The relationship between salespersons ethical philosophy and their ethical decision-making process

Asian J Bus Ethics (2014) 3:11 33 DOI 10.1007/s13520-013-0028-x The relationship between salespersons ethical philosophy and their ethical decision-making process Mirahmad Amirshahi & Mahmood Shirazi & Sara Ghavami Received: 7 August 2012 / Accepted: 27 May 2013 / Published online: 17 July 2013 # Springer Science+Business Media Dordrecht 2013 Abstract The aim of the present research is studying the relationship between the salespersons ethical philosophy and their ethical decision-making process and seeks to answer two fundamental questions: first, what is the ethical philosophy of salespersons? And second, how does the salespersons ethical philosophy affect their ethical decisionmaking process? Statistical population of this research is salespersons who have passed the sales training course at the Department of Commerce Research Centre. One hundred thirty-seven questionnaires of total 300 accessible populations were analyzed through path analysis method. The findings indicate that most salespersons are idealists. Although this idealism affects the ethical judgment directly, but the effect of relativism on ethical intention is more considerable. Keywords Ethical decision making. Ethical perception. Ethical judgment. Ethical intention. Ethical philosophy The authors herewith acknowledge constructive criticisms and comments of two unknown reviewers of this article whose professional advices have helped to greatly improve the quality of this paper. M. Amirshahi : S. Ghavami (*) Al-Zahra University, Tehran, Iran e-mail: sarah.ghavami@yahoo.com S. Ghavami e-mail: sara.ghavami@uon.edu.au M. Amirshahi e-mail: amrshah@alzahra.ac.ir M. Amirshahi e-mail: m_amirshahi@yahoo.com M. Shirazi Shahid Beheshti University, Tehran, Iran e-mail: m-shirazi@sbu.ac.ir

12 M. Amirshahi et al. Introduction For over three decades, ethics and ethical issues at the workplace and commercial environments have been considered by large organizations and management scientists. Over 200 companies out of 500 creditable companies listed on Fortune magazine have codes of ethics and it has been mentioned that the ethical behavior of the businesses increases the capability of the organizations in absorbing and maintaining the staff as well as good customers (Kaptein and Avelino 2005). Kaptein believes that paying attention to an ethical approach is increasingly spreading in the world and ethical criteria are rapidly becoming universal (Kaptein 2004). The findings of the research have shown that marketers of the organizations which possess higher levels of organizational ethics are more committed to observing ethical principles and social responsibilities as compared with the marketers of the organizations which have lower levels of organizational ethics (Yeung 2004). Ethics and doing research about it in the Iranian society as an Islamic society and a country which claims to be the ethical model among Islamic states is of particular significance and is highly important and fundamental. Ethical decision-making models, such as Jones s model (1991), focus on the cognitive decision-making process. In these models, following recognition of an ethical issue (ethical perception), individuals pass a judgment on their own performance (ethical judgment), then they form a tendency to do that action (ethical intention) and eventually, they commit the ethical/unethical action. Numerous factors affect this process. An important internal factor which affects this process is personal ethical philosophy which includes idealism and relativism. Individuals possess degrees of either of these philosophies. Another significant situational factor affecting this process is the characteristics of the ethical issue (ethical intensity) which the individual has faced. Personal ethical philosophy is also a system of values and beliefs that the individual has preserved and based on which he makes decisions on ethical issues. The objective of this research was to study the relationship between the salespersons personal ethical philosophy and their ethical decision-making process. The problem this study seeks to solve is recognizing the ethical philosophy of the Iranian salespersons and how and to what extent this ethical philosophy affects their ethical decision-making process. It is hoped that based on the findings of this study, companies may be able to formulate appropriate ethical strategies and adopt necessary strategies to promote observance of ethical principles at sales departments (which seem to be more exposed to ethical decisions than other departments). This study seeks to answer the following fundamental questions: 1 What is the ethical philosophy of the salespersons in this research population? 2 How does the salespersons ethical philosophy affect their ethical decisionmaking process? Review of theoretical literature Ethics often refers to a series of moral principles or values that direct behavior. De George (quoting Hoffman et al. 1986, p. 40) defines ethics as follows:

Ethical philosophy and ethical decision-making process 13 Ethics is a systematic effort for creating sensitivity in ethical (conscientious) experiences at a social and personal level, in a way that the laws which must lead the individual, values which must be encouraged and characteristics in life which deserve being spread may be determined. Jones (quoting Reidenbach and Robin 1991, p. 84) introduces ethical decision as a decision which is both conscientiously and legally acceptable to the majority of society. These principles are beyond law and serve as guidance for solving conscientious problems while observing justice and adopting a proper and just solution. Ethics considers guiding laws and standards pertaining to the laws of moral philosophy. From this perspective, Marketing ethics is the systematic study of implementation of ethical standards in marketing decisions, behaviors, and propositions (Murphy et al. 2005, p. 17). The process of ethical decision making Ethical decision-making models focus on cognitive thinking of the individuals. In these models, decision making is often a sequential cognitive process (Park and Stole 2005). Cognitive process method in decision making has long been considered by the scientists. Jones (1991) has developed the issue-contingent model of ethical decision making in organization as a four-phase model based on the Rest (1983) and Kohlberg (1958) model. In this model, in order to make an ethical decision, four phases are passed through which include: ethical perception, ethical judgment, moral intention, and committing the ethical act whichareexplainedinthefollowingsection: 1. Ethical perception: ethical perception refers to an individual s recognition of an ethical concept. Ethical perception is the stimulus for all ethical decision makings (Attia et al. 1999, p. 613). While involved in ethical decision-making process, one must perceive an ethical issue (Hunt and Vitell 1986). According to Rest (quoted in Shaub 1994, p. 3), the factor which leads to ethical perception is ethical sensitivity. Ethical sensitivity is the ability to recognize whether or not a specific situation has ethical content? (Shaub 1994, p. 3). 2. Ethical judgment: after an individual perceives an ethical issue, he passes a judgment on it. The individual s discernment as to which behavior is right and which one is wrong is called ethical judgment (Reidenbach and Robin 1991, p.887). 3. Moral intention: moral intention refers to an oriented behavior toward which the individual, following ethical judgment, is inclined according to his cognitive moral development (Street et al. 1997, p. 1157). Forming this intention for solving an ethical issue includes investigation of various options for solving that problem and choosing an option which the individual is more inclined to act upon. The selected option may not be quite compatible with the individual s idealistic viewpoint on the ethical issue. Therefore, the individual s intention to whether or not act upon his ethical judgment shows his intention to use ethical values instead of non-ethical values. In other words, a specific option is selected based on the results of the person s ethical judgment and the person forms an

14 M. Amirshahi et al. intention for acting upon that option. This explains why people commit an act even though they know it is non-ethical (Malhotra and Miller 1998, p. 269). 4. Committing the ethical act: the final phase of the ethical decision-making process is committing the act in ways compatible with previous phases of decision making (Street et al. 1997, p. 1159). The basis for committing an ethical act is the moral intention of the individual towards it (Hunt and Vitell 1986, p. 9). The role of personal ethical philosophy in ethical decision making Personal values are part of various beliefs that people, consciously or unconsciously, hold about their world. Values are separated by their content and cover beliefs which lead to preferring a certain form of behavior (such as fairness) over other behavioral alternatives. Values serve as the basis for ethical judgment and guide it (Douglas et al. 2001, p. 104). Personal values which affect ethical decision making are concepts or beliefs about ideal goals or behaviors that in a specific situation guide the individual in selecting or assessing a behavior and are of relative significance in comparison with one another. Each person holds values of different importance. A certain value may be of great importance to a person, but not for someone else. General theory of marketing ethics considers a person s ethical ideology as prior to his other values (Steenhaunt and Van Kenhove 2006, p. 142); so that while making an ethical decision, the more conscious people are of their ethical philosophy, the more impact these philosophies will have on their ethical decision making. In other words, a person is influenced by the philosophy he has adopted during his process of socialization. For instance, social groups, formal education, educational system, and teachings and seminars on ethics affect people s ethical beliefs and ethical behavior. However, cultural backgrounds of people also have an impact on their ethical/nonethical behavior (Ferrel and Gresham 1985, p.90). Creating an ethical decision-making framework without studying principal ethical standards which are derived from ethical philosophy is impossible. Since the most fundamental approach to ethics is based on ethical philosophy, it is presumed that marketers form laws and regulations related to ethical behavior according to an ethical philosophy. People, consciously or unconsciously, use philosophical assumptions as the basis for their ethical decision making. In the literature of marketing, the effect of culture, values and principles dominating the working group on the personal decision-making process has been numerously discussed. Ethical philosophy is a basis on which all ethical studies are formed. Ethical philosophies affect people s ethical decision making (Ferrel and Gresham 1985, p. 88). Ethical philosophies divide ethical assumptions into the two categories of teleological and deontological. These two approaches are the basis of different ethical behaviors and judgments. Teleological philosophy determines the ethical values of a behavior according to its overall result. General theory of marketing ethics claims that a teleological assessment can directly affect the moral intention of people and allows the individual to deviate from their ethical judgment or deny it in order to gain or avoid specific results. Thus, behavior can occur for the purpose of gaining some results. This shows why at times people s ethical judgment is in discrepancy with

Ethical philosophy and ethical decision-making process 15 their real intentions or behavior. Teleologist people believe that ethical judgments can and must be based on the results of the action. On the other hand, those who stick to a deontological philosophy explicitly reject teleology and consider the use of results for making ethical judgments as improper. Instead, they focus on universal laws and that in case of these laws, exceptions are either scarce or do not exist at all (Barnett et al. 1998). In 1980, Forsyth introduced two basic aspects of ethical philosophy (idealism and relativism) which correspond to teleology and deontology. Idealism suggests a person s firm belief in that ethical judgment must be, conscientiously, quite in accordance with ethical principles, norms and rules. Idealists believe that: (1) ethical principles, norms, and rules are always true- regardless of different situations (Park and Stole 2005) and (2) harming others is always avoidable (Douglas et al. 2001, p. 105). On the other hand, relativism is the degree a person rejects universal ethical rules in order to make rather more expedient decisions. According to the relativists, all ethical standards depend on society, culture, and the nature of situation and results and there are numerous interpretations while considering an ethical issue (Douglas et al. 2001, p. 105). From the viewpoint of ethical relativism, it is not possible to provide definitions of right and wrong behavior and, therefore; behaviors cannot be explicitly assessed as right or wrong. The results of the studies show that idealism positively and relativism negatively affect task-oriented norms, ethical judgment, perceived significance of ethics, social responsibility, and moral intention. According to Forsyth, these are not contradictory concepts, but rather independent concepts of belief and individuals make use of both aspects of this philosophy. That is to say, idealism emphasizes altruistic considerations for others, whereas; relativism focuses on the best choices (Park and Stole 2005). Idealism and relativism have proved their power in shaping ethical decisions related to business (Vitell et al. 1993, p. 755). People with high idealism and low relativism show more honesty and trust. They consider the effect of ethics and social responsibility in the success of organizations to be more important as compared with the relativists. In general, the status a person gains in relation to these two concepts affects his ethical judgment. Chan et al. (2011) state that moral base, including personal moral philosophy, is a key determinant of ethical decision making. They believe that more idealistic people indicate more honesty and integrity than less idealist individuals. In order to answer the second question and considering the explanations provided in the section on theoretical literature about ethical philosophy and ethical decisionmaking process, the first research hypothesis is introduced as follows: Hypothesis 1 There is a relationship between ethical philosophy and ethical decisionmaking process. According to the literature of the research, it is expected that the more idealistic people are the more ethical decisions are made by them. In other words, idealism has a direct relationship with ethical process and an indirect one with relativism. This hypothesis is divided into six sub-hypotheses: Hypothesis 1-1: Idealism has a positive relationship with ethical perception. Hypothesis 1-2: Idealism has a positive relationship with ethical judgment. Hypothesis 1-3: Idealism has a positive relationship with moral intention.

16 M. Amirshahi et al. Hypothesis 1-4: Relativism has a negative relationship with ethical perception. Hypothesis 1-5: Relativism has a negative relationship with ethical judgment. Hypothesis 1-6: Relativism has a negative relationship with moral intention. Moral intensity Ethical issue is caused when free behavior of an individual may harm or benefit others (Solymssoy and Masters 2002). Ethical intensity perceived by an individual is related to his perception of the specific characteristics of an ethical issue and directly influences his perception of an ethical issue under a certain condition. Jones (quoting Solymssoy and Masters 2002) believes that ethical issues are different with regard to intensity and ethical intensity not only affects recognition of an ethical issue but also the probability of ethical judgment and the degree to which people s behavior becomes compatible with that behavior (moral intention). In other words, the entire phases of the processes of ethical perception ethical judgment moral intention are affected by ethical intensity (Fisher 2003). According to Jones(1991), moral intensity is a construct that captures the extent of issue-related moral imperative in a situation. As quoted in Street et al. (1997, p. 1154) Moral Intensity is the variance in response by individuals to different moral issues based on the specific characteristics of the issue and moral intensity of an ethical issue can vary drastically between ethical dilemmas. In this research, the moral intensity has been defined by the amount of ethicality/unethicality of an action and is determined by asking respondents about how they evaluate a mentioned action as ethical/unethical. An ethical issue is regarded more intense, if the respondents believe that it is extremely ethical/unethical. Jones believes that if ethical intensity of a situation is weak, the individual does not regard it as a situation with an ethical content. That is to say, moral intention is formed when a person is involved with an ethical issue with high ethical intensity (Street et al. 1997, p. 1156). Morris (2004) alsodiscoveredthat the perceived ethical intensity significantly affects people s ethical judgment. The second hypothesis is introduced as follows: Hypothesis2 Ethical intensity has a positive relationship with ethical decision making. With regard to phases of ethical decision making, this hypothesis is divided into three sub-hypotheses. Hypothesis 2-1: Ethical intensity has a positive relationship with ethical perception. Hypothesis 2-2: Ethical intensity has a positive relationship with ethical judgment. Hypothesis 2-3: Ethical intensity has a positive relationship with moral intention. Considering the definition of ethical philosophy, it is expected that personal ethical philosophy also affect ethical intensity. In other words, since idealists consider impermissible even the slightest harm to others, they probably perceive ethical issues with more intensity than relativists and in their view ethical issues are of higher intensity. Thus, the third research hypothesis is formed.

Ethical philosophy and ethical decision-making process 17 Hypothesis 3 Ethical philosophy has a relationship with ethical intensity of the issue. Considering the two aspects of ethical philosophy, this hypothesis is divided into the following sub-hypotheses. Hypothesis 3-1: Idealism has a positive relationship with ethical intensity of the issue. Hypothesis 3-2: Relativism has a negative relationship with ethical intensity of the issue. In addition to the subjects discussed above, Islam advocates the principle of social commitment, that is; Islam believes that all Muslims are members of the same family and must help each other by paying the zakat (a religious tax) or in any other way. Followers of Islam are idealists because they adhere to a philosophy that requires them to be very accurate while making decisions and make sure that the consequences of their action will do the least harm to others and this makes them even more strict idealists. Strict support for Islamic rules strengthens the norms of task-orientation and guiding criteria within the personal ethical system (Cornwell et al. 2005). Also, according to Hunt and Vitell s theoryofethics(2006), cultural environment (including religion and legal and political systems) is one of the influential factors affecting ethical decision making, specially perceived ethical problem. They believe that highly religious people would have more clearly defined deontological norms and such norms would play a stronger role in ethical judgments. Therefore, since Iran is a religious country and most of Iranian people hold highly religious beliefs, it is not far to expect that they are more idealists and behave based on idealistic philosophy. Since vast majority of Iranians are Muslims, to answer the first research question, the fourth hypothesis is formed as follows: Hypothesis 4 The majority of salespersons in this research are idealists. Conceptual model In 1991, Jones (quoting Street et al. 1997, p. 1154) developed the relativist-case study model of ethical decision making. The basis of this model has been focus on the effect of ethical intensity on ethical decision-making process. As mentioned before, this model comprises four phases: recognizing the ethical issue (ethical perception), making ethical judgment, formation of moral intention, and eventually involving in the ethical act. In this model, each of the phases of ethical decision making is directly affected by ethical intensity. The present study, considers Jones s model as the basis for ethical decision making. However, it is noteworthy that since evaluation of ethical behavior requires conducting a different research, only the first three phases of Jones s relativist-case study model (perception, judgment, and moral intention) have been investigated.

18 M. Amirshahi et al. Also, in 1980, Forsyth introduced two major aspects of ethical philosophy (idealism and relativism) which affect ethical perception. Idealism and relativism have proved their power in ethical decisions related to business. By combining Jones s relativist-case study model and Forsyth s theory, the conceptual model of this research was formed. Furthermore, the present study has also examined the relationship between personal ethical philosophy and ethical intensity of the issue. Figure 1 shows the conceptual research model. As indicated in this model, people s ethical philosophy affects their perception of the significance of an ethical issue (ethical intensity). Moreover, ethical philosophy influences all the phases of ethical decision-making process. According to Jones s model (1991), the degree to which people consider an ethical issue to be significant (intense) affects various phases of their ethical decision-making process. Based on the conceptual model, research hypotheses were formed and employed in the research. Research methodology This is a descriptive/correlational research. The tool for measuring variables of this research is a standard questionnaire which has been domesticated. In this questionnaire, 15 questions have been designed in the form of Likert s five-choice scale for assessing marketers ethical philosophy (including seven questions regarding idealism and eight questions about relativism). This scale was developed by Forsyth in 1980 (Singhapakdi et al. 1994) which includes 20 questions. After studying this scale and based on the experts opinion, some of the questions of the questionnaire were modified or removed due to their inconsistency with cultural conditions dominating Iran. Cronbach s alpha index calculated for idealism criterion is 0.773 and for relativism 0.815. Four scenarios along with 12 questions, which for increased precision and ease of response, were formulated based on Likert s three-choice spectrum were also designed in order to measure ethical perception, judgment, and intention of the marketers. Using scenarios is a well-formed method and is Ethical Philosophy Ethical Decision-Making Process Idealism Ethical Perception Ethical Intensity Ethical Judgment Relativism Moral Intention Fig. 1 Conceptual model

Ethical philosophy and ethical decision-making process 19 considered a suitable tool in ethical marketing research (Patterson 2001). Scenarios are in fact descriptions of the circumstances under which a person must express his manner of decision making. Incorporating scenarios enables a person to better comprehend the decision-making condition. This tool also helps simulate the condition for the respondents and makes the decision-making condition more real (Attia et al. 1999). In this research, six ethical stories developed by Dornoff and Tankersley 1975 (as quoted by Marta and Singhapakdi 2005) were studied and from among them four scenarios were used. In these four scenarios, after the initial testing of the questionnaire, some modifications were made in order to adapt it to Iranian culture and work conditions. Also, in order to measure ethical intensity one question was designed which is repeated at the end of each scenario. Generally, the respondents were required to answer the questions at the end of each scenario and based on the action performed in the scenario. These scenarios have been presented in the appendix to this paper. In this paper, personal ethical philosophy (including idealism and relativism) is independent variable; ethical intensity is modifying variable; and ethical decision-making process including: ethical perception, judgment and intention are dependent variables. Statistical population of this research include Iranian professional salespersons of companies who have passed the sales training course at the Department of Commerce Research Centre from 2002 to 2004. (Above-mentioned course was offered by said center only during the referred period). Total number of the accessible members of this population in Tehran was 300 people. Research tool (a questionnaire) was mailed to all members of the population via post. After repeated follow ups, 143 filled out questionnaires were returned, 6 of which were unusable due to their defections and eventually, 137 questionnaires were left as an acceptable number for analysis. Descriptive analysis of the samples Of the respondents, 47.4 % in this research were females and 52.6 % were males. 91.3 % of them had B.S. or higher educational degrees and most (45.3 %) had less than 5 years of work experience. As for their ages, the highest frequency was that of the 20 30 age groups (56.9 %) and the lowest frequency was that of over-51 (2.9 %); meanwhile, 5.1 % of the respondents did not enclose their age. On the whole, majority of the respondents are young. Table 1 shows the frequency distribution of the type of industry in which the respondents work as salespersons. As seen in this table, more than half of the respondents (52.5 %) work as foodstuffs, travel services and engineering services salespersons. Answering research questions In this section, in order to answer research questions, inferential statistics have been used and to preserve the coherence of the subjects, first, the fourth hypothesis, which was introduced in response to the first research question, are analyzed and then other assumptions for answering the second research question are examined and analyzed.

20 M. Amirshahi et al. Table 1 Frequency distribution of salespersons work (industry type) Items Frequency percentage Frequency Foodstuffs 23.36 32 Travel services 15.33 21 Engineering services 13.87 19 Automobile 12.41 17 Pharmaceutical products 10.22 14 Insurance services 8.76 12 Publications 8.76 12 No response 7.30 10 Total 100 137 Question 1: What is the ethical philosophy of the salespersons in this research population? As mentioned previously, to answer this question, the fourth hypothesis was developed and in order to test this hypothesis, ratio test and mean difference test were used. Based on the results of this test, number of the idealists (135) is more than 50 % of the total number of the respondents (137). Also, Table 2 shows that the respondents are above average (3) in idealism variables and around average in relativism variables and that the mean of idealism (4.16 out of 5) is rather higher than that of relativism (3.12 out of 5). In other words, the idealist aspect of the total respondents is far more than their relativist aspect. Therefore, the fourth research hypothesis which suggests that respondents are idealists is confirmed. Also, in Table 3, the respondents opinion about dependent research variables (phases of the salespersons ethical decision-making process) has been presented. As it is seen, in all three variables of ethical perception, judgment, and intention, respondents are above average (2). Question 2: How does the salespersons ethical philosophy affect their ethical decision-making process? As mentioned before, to answer this question, the first and third research hypotheses were designed and in order to test the hypotheses, the conceptual research model was examined using path analysis method. The purpose of using path analysis in this Table 2 Test of significance of the difference between mean of independent variables and the mid-point (3) Level of significance t statistic Degree of freedom Standard deviation Mean Idealism 0.00 24.5 134 0.55 4.16 Relativism 0.075 1.8 134 0.76 3.12

Ethical philosophy and ethical decision-making process 21 research is to study the effect of the salespersons ethical philosophy on their ethical decision-making process. Path analysis is expansion of regression methods, and in fact, application of multiple-variable regression for clear formulation of causal models (Hooman 2006). Sarmad et al. (2007) have introduced these methods in their book as correlations of descriptive type. The aim of the statistical technique of path analysis is to obtain quantitative estimations of causal relationships between sets of variables. In this analysis, the relationships between variables flow in the same direction and are considered as separate paths. Path analysis concepts, in the best case, are delineated through its main characteristics, that is; path diagram which reveals possible causal links between variables. Path analysis explains which paths are more important or more significant, and this can also justify predetermined causal hypotheses. What can be performed using this technique is to study model of relations between several variables. Path analysis basically deals with estimation of amount of connections between variables and using these estimations for acquiring some information about underlying causal processes. In this method, after drawing the relationships between variables, equations are defined for each of the variables. Any variable which has been influenced by other factors is considered a dependent variable and an equation is written for it. This variable can play the role of an independent variable for another variable. Then, among all the relationships, multiple regressions are calculated. Significance of the beta index obtained from regression analysis suggests that there is a relationship between the variables. Besides, standard error for each regression equation, if it is significant, indicates that factors beyond researcher s conjectures affect the dependent variable. In path analysis, these factors are represented by Hooman (2006). Variables considered for path analysis based on this research model include: ethical intensity, ethical perception, ethical judgment, and moral intention; the amount of relationship between them has been calculated in the below table. Note that whenever one of the variables of the model is considered as dependent variable, all its upstream variables in the research model are regarded as independent variables and, thus; the amount of direct and indirect effect of the factorsiscalculated. A Ethical intensity as dependent variable In this section, ethical intensity has been considered as a dependent variable and idealism and relativism (which are its upstream variables) as independent variables. Effect coefficients between these variables, which have been calculated based on the primary research model, have been presented in Table 4. Table 3 Mean of dependent variables (mid-point: 2) Items Standard deviation Mean Ethical perception 0.59 2.26 Ethical judgment 0.45 2.31 Moral intention 0.47 2.36 Note: Questions related to dependent variables have been designed with three-choice Likert s scale

22 M. Amirshahi et al. B C As seen in the above table, level of significance for beta index is only significant in case of idealism. This means that idealism affects ethical intensity directly and with an index of 0.331. Significance of the constant shows that factor(s) beyond the limits of the research also affects ethical intensity of the salespersons. Based on the level of significance, it can be said that: (1) salespersons relativism has not had a significant effect on their ethical intensity and (2) salespersons ethical intensity is directly affected by their idealism. Ethical perception as a dependent variable Here, ethical perception has been considered as a dependent variable and idealism, relativism, and ethical intensity (which are its upstream variables in the research model) have been regarded as independent variables. Effect coefficients, which have been calculated based on the primary research model, have been shown in Table 5. As seen in Table 5, level of significance for beta index is only significance in case of ethical intensity. This means that ethical intensity, with an index of 0.34, directly affects ethical perception. Significance of the constant shows that factor(s) beyond the limits of the research also affects ethical perception. Based on the level of significance, it can be said that ethical perception is directly affected by ethical intensity. Ethical judgment as dependent variable In this section, ethical judgment has been considered as dependent variable and idealism, relativism, ethical intensity and ethical perception (which are its upstream variables) as independent variables. Effect coefficients, which have been calculated based on the primary research model, have been presented in Table 6. As seen in Table 6, level of significance for beta index is only significant in case of idealism, ethical intensity, and ethical perception; that is, ethical perception, ethical intensity, and idealism, each with the indices specified in the table, affect ethical judgment. Significance of the constant shows that factor(s) beyond the limits of the research also affect(s) ethical judgment. Based on the level of significance, it can be said that ethical judgment is directly affected by ethical perception, ethical intensity, and idealism. Table 4 Regression coefficient analysis-dependent variable: ethical intensity Model Unstandardized coefficients Standardized coefficients t Significance Collinearity statistics B Standard error Beta Tolerance VIF (Constant) 1.497 0.532 2.813 0.006 Idealism 0.418 0.105 0.331 3.982 0.000 0.976 1.025 Relativism 0.019 0.076 0.021 0.248 0.805 0.976 1.025 Dependent variable: ethical intensity

Ethical philosophy and ethical decision-making process 23 Table 5 Regression coefficient analysis-dependent variable: ethical perception Model Unstandardized coefficients Standardized coefficients t Significance Collinearity statistics B Standard error Beta Tolerance VIF (Constant) 1.489 0.495 3.008 0.003 Idealism 0.039 0.01 0.04 0.400 0.690 0.834 1.199 Relativism 0.028 0.07 0.035 0.424 0.673 0.971 1.030 Intensity 0.290 0.08 0.34 3.85 0.00 0.878 1.139 Dependent variable: ethical perception D Moral intention as dependent variable In this section, moral intention has been considered as dependent variable and its upstream variables as independent variables. Effect coefficients, which have been calculated based on the primary research model, have been presented in Table 7. As seen in Table 7, level of significance for beta is only significant in case of ethical judgment, ethical intensity, and relativism. This means that ethical judgment and ethical intensity, each with their respective indices, directly affect moral intention. Beta index being negative for relativism shows that relativism is directly and inversely related to moral intention. In other words, relativism decreases a person s intention for performing an ethical action. Significance of the constant shows that factor(s) beyond the limits of the research also affects moral intention. Based on the level of significance, it can be said that moral intention is directly affected by ethical judgment, ethical intensity, and relativism. The variance inflation factor (VIF) quantifies the severity of multi-collinearity in an ordinary least squares regression analysis. It provides an index that measures how much the variance (the square of the estimate's standard deviation) of an estimated regression coefficient is increased because of collinearity. As it can be seen, the Tolerance factor in Tables 6 and 7 are near 1 and VIF is less than 1.5. Therefore, independent variables are not correlated. Table 6 Regression coefficient analysis-dependent variable: ethical judgment Model Unstandardized Coefficients Standardized coefficients t Significance Collinearity statistics B Standard error Beta Tolerance VIF (Constant) 1.567 0.391 4.008 0.000 Idealism 0.047 0.074 0.157 0.632 0.032 0.833 1.2 Relativism 0.076 0.050 0.127 1.519 0.131 0.970 1.031 Intensity 0.128 0.061 0.196 2.115 0.036 0.788 1.27 Perception 0.136 0.067 0.179 2.026 0.045 0.865 1.155 Dependent variable: ethical judgment

24 M. Amirshahi et al. Table 7 Regression coefficient analysis-dependent variable: moral intention Model Unstandardized coefficients Standardized coefficients t Significance Collinearity statistics B Standard error Beta Tolerance VIF (Constant) 0.837 0.314 2.67 0.009 Idealism 0.020 0.056 0.023 0.350 0.727 0.842 1.188 Relativism 0.060 0.038 0.256 1.571 0.045 0.956 1.046 Intensity 0.087 0.045 0.128 1.938 0.046 0.833 1.201 Judgment 0.685 0.067 0.658 10.238 0.000 0.896 1.116 a. Dependent variable: moral intention Final path analysis model By illustrating significant relationships, the final research model has been presented as Fig. 2. The overall results of the effects of variables on each other are seen in Table 8. Hypotheses conclusions Based on Table 8, the outcome of hypotheses tests is presented in Table 9. Discussion According to Fig. 2, salespersons idealism relates directly to their ethical intensity and ethical judgment; and ethical intensity directly relates to the three aspects of ethical decision-making process (perception, judgment, and intention). Also, salespersons relativism is directly and inversely relates to their moral intention. The positive relationship observed between aspects of ethical decision making (perception with judgment and judgment with moral intention), indicates the sequence and correlation of these aspects. The direct relationship between ethical intensity and ethical decision-making aspects also shows that when people consider an ethical issue as intense, they make more ethical decisions. The direct relationship between idealism and ethical intensity shows that the idealists perceive ethical issues more intense and serious. In other words, they are more sensitive about the ethical issues. This sensitivity causes to recognize the ethical issue of the dilemma. This is the reason of direct (but not indirect) relationship between moral intensity and ethical perception (note that the majority of respondents are idealists). Ethical judgment is usually done based on salespeople's value system, after they perceived the existence of the ethical problem. Therefore, at this stage moral intensity does not affect directly. But it influences on ethical judgment

Ethical philosophy and ethical decision-making process 25 e Relativism e Moral Intensity 0.331 Idealism e -0.256 0.34 Ethical perception e 0.179 0.257 0.257 Ethical judgment 0.658 Ethical intention e e 0.242 Fig. 2 The relationships between research variables (obtained from path analysis) indirectly, by helping people to perceive the ethical issue and starting the ethical decision making process. The same thing happens for the ethical intention. On the other hand, moral intensity plays no role in ethical decision making process of relativists, because relativism has no effect on the perception of moral intensity among relativists. In other words, since the relativists pay attention to the outcome of a decision, they do not perceive the intensity of an ethical issue in a dilemma. Considering the fact that idealists hold specific ethical principles and values, they recognize and judge ethical behavior based on their idealistic principles. This is why we see the direct relationship between idealism and ethical judgment. However, it is noteworthy that idealism is not in direct relation with moral intention, which is the intention for acting based on ethical judgment, but indirectly (through ethical intensity and ethical judgment) affects moral intention. On the contrary, relativism (which has less regard for ethical principles than results of the action ) is in direct and inverse relation with moral intention. Accordingly, it appears that the salespersons intention for ethical/unethical action is directly affected by relativism and indirectly affected by their ethical perception and judgment. In this regard, it must be mentioned that the absolute value of the relationship between relativism and moral intention ( 0.256) is stronger than the relationship between idealism and ethical judgment (0.242). It means that the effect of relativism on the salespersons moral intention (which is closer to ethical behavior) is more than the effect of idealism on ethical judgment. The existence of a relationship between ethical perception and ethical judgment (0.179) and also between ethical judgment and moral intention (0.658) indicates that the salespersons pass through ethical decision-making phases respectively. In other

26 M. Amirshahi et al. Table 8 Analysis of path indices Total Indirect effect Amount of direct effect Total of Amount a Effect path indirect effects The effect of variables on each other Number 0.11 0.11 0.11 Idealism ethical intensity ethical perception 0.242 0.085 0.02 Idealism ethical intensity ethical perception ethical judgment 3 0.065 Idealism ethical intensity ethical judgment 0.188 0.188 0.042 Idealism ethical intensity moral intention 0.043 Idealism ethical intensity ethical judgment moral intention 0.103 Idealism ethical judgment moral intention 0 Idealism on ethical perception 0.157 Idealism on ethical judgment 0 Idealism on moral intention 0.331 0 0 0.331 Idealism on ethical intensity 0 0 0 0 Relativism on ethical perception 0 0 0 0 Relativism on ethical judgment 0.256 0 0 0.256 Relativism on moral intention 0 0 0 0 Relativism on ethical intensity 0.34 0 0 0.34 Moral intensity on ethical perception 0.257 0.061 0.061 Ethical intensity ethical perception ethical judgment 0.257 0.128 0.128 Ethical intensity ethical judgment moral intention 0.196 Moral intensity on ethical judgment 0.128 Moral intensity on moral intention 0.179 0 0 0.179 Perception on ethical judgment 0.658 0 0 0.658 Judgment on moral intention 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 a The amount of indirect effect is obtained by multiplying beta indices of the factors comprising the path. For example, the effect of idealism on ethical perception is calculated as follows: Path: idealism, ethical intensity, ethical perception: (idealism, ethical intensity) 0.331 (ethical intensity, ethical perception) 0.34=0.11

Ethical philosophy and ethical decision-making process 27 words, they form their judgment under the influence of their perception of the ethical issue, and their moral intention, to a great extent, under the influence of their ethical judgment. The positive relationship between ethical judgment and moral intention shows that (as expected based on research literature) moral intention for performing ethical actions is formed mostly based on people s judgment of ethical subjects. In brief, to answer the second research question regarding the effect of salespersons ethical philosophy on their ethical decision-making process, as depicted in Fig. 2, it must be mentioned that salespersons idealism only affects their ethical judgment directly; and salespersons relativism only affects their moral intention directly. Nevertheless, both idealism and relativism indirectly and through ethical intensity of the issue affect the salespersons ethical decision-making process. Although salespersons participating in this research are idealists, the effect of salespersons relativism is more influential on their ethical decision-making process than that of their idealism. Table 9 Conclusion of hypotheses analysis Hypothesis Approve/ reject Type of relationship Hypothesis 1: There is a relationship between ethical philosophy and ethical decision-making process. Hypothesis 1-1 Idealism has a positive relationship with ethical perception. Approved Indirect Hypothesis 1-2 Idealism has a positive relationship with ethical judgment. Approved Direct and indirect Hypothesis 1-3 Idealism has a positive relationship with moral intention. Approved Indirect Hypothesis 1-4 Relativism has a negative relationship with ethical Rejected perception. Hypothesis 1-5 Relativism has a negative relationship with ethical Rejected judgment. Hypothesis 1-6 Relativism has a negative relationship with moral intention. Approved Direct Hypothesis2: Ethical intensity has a positive relationship with ethical decision making. Hypothesis 2-1 Ethical intensity has a positive relationship with ethical Approved Direct perception. Hypothesis Ethical intensity has a positive relationship with ethical judgment. Approved Direct and indirect Hypothesis 2-3 Ethical intensity has a positive relationship with moral intention. Approved Hypothesis 3: Ethical philosophy has a relationship with ethical intensity of the issue. Hypothesis 3-1 Idealism has a positive relationship with ethical intensity Approved of the issue. Hypothesis 3-2 Relativism has a negative relationship with ethical intensity Rejected of the issue. Hypothesis 4 The majority of salespersons in this research are idealists. Approved Direct and indirect Direct

28 M. Amirshahi et al. Conclusions Findings of this research indicate that the respondents in this research are mostly idealists. This is not far from the expectations, taking into consideration that Iran is an Islamic and ethical society. There is a positive relationship between ethical intensity and ethical decisionmaking process (ethical perception, judgment, and intention) of the salespersons in this research. In other words, when a salesperson perceives the intensity of an ethical issue, he/she also perceives strongly the ethical issue involved in that situation and makes more use of his personal ethical principles. Therefore, when the salespersons, as idealist persons, perceive ethical issues intensely, make more ethical judgments. Table 8 shows the simultaneous existence of direct and indirect relationships between idealism and phases of ethical decision-making process. In other words, idealism, through increasing ethical intensity, leads the individual into ethical decision-making process. When the individual s perception of ethical intensity was enhanced, he/she strongly perceives the existence of an ethical issue. The mechanism of ethical decision-making process leads a person from ethical perception to judgment and intention. This is not far from expectations; because Iranian salespersons are Muslims and mostly idealists, and in Islam religion no harm (even the slightest harm) is considered insignificant and is forbidden so that annuls one s prayer (Imam Khomeini 1999). Therefore, such attitude makes idealists consider unethical issues as significant, even if they are trivial. Hence, the salespersons idealism affects their perception of intensity of ethical issues. In regard to the relationship between the salespersons idealism and the phases of their ethical decision making (ethical perception, judgment, and intention), it was found out that this relationship is only direct in case of ethical judgment. In other words, it seems that besides the indirect effect of ethical intensity and perception on their ethical judgment and intention, idealist salespersons make direct ethical judgments and then form their moral intention based on their strong idealism. One reason behind lack of a direct relationship between idealism and ethical perception and intention could be concealed in the fact that the salespersons, which mostly fall under hasty decision-making conditions, while forming a moral intention, pay attention to aspects of the issue for which they are accounted responsible and the effect of other aspects, including ethical aspects, on them are weakened. As mentioned while explaining the effects of ethical judgment, when people find contradictions between their ethical philosophies or between the interests of the beneficiary groups towards which they have duties, they use one or more specific ethical philosophies in making their decision and abandon other philosophies. Therefore, it appears that while forming ethical perceptions and intentions, the salespersons pay little attention to their ethical philosophy; because perhaps the conditions of their workplace do not allow the idealists to use their idealism as they wish in perceiving and shaping their moral intention. Figure 2 also shows that factor(s) beyond the limits of research variables affect people s perception or intention. The salespersons relativism is in direct and inverse relation with their moral intention. This relationship indicates that the salespersons in this research, who were mostly idealists, preserve high ethical standards and when they are supposed to recognize which behavior is right and which one is wrong (ethical judgment), they

Ethical philosophy and ethical decision-making process 29 judge based on their ethical principles. But when they approach the practice phase and form their moral intention (which is the phase prior to committing the ethical act), they consider the results of action rather than the ethically right action (the absolute value of the effect coefficient of 0.256 as compared to 0.188, in Table 8). Here also, it seems that an important factor which affects people in forming their moral intention is their workplace and expectations of their managers and supervisors. Trevino (1986) also showed that work conditions have a considerable effect on the employees moral intentions, in a way that they can modify the effect of personal values on ethical decision making. Therefore, again it seems that the conditions dominating the salespersons workplace can make idealist salespersons ignore their idealism and form their intention based on relativism. In this regard, it seems that the supportive role of managers of organizations and their practical advocacy of the salespersons (and the entire personnel s) ethical behavior can direct this non-inherent relativism (because the majority of the salespersons participating in this research are idealists) in line with their inherent ethics. As presented in Table 3, the salespersons participating in this research possess high ethical perception, judgment, and intention. However, there are numerous internal organizational as well as environmental factors which affect their actual performance. In other words, the findings of this research show that although salespersons at organizations are ready to present a high ethical performance, but they adhere to relativism. Thus, it is the duty of management team: (1) to formulate organizational codes of ethics, (2) to promote them in their organizations, (3) to strictly adhere to their content in order to create a suitable context for more ethical behavior by the salespersons (and the entire personnel), and (4) to guide, support, and encourage their personnel in performing ethical behaviors. Research implications It has been mentioned that the ethical behavior of the businesses increases capability of the organizations in absorbing and maintaining quality staff as well as good customers (Kaptein and Avelino 2005). Kaptein believes that paying attention to an ethical approach is increasingly spreading in the world and ethical criteria are rapidly becoming universal (2004). Thus, our findings are of great use not only for Iranian managers and organizations, but for their counterparts in other parts of the world and especially in Islamic work environments where culture setting is more similar. As this research finding indicates, managers should not leave what is considered to be ethical/unethical in their organizations to the individual interpretation of the sales people. Ethical behavior needs leadership and extends farther than mere formulation of organizational codes of ethics to actively support and implement them in their day to day businesses. Sinha and Mishra (2012) reported that environmental factors including social, governmental, professional, and work environment beside individual attitudes and values are important factors influencing ethical decision making. Therefore, if the environmental situations support the ethical behavior, probably salespersons decide to act according to their ethical philosophy and their ethical judgment. Reinforcing Sinha and Mishra findings, out research model aggregates all the above-mentioned environmental factors in moral intensity. It is a pre-requisite of ethical process (perception, judgment, and