The Conflict of Ethos and Ethics: A Sociological Theory of Business People’s Ethical Values

Abstract

This article develops a sociological theory of ambivalence to explain several puzzling and contradictory ethical attitudes of business people: (1) a simultaneous disposition to comparatively more self-interested and more charitable behavior than many other occupational groups and (2) a moderate level of receptiveness to inculcation of moral principles through social channels such as higher education. We test the theory by comparing the way that business students rate the ethical acceptability of various ethically challenging scenarios with the way that criminal justice students rate these same scenarios. We also explore the malleability of ethical views by measuring differences between the responses of sophomores and seniors. The data generally support hypotheses based on a theory of ambivalence. At the same time, however, we also report on findings that suggest alternative explanations to ambivalence.

Appendices

Appendix 1

11 Scenarios Where Significance was Found (Table 2)

A. An executive earning $100,000 a year padded his expense account by about $3,000 a year.

H. A company president recognized that sending expensive Christmas gifts to purchasing agents might compromise their positions. However, he continued the policy since it was common practice and changing it might result in a loss of business.

I. A corporate director learned that his company intended to announce a stock split and increase its dividend. On the basis of this information, he bought additional shares and then following the announcement sold them for a gain.

K. An engineer discovered what he perceived to be a product design flaw that constituted a safety hazard. His company declined to correct the flaw. The engineer decided to keep quiet, rather than taking his complaint outside the company.

L. A comptroller selected a legal method of financial reporting which concealed some embarrassing financial facts that would otherwise have become public knowledge.

N. As part of the marketing strategy for a product, the producer changed its color and marketed it as “new and improved,” even though its other characteristics were unchanged.

O. Facing large clean-up costs, a mining company that produces arsenic as a by-product of its regular operations hired research consultants to show that the safe level of arsenic in drinking water is higher than previously believed.

S. Pears, Inc., a large computer manufacturer recently introduced a new line of computers that made their existing line functionally obsolete. Pears, Inc. decided to donate the obsolete computer inventory to a local school district and in so doing, Pears, Inc. received a tax break and improved its image on social responsibility.

V. The board of directors of TTT, Inc., recently approved a policy earmarking 7.5 % of its profits for corporate giving. The funds will come directly out of retained earnings and thereby reduce the payout of dividends to the stockholders of the firm.

Appendix 2

Additional Scenarios Where Significance was Found (Tables 3, 4)

B: In order to increase profits of the firm, a general manager used a production process that exceeded legal limits for environmental pollution.

J: Corporate executive promoted a loyal friend and competent manager to the position of divisional vice president in preference to a better-qualified manager with whom he had no close personal ties.

Q: Jack is a used car salesman who was under pressure from his boss to increase sales in order for the company to survive. In response, he began rolling back odometers and using high-pressure sales tactics.

R: Lester is editor of the Daily Paper, which was running an expose article about defective products being sold by local businesses. One of the owners of these businesses, Shoes, Inc., called Lester and threatened to pull out his advertising in the Daily Paper if the expose mentioned his story by name. Lester agreed to remove the “Shoes, Inc.” name from the article.

T: “Dean is a purchasing agent who has the final say on which suppliers his firm will buy from. Dean let it be known that when price and other things were equal, his purchasing decisions could be swayed by receipt of an “appropriate” gift.”

W: The design department of XYZ Child Corporation recently developed a new, lighter weight baby carrier. The new design is less expensive to manufacture, but has a slightly higher risk of handle collapse which could cause injury to children. XYZ decided to produce and market the carrier anyway.