Skip to main content
SpringerLink
Log in

Analysing the Effects of Unethical Culture and Organizational Commitment on Employees’ and Managers’ Unethical Behaviours: Evidence from Turkish Insurance Industry

  • Chapter
  • First Online:
Regulations and Applications of Ethics in Business Practice

Abstract

A successful business is dependent on the trust of all types of stakeholders within an organization—employees, managers, executives, customers, and suppliers. Today, ongoing changes in consumer expectations, human relations in task environment, and technological advancements continue to affect the dynamics of service industry. Ethical conduct, in this sense, has become a major component of doing business. A company’s ethics helps to shape the behaviour of its employees, since leaders at the top of organizations are the key role models for establishing and improving the ethical climate. Employees’ work-related attitudes and behaviours are sensitive to the climate they are engaged. Whether it is for organizational, legal, or personal reasons, ethics cannot be ignored, and this is particularly true for the insurance industry. Recent scandals have demonstrated that unethical behaviour can be costly to the company. The study aims to examine the relation between organizational commitment, unethical culture, and the unethical behaviour of employees and managers working in the insurance industry. A survey was conducted to test these hypotheses. The sample of the survey represents white-collar workers (N = 250) who work in various branches in insurance companies in Istanbul. The findings reveal that there is a positive relation between unethical culture and managerial unethical behaviour and employee unethical behaviour. However, organizational commitment has no effect on employee unethical behaviour, while it affects employees’ unethical behaviour.

This is a preview of subscription content, log in via an institution to check access.

Access this chapter

Log in via an institution
Chapter
USD 29.95
Price excludes VAT (USA)
  • Available as PDF
  • Read on any device
  • Instant download
  • Own it forever
eBook
USD 99.00
Price excludes VAT (USA)
  • Available as EPUB and PDF
  • Read on any device
  • Instant download
  • Own it forever
Softcover Book
USD 129.99
Price excludes VAT (USA)
  • Compact, lightweight edition
  • Dispatched in 3 to 5 business days
  • Free shipping worldwide - see info
Hardcover Book
USD 199.99
Price excludes VAT (USA)
  • Durable hardcover edition
  • Dispatched in 3 to 5 business days
  • Free shipping worldwide - see info

Tax calculation will be finalised at checkout

Purchases are for personal use only

Institutional subscriptions

References

  • Adam AM, Rachman-Moore D (2004) The methods used to implement an ethical code of conduct and employee attitudes. J Bus Ethics 54:225–244

    Article  Google Scholar 

  • Balch DR, Armstrong RW (2010) Ethical marginality: The Icarus syndrome and banality of wrong doing. J Bus Ethics 92(2):291–303

    Article  Google Scholar 

  • Bellizzi JA, Hasty RW (2003) Supervising unethical sales force behavior: how strong is the tendency to treat top sales performers leniently. J Bus Ethics 43(4):337–351

    Article  Google Scholar 

  • Birch D (2004) Doing business in new ways: corporate community partnerships. In: Sengupta S (ed) Business-social partnerships: an international perspective. Aalekh Publishers, Jaipur, India

    Google Scholar 

  • Bommer M, Gratto C, Gravander J, Tuttle M (1987) A behavioral model of ethical and unethical decision making. J Bus Ethics 6:265–280

    Article  Google Scholar 

  • Brass DI, Butterfield KD, Skaggs BC (1998) Relationships and unethical behavior: a social network perspective. Acad Manag Rev 23(1):14–31

    Article  Google Scholar 

  • Buckley MR, Beu DS, Frink DD, Howard JL, Berkson H, Mobbs TA, Ferris GR (2001) Ethical issues in human resources systems. Human Res Manag Rev 11:11–29

    Google Scholar 

  • Carroll AB (2000) Models of management morality for the New Millennium’. Bus Ethics Q 11(2):365–371

    Article  Google Scholar 

  • Cassell C, Johnson P, Smith K (1997) Opening the black box: corporate codes of ethics in their organizational context. J Bus Ethics 16:10–24

    Article  Google Scholar 

  • Chang MK (1998) Predicting unethical behavior: a comparison of the theory of reasoned action and the theory of planned behavior. J Bus Ethics 17:1825–1834

    Article  Google Scholar 

  • Clark MA, Leonard SL (1998) Can corporate codes of ethics influence behavior? J Bus Ethics 17:619–630

    Google Scholar 

  • Cooper RW, Frank GL (1991) Ethics in the life insurance industry: the issues, helps and hindrances. J Am Soc CLU & ChFC 45:54–66

    Google Scholar 

  • Cooper RW, Frank GL (2002) Ethical challenges in the two main segments of the insurance industry: key consideration in the evolving financial services market place. J Bus Ethics 36:5–20

    Article  Google Scholar 

  • Corbin D (2006) Establishing ethics for insurance professionals. Insur J. Retrieved from http://www.insurancejournal.com/magazines/features/2006/09/04/152461.htm

  • Crittenden VL, Hanna RC, Peterson RA (2009) Business students’ attitudes toward unethical behavior: a multi-country comparison. Mark Lett 20:1–14

    Article  Google Scholar 

  • Crosby LA, Evans KR, Cowles D (1990) Relationship quality in services selling: an interpersonal influence perspective. J Mark 54:68–81

    Article  Google Scholar 

  • Cullen JB, Parboteeah KP, Victor B (2003) The effects of ethical climates on organizational commitment: a two-study analysis. J Bus Ethics 46(2):127–141

    Article  Google Scholar 

  • Diacon SR, Ennew CT (1996a) Ethical issues in Insurance marketing in the UK. Eur J Mark 30(5):67–80

    Article  Google Scholar 

  • Diacon SR, Ennew CT (1996b) Can business ethics enhance corporate governance? Evidence from a survey of UK executives. J Bus Ethics 15:623–634

    Article  Google Scholar 

  • Dozier JB, Miceh MP (1985) Potential predictors of whistle-blowing: a prosocial behavior perspective. Acad Manag Rev 10:823–836

    Article  Google Scholar 

  • Egri CP, Ralston DA (2008) Corporate responsibility: a review of international management research from 1998 to 2007. J Int Manag 14(4):319–339

    Article  Google Scholar 

  • Federwisch A (2006) Ethical issues in the financial services industry. Santa Clara University web site http://www.scu.edu/ethics/practicing/focusareas/business/financial-services.html

  • Ferrell OC, Fraedrich J (1990) Understanding pressures that cause unethical behavior in business. Bus Insights, Spring/Summer, pp 1–4

    Google Scholar 

  • Fritz JMH, Arnett RC, Conkel M (1999) Organizational ethical standards and organizational commitment. J Bus Ethics 20:289–299

    Article  Google Scholar 

  • Garrison R, Noreen E, Brewer P (2012) Managerial accounting, 13th ed. Mc-GrawHill, US. ISBN: 9781259028526

    Google Scholar 

  • Georgescu MA (2012) Emerging markets queries in finance and business ethics and organizational values in Romanian enterprises. Proc Econ Financ 3:734–739

    Article  Google Scholar 

  • Gibbs PT (1993) Customer care and service: a case for business ethics. Int J Bank Mark 11(1):26–33

    Article  Google Scholar 

  • Gonzales J (2013) The importance of being ethical in the insurance industry, business. http://www.noozhawk.com/article/joanne_gonzales_being_ethical_in_the_insurance_industry_20130723

  • Gunthorpe DL (1997) Business ethics: a quantitative analysis of the impact of unethical behavior by publicly traded corporations. J Bus Ethics 16:537–543

    Article  Google Scholar 

  • Head GL (2008) Ethics and the insurance agent: “C’mon, Little Sister!”, IRMI http://www.irmi.com/expert/articles/2008/head02.aspx 15 Nov, 2013

  • Hegarty WH, Sim HP Jr (1978) Some determinants of unethical decision behavior: an experiment. J Appl Psychol 63(4):451–457

    Article  Google Scholar 

  • Herndon NC Jr, Fraedrich JP, Yeh Q (2001) An investigation of moral values and the ethical content of the corporate culture: Taiwanese versus U.S. sales people. J Bus Ethics 30:73–85

    Article  Google Scholar 

  • Howe V, Hoffman KD, Hardigree DW (1994) The relationship between ethical and customer-oriented service provider behaviors. J Bus Ethics 13:497–506

    Article  Google Scholar 

  • Huhtala M et al. (2013) Ethical organisational culture as a context for managers’ personal work goals. J Bus Ethics 114(2):265–282

    Article  Google Scholar 

  • Hunt SD, Wood VR, Chonko LB (1989) Corporate ethical values and organizational commitment in marketing. J Mark 53:79–90

    Article  Google Scholar 

  • Jones GE, Kavanagh MJ (1996) An experimental examination of the effects of individual and situational factors on unethical behavioral intentions in the workplace. J Bus Ethics 15:511–523

    Article  Google Scholar 

  • Jose A, Thibodeaux MS (1999) Institutionalization of ethics: the perspective of managers. J Bus Ethics 22:133–143

    Article  Google Scholar 

  • Key S (1999) Organizational ethical culture: real or imagined? J Bus Ethics 20 (3) 217–225

    Google Scholar 

  • Koh HC, Boo EHY (2001) The link between organizational ethics and job satisfaction: a study of managers in Singapore. J Bus Ethics 29:309–324

    Article  Google Scholar 

  • Kurland NB (1996) Sales agents and clients: ethics, incentives, and a modified theory of Planned Behavior. Hum Relat 49:51–74

    Article  Google Scholar 

  • Marcum WM, Robin DP (2003) Accessing and understanding the ethical attitudes of insurance practitioners. CPCU eJournal 58(5):1–14

    Google Scholar 

  • Mowday RM, Steers R, Porter L (1979) The measurement of organizational commitment. J Vocat Behav 14:224–247

    Article  Google Scholar 

  • Oakes G (1990) The sales process and the paradoxes of trust. J Bus Ethics 9:671–679

    Article  Google Scholar 

  • Öncer AZ, Yıldız ML (2012) The impact of ethical climate on relationship between corporate reputation and organizational identification. Proc-Soc Behav Sci 58:714–723

    Article  Google Scholar 

  • Oz E (2001) Organizational commitment and ethical behavior: an empirical study of information system professionals. J Bus Ethics 34(2):137–142

    Article  Google Scholar 

  • Pike D (1980) How inflation brings out the criminal urge. U.S. News & World Report 8:56

    Google Scholar 

  • Porter LW, Steers RM, Mowday RT, Boulian PV (1974) Organizational commitment, job satisfaction, and turnover among psychiatric technicians. J Appl Psychol 59:265–288

    Article  Google Scholar 

  • Schminke M, Ambrose ML, Neubaum DO (2005) The effect of leader moral development on ethical climate and employee attitudes. Organ Behav Hum Decis Process 97(2):135–151

    Article  Google Scholar 

  • Schwepker CH Jr (1999) understanding salespeople’s intention to behave unethically: the effects of perceived competitive intensity, cognitive moral development and moral judgment. J Bus Ethics 21:303–316

    Article  Google Scholar 

  • Schwepker CH Jr (2001) Ethical climate’s relationship to job satisfaction, organizational commitment, and turnover intention in the salesforce. J Bus Res 54:39–52

    Article  Google Scholar 

  • Shi J, Fan L, Zhou Z (2007) An empirical study on the difference of corporate ethical climate and unethical behavior in China, Studies in Science of Science

    Google Scholar 

  • Sims RL, Kroeck KG (1994) The influence of ethical fit on employee satisfaction, commitment and turnover. J Bus Ethics 13:939–947

    Article  Google Scholar 

  • Sims RR (1992) The challenge of ethical behavior in organizations. J Bus Ethics 11:505–513

    Article  Google Scholar 

  • Sims RR, Brinkmann J (2002) Leaders as moral role models: the case of John Gutfreund. J Bus Ethics 35:327–339

    Article  Google Scholar 

  • Sinclair A (1993) Approaches to organizational culture and ethics. J Bus Ethics 12:63–73

    Article  Google Scholar 

  • Somers MJ (2001) Ethical codes of conduct and organizational context. A study of the relationship between codes of conduct, employee behavior and organizational values. J Bus Ethics 30:185–195

    Article  Google Scholar 

  • Stead WE, Worrell DL, Stead JG (1990) An integrative model for understanding and managing ethical behavior in business organizations. J Bus Ethics 9(3):233–242

    Article  Google Scholar 

  • Tang TP, Chiu RK (2003) Income, Money ethic, pay satisfaction, commitment, and unethical behavior: is the love of money the root of evil for Hong Kong employees? J Bus Ethics 46:13–30

    Article  Google Scholar 

  • Tenbrunsel AE, Messick DM (2004) Ethical fading: the role of self-deception in unethical behavior. Soc Justice Res 17(2):223–236

    Article  Google Scholar 

  • Trevino LK, Butterfield KD, McCabe DL (1998) The ethical context in organizations: influence on employee attitudes and behaviors. Bus Ethics Q 8:447–476

    Article  Google Scholar 

  • Valentine S, Barnett T (2003) Ethics code awareness, perceived ethical values, and organizational commitment. J Pers Sell Sales Manag 23:359–367

    Google Scholar 

  • Van Zyl E, Lazenby K (2002) The Relation between ethical behaviour and workstress amongst a group of managers working in affirmative action positions. J Bus Ethics 40:111–119

    Article  Google Scholar 

  • Vitell SJ, Paolillo JGP, Singh J (2006) The role of money and religiosity in determining consumers’ ethical beliefs. J Bus Ethics 64(2):117–124

    Article  Google Scholar 

Download references

Author information

Authors and Affiliations

  1. School of Banking and Insurance, Marmara University, Istanbul, Turkey

    Melisa Erdilek Karabay

  2. Faculty of Business Administration, Gebze Technical University, Gebze, Turkey

    Meral Elçi

  3. School of Banking and Insurance, Marmara University, Istanbul, Turkey

    Özgür Akpınar

Authors
  1. Melisa Erdilek Karabay
    View author publications

    You can also search for this author in PubMed Google Scholar

  2. Meral Elçi
    View author publications

    You can also search for this author in PubMed Google Scholar

  3. Özgür Akpınar
    View author publications

    You can also search for this author in PubMed Google Scholar

Corresponding author

Correspondence to Melisa Erdilek Karabay .

Editor information

Editors and Affiliations

  1. SOAS, University of London, London, United Kingdom

    Jing Bian

  2. Trakya University, Edirne, Turkey

    Kıymet Tunca Çalıyurt

Rights and permissions

Reprints and permissions

Copyright information

© 2018 Springer Nature Singapore Pte Ltd.

About this chapter

Check for updates. Verify currency and authenticity via CrossMark

Cite this chapter

Erdilek Karabay, M., Elçi, M., Akpınar, Ö. (2018). Analysing the Effects of Unethical Culture and Organizational Commitment on Employees’ and Managers’ Unethical Behaviours: Evidence from Turkish Insurance Industry. In: Bian, J., Çalıyurt, K. (eds) Regulations and Applications of Ethics in Business Practice. Accounting, Finance, Sustainability, Governance & Fraud: Theory and Application. Springer, Singapore. https://doi.org/10.1007/978-981-10-8062-3_6

Download citation

Publish with us

Policies and ethics

Search

Navigation