Business Ethics in Brazil Essay

In this comparative degree survey of 126 brazilian and U.S. wrinkle professionals, we explore the effect of depicted object cultivation on honorable decision reservation inside the context of line of products. apply Reidenbach and Robins (1988) multi-criteria holiness promoter, we examined how these 2 countries differences on Hofstedes laissez gracefule/ socialism Rafik I. Beekun (Ph.D., The University of Texas, Austin) is Professor of management and Strategy in the Managerial Sciences Department at the University of Nevada, Reno. His current search concerns be in the bea of strategic adaptation, the link among field cultures and ethics, and the relationship amidst management and spirituality. He has make in much(prenominal)(prenominal) journals as diary of Applied Psychology, Human Relations, Journal of Management and Decision Sciences. Correspondence dealing this oblige should be sent to him at Managerial Sciences Department, Mail Stop 28, University of N evada, Reno, NV 89557-0206. Yvonne Stedham (Ph.D., University of Kansas) is an connect Professor of Management in the Managerial Sciences Department at the University of Nevada, Reno. She has published in such journals as the Journal of Management and Journal of Management Studies. Dr. Stedhams research cerebratees on the following atomic number 18as CEO performance evaluation, sexual activity discrimination in employment, ethics in communication channel, decision making crosswise cultures, and managing knowledge workers. Jeanne H. Yamamura (CPA, Ph.D., Washington State University) is an Associate Professor of Accounting in the College of rail line at the University of Nevada Reno. Her t apieceing responsibilities include auditing and accounting information systems courses. Dr. Yamamuras research niduses on the management of accounting professionals with a particular interest in cross-cultural differences and her work has been published in accounting and commerce journals. S he has extensive practical experience in the field of accounting by dint of her anterior employment in public and private accounting.Rafik I. Beekun Yvonne Stedham Jeanne H. Yamamura dimension are related to the manner in which strain practiti aners make respectable decisions. Our gos show up that Brazilians and Ameri faecess evaluate the h sensationst content of implements or decisions oppositely when applying utile criteria. By job, business stack from twain countries do not differ Copernicanly when they use egoistic criteria in evaluating the honest nature of business decisions. fundamental WORDS Brazil, egoism, ethics, guinea pig culture, U.S., usefulism As business organizations move from domestic to inter content and transnational competition, they are finding that cultural take to bes vary significantly across national boundaries, and are belike to affect business practices (Husted, 2000). During the bingletime(prenominal) decade, several researchers (Ferrell and Gresham, 1985 Hunt et al., 1989 Abratt et al., 1992 Hunt and Vitell, 1992 Tsalikis and Nwachukwu, 1991 Vitell et al., 1993) allow noted the potential curve of national culture on ethics within a business context. What obscures the impact of national culture on ethics is that business practices whitethorn conflict with ethical time values in a manner that medicine, natural law and government do not (DeGeorge, 1993). Not surprisingly, empirical research analyze the relationship between national culture and ethical decision-making is relatively slender (Vitell et al., 1993). A primary reason for exploring the effects of culture on ethics is the increased globalization of business. This trend, in turn, is characterized by a diverse phalanx of interorganizational arrangements that require cross-cultural inter pull through. As a result, cultural misunderstandings are likely to occur.One of the key areas where such mis- Journal of Business Ethics 42 267279, 2003. 2003 Kluwer Academic Publishers. Printed in the Netherlands. 268 Rafik I. Beekun et al. understandings take place is in the area of ethics, partly because of the influence that national cultures may corroborate upon business ethics (Husted, 2000). consortly, in our study, we explore the relationship between national culture and business ethics. We volition seek to investigate what process underlies ethical port across national boundaries. Understanding this process may help global managers develop tools to kick upstairs ethical behavior in their international workforce. In this research, we compare cardinal cultur solelyy diverse countries, the United States (U.S.) and Brazil, in order to identify similarities and differences with regard to approaches toward ethical decision-making in a business context. Since culture is a abundant concept, it is necessary to specify the values that could be related to behaviors or practices (Husted, 2000). For the purposes of this study, we use a well-established framework of national culture (Hofstede, 1980). Hofstede pick outed unrivalled of the or so important studies that as veritableed the relationship between national culture and management. From this study, he determine several value dimensions along which countries differ. Using Hofstedes (1980) framework, we carried out a crosscultural, comparative survey to assess the relationship between his undividedization/collectivism dimension of national culture and ethical criteria. With attentiveness to ethical decision-making, we adopt the instrument proposed and validated by Reidenbach and Robin (1988, 1990).They have generated a chasten of home bases that pecker the core dimensions characterizing different surveys of ethical philosophy. Defining national culture Hofstedes dimensions of culture Multiple definitions and conceptualizations of national culture exist (Hofstede, 1980, 1988, 2001 Kluckhohn, 1951, 1962 Kluckhohn and Strodtbeck, 1961 Ronen and She nkar, 1985 Trompenaars, 1993). Although these frame plant life and conceptualizations typic wholey center on values, they differ with respect to the specific values that are included in their respective frameworks. For instance, Trompenaars (1993) focuses on values related to relationships such as obligation, emotional orientation in relationships, and involvement in relationships. By contrast, Kluckhohn and Strodtbeck (1961) emphasize more(prenominal) global values such as citizenrys relationship to nature and time-orientation. With respect to our study, Hofstedes framework of national cultures is the most appropriate since he identified values related to stinting activity (Husted, 2000). Therefore, his framework is germane for the study of business decisions. Focusing on national cultures, Hofstede (1997, p. 260) defines culture as the collective programming of the mind which do ites the members of one group or category of commonwealth from some other. Thus, although the prob lems faced by groups (whether organizational or national) are customary, the solutions devised by each group may be relatively unique to that group. These solutions then become taken for tending(p) over time, and may evoke why people hold certain beliefs and behave the way they do (Schneider and Barsoux, 1997). Hofstede (1980, 1988) has suggested that five dimensions of national culture underlie differences in the behavior of individuals from different cultural backgrounds.Since these dimensions describe how individuals scenery and comprise situations and behavior, they are likely to be related to how individuals engage in decision-making in general (Weick, 1979 Adler, 2002). Ethical decisionmaking, too, is likely to be affected by these dimensions of national culture. Hofstedes five cultural dimensions (1980, 1988) are power distance, uncertainty avoidance, masculinity/femininity, individualism/collectivism, and long-term/short-term orientation. motive distance refers to the horizontal surface to which less(prenominal) powerful members in a country accept an unequal diffusion of power. Uncertainty avoidance depicts a peoples ability to bring off with ambiguous situations as well as the mechanisms they have created to avoid such situations. Masculinity exemplifies a focus on material things, such as money, success, etc., whereas femininity refers to a focus on quality of life, caring, etc. Individualism, which bequeath be discussed in more detail later, refers to the tendency of people to reckon their interests and those of A Comparative Investigation of Business Ethics their flying family only. By contrast, collectivism refers to the inclination of people to view themselves as part of a larger group, and to protect the interests of group members. Longterm/short-term orientation describes the time perspective people take when dealing with a situation. Table I even outs the lots for Hofstedes cultural dimensions for Brazil and the U.S. While the scores indicate dissimilarities between the U.S. and Brazil on all five cultural dimensions, by off the beaten track(predicate) the largest difference appears in the individualism/collectivism dimension. Brazil scored low on individualism, and hence is considered a socialistic country by contrast, the U.S. scored high on individualism and is considered an individualistic country.The individualism/collectivism dimension describes how individuals relate to others and to company, and represents the result to which they are emotionally and cognitively attached to a particular net income of individuals. Individualism describes the inclination of individuals to be primarily concerned with their personal interests and their immediate familys welfare (Hofstede, 1980). Members of a highly individualistic country view themselves as in cypherent of organizations or institutions, and place a higher value on self-reliance and individual action. Collectivism, in comparison, describes a cultu re where individuals are viewed as part of a larger group, and look after each other. Collectivistic cultures protect the interests of their members in return for their loyalty. In collectivist cultures, lessonity is defined in terms of the benefits for the in-group (family, friends, work companies, 269 etc.), implying the maintenance of solidarity (Triandis and Bhawuk, 1997). Hofstede (1980) noted that the individualism/collectivism dimension carried strong moral overtones because this dimension was reflected in value systems shared by the majority. For example, in a highly individualistic country, individualism is viewed as a strength and the major reason for the countrys accomplishments. By comparison, inhabitants of a highly collectivistic country view an ferocity on self as a negative attribute to be eliminated for the good of society. Competing ethical frameworks for business decisions Ethics are the principles of gracious conduct regarding either an individual or a group ( Shaw, 1999), and represent the moral standards not governed by law, that focus on the human consequences of actions (Francesco and Gold, 1998).Ethics oft require behavior that meets higher standards than those established by law, including selfless behavior rather than calculated action intend to produce a unmistakable benefit. With respect to this study, business ethics describe the ultimate rules governing the judging of what constitutes right or wrong, or good or dingy human conduct in a business context (Shaw, 1999). In the judicial decision of ethical behavior, perception is critical (Hartmann, 2000). Indeed, ethical decisions may be influenced by our birth perception, by others perceptions of our actions, and by our perception of universal laws. As a TABLE I Cultural dimensions (Hofstede 1980, 1988, 2001) Dimensions of culture U.S. Brazil Difference Power distance Uncertainty avoidance 40 46 69 76 (29) (30) Individualism/Collectivism 91 38 53 Masculine/ effeminate Confuc ian Dynamism 62 29 49 65 13 (36) 270 Rafik I. Beekun et al. result, our final choices may be determined by the perception that is the most salient at the time. Further, Hartmann suggests that cultures may differ not only with respect to the ethical principles fundamental decisions but withal with respect to which of the common chord stakeholders self, society, and universal laws is emphasized in any given situation. Depending on which stakeholder is emphasized, people from different cultures may vary in their assessment of the ethical nature of a decision. Across most situations, ethical principles that distinguish right from wrong actions are encompassed by several normative theories, e.g., justice, relativism, egoism, utilitarianism, and deontology. These theories can generate potentially irrelevant interpretations of what is ethical or unethical, originating from the very nature of the theories themselves.Moreover, prior research (Cohen et al., 1996 Hansen, 1992 Reidenbach and Robin, 1988, 1990) indicates that individuals making ethical decisions do not select a single hypothesis or philosophy by which to make their decisions. In fact, Reidenbach and Robin (1988) engraft that a varying combination of ethical philosophies or theories is employed when ethical decisions are made. Shaw (1999) draws a distinction between twain types of ethical theories, consequentialist and nonconsequentialist. Consequentialist theories suggest that the moral rightness of an action depends on the actual or intended results of the action. What is right is determined by weighing the ratio of good to bad that an action is likely to produce (Shaw, 1999, p. 45). A key issue underlying consequentialist theories is the nature of the beneficiaries of the action under consideration. Should one consider the consequences for oneself or for all involved? The most important consequentialist theories are egoism and utilitarianism. Egoism supercharges individual expedience as the gu iding principle whereas utilitarianism advocates that everyone affected by the action or decision must be taken into account (Shaw, 1999). By contrast, nonconsequentialist theories suggest that it is not simply the consequence of an act that matters, but also its inherent character. Although these theories do not deny that con- sequences are virtuously relevant, they depose that other factors are also important in assessing the moral conditional relation of an action. For example, breaking a promise is wrong not simply because of the consequences that result from breaking it, but also because of the nature of the act itself. In this study, we focus on consequentialist theories for several reasons. First, Hofstedes individualism/collectivism dimension can be clearly and easily related to the two consequentialist theories. Second, the two theories represent the perceptions of two of the deuce-ace come-at-able stakeholders identified by Hartmann (2000), namely own perceptions and o thers perceptions.Third, staying within one theoretical category allows for a much more parsimonious, yet thorough, analysis. Ethical perspectives and national culture hypotheses Whether egoistic or utilitarian principles are employed, ethics are a product of a societys culture, which includes its traditions, values, and norms. Within a society, ethical behavior is generally concord upon. Francesco and Gold (1998, p. 40) explain that members implicitly understand how relationships, duties and obligations among people and groups ought to be conducted, and distinguish between their selfinterests and the interests of others. However, when two or more countries interact, they often find that their ethics differ. According to Hendry (1999), these differences may allow to three types of culturally based ethical conflicts. First, at that place are those conflicts where the ethical values typifying the two national cultures lead to differing conclusions what is deemed unethical from one perspective is considered to be ethical from the other. Second, conflict may arise when businesspersons from one culture consider something morally significant whereas their counterparts from another culture are ethically neutral. Third, business people from two cultures may interpret a common situation differently even when there is some commonality among their national values. A Comparative Investigation of Business Ethics To investigate the relationship between national culture and ethics, we chose two culturally diverse countries, Brazil and the U.S. Given the differences in their respective national cultures, we expect Brazilians and Americans to differ in their assessment of the ethical content of business decisions.Accordingly, we propose the following hypothesis H1 The assessment of the ethical content of business decisions is a function of national culture. Egoism and individualism/collectivism According to egoism, the only valid standard of ones behavior is ones obligation to advance ones well-being to a higher place everyone elses (Beauchamp and Bowie, 1997). Promotion of ones own longterm interest is viewed as the only worthwhile objective and the only determinant of whether an act is morally right or not. Nothing is owed to others or to the organization that one works in. Those who abide by this approach to ethics intensely believe that all altruistic efforts by others are really acts of self- promotional material since an individual may have to help others in order to advance his/her own interests. Brazil is collectivistic whereas the U.S. is individualistic. As discussed earlier, persons from an individualistic culture emphasize their families and their own interests. H1.a When applying egoistic criteria to measure the ethical content of an action or a decision, respondents from the U.S. will be less likely than respondents from Brazil to see a decision or action as unethical. Utilitarianism and individualism/collectivism Utilitarianism, in di rect contrast to egoism, is the moral doctrine that we should always act to produce the superlative possible balance of good over bad for everyone affected by our action (Shaw, 1999, p. 49). Although utilitarians also 271 evaluate an action in terms of its consequences, an action is ethical if it results in the superlative benefit or good for the largest number of people.Issues of self-interest are not germane since actions are assessed in accordance with one primary standard the general good. Utilitarianism has long been associated with social improvement and the promotion of actions that are in the best interest of the community. Actions are right if they promote the greatest human welfare. Brazil is collectivistic. Persons from a collectivistic culture focus on actions that lead to the greatest benefit for most members of a group. H1.b When applying utilitarian criteria to judge the ethical content of an action or a decision, respondents from Brazil will be less likely than res pondents from the U.S. to see an action or decision as unethical. To be consistent with prior ethics research (Reidenbach and Robin, 1988), the above hypotheses (H1.a and H1.b) together suggest that Americans and Brazilians rely on more than one ethical criterion when assessing the ethical content of an action or decision. However, we are also suggesting that when each specific ethical criterion they refer to is considered separately, people from different national cultures will vary in their assessment of the ethical content of a course of action or a decision. methodology Sample Data were collected from 126 respondents 92 from the U.S. and 34 from Brazil. U.S. participants included MBA students at a regional university as well as business professionals. Brazilian participants were all students enrolled in an Executive MBA program. We utilize MBA students in our study for two reasons. First, MBA students are a commonly used proxy for business people (Dubinsky and Rudelius, 1980) . Dubinsky and Rudelius (1980) comparison of 272 Rafik I. Beekun et al. student versus professional evaluations found a high degree of congruence between the two groups. Second, since all students ( both(prenominal) U.S. and Brazilian) were currently employed by companies or had recent professional work experience, the sample can be used as a proxy for business professionals in both countries.Data collection The instrument we used was Reidenbach and Robins (1988) pre-validated, multi-criteria instrument incorporating the core dimensions that underlie several ethical perspectives. We selected this survey instrument because it is a multi-philosophy and multi-item questionnaire. As a result, it will enable us to assess both ethical dimensions of interest, i.e., egoism and utilitarianism, simultaneously. This instrument incorporates multiple items for each ethical philosophy and, therefore, is relatively more reliable than single item instruments (Kerlinger, 1986). Reidenbach and Robins instrument includes an initial set of scales that has shown evidence of high reliability and dispirited convergent validity with respect to U.S. respondents. The scales correlate highly with a univariate measure of the ethical content of situations. Hence, the instrument can be said to have high construct validity in the U.S. Additional reliability and organization efforts for the whole sample and for Brazil specifically are reported below. Using a seven-point Likert scale (1 = ethical, 7 = unethical), respondents were asked to rate the action in three scenarios using the criteria (items) described in Table II. The perception of and the criteria emphasized in evaluating the ethical content of a decision or situation depend on the nature of the decision or the situation. In accordance with previous research, scenarios will be used in this study to provide the contextual stimulus and to motivate the evaluation process (Alexander and Becker, 1978). We adopted the three scenarios de velop and validated by Reidenbach and Robin (1988, 1990).Table III presents the three scenarios used in this study. Data were collected by means of the abovementioned instrument administered to Brazilian participants (in Portuguese) and provided via written instrument and website access to U.S. participants (in English). The Brazilian instrument was back translated to vouch equivalence. Efforts were made to establish the reliability and validity of the instrument in this comparative context and are reported as follows. We examined the reliability of the instrument by assessing its internal consistency through the use of Cronbachs alpha. Since we used three different measures (one for each of the scenarios), we calculated three inter-item coefficient alphas. The Cronbach alpha was 0.81 for the first scenario, 0.75 for the twinkling scenario and 0.86 for the third scenario. All three coefficients indicate that the scale items are internally con- TABLE II Ethics instrument scales Eth ical perspective Items (Seven-point Likert scale 1 to 7)* Egoism Self promoting/not self promoting Self sacrificing/not self sacrificing Personally satisfying/not personally satisfying Utilitarianism Produces greatest utility/produces the least utility Maximizes benefits while minimizes persecute/minimizes benefits while maximizes harm Leads to the greatest good for the greatest number/leads to the least good for the greatest number * Generally speaking, in the above bipolar scales, 1 = fair or just or efficient (ethical) whereas 7 = unfair, unjust or inefficient (unethical). A Comparative Investigation of Business Ethics