2 peer reviews - paper

ABSTRACT

Ethics in organizational settings is a constant topic in today’s society. With unethical behavior being reported in the news frequently such as whistleblowers coming forward and CEO unethical behaviors being surfaced, the subject of ethical workplace cultures is becoming more predominant then ever. The literature review conducted was executed to respond to the question of what strategies do C-suit executives employ to promote ethics and prevent address unethical behaviors? Additionally, history and relevant research related to the topic would be gathered and used to support future research such qualitative research towards identifying a common set of strategies used by executives perceived to make a positive impact within their organizations. AAsS a result of the literature review, five central themes emerged: executive ethical leadership behavior as a focus area needing study, ethical leadershi behaviors which influence organizational climate, ethical climate as a distinct climate within companies, ethical culture, a distinct outcome of climate and leadership behaviors, and the impact the aforementioned themes have on organizational outcomes. Several future research implications are drawn from the literature review as well as an emerged conceptual model capturing the central themes of the review.

INTRODUCTION

Striving for an ethical workplace culture continues to be a common interest and subject matter across industries and academic studies. The notion of ethical companies (Chadegani, and Jari, 2016) and the relevancy to focus areas such as leadership (Bello, 2012; Yang, 2014; Krapfl and Kruja, 2015; Moore, Mayer, Chiang, Crossley, Karlesky, and Birtch, 2018), and turnover (Kangas, Kaptein, Huhtala, Lämsa, Pihlajasaari, and Feldt, 2018) is being studied both by ethicists, psychologists, human resource professionals, economists, and academics in schools of business. The literature points to a relationship between leadership and ethics in the workplace, mainly the leader’s behaviors influencing the behaviors of other workers. A recent paper by Broadhead, Quigley, and Cox (2018) described means of evaluating ethical values of an organization, a subject matter in itself studied greatly (Tyler, 2005; Chen, Sawyers, and Williams, 1997) which includes leadership behaviors. The purpose of the current research was to conduct a literature review focused on what leadership behaviors, organization processes and systems promote ethical workplace cultures, as well as prevent and address unethical behaviors.

Within the human service industry, ethics is at the very core of the professionals practicing given the nature of their work serving clients with specific needs such as drug addiction, developmental disabilities, and mental health to name a few. Human service professionals enter their career with ethics being a central focus, realized by the various codes of ethics practitioners must adhere to (Workers, 2008; Behavior Analyst Certification Board, 2014; American Psychological Association, 2017). Professionals in human services hold various certifications and licensures which includes codes of ethics. Their commitment to their profession, adherence to their codes of ethics, and moving beyond compliance to more proactive or preventive ethics (Winfield, Sparkman-Key and Vajda, 2017) is becoming more prevalent in the industry than ever before. Many professionals work for companies which more than likely have their own code of conduct with regards to ethics. However, because the individual professionals must adhere to their codes of ethics, potential conflict may arise if the organizations code of conduct or even the preventive measures to create an ethical workplace culture may in fact conflict with the individuals code of ethics.

This literature review focused on ethical workplace cultures, climates, and ethical leadership, specifically from the perspectives of executives of organizations. The study explored the focus area as described and relevant theoretical ideologies. The literature review included reviews of publications in academic journals in the areas of business, ethics and organizational behavior. In addition, the literature review will include relevant published works (books, magazine) and other relevant sources (i.e., conference presentations, white papers). The research question explored was what strategies do C-suit executives employ to promote ethics and prevent address unethical behaviors? The goal was to gather and present in a clear and concise manner history and relevant research related to the topic. In addition, the literature review was intended to support follow up qualitative research towards identifying a common set of strategies used by C-level executives that are perceived to make a positive impact within their organizations in the area of ethical behavior.

METHOD

The review was open in exploration across various sample populations, however focused attention was given to search findings where sources included the sample population of “executives,” individuals with job titles such as Director, Vice President, President, or beginning with the word Chief such as Chief Operating Officer and Chief Executive Officer. The literature review was also focused on the specific industry of human services, as this industries include individuals credentialed by an external governing body with a code of ethics (e.g., psychologists, psychiatrists, counselors, behavior analysts, speech language pathologists, medical doctors, nurses), hypothesizing a greater likelihood of ethics being integrated within the organization policies, procedures and practices, including leaderships focus. The literature review was conducted using ABI/Inform Global, and JSTOR databases, as well as the University of South Florida’s Library services “Find It!” search function.

The author selected scholarly journals as the source type, and a publication date of 2000 – 2019. The key words “ethical workplace culture,” were used in the search fields. Advanced search fields were used applying key words “human services,” and “executive.” The search was conducted over a period of four weeks by the author. With the above filters, the author listed the top 5 journals identified in the searches based on the final advanced search using “Ethical Workplace Culture AND Executive AND Human Services” filtering for scholarly journals only and from 2000 to 2019. Articles were then selected and prioritized for full review based on titles, abstracts, and the word “ethics” within the title and/or as the focus of the article in the abstract versus other topics. The author prioritized the articles selected after reading the abstracts, verifying focus of the article was based on the key word search, and the variables of interest or conceptual topic was relevant to the scope of the research question. The prioritization included the additional nine articles recommended by colleagues of the author, which met the criteria.

FINDINGS FROM THE LITERATURE SEARCH

The literature review conducted began with the search described in the methods section. Table 1 illustrates the number of articles found on April 17, 2019 using the key word and advance key words. Between ABI/Inform Global and the USF Libraray Services “Find It!” the following Scholarly Journals were identified as having the highest number of relevant articles based on the key words and search criterion: Journal of Business Ethics (979), The Journal of Management Development (86), The Journal of Economic History (79), Leadership and Organization Development Journal (71), Personnel Review (58), Public personnel management (4), International journal of knowledge, culture, and change in organizations annual review (2), Business ethics: a European review (2), Society for Advancement of Management Journal (3), and Bharati Vidyapeeth’s Institute of Management Studies and Research (bvimsr) journal of work and organizational psychology (1). JSTOR labeled the findings under subject matter, with six subjects providing the majority of the findings: Business (780), Philosophy (413), Law (255), Management and Organizational Behavior (216), Sociology (162), and Political Science (131).

Table 1: Publication Course Paper Literature Review Search Results, Search ran on April 17, 2019.

Articles were selected and prioritized for full review based on titles, abstracts, and the word “ethics” within the title and/or as the focus of the article in the abstract versus other topics. Twenty-two (22) articles were chosen from JSTOR, seven (7) from the USF Library services “Find It!,” and an additional nine (9) articles were found by the author outside of the formal search through recommendations by colleagues and were articles not part of the search results when using the data bases due to different date range used and the key words identifying these nine articles. No articles were selected from the ABI/Inform Global search as there were duplicate findings from articles already selected from the JSTOR search, while other articles did not appear readily relevant to the scope of the literature review.

The searches yielded three (3) common themes related to the scope of this research and specifically the subject matter of Ethical Workplace Cultures: definitions of ethical workplace culture, leaderships role, culture and climate. During the review of the articles, relevant historical literature was also reviewed and integrated into the current paper to support the scope of this work. The literature review will summarize the findings using these common themes. The literature review will conclude with limitations and future research implications.

Definitions of Ethical Workplace Culture

Leadership

The subject matter of leadership behaviors contributing to unethical behavior contributes to the literature on ethical workplace cultures. Litzky, Eddleston, and Kidder (2006) review triggers and costs to employee deviant behaviors such as violating standards, stealing, and hostile behavior. The researchers illustrated triggers and costs with relation to types of workplace deviance, recreated here in Figure 1. Litzky et. al. (2006) describe six factors “under managers’ control” which can encourage deviant behaviors: “1) the compensation/reward structure, 2) social pressures to conform, 3) negative and untrusting attitudes, 4) ambiguity about job performance, 5) unfair treatment, and 6) violating employee trust (page 93).

Figure 1: Triggers/cost related to workplace deviance, recreated from original Litzky, et. al. (2006)

The term “ethical leadership” continues to be a standalone subject of interest by researchers and organizations alike (Yang, 2014; Zoghbi-Manrusique-de-Lara and Suárez-Acosta, 2014). Brown, Treviño, and Harrison (2005) define ethical leadership “as the demonstration of normatively appropriate conduct through personal actions and interpersonal relationships, and the promotion of such conduct to followers through two-way communication, reinforcement and decision-making” (page 120). The definition provides a construct based on social learning theory focused on three behaviors: leaders modeling ethical conduct, and encouraging ethical conduct through communication, reinforcement and making ethical decisions. Resick, Hanges, Dickson, and Mitchelson (2006) reinforce the definition of ethical leadership “focuses on how leaders use their social power” (page 346). Their research took a cross-cultural approach to ethical leadership, evaluating four dimensions: character/integrity (demonstrating a pattern of ethical behavior), altruism (“engaging in behaviors intended to help others without expecting any external rewards” (page 347)), collective motivation (the interest of the group comes before an individuals interest), and encouragement (reinforcing others to be “self-sufficient” (page 347)). Resick et. al. (2006) used data from the Global Leadership and Organizational Behavior Effectiveness (GLOBE) program as a basis for their study, which included “17,000 middle managers from 931 organizations in 62 different societies and three different industries” (page 349). Data related to ethical leadership was obtained as part of the GLOBE’s process using “scales designed to assess organizational culture…[and] scales designed to examine societal culture” (page 349). As a result, the researchers found the four components of ethical leadership were supported across the cultures, and leaders were perceived as effective across cultures with these behaviors (page 354). Resick et. al. (2006) further conclude stating “each of the ethical leadership dimensions…focuses on leading in a positive or people-focused manner. When combined, these dimensions reflect leading in a manner that is respectful of the rights and dignity of others - that is, ethical leadership” (page 357).

A few theories on leadership seem to support ethical leadership. Transformation leadership describes leaders posing influence power over others, demonstrated by interpersonal behaviors. Followers of the transformational leader develop moral principles similar to the leader given the positive influence transformational leaders look to achieve (Bass and Steidlmeier, 1999). Authentic leadership (George, 2003; Avolio and Gardner, 2005) also has similarities to ethical leadership. Authentic leadership focuses on integrity, honesty and self-awareness. Yang (2014) points out “despite the similarity…these types of leadership contribute to only a part of ethical leadership” (page 514). Yang (2014) also references social identity theory having relevancy to ethical leadership. Taijfel (1982) raised how the relationship between individuals creates both a sense of belonging and divide. Walumbwa suggests social identity theory explains how ethical leadership leads to employee outcomes related to behaviors linked to the organization’s values. Yang (2014) also suggests the leader-member exchange theory as relevant to ethical leadership, proposing it’s focus on the interaction between manager and employees being a good “predictor of outcomes of not only the individual, but also of the subunit and organization” (page 515). Yang (2014) argues the relationship between “…leaders of an organization and its members is crucial…” however few studies have explored the reflection on “…ethical status of their supervisors” (page 515). These theorems were the basis of Yang (2014) exploring the framework of ethical leadership supporting job satisfaction, employee well-being, and life satisfaction of employees, illustrated in the researchers model (see figure 3).

Ethical Leadership

Employee well-being

Job Satisfaction

Life Satisfaction

Figure 3: Research Framework from Yang (2014).

Research has also explored antecedents to ethical leadership predicting ethical behavior of others. Mayer, Acquino, Greenbaum, and Kuenzi (2012) found an antecedent of ethical leadership to be “moral identity,” a construct related to demonstrating traits such as honesty, caring, compassion, and hard-work ethic. A finding from Mayer et. al. (2012) was the suggestion that “finding ways to reinforce or activate leaders’ moral identities may be one way to promote ethical behaviors” (page 166). Activating moral identities could take the form of various antecedents such as symbols, slogans and prompts. Mayer et. al. (2012) also presume moral identities are self-motivating and can be maintained through avoidance of “feeling inauthentic” (page 166). Simha and Cullen (2012) discuss exploring strategic and managerial orientations as antecedents to ethical climates (page 23).

Trevino, Brown, and Pincus (2003) conducted a qualitative analysis of the perceptions of executive ethical leadership. The informant-based interview included both senior executives and corporate ethics officers to learn what constitutes ethical leadership due to the limited empirical evidence at the time, a reason why the researchers chose a qualitative informant-based interview approach (Trevino, et. al., 2003, page 8). The research included perspectives from within the senior executive suite as well as outside perspectives, mostly from the corporate ethics officers. Forty (40) interviews, evenly distributed between senior executives and corporate ethics officers, were conducted with medium to large organizations from the United States of America (Trevino, et. al., 2003, page 9). The authors reported broad themes from the interviews categorized as people orientation (i.e., respect, “walk the talk,” honesty, modeling), setting ethical standards and accountability (i.e., setting expectations and rules, use of rewards and punishment, institutional values), broad ethical awareness (i.e., greater good, long term concerns, bottom line concerns, quality and value to customers), decision-making processes, and miscellaneous categories such as personal morality being related to ethical leadership, ethics being top down however can also be bottom up surfaced but inconsistent in responses (Trevino, et. al., 2003, page 15-16). The contribution of this research were the categories being more applied focused versus “…traits such as integrity” and conceptually “…exceptional forms of leadership (such as transformational or charismatic leadership),” however, the research do note overlap between their findings and “…transformational leadership dimensions” (Trevino, et. al., 2003, page 21).

Wu, et. al. (2015) studied the relationship CEO leadership with regards to ethics and corporate social responsibility. The authors described a lack of attention on the “relationship between CEO ethical leadership and corporate social responsibility” which is focused on organizational economics, social and environmental performance (page 819). The authors further state how “research has argued that establishing an organizational culture is a fundamental function of an ethical leader” (page 819), describing the link to social learning theory (Bandura, 1977). Wu, et. al. (2015) provided a conceptual model for their study, illustrating the connection between the CEO founder status, CEO ethical leadership, organizational ethical culture, and corporate social responsibility. Figure 2 is a recreation of the conceptual model. The research used a questionnaire survey of Chinese firms “as a part of a comprehensive research project centering on CEO leadership and business strategy in China” (page 823). CEO ethical leadership was measured using a ten-item scale from Brown et. al. (2005), a nine-item scale developed by Key (1999) was used to measure organizational ethical culture, and a seven-point scale by Turker (2009) was used to measure corporate social responsibility. As the authors note, a main contribution of their study is related to managerial discretion as a moderator of CEO ethical leadership (Wu, et. al., 2019, page 827). Additionally, the “model of CEO ethical leadership…provides a generative framework for future research that focuses on the firm consequences of CEO ethical leadership (Wu, et. al., 2019, page 827).

Culture versus Climate

Raile, E.D. (2013) describes the difference between organizational culture and climate, which admittingly he states, “remains subject to some ambiguity” (page 253). As Raile (2013) mentions, organizational culture is typically viewed to focus on stability, values-based, outcomes of the organization based on connections between individuals and the environment. Organizational Climate however is viewed as “temporary, better defined, easier to measure, and more controllable” (Raile, 2013 pp 253-254). Defined as “…the shared perceptions of procedures, policies, and practices, both formal and informal, of the organization” (Reichers & Schneider, 1990; Schneider, 1975, 1983), organizational climate has a major influence on the organizational culture. “The notion of organization climate is related to ethics in that literature speakers to Ethical climates as one type of work climate” (Raile, 2013), including the idea “1) that ethical climates involves shared perceptions of group norms related to organizational policies, procedures and practices, and 2) that these norms deal with distinctions between right and wrong behavior within the organization” (page 254). Because of the nature of ethics, it would appear it is more desirable to establish an ethical workplace climate to ensure stability and organizational outcomes, a premise made strong by Simha and Cullen (2012).

Simha and Cullen (2012) describe ethical climate theory based on the works of Victor and Cullen (1987,1988) consisting of two dimensions: ethical philosophy and sociological theory. Ethical philosophy provides the foundation of three criterion: egoism (self-interest), benevolence (decisions and actions for the greater good), and principle (in accordance with laws, rules, codes and procedures) (Simha and Cullen, 2012, page 21). The sociological theory comprises of three “loci: individual, local, and cosmopolitan” (Simha and Cullen, 2012, page 21). This theory is about decision making per individual beliefs and values, the organization, and the society at large (Simha and Cullen, 2012). The work by Simha and Cullen (2012) describes organizational outcomes related to ethical climates such as ”job satisfaction, organizational commitment, turnover intentions, ethical behavior, and dysfunctional behavior” (page 24).

Litzky et. al. (2006) describe how “ethical organizational climate” support improving the triggers for deviant behaviors (page 97). Organizational climate includes organizational systems such as structure, reward, and standards, and reactions to those systems (Litzky, et. al., 2006). It has been argued that climates emphasizing ethical behavior have less deviant behavior. Research has also described how management behaviors have strong influence on employee decision making when it comes to ethics (Treviño and Brown, 2005), which is reinforced heavily by Litzky et. al. (2006). In addition to establishing a ethical organizational climate, Litzky, et. al. (2006) described fostering relationships based on trust and respect and implementing rules and reward systems also improve deviant behavior (pages 98-99). Huhtala et. al. (2014) studied employee perceptions of organizational culture, and the relationship between the culture and well-being regarding burnout and work engagement. Based on qualitative survey data using the Corporate Ethical Virtues questionnaire (Kaptein, 2008) with 2,146 respondents, the researchers found shared experiences at departmental levels supported ethical culture perceptions, and positive perceptions of ethical cultures contributed to low burnout and high engagement.

Ardichvili, Mitchell, and Jondle (2019) identified characteristics of ethical business cultures by executives across several industries. The authors now research describes how ethical cultures “are based on alignment between formal structures, processes, and policies, consistent ethical behavior of top leadership, and informal recognition of heroes, stories, rituals, and language that inspire organizational members to behave in a manner consistent with high ethical standards that have been set by executive leadership (Ardichvili et. al., 2019, page 446). The authors explored their research on Executives perspective on what are the most important characteristics of ethical business cultures using grounded theory to gather data through field investigation (Ardichvili et. al., 2019, page 446). Using an informant-based interview method, 67 participants, including 54 executives, representing 8 industries and academia. The research identified five characteristics: Mission-and values driven, stakeholder balance, leadership effectiveness, process integrity, and long-term perspective (Ardichvili et. al.,2019, page 448).

LIMITATIONS

The literature review limitations are related to scope of the search, lack of findings specific to the human service industry, and the broadness of the subject matter. Much of the literature reviewed were conceptual, theoretical, and broadly covering ethics, ethical workplace culture, ethical climates, and ethical leadership. The theorems several of the articles cited were consistent in usage, exploring various theorems in total however a great deal of overlap. The participants in the mostly qualitative research reviewed were across various industries, and geographies, and positions of participants, however no literature was found on the subject matter (ethical workplace cultures) within the targeted industry of this search (human services) with the targeted participants (executives). This could be do the another limitation being the scope of the search of the years 2000-2019, the subject matter itself being very broad, and the subject matter being focused mainly in journals and authors focused on different industries or researching across industries. A final limitation to the literature review was the inconsistent definitions of ethical workplace climate versus culture, and variations of the terms (i.e., ethical climate, ethical workplace culture). However, reviewing the subject matter of climate versus culture was helpful to further evaluate literature related to the research question.

FUTURE RESEARCH IMPLICATIONS

The literature review proved useful to identify future research implications related to the authors original research question of what strategies do c-suite executives employ to promote ethics and prevent address unethical behaviors? First, exploring perceptions of ethical executive leadership behaviors in comparison to strategies used by executives to promote ethics and prevent/address unethical behaviors is an avenue for future research. Trevino, et. al. (2003) proposed using more “…complex and precise measures of the ethical dimension of executive leadership” such as posing survey questions on “…which dimensions of executive leadership are most important and how they work together, what factors influence the development of ethical leadership in executives, and what organizational and employee outcomes it influences” (page 30).

Second, research examining organizational context, leader behavior, and ethics would be valuable research to conduct. Trevino, et. al. (2003) proposed research is needed on “the social context of the organization” related to types of leader behaviors being perceived as ethical or unethical (page 32). Simha and Cullen (2012, page 30) suggests research on the “determination of contextual determinants of ethical behavior”, possibly using the Ethical Climate Index (Arnaud (2010) as a measure used to determine contextual determinants. Third, research on ethical leadership’s relationship with organizational outcomes should be explored. The “…relationship between ethical leadership and leader effectiveness” should be studied, although complex in nature as noted by Trevino, et. al. (2003, page 32). Fourth, research related to the original scope of the authors research question on strategies to promote ethical behavior is needed. Simha and Cullen (2012, page 30) suggests research that would result in how-to guidelines to “establish a clear and unambiguous schema for the establishment and management of different ethical climates.”

DISCUSSION (synthesize findings, conceptual theme using a diagram, list of categories or table)

The literature review found two main concepts related to ethical workplace cultures: ethical climates and ethical leadership. The literature review identified more specifically the construct of executive ethical leadership, which as a result of this literature review and be further explored and is the basis of the scope of the authors future line of research. The relationship between executive ethical leadership behavior (distinguished in regards to level in the organization such as director, vice president, CEO), ethical leadership behavior (distinguished in regards to level in the organization such as managers, supervisors, ethical climates and ethical cultures appear to be a central schema from this literature review, as well as the inclusion of organizational outcomes. A conceptual model designed by the author illustrates this in figure 4 with the intent to synthesize the array of research, conceptual papers, and theorems explored on the subject matter.

Figure 4. Conceptual Model as a Result of Literature Review

The literature review supports the need for clear definitions for each element in the conceptual model in figure 4. The ambiguity, inconsistency, and scope of ethics requires precision in research to extract valuable information for business leaders and practitioners. The scope of the literature review was to focus on the Human Service industry to the focus of ethics from both an employee perspective, most employees are credentialed in their profession and follow codes of ethics, and the organizations perspective, most are regulated and perceptions are they are highly ethical due to the nature of their business. However because the literature review did not yield much results in the industry with the scope of ethics from an executive level perspective, the future research proposed can support the industry of human services as well as more broadly organizations of any industry given the scope and need of ethics in the workplace.

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