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Management accountants and ethical dilemmas: How to promote ethical intention?

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Abstract

Multiple incidents of misconduct have strengthened the need to foster ethical behavior in organizations. Unfortunately, the reasons why some people tend to ignore ethical considerations are largely unclear. In particular, comprehensive analyses in the context of management accounting are still rare. As a distinctive characteristic, our study therefore aims at generating more knowledge about the driving factors in ethical decision-making processes of professional management accountants and thus complements findings of experimental studies in other fields. Based on survey data from 90 international management accountants, we find evidence that the ethical environment strongly affects management accountants’ tendency not to engage in ethically questionable behavior. In detail, our results support the notion that the connection between ethical awareness and the intention to engage in ethically questionable behavior is rather indirect and also mediated by the level of ethical experience, i.e., individuals’ exposure to ethical role models in organizations. In sum, our research study helps to disentangle the ethical decision-making process of professional management accountants and illustrates that ethical environments are necessary to enforce adequate ethical behavior.

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Notes

  1. In line with Jones (1991), we use the terms moral and ethical interchangeably. For the terms’ etymological similarity see, e.g., Fischer (1990).

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  1. Heinrich Heine University Düsseldorf, Universitätsstraße 1, 40225, Düsseldorf, Germany

    Tabea Franziska Hirth-Goebel & Barbara E. Weißenberger

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Appendix

Appendix

1.1 Results of scenario 2 (individual benefit)

See Tables 5, 6, 7 and 8, Fig. 4.

Table 5 Results of the measurement models
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Table 6 Discriminant validity check and correlations
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Table 7 Cross-loadings
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Table 8 Results of the structural model
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Fig. 4
figure 4

Results of the structural model

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figure a
figure b
figure c

1.2 Multi-item constructs

Label

Item

Ethical experiencea (RC)

EE_1

Successful people in our company are generally more unethical than less successful ones

EE_2

In order to be successful in the long run, it is often necessary to compromise one’s ethics

EE_3

Successful people tend to withhold information that might be detrimental to their own self-interests

EE_4

Successful people tend to look for a “scapegoat” when they feel they may be associated with failure

EE_5

Successful people in our company often take credit for the achievements of others

Ethical awarenessb

EA_1

Our employees are aware of ethical issues related to their job

EA_2

Our employees are able to recognize ethically questionable issues

EA_3

If regulations are broken, our employees are quick to notice

EA_4

Our employees are sensitive to ethically questionable activities

EA_5

Our employees pay attention to ethical issues

Short-term profit orientationc

SO_1

The most important thing for a company is to make a profit, even if it means bending or breaking the rules

SO_2

To remain competitive in a global environment, companies have to disregard ethics and social responsibility

SO_3

If the survival of a company is at stake, ethics and social responsibility must be ignored

  1. aPlease indicate the extent to which the following statements apply to the behaviour you perceive of your company’s employees. Scale from 1 (does not apply at all) to 6 (does completely apply). Empirical item min. = 1; empirical item max. = 6
  2. bPlease indicate the extent to which the following statements apply to the working climate in your company. Scale from 1 (does not apply at all) to 6 (does completely apply). Empirical item min. = 1; empirical item max. = 6
  3. cPlease indicate to what extent you agree with the following statements. Scale from 1 (completely disagree) to 6 (completely agree). Empirical item min. = 1; empirical item max. = 5

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Hirth-Goebel, T.F., Weißenberger, B.E. Management accountants and ethical dilemmas: How to promote ethical intention?. J Manag Control 30, 287–322 (2019). https://doi.org/10.1007/s00187-019-00288-7

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