The Role of Ethics Institutionalization in Influencing Organizational Commitment, Job Satisfaction, and Esprit de Corps

Journal of Business Ethics (2008) 81:343 353 Ó Springer 2007 DOI 10.1007/s10551-007-9498-x The Role of Ethics Institutionalization in Influencing Organizational Commitment, Job Satisfaction, and Esprit de Corps Scott John Vitell Anusorn Singhapakdi ABSTRACT. Given increasing ethical problems in business, many organizations have tried to control these problems by institutionalizing ethics such as by creating new ethics positions and formulating and enforcing codes of ethics. In this study, the impact of implicit and explicit forms of institutionalization of ethics on job satisfaction, esprit de corps, and organizational commitment for marketing professionals is investigated. Additionally, the influence of organizational socialization, ethical relativism, and age relative to each of the above organizational climate constructs is examined. Results indicate that at least one of the forms of institutionalization of ethics is a significant determinant of all three organizational climate constructs. Scott John Vitell is Phil B. Hardin Professor of Marketing and Chair of the Marketing Department at the University of Mississippi. He received his Ph.D. in Marketing from Texas Tech University. He has published more than 100 journal articles. His recent publications have appeared in the Journal of Retailing, the Journal of Business Ethics, the Journal of Marketing Theory and Practice, the Journal of International Marketing, International Business Review and the Journal of Macromarketing, among others. He serves on the Editorial Board of the Journal of Business Research. Anusorn Singhapakdi is Professor of Marketing and Marketing Area Coordinator at Old Dominion University. He has published more than 50 journal articles. He has also received recognition for his publications from a number of academic journals including the Journal of Business Research, International Marketing Review, Marketing Education Review, and the Journal of the Academy of Marketing Science. He serves on the Editorial Boards of the Journal of Macromarketing and the Journal of Marketing Education. He is a section editor for Applied Research in Quality of Life and has served as a guest editor for the Journal of Business Ethics. However, while organizational socialization is a significant determinant of all three organizational climate variables, relativism is only significant in determining organizational commitment (in a negative direction) and age is only significant in determining job satisfaction. KEY WORDS: ethics institionalization, job satisfaction, organizational commitment, esprit de corps Due to the increasing concern of the general public about ethical issues in business, many organizations have tried to control these problems through the institutionalization of ethics (Gellerman, 1986; Murphy, 1989; Stevens, 1994). For example, to provide ethical guidance to employees, some organizations have made structural and procedural changes such as creating new ethics positions (e.g., ethics ombudsmen and ethics committees) and have increased the formalization of ethics in the form of corporate codes of ethics and ethics newsletters (Badaracco and Webb, 1995; Briggs and Bernal, 1992; Cressey and Moore, 1983; Murphy, 1989; Stevens, 1994; Weiss, 1994). In addition to providing a positive impact on the ethical image of the firm and the ethical behaviors among employees, these different forms of ethics institutionalization directly benefit the organization since the U.S. Federal Sentencing Guidelines for Organizations, approved by Congress in 1991, provide for reduced penalties for organizations that can demonstrate a significant emphasis on ethics in compliance with minimum requirements specified by the U.S. Sentencing Commission in 1994 (Ferrell et al., 2002; Trevino and Nelson, 1995). These Sentencing

344 Scott John Vitell and Anusorn Singhapakdi Guidelines were amended in 2002, further adding to the importance of the institutionalization of ethics for the organization. Indeed, it can be argued that increasing institutionalization efforts by organizations, at least in the U.S., have been primarily due to the sentencing guidelines. Also driven by the public and organizational concerns, marketing scholars have shown an intense interest in ethics as a research area over the last two decades. Several significant ethics theories have been developed during that period (e.g., Dubinsky and Loken, 1989; Ferrell and Gresham, 1985; Hunt and Vitell, 1986) and numerous empirical studies investigating the ethical decision-making processes of marketing professionals have been conducted (e.g., Hunt and Vasquez-Parraga, 1993; Robin et al., 1996; Singhapakdi, 1999; Sparks and Hunt, 1998; Vitell et al., 1993). Particularly relevant to this study, different forms of ethics institutionalization, structural and procedural changes, and increased formalization of ethics, have generally been recognized by marketing ethics theories. For example, Hunt and Vitell (1986) as well as Ferrell and Gresham (1985) recognize that the organizational environment, of which the institutionalization of ethics is a part, is an important determinant of the decision-making processes of employees in situations involving ethical issues. Brenner (1992) has argued that organizations whether they even know it or not, have an ethics program either explicitly created or implicitly inherited. Examples of explicit aspects of ethics programs include codes of ethics, policy manuals, employee training and training materials, employee orientation programs and ethics committees. According to Brenner (1992), most of these programs, however, are not explicitly created, but are inherent in the culture of the organization. Examples of the more implicit aspects of ethics programs include incentive systems, leadership, promotion policies, and performance evaluations. How useful is the institutionalization of ethics for an organization? What is the impact of different forms of ethics institutionalization on marketing managers? While mainstream research in marketing ethics, both theoretical and empirical, has focused on the impact of the different forms of ethics institutionalization on the various components of ethical decisions of marketers, its impact on different aspects of the organizational climate has received only very limited attention. Thus, the present research is designed to help in narrowing this research gap. Specifically, this study investigates the influences of two different types of ethics institutionalization (implicit and explicit) on the marketing professionals job satisfaction, esprit de corps, and organizational commitment. The influence of organizational socialization and relativism is also investigated as is the impact of respondents age. Given increasing ethics institutionalization efforts by organizations in recent years, an investigation into the effects of the two forms of institutionalization on the attitudes of marketing professionals represents a contribution to both the marketing ethics literature and the general business management literature. Conceptual foundations and testing of hypotheses As already stated, marketing ethics models generally recognize that organizational culture, of which the institutionalization of ethics is a part, impacts a manager s ethical decisions. For example, Ferrell and Gresham (1985) depict organizational factors as one of the three major groups of independent variables underlying the ethical decision process. Consistently, Hunt and Vitell (1986) depict organizational environment as one of the key background variables of the ethical decision-making of marketers. Therefore, in general, we would expect the institutionalization of ethics by organizations to have a positive impact on marketing professionals not only in terms of higher moral standards but also in terms of higher job satisfaction, organizational commitment, and esprit de corps. Consistent with established theories, we might also expect characteristics such as relativism and organizational socialization to be important factors. Ethics institutionalization and organizational commitment As pointed out by Hunt et al. (1989), there have been abundant scholarly works on organizational commitment, and also numerous forms and definitions of organizational commitment. Drawing on the work of Buchanan (1974) and Hrebiniak and Alutto (1972), Hunt et al. (1989) conclude that the common theme in most of the definitions of

Role of Ethics Institutionalization 345 organizational commitment is that committed individuals tend to identify with the objectives and goals of their organizations and want to remain with their organizations (p. 81). Organizational commitment is important since committed employees tend to be more willing to make personal sacrifices for their organizations (Jaworski and Kohli, 1993). Based on a review by Ferrell et al. (2002), work factors that have the greatest influence on an employee s organizational commitment include ethical or ethically related elements such as fairness at work, care and concern for employees, trust in employees, and reputation of the organization. Furthermore, according to a study by Hunt et al. (1989), there is a positive relationship between corporate ethical values and organizational commitment. Consistently, a study by Maignan et al. (1999) revealed that proactive corporate citizenship, of which ethical responsibility is a part, can improve the levels of employee commitment. Furthermore, Schwepker (2001) found that, among salespeople, perceptions of a positive ethical climate were positively associated with organizational commitment. Finally, the results of a study by Valentine and Barnett (2003) suggest that the belief that one s organization has strong ethical values increases organizational commitment. Thus, based on the literature, one would expect marketers in organizations where ethics is more institutionalized to feel more committed to their organizations than their counterparts. Therefore, the following hypotheses are formulated: H1 a : Implicit ethics institutionalization positively influences organizational commitment. H1 b : Explicit ethics institutionalization positively influences organizational commitment. Ethics institutionalization and esprit de corps What effect does ethics institutionalization have on esprit de corps? When defining esprit de corps as the extent to which there is evidence of a team spirit within the organization (Jaworski and Kohli, 1993), one would expect that this team spirit would tend to go hand in hand with organizational commitment. Thus, similarly to organizational commitment, one might expect that the institutionalization of ethics programs would enhance and strengthen esprit de corps. Although no study has directly investigated the impact of institutionalization of ethics on esprit de corps, Moorman (1991) reported a positive relationship between perceptions of organizational justice and various relevant organizational citizenship behaviors such as altruism and civic virtue. In fact, as he points out, his findings are consistent with the view of Organ (1988, 1990) that these citizenship behaviors may be a function of an employee s beliefs that he or she has been treated fairly by the organization. Thus, the following hypotheses are postulated: H2 a : H2 b : Implicit ethics institutionalization positively influences esprit de corps. Explicit ethics institutionalization positively influences esprit de corps. Ethics institutionalization and job satisfaction An employee s overall job satisfaction is composed of several dimensions such as satisfaction with compensation, satisfaction with top management, satisfaction with promotions and satisfaction with coworkers. According to Dubinsky et al. (1986), job suitability and ability to deal with conflicts at work also have a positive impact on an employee s satisfaction with his or her work. A review of the literature reveals that no study has directly investigated the impact of the degree of ethics institutionalization on job satisfaction. However, a useful heuristic would suggest that people who work for organizations that institutionalize ethics would tend to be more satisfied with their jobs. One reason is that organizations that institutionalize ethics, either explicitly or implicitly, value integrity. By definition, this type of organization not only has codes of ethics and clear policy manuals, but also reflects them in the management of employees. As a result, one would expect these organizations to treat their employees more fairly for example, in terms of compensation, performance evaluation, promotion, and conflict resolution. In fact, according to a study by Moorman (1991), there appears to be a positive causal relationship between perceptions of organizational justice and job satisfaction. More recently,

346 Scott John Vitell and Anusorn Singhapakdi Schwepker (2001), in a study of salespeople, found that there is a positive association between their perceptions of a positive ethical climate and job satisfaction. Furthermore, organizations that institutionalize ethics may be less likely to impose any undue pressure on their employees to generate unreasonable profits. Accordingly, we can expect marketers in organizations with a higher degree of ethics institutionalization to be more satisfied with their job. Based on these findings as well as other supporting literature, the following hypotheses are formulated: H3 a : H3 b : Implicit ethics institutionalization positively influences job satisfaction. Explicit ethics institutionalization positively influences job satisfaction. Socialization In addition to the influence of the institutionalization of ethics on job satisfaction, organizational commitment, and esprit de corps, the impact of two other independent constructs will be examined. These are the degree of socialization of the decisionmaker and the extent to which the individual decision-maker is an ethical relativist. The degree of organizational socialization is defined as the process by which a person learns the values, norms and behaviors... of the organization (Van Maanen, 1976, p. 67). Since one cannot expect to be socialized into any organization without knowing the values and norms of that organization, one might expect that the greater the degree of organizational socialization, the greater is the likelihood of job satisfaction, organizational commitment, and esprit de corps. Numerous studies have supported this notion. For example, Allen and Meyer (1990) and Baker (1992) both reported a positive link between socialization and both job satisfaction and organizational commitment. In a subsequent study, Baker and Feldman (1990) again found that socialization was positively associated with both job satisfaction and organization commitment. Finally, organizational commitment and satisfaction with communications in an organization were found to be positively linked to socialization by Mignerey et al. (1995). While esprit de corps was not examined in these studies, one might expect a similar relationship between socialization and the esprit de corps construct. Thus, the following hypothesis is examined: H4: Organizational socialization positively influences: (a) Organizational commitment, (b) Esprit de corps and (c) Job satisfaction. Relativism As mentioned, relativism, the extent to which the individual decision-maker is an ethical relativist, is also included as an independent construct. More specifically, relativism is the extent to which an individual tends to reject the notion that absolute moral principles exist (Forsyth, 1980). In other words, relativists tend to adhere to a moral philosophy based somewhat upon skepticism. As Forsyth (1992, p. 462) explained, relativists generally feel that moral actions depend upon the nature of the situation and the individuals involved, and when judging others they weigh the circumstances more than the ethical principle that was involved. To the best of our knowledge, virtually all studies using relativism in a marketing context have dealt with its influences on different components of ethical decision-making. For example, the study of professional members of the American Marketing Association (AMA) by Vitell et al. (1993) partially supports their hypothesized negative relationship between relativism and various dimensions of marketing specific norms. Consistently, in another study of AMA members, Singhapakdi et al. (1995) found a negative relationship between relativism and a marketer s perceived importance of ethics. Similarly, a study by Sparks and Hunt (1998) revealed a negative relationship between relativism and ethical sensitivity. Since relativists tend to not always adhere to marketing norms, tend to place less importance on ethics, and tend to be less ethically sensitive, one would intuitively expect them to be lower in terms of their job satisfaction, organizational commitment, and esprit de corps as well. Therefore, based upon the empirical evidence as well as the conceptual evidence discussed, we expect

Role of Ethics Institutionalization 347 the relationships between relativism vis-à-vis job satisfaction, organizational commitment, and esprit de corps to be negative. H5: Relativism negatively influences: (a) Organizational commitment, (b) Esprit de corps and (c) Job satisfaction Age The impact of a single demographic variable will also be examined. This variable is the age of respondents. Since the relationships of this demographic variable with organizational commitment, esprit de corps, and job satisfaction may be somewhat speculative, no specific hypotheses were included. Methodology Sample The study used a self-administered questionnaire as the data-collection technique. The data came from two sources: a sample of U.S. practitioner members of the AMA (1000) and a national sample of marketing professionals purchased from a firm specializing in mail lists (1500). Individuals in the sample were sent a brief letter by regular post which directed them to a website where the survey could be completed. The AMA sample resulted in 101 responses (10.1%) while the purchased sample resulted in 205 responses (13.7%). This represents a combined response rate of 12.24%. A comparison of the two samples using t-tests on several demographic as well as substantive variables resulted in no significant difference between the samples. Thus, the two sub-samples were combined for purposes of this research. Table I summarizes the demographic profile of the overall sample. Measurement: dependent measures Organizational commitment The 7-item organizational commitment scale developed by Jaworski and Kohli (1993) was adopted for use in this study to measure a manager s degree of commitment to the organization. The scale was originally designed to tap the extent to which a business unit s employees were fond of the organization, and were willing to make personal sacrifices for the business unit (Jaworski and Kohli, 1993, p. 60). One example of an organizational commitment item is Employees often go above and beyond the call of duty to ensure this business unit s well-being. A 7-point agree/disagree Likert format was used. Like those of Jaworski and Kohli (1993), our results indicate that the scale is reliable with a coefficient alpha of 0.917. Esprit de corps TABLE I Profile of respondents Variables % Gender Male 58 Female 42 Age 29 or under 7.9 30 39 27.2 40 49 33.3 50 59 25 60 or over 6.6 Years of business experience 5 or under 6.6 5 10 15.4 11 15 16.8 16 20 14.1 21 25 19.3 26 30 14.1 30 or over 13.7 The esprit de corps scale developed by Jaworski and Kohli (1993) was also adopted for use in this study. This scale consists of seven items designed to assess the extent to which a team spirit prevailed in the organization (Jaworski and Kohli, 1993, p. 60). One example of an esprit de corps item is People in this business unit are genuinely concerned about the needs and problems of each other. A 7-point agree/ disagree Likert format was also used with a high score indicating a high level of esprit de corps.

348 Scott John Vitell and Anusorn Singhapakdi Again, like those of Jaworski and Kohli (1993), our results also indicate that the scale is reliable with a coefficient alpha of 0.945. Job satisfaction Job satisfaction was measured by the 5-item scale used by Dubinsky and Hartley (1986) and Dubinsky et al. (1986). One characteristic example of a job satisfaction scale item is Generally speaking, I am very satisfied with this job. A 7-point Likert type scale ranging from strongly disagree (value of 1) to strongly agree (value of 7) was used to measure this scale; thus, higher values indicate that the respondent is generally satisfied with his or her work. This scale had a coefficient alpha of 0.890. Measurement: independent measures Institutionalization of ethics scale The specific instrument used contained 15 items for measuring the institutionalization of ethics. This scale was originally developed by Singhapakdi and Vitell (2007). A maximum likelihood factor analysis was performed on these items resulting in a twofactor solution. The first factor explained 46.0% of the variance and the second factor explained 17.5% of the variance. Factor one, representing a more explicit institutionalization of ethics, consists of 9 items while the second factor, representing the implicit institutionalization of ethics, consists of 6 items. An example of an explicit institutionalization item is, Top management evaluates the ethics training programs on a regular basis. An example of an implicit ethics institutionalization item is, In my organization there is a sense of responsibility among employees for maintaining an ethical reputation. The explicit scale had a coefficient alpha of 0.933 while the implicit dimension had a coefficient alpha of 0.909. study. It measures the extent to which someone has learned the values and norms of an organization of which he or she is a member, in this case one s employer. The scale is exemplified by items such as, I know how things are done around here and I know the rules and regulations associated with my job. A 7-point agree/disagree Likert format was used with a high score indicating a high degree of organizational socialization. This scale had a coefficient alpha of 0.721. Relativism The short/revised version used by Sparks and Hunt (1998) to measure relativism was employed in this study. This measures the extent to which an individual rejects moral absolutes and rules. It is a 5-item scale that uses three items from Forsyth s (1980) original relativism scale and adds two new items. This scale is exemplified by items such as, Different moral and ethical codes cannot be compared as to rightness and I should refrain from judging other people s actions because my moral code applies only to me. A high score indicates a high degree of ethical relativism. A 7-point agree/disagree Likert format was used and the scale had a coefficient alpha of 0.821. Results All research hypotheses were tested using multiple regression analyses. As a preliminary step, a correlation analysis of all variables of the study was conducted (the results are included in Table II). The correlation results indicate that both implicit institutionalization and explicit institutionalization are significantly correlated with organizational commitment, job satisfaction, and esprit de corps. It should be noted that, in order to observe the separate impact of each type of ethics institutionalization, these two variables were not included together in the same regression model. Organizational socialization The 4-item organizational socialization scale developed by Sparks and Hunt (1998) was adopted for this Ethics institutionalization The regression analyses results for hypotheses H1 a and H1 b relating to organizational commitment are

TABLE II Correlation matrix IMPLICIT EXPLICIT ESPRIT ORGCOM JOBSAT RELATIV SOCIAL AGE IMPLICIT 1.000 EXPLICIT 0.404** 1.000 ESPRIT 0.658** 0.223** 1.000 ORGCOM 0.664** 0.278** 0.778** 1.000 JOBSAT 0.595** 0.258** 0.706** 0.698** 1.000 RELATIV )0.218** )0.204** )0.226** ).265** )0.238** 1.000 SOCIAL 0.501** 0.231** 0.443** 0.466** 0.424** )0.200** 1.000 AGE 0.225** 0.109 0.115 0.153* 0.239** )0.137* 0.141* 1.000 * Correlation is significant at the 0.05 level (2-tailed). ** Correlation is significant at the 0.01 level (2-tailed). IMPLICIT: Implicit Institutionalization. EXPLICIT: Explicit Institutionalization. ESPRIT: Esprit de Corps. ORGCOM: Organizational Commitment. JOBSAT: Job Satisfaction. RELATIV: Relativism. SOCIAL: Organizational Socialization. AGE: Age of the Respondent. Role of Ethics Institutionalization 349 summarized in Table III. As indicated, the regression results reveal that implicit ethics institutionalization is a significant predictor of organizational commitment in a positive direction as hypothesized. Our results also reveal that explicit forms of ethics institutionalization are also significant. Therefore, hypotheses H1 a and H1 b are both TABLE III Regression analyses organizational commitment Variables b T p Model with implicit institutionalization a Implicit institutionalization 0.502 9.210 0.000 Relativism )0.105 )2.014 0.045 Socialization 0.194 3.334 0.001 Age )0.002 )0.033 0.974 Model with explicit institutionalization b Explicit institutionalization 0.155 2.463 0.015 Relativism )0.136 )2.159 0.032 Socialization 0.400 6.327 0.000 Age 0.053 0.857 0.393 a Adjusted R 2 = 0.465, F = 46.837, Significant F less than 0.001. b Adjusted R 2 = 0.256, F = 18.407, Significant F less than 0.001. supported. One can conclude that both implicit and explicit forms of institutionalization directly influence an employee s organizational commitment. Results for esprit de corps appear in Table IV and indicate that implicit institutionalization is a significant determinant of esprit de corps, but that explicit TABLE IV Regression analyses esprit de corps Variables b T p Model with implicit institutionalization a Implicit Institutionalization 0.553 9.184 0.000 Relativism )0.070 )1.308 0.192 Socialization 0.166 2.787 0.006 Age )0.045 )0.845 0.399 Model with explicit institutionalization b Explicit Institutionalization 0.099 1.537 0.126 Relativism )0.118 )1.808 0.072 Socialization 0.387 5.945 0.000 Age 0.007 0.102 0.918 a Adjusted R 2 = 0.429, F = 41.345, Significant F less than 0.001. b Adjusted R 2 = 0.199, F = 13.826, Significant F less than 0.001.

350 Scott John Vitell and Anusorn Singhapakdi institutionalization is not. Thus, H2 a is supported, but H2 b is not. The regression analyses results for hypotheses relating to job satisfaction (H3 a and H3 b ) are given in Table V. As indicated in the table, implicit institutionalization is a significant determinant of job satisfaction, but explicit institutionalization is not (only significant at the 0.10 level). Thus, hypothesis H3 a regarding the overall impact of implicit ethics institutionalization on job satisfaction is supported, but hypothesis H3 b, regarding explicit ethics institutionalization, is not supported. Socialization and relativism As is also evident in Tables III V, the degree of organizational socialization (H4) of the individual is a significant determinant of job satisfaction (H4 c ), organizational commitment (H4 a ) and esprit de corps (H4 b ). That is, the greater the socialization, the greater the job satisfaction, the greater the organizational commitment, and the greater the esprit de corps. Regarding a relativist perspective (H5), it was a significant determinant of only organizational commitment (H5 a ) with more relativistic employees being less committed to the organization. The impacts of relativism on esprit de corps (H5 b ) and job satisfaction (H5 c ) were not supported. TABLE V Regression analyses job satisfaction Variables b T p Model with implicit institutionalization a Implicit Institutionalization 0.455 7.013 0.000 Relativism )0.092 )1.595 0.112 Socialization 0.156 2.429 0.016 Age 0.080 1.400 0.163 Model with explicit institutionalization b Explicit Institutionalization 0.117 1.800 0.073 Relativism )0.100 )1.534 0.127 Socialization 0.347 5.331 0.000 Age 0.137 2.144 0.033 a Adjusted R 2 = 0.347, F = 29.216, Significant F less than 0.001. b Adjusted R 2 = 0.203, F = 14.028, Significant F less than 0.001. Age Although not hypothesized, the demographic variable, age, was tested in the regression analyses. This was not a significant determinant of any of the dependent variables with the sole exception being job satisfaction, however, where older respondents tended to have higher job satisfaction. Discussion and implications As stated previously, due to an increasing concern of the public about ethical problems in business, organizations have tried to control the problem by institutionalizing ethics. In addition to helping control ethical problems, different forms of ethics institutionalization may have a disparate impact upon different aspects of the organizational climate. As previously stated in the introduction, this issue has received only limited attention. This study investigated the influences of the two forms of the ethics institutionalization on the job satisfaction, organizational commitment, and esprit de corps of marketing professionals. The results revealed that, overall, both the implicit and explicit institutionalization of ethics tended to have a positive impact on these three constructs. However, implicit ethics institutionalization tended to be a more significant determinant of the organizational climate constructs tested. While clearly organizations should have explicit rules and guidelines including ethical codes established and strictly enforced to make it clear to employees what are the proper courses of action to follow, implicit institutionalization is at least as important, and perhaps more so. Perhaps, organizations should also pay close attention to implicit institutionalization including, top management commitments and ethical leadership, and other actions that essentially amount to changes in the culture of an organization itself. Of course, the difficult question is how can an organization instil appropriate values or beliefs among its employees? The authors believe implicit institutionalization may in fact require certain explicit acts of institutionalization. For example, leadership training, with an ethics component, may be necessary to help managers understand or value the

Role of Ethics Institutionalization 351 importance of ethics to the success of the organization. This is consistent with Singhapakdi s (1999) recommendation that to nurture a marketer s realization of the important role of ethics and social responsibility, the topics should be incorporated into the marketing training programs as well as other forms of communication to employees. Furthermore, results reveal that the degree of an individual s organizational socialization is clearly a significant determinant of job satisfaction, organizational commitment, and esprit de corps. These results imply that an employee s understanding of the values and norms of the organization is essential. That is, if top management wants its employees to have greater job satisfaction, greater organizational commitment, and greater esprit de corps, it is important to communicate to them, on a regular basis, the values and norms as well as the rules and guidelines of the organization. The degree of ethical relativism had little impact on the constructs, job satisfaction, and esprit de corps. This may mean that the institutionalization of ethics by the organization can have even a greater impact than what might be at first expected. That is, regardless of the particular employee s individual perspective vis-à-vis ethics, the institutionalization of ethics by the organization can result in greater job satisfaction and esprit de corps. Clearly, the benefits of institutionalizing ethics for organizations go well beyond controlling unethical problems as our results indicate, ethics institutionalization should also lead to a more positive organizational climate. Relativism did have a negative impact on organizational commitment indicating that relativists were less committed to the organization. This also indicates the importance of ethics institutionalization for organizations as a means for overcoming this tendency among relativists. Some limitations may be present. First, crosssectional data were used to develop causal predictions. However, marketing, as well as other disciplines, are now more amenable to studies exploring causal relationships on the grounds that they only contain cross-sectional data. Still, this leads one to suggest that in the future longitudinal studies should be attempted using the institutionalization of ethics scale. Second, the response rate is somewhat low. Nevertheless, as we are primarily examining the relationships among constructs rather than generalizing to a broader population, this does not pose a significant problem. Future research should examine the link between the institutionalization of ethics, both implicit and explicit, and constructs such as intentions and behaviors in specific situations that have ethical content. Future research should also explore the relationships between the institutionalization of ethics and other components of the ethical decision-making process specified in various ethics theories. These components might include constructs such as moral intensity, perceived ethical problems and ethical judgments (e.g., Ferrell and Gresham, 1985; Hunt and Vitell, 1986; Jones, 1991). The institutionalization of ethics should also be studied within the context of different types of industries, cultures and professions. Such studies would be likely to add to the richness of our knowledge and understanding in the ethics field. Since the institutionalization of ethics is to a large degree a controllable factor, a high priority should be given to further studying its impact on the organizational culture. Furthermore, given that survey research is becoming more and more difficult (e.g., the somewhat low response rates experienced in this study), future research should explore other data gathering methodologies. One such approach that has been more widely used by management researchers and organizational psychologists in their studies of ethical behavior is laboratory experiments and simulations (e.g., Hegarty and Sims, 1978, 1979). We believe laboratory experimentation and/or simulation could and should be utilized more in ethics studies in the marketing area. Where consumer ethics are being researched, field experiments may even be possible. However, whatever research design approach might be used, we trust that the results generated by this research can be successfully used to guide future ethics research projects. References Allen, H. J. and J. P. Meyer: 1990, Organizational Socialization Tactics: A Longitudinal Analysis of Links to Newcomers Commitment and Role Orientation, Academy of Management Journal 33, 847 858. Badaracco, J. L., Jr. and A. P. Webb: 1995, Business Ethics: A View From the Trenches, California Management Review 37(2), 8 28.

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