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Ambiguous Allure:
GEORGE
Original
Blackwell
Malden,
Business
BASR
©
0045-3609
XXX
BUSINESS Article
W.AND
2008 Center
USA
and WATSON,
Publishing
Society
forSOCIETYROBYN
Business
Inc
Review A.at
Ethics
REVIEW BERKLEY, ET AL.
Bentley College
ABSTRACT
Research in organizational ethics emphasizes those disposi-
tional factors that are expected to foster positive ethical
behavior. We seek to contribute to this literature by includ-
ing personal values that are in contention with moral
outcomes. Specifically, we combine the values of hedonism
and power with benevolence and universalism. Our underly-
ing premise of this value–pragmatics model is that nonmoral,
as well as moral, dispositional characteristics simultaneously
influence ethical decision making. We further contribute
to the existing research by investigating how these con-
tending values interact with situational factors, such as
performance rewards and punishments for unethical
conduct. We administer an experiment to subjects (N = 177)
and analyze their decisions regarding the likelihood they
would act unethically. Results indicate that both morally
relevant and nonmoral variables have direct effects on these
decisions, and that nonmoral as well as moral values interact
with situational factors to significantly influence decisions.
Implications for practice and research are discussed.
© 2009 Center for Business Ethics at Bentley University. Published by Wiley Periodicals, Inc.,
350 Main Street, Malden, MA 02148, USA, and 9600 Garsington Road, Oxford OX4 2DQ, UK.
2 BUSINESS AND SOCIETY REVIEW
O
rganizational moral behavior is addressed by a number
of theories. At the center of any theory, however, is the
assumed moral nature of the agent. Yet, as others have
argued: “. . . this problem is so generally neglected that it has been
possible to make off with its very name almost without being
noticed and, evidently, without evoking any widespread feeling of
loss” (Frankfurt 1971:6). Our goal in the present research is to
contribute to the specification of this moral nature by examining
the influence of negative dispositional characteristics in the person–
situation interaction model simultaneously with positive influences.
This is the core of the value–pragmatics approach.
Organizational ethicists have historically evaluated the person’s
ability to reason out moral problems in ways that result in accept-
able justifications for a choice of action (Kohlberg 1984; Piaget 1965;
Rest et al. 1999). Other theories claim that humans develop an
ethical ideology that is predictive of moral judgment and they
examine these ideological inclinations along the consequentialist
and formalist dimensions (Forsyth 1980; Forsyth and Berger 1982;
Forsyth and Nye 1990). Still others see moral reasoning as a
cognitive predisposition (Brady and Wheeler 1996) more likely to be
autonomously generated than an acquired ideology.
Other organizational moral behaviorists, however, see limitations
in the dispositional and rational approaches described previously,
because they are individualistic and do not account for the differ-
ences in contextual circumstances (Ashkanasy et al. 2006; But-
terfield et al. 2000; Church et al. 2005; Trevino 1986; Trevino and
Youngblood 1990). One approach in bridging this gap is the
person–situation interaction model (Trevino 1986). This model
holds as its primary hypothesis that: “. . . ethical decision making
in organizations is explained by the interaction of the individual
and the situational components [such that] . . . individual and
situational variables interact with the cognitive component to
determine how an individual is likely to behave in response to an
ethical dilemma” (Trevino 1986: p. 602).
The problem of competing moral motivations, although broadly
recognized in ethical dilemmas as conflicts of interest, is rarely
explicitly analyzed in models of moral decision making. As organi-
zational ethicists, we tend toward understanding humans as having
the capacity to transcend self-interests that create conflicts of interest.
Empirical evidence, however, demonstrates time and again that we
GEORGE W. WATSON, ROBYN A. BERKLEY, ET AL. 3
Butterfield et al. (2000) Moral awareness Consequences of Perception that there Significant effects for
the issue is a social consensus consequences
on a response
What are the factors Framing marginally
influencing moral significant
awareness in
organizations
How the issue is Social consensus is
framed. significant
Is the industry Aggressive
aggressively competition
competitive significant
Greenberg, J. (2002). Employee theft Ethics programs Cognitive moral Ethics program
What are the combined development (CMD) interacts with CMD
effects of personal and and previous victim
situational variable on
employee theft
Previous victim of Significant direct
theft effects for all
dispositional and
situational factors
5
TABLE 1 (Continued)
6
Study and primary
question Dependent variable Situational factors Dispositional factors Reported results
7
8 BUSINESS AND SOCIETY REVIEW
Value–Pragmatics
values that contend with hedonism and power are listed as benevo-
lence and universalism, respectively. In seeking out the role of
values in the person–situation hypothesis we hypothesize that both
value types are important in explaining the variance in morally
related judgments and will interact with situational factors.
Schwartz’s definition for these value types are: (1) universalism,
defined as an appreciation for the welfare of all people, (2) benevo-
lence, defined as having the qualities of helpfulness, forgivingness,
honesty and enhancement of people with whom one is in frequent
contact, (3) hedonism, defined as seeking pleasure and sensual
gratification for oneself and, (4) power, the seeking of social prestige,
status, and control. Universalism and benevolence are categories of
self-transcendent, moral values that involve how one conceives,
and behaves toward, other people. In contrast, power and hedonism
are self-enhancing and inwardly oriented values that involve how
one behaves in reaching privately held, personally satisfying, goals
and objectives. Consequently, and as depicted in Figure 1, our first
hypotheses are as follows: We propose that the nonmoral value type
*C = control variables
12 BUSINESS AND SOCIETY REVIEW
METHOD
Design
Procedure
Data collection took place in two phases. In the first phase subjects
were administered measures for moral reasoning, a demographics
questionnaire and value priorities. In the second phase, initiated
several weeks later, subjects were given the eight vignettes and
asked to make a judgment about how likely they would be to act as
in the same way as the person in the vignette. As a result there were
1,416 different decisions about how one would act. Respondents’
answers were matched using names, and because responses were
not anonymous the surveys were held strictly confidential.
Measures
Dependent Variable
the manager falsified sales reports. All managers’ names were meant
to be gender neutral and were altered in each vignette.
RESULTS
Hypothesized Relationships
Reward 0.178*** 0.172*** 0.171*** –0.105 0.173*** –0.074 0.173*** 0.0192 0.185*** 0.056
Punishment –0.287*** –0.286*** 0.084 –0.297*** 0.097 –0.298*** –0.585*** –0.286*** 0.040 –0.286***
Moral Reasoning –0.222 –147*** –0.147*** –0.148*** –0.147*** –0.149* –0.153*** –0.147*** –0.134*** –0.147***
Power 0.153*** 0.159** 0.159*** 0.241*** 0.114** 0.158*** 0.154*** 0.138*** 0.153***
Hedonism 0.142*** 0.227*** 0.089* 0.142*** 0.151*** 0.145*** 0.142*** 0.129**** 0.142***
Universalism –0.084** –0.094** –0.094** –0.084** –0.108** –0.155*** –0.080† –0.061* 0.084**
Benevolence –0.128*** –0.130*** –0.131*** –0.127*** –0.122*** –0.122*** –0.128*** –0.107** 0.144***
Punish x Hedonism –0.397**
Reward x Hedonism 0.288*
Punish x Power –0.403***
***p ≤ 0.001.
**p ≤ 0.01.
*p ≤ 0.05.
†p ≤ 0.10.
GEORGE W. WATSON, ROBYN A. BERKLEY, ET AL. 19
only indirect effect and a third with have both direct and indirect
effects on moral judgments. Is there a relationship between global
variables such as moral intensity of the issue itself and cognitive
capacities for moral reasoning? In other words, is the evaluation of
the broader moral issue conducted with deontological rules, while
the impact of reward and punishment are evaluated with utilitarian
rules? Conversely, will a situational variable such as a company
policy show more direct effects due to the cognitive efficiencies of
linking less ambiguous factors (such as rewards or punishments) to
ethical judgments?
Punishments were weighted at surprisingly high levels of direct
and indirect significance. There are, however, multiple attenuating
possibilities for implementing a deterrence strategy, including; the
probability of one’s actions being discovered, the consistency with
which punishments are administered, the effectiveness of commu-
nicating that punishment is administered while still maintaining
privacy, and the severity of the punishment. Assuming that all
three of these factors are high, there is still the possibility that a
high tolerance for risk will mitigate their effects.
We think punishments, however, have something to say to
managers as well, and that the factors of surveillance, communi-
cating the results, consistent punitive responses with adequate
severity will strongly influence ethical judgments. Each of these,
however, deserves careful deliberation so that principles of organi-
zational justice remain intact. Unreasonably severe punishments
will appear unjust, and meager punishments may be interpreted as
tacit tolerance for unethical behavior.
A second factor important to practice is that the moral intensity
of a situation is likely not to be immediately felt, but that situational
factors motivating behavior are likely to be to have immediate
impact. The business outcomes of a decision often take time to develop
and are sometimes quite ambiguous at the time the decision is made
(Bazerman 2006). Moreover, these situational factors may cue non-
moral considerations, such as nonmoral values of hedonism or power,
to moderate the relationship between the factor and the ethical judg-
ment, and offset one’s moral reasoning capacities. This further empha-
sizes the importance of shared values, organizational culture, and
ethical climate in providing the employee with prescriptive guidance.
This study adds some clarity to the often blurred relationship
between personal values and organizational performance. Advocates
GEORGE W. WATSON, ROBYN A. BERKLEY, ET AL. 23
REFERENCES
Ashkanasy, N., Windsor, C., and Trevino, L. 2006. “Bad Apples in Bad
Barrels Revisited: Cognitive Moral Development, Just World Beliefs,
Rewards, and Ethical Decision Making.” Business Ethics Quarterly 16,
449–473.
Baron, J., and Spranca, M. 1997. “Protected Values.” Organizational
Behavior and Human Decision Processes 70, 1–16.
Batson, D., and Thompson, E. R. 2001. “Why Don’t Moral People Act Morally?
Motivational Considerations.” Current Directions in Psychological Science
10, 54–57.
Batson, D., Thompson, E. R., Seuferling, G., Whitney, H., and Strongman,
J. A. 1999. “Moral Hypocrisy: Appearing Moral to Oneself without
Being So.” Journal of Personality and Social Psychology 77, 525–537.
Batson, D., Thompson, E. R., and Chen, H. U. 2002. “Moral Hypocrisy:
Addressing Some Alternatives.” Journal of Personality and Social
Psychology 83, 330–339.
Batson, D., Collins, P., and Powell, A. 2006. “Doing Business After the Fall:
The Virtue of Moral Hypocrisy.” Journal of Business Ethics 66, 321–335.
Bazerman, M., 2006. Judgment in Managerial Decision Making. New York:
John Wiley & Sons.
Beach, L., and Connoly, T. 2005. The Psychology of Decision Making.
Thousand Oaks, CA: Sage Publications.
Brady, N., and Wheeler, G. 1996. “An Empirical Study of Ethical
Predispositions.” Journal of Business Ethics 15, 927–941.
Butterfield, K. D., Treviño, L. K., and Weaver, G. R. 2000. “Moral Awareness
in Business Organizations: Influences of Issue-Related and Social
Context Factors.” Human Relations 53, 981–1018.
24 BUSINESS AND SOCIETY REVIEW
APPENDIX
Results of Interactions
†P ≤ 0.10.
*P ≤ 0.05.
**P ≤ 0.01.
***P ≤ 0.001.
GEORGE W. WATSON, ROBYN A. BERKLEY, ET AL. 29
Example Scenario
(Alternate wordings and factors are in parentheses)
Situation: (Moral Issue) sales revenue shortfall (environmental
off-shore dumping)
The Problem: As Tyler reviewed the sales figures for the third
quarter it was clear that they fell short of the quota the sales teams
were given. However, Tyler reasoned that next quarter would be
much better, and things would even out. The trouble was, every-
body had a short-term perspective and wanted immediate results.
Tyler considered whether the numbers should be made to look
more positive than third-quarter results indicated.
The Alternatives: Tyler considered the two alternatives. The first
was to report the numbers the way they were. The second was to
ship some of the products that were going to be sold next quarter to
the company’s largest customers. Although these items would not
be paid for until next quarter, they would appear to have been sold
in this quarter.
The Facts: 1. (Reward) This move would keep Tyler and the sales
force out of hot water (Tyler would receive a $30,000 bonus for mak-
ing sales quotas). 2. (Punishment) Last year someone had done
something similar (insert) and was given a stern reprimand and was
almost fired (but it was swept under the rug).
In the end Tyler decided to ship the products to several good cus-
tomers with the understanding that they would not have to pay for
the product until they needed it.
(Decision) Answering as honestly and thoughtfully as possible,
how likely do you think you would make the same decision as Tyler?
1 2 3 4 5 6 7