with your account. Find out more about saving content to Google Drive.

Available formats
×