Influence of work-related ethical values on pro-social behavior

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1 Influence of work-related ethical values on pro-social behavior Ing. Pavel Žiaran, Department of Management, Faculty of Business and Economics, Mendel University in Brno, Abstract The article has an objective to analyze the relation between work-related ethical values and its influence on pro-social behavior. Partial research consist in understanding relation between three phenomena: (1) Tools to measure ethical values (Rest`s DIT test measuring cognitive moral development), (2) Tools to measure career orientation (measured by Holland`s test), (3) Ethically sensitive behavior (free-riding/pro-social) behavior in the frame of an in-class experiment. Findings are as follows: (1) Free-riding/pro-social behavior does not correlate with the level of a cognitive moral development. (2) Cognitive moral behavior corresponds to certain combination of professional orientations, that we name value-oriented and contextual. (3) Combinations of professional orientations (value-oriented and contextual) correspond to the free-riding/pro-social behavior. This correspondence creates a pattern referring to an analogy with the Forsyth`s theory, explaining ethical behavior based on absolutistic or relativistic approach. However more research and analysis is needed. Key Words Business ethics, measurement, free-riding, human resources, DIT, Holland test, Forsyth test. Introduction Growing number of companies consider ethics as a strategic momentum for their business. Studies realized by Flynn (1994) showed that during the recruitment process 60 % of managers consider ethics as a crucial criterion. Marrens a Garett (1975) showed an important relation between working ethics and the amount of time spent on certain task and capacity to finish it. To our understanding, nowadays, recruiters and businesses do not have a reliable tool to measure ethical values, and what is the influence of ethical values on behavior. To answer these questions we enacted an in-class experiment to stimulate a free-riding behavior/pro-

2 social behavior. Consequently we will test ethical and work-related values and orientations of participants. Objectives and methodology There are several concepts to measure ethical values in the work related environment. A crucial question consists in the reliability and capacity to predict a work-related behavior. Forsyth`s taxonomy of ethical ideology (EPQ) Researchers found an inconsistency between moral behavior and moral values of people. In a famous study in 1928, Herstone and May, On the nature of a character tested hundreds children and showed that acts like lying, cheating or stealing is well explained by a combination of moral values and situational context. Forsyth comes up with a theory of two concepts (relativism and idealism) that predict well outcomes of a behavior in morally sensitive situation, see Tab. I. (Forsyth, 1980) I: Categories of moral positions by Forsyth High idealism Low idealism Low relativism Absolutists: Principled idealist who always behave in consistence with moral rules and believe that this will bring the best results to all interested parties. Exceptionists: They accept the moral rules as a general direction and suppose these rules will lead towards best possible results for all interested parties. High relativism Situationists: If there is a way to achieve best possible results for all participants, it is possible to circumvent general moral rules that they normally adhere to. Subjectivists: Their decisions are based on individual values and moral rules. Source: Forsyth, 1980 EPQ measurement by Forsyth shows high inner consistency, time reliability, does produce socially desired answer and does not correlate with DIT tests, and works as a good predictor of moral reasoning. Its validity was confirmed for example by a study of Venable and Wagner (2005), who showed that NGO workers have higher level of idealism than relativism, and NGO workers have higher level of absolutism than MBA students. Rest`s Test of Defined Issues (DIT) The test is based on Kohlberg s theory (1984) of cognitive moral development, stating that a human passes through different stages of a moral development. This development could be defined by clear stages, see Tab. II. (Koehn, 2005)

3 II: Stages of cognitive moral development by Kohlberg 1. Pre-conventional phase: egocentric people, main motivation is self-satisfaction, they are afraid of punishment or loss of enjoyment. 2. Conventional phase: people search for conformity with the reference groups or social norms. 3. Post-conventional ethics: adhering to the social contract, orientation to universal moral principles. Source: Koehn, 2005, Wilson, 1999 Cognitive moral development is statistically measured by means of Rest`s test (1996), named defining issue test (DIT), based on a standardized dilemma and questionnaire. Later on, a DIT-2 test, using Lickart scale, has been developed for higher statistical reliability. (Eastman Yetmar, 2000) To avoid self-stylization and socially desired answers, other dilemmas have been developed, as well as there are specialized dilemmas for specific professions and fields of business. (Cagle - Bakus, 2006). Further research shows interesting correlations between CMD and beliefs of the inherent importance of nature. (Karpiak - Galen, 2007). Methodology based on a DIT test gained a wide popularity among researchers. In the last fifteen years, the DIT methodology has been used in approximately five hundred scientific studies. (Bailey, 2010) Holland`s Test of Career Types (RAISEC) According to the Holland`s theory, in the frame of professional orientation, an individual could be characterized by six personality types (see Tab. III). Numerous scientific studies confirmed that if a person chooses a profession that corresponds to his or her personality types achieves systematically better results. (Balkis Isiker, 2005) III: Personality types according to Holland (RIASEC) Realistic prefers regular and systematic work, often manual, hand-crafts, works with tools, animals, etc.. Investigative prefers analytical, investigative thinking, logical reasoning, motivated to understand, etc. Artistic prefers free, often unstructured activities oriented towards innovation and creativity. Social prefers activities oriented towards people, aimed principally to human relations, not results. Enterprising oriented to achieve results through, organizing people and resources. Conventional prefers regular and systematic manipulation with data, averse to ambiguity. Source: Balkis Isiker, 2005 Holland`s method, despite the fact that it combines a wide spectrum of aspects, provides stable results, empirically easy to understand and very straightforward managerial implications. (Schneider at al., 1996) In more recent studies a category of an idealist has been introduced, and as by its nature this category strongly corresponds to our research interests we included it into the questionnaire.

Research objectives, research questions and methods This article has for objective analysis of relation between tendencies towards free-riding or vice-versa pro-social behavior, level of moral

4 Research objectives, research questions and methods This article has for objective analysis of relation between tendencies towards free-riding or vice-versa pro-social behavior, level of moral cognitive development and professional orientation. We have stipulated three research questions: (1) Is there a relation between freeriding/pro-social behavior and the cognitive moral development? (2) Is there a relation between professional orientations and cognitive moral development? (3) Is there a relation between free-riding/pro-social behavior and professional orientations? As a methodology to analyze free-riding/pro-social tendencies we have use a classical in-class experiment used for teaching free riding. Students in several rounds can choose investments to public or private account. Public account brings and interest of 10% and private account brings 5%. However, all the earnings from the public account are equally redistributed among all participants, thus motivating to free-ride. During the game, participants have free opportunities to coordinate and verify their behavior, all based on their mutual agreement. Figure 1 shows the results of the in-class experiment. Source: author 1: Results of in-class experiment on free riding/pro-social behavior Blue color shows total amount of money invested to public account. Red shows average earnings from the public account. Green color shows average earning from private accounts. Round number 11 is of highest interest, as the instructor motivates all the students to invest to the public account, so that the students can immediately see, how much they earn on average, and what is consequently the best option for everyone. However, in the next consecutive 12th round, only marginal part of money is invested back to public account, and average earning falls dramatically. After the simulation game finishes, we distribute questionnaires to the students, measuring the above mentioned concepts: DIT and Holland test. Data from the questionnaire

5 are analyzed by means of simple statistical analysis (correlation matrix, based on least square methods). Results In the following section could be find answers to our three research question or an eventual tentative and if the answers are not satisfactorily straightforward. 1. Relation between cognitive moral development and pro-social behavior Fig. 2 shows relation between pro-social behavior and cognitive moral development (abbreviated CMD). Red dots show level of CMD in percentage derived from maximal relative values and blue line connects amount of investments to the public account (sorted from minimal to maximal amount of investment). Source: authors 2: Relation between cognitive moral development and level of pro-social behavior Even more in-depth inspection, should it be graphical or statistical, does not reveal any evident relation between CMD and pro-social behavior. 2. Relation between professional orientation and cognitive moral development We used a simple correlation matrix based on the least square meter method to analyze relations between CMD and professional orientation (see Tab. IV). Though, there is no sufficiently significant correlation between any categories of professional orientations and CMD, we observe that Idealist, Creative and Social correlate positively and more strongly with the CMD than all the other Holland`s categories.

6 IV: Correlation matrix, relation between CMD and career orientation, observations 1 19, 5% critical value (two tailed) = 0,4555 Level of cognitive moral development Professional orientation 0,3712 Idealist 0,2817 Creative 0,1744 Social 0,0573 Investigative -0,0923 Realistic -0,1926 Enterprising -0,4154 Conventional Meta categories Valueoriented Contextual Source: author We decided to name these three categories value-oriented; based on an intuitive consideration suggesting that people with these orientations naturally manifest these tendencies as jobs as well as values. If a person is Social, Idealist and eventually Creative, he or she, will be searching a job with the corresponding responsibilities and at the same time the person will consider these orientations as personal values. On the other hand, professional orientations as Analytical, Realistic, Conventional and eventually Enterprising will predict clear careers choices, however probably not inner personal values. We will name these professional orientations as contextual. We admit that the constructions have certain level of arbitrariness, on the other hands, intuitively; we feel that there is a certain consistency. To great extent we have got inspired here by the Forsyth`s taxonomy. 3. Relation between professional orientation and pro-social behavior This chapter has for ambition to explain the inconsistency between CMD and pro-social behavior, as seen in the chapter no. 1 above, by means of inserting a new variable: metacategory of professional orientation, value-oriented and contextual that we developed in the previous chapter no. 2. In the chapter no. 1, fig. 1, we observed four very distinct groups of participants: - high level of CMD, high level of investment to the public account, - high level of CMD, law level of investment to the public account, - low level of CMD, high level of investment to the public account, - low level of CMD, low level of investment to the public account.

7 The correlation matrix did not show any significant relations between pro-social behavior and a specific professional orientation. We analyzed professional orientations in various combinations but could not find any evident correlations. Finally, we found certain relation when we used combination of value-oriented and contextual categories see Tab. V. V: Analysis of relation between pro-social behavior and professional orientation. Cognitive moral development High Low Investment to the public account (pro-social behavior) High Low Average values: Average values: - contextual: 0,92 - contextual: 0,86 - value-oriented: 0,78 - value-oriented: 0,86 Ratio contextual to value-oriented: 1,2 Ratio contextual to value-oriented: 1,0 3. Average values: - contextual: 1,4 - value-oriented: 0,2 4. Average values: - contextual: 1,2 - value-oriented: 0,5 Ratio contextual to value-oriented: 7,0 Ratio contextual to value-oriented: 2,4 Source: author Table V. demonstrates two findings: Finding (1) suggests that level of cognitive moral development, for both low and high level, corresponds to the level of contextual and valueoriented average values. When CMD is high the ratio is 1,2 and 1 which is significantly less when compared to the two ratios 7 and 2,4 when CMD is law. This is an important finding, as it suggests that classical tool used in HR management has a potential to indicate ethical values. Finding (2): Level of pro-social behavior show quite a clear pattern, that is however rather difficult to interpret. Notably, high level of pro-social behavior corresponds to the relatively higher level of contextual orientation and lower level of value-orientation, in both cases of low and high CMD. This is the opposite what we would intuitively expect, however the pattern is quite clear. Discussion In the frame of finding (1) it might be useful to point out a fact that the high level of CMD is accompanied by relatively equilibrate levels of contextual and value-orientated tendencies, 1.2 and 1 ratio for high CMD and 7 and 2.4 for low CMD. This could be interpreted in a way that high CMD according to Kohlberg`s theory implicitly requires both aspects: value-oriented, because a person should adhere to certain

8 moral values and contextual, because a person should be able to understand and see results of his or her decision in a wider multi-layer context of complex interrelations as economic, legal, societal and those of universal values. Finding (2) suggests two possible explanations: (2a) Our in-class experiment is not completely straightforward in a sense of moral sensitivity, as no financial value is at stake. A person with a high level of cognitive moral development might not perceive the situation as significantly morally sensitive as he or she would in a real life. This assumption would then lead us towards the Forsyth`s theory that a concrete decision of a human depends on the consideration of general moral believes and concrete situation with the aim to achieve best results interested parties. However the reference to Forsyth theory of Ethical Positions, owing to the specificity of results, could be seen more-less as a mere analogy to provide direction on how to seize the further research. (2b) Second potential explanation stems from the construction of the term moral. Being moral or ethical implies mental capacity to encompass wider consequences of human action, should it be in the frame of a social contract or universal moral values. In other words, this construct, presupposes higher level of wider contextual intelligence that at certain persons could be relied with higher level of analytical/investigative thinking, hence what we measure here as contextual. Conclusion Our conclusion is threefold: (1) We did not observe a direct relation between cognitive moral development and pro-social behavior. This conclusion has been confirmed also by research studies that we have enacted previously. (2) We could clearly detect relation between cognitive moral development and professional orientation, especially when we created two meta-categories of professional orientation. We found that value-oriented professions (Creative, Social, Idealist) correspond to the higher CMD and contextual professions (Investigative, Enterprising, Conventional, Realistic) correspond in general to lower level of CMD. Furthermore, higher CMD corresponds to a more equilibrate level of both orientations, whereas low CMD is accompanied be higher level of contextual orientation and lower level of value-oriented one. (3) As a most interesting finding we consider the observation of a pattern relaying cognitive moral values with pro-social behavior through professional orientation. This pattern,

9 on one hand, calls for reference Forsyth`s theory of four quadrants predicting moral decisionmaking, on the other hand does not correspond to what we would intuitively expect, hence further research seems to be appropriate. Generally, we can conclude, that our research shed some light on the opportunities to implement and develop new ethical measures in the field of human resource management. References BAILEY, C. et al. 2010: Revitalizing Accounting Ethics Research in the Neo-Kohlbergian Framework: Putting the DIT into Perspective. Behavioral Research In Accounting. 22(2): BALKIS, M. ISIKER, G. The relationship between thinking styles and personality types. Social Behavior & Personality: An International Journal, 2005, Vol. 33, Issue 3, p CAGLE, A. B., - BACUS, M. S.: Case Studies of Ethics Scandals: Effects on Ethical Perceptions of Finance Students. Journal of Business Ethics, Vol. 64, Issue 3, s EASTMAN, K. K. YETMAR, S. A., 2000, Tax Practitioners' Ethical Sensitivity: A Model and Empirical Examination, Journal of Business Ethics, 26, s , FLYNN, G Attitude more valued than ability. Personnel Journal, 73 (1994), p. 16 FORSYTH, D. R., A taxonomy of ethical ideologies. Journal of Personality and Social Psychology, Vol 39(1), Jul 1980, FORSYTH, D. R., Studying Our Social World, [cit ]; Cited from KARPIAK, C. P. BARIL, G. Moral reasoning and concern for the environment. Journal of Environmental Psychology, Volume 28, Issue 3, September 2008, pp KOEHN, D Transforming Our Students: Teaching Business Ethics Post-Enron. Business Ethics Quarterly, Vol. 15, Issue 1, s REST. J Guide for the defining issues test. Center for the Study of Ethical Development, Minneapolis, MN, SHNEIDER P. et al Examining the relation between Holland's RIASEC model and the interpersonal circle. Measurement & Evaluation. Counseling & Development, American Counseling Association. 29(3): VENEBLE B. - WAGNER J Exploratory study on ethical values in nonprofit fundraising. Psychological Reports. Oct 2005;97(2): WILSON, F. L Measuring Morality of Justice and Care Among Associate, Baccalaureate and Second Career Female Nursing Students. Journal of Social Behavior & Personality. Vol. 14, Issue pp

Title page. Ethical stance among senior business and marketing students at Macquarie University

Title page. Ethical stance among senior business and marketing students at Macquarie University Title page Ethical stance among senior business and marketing students at Macquarie University Authors: Julian de Meyrick, Business Department, Division of Economic and Financial Studies, Macquarie University,