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A Classification Scheme For Codes of Business Ethics
A Classification Scheme For Codes of Business Ethics
Lere Source: Journal of Business Ethics, Vol. 49, No. 4 (Feb., 2004), pp. 329-335 Published by: Springer Stable URL: http://www.jstor.org/stable/25123179 . Accessed: 23/04/2013 08:33
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Bruce R.
A great deal of interest in codes of in both the business community and the
Within given rise the to academic a number commu of studies has
Introduction Researchers to systematically examine, may wish or in some way process codes classify, categorize, of business ethics in order to facilitate discussion, enable of codes use the scientific comparisons, of ethics. scientific method To of understanding to so, they might wish method. Hallmarks of the do and advance
community. interest
is by the study of codes of ethics can be advanced applying formal tools of analysis to codes of ethics. An understanding of important dimensions that may
differ across codes these of ethics, a common and a means to describe dimensions, terminology to measure
these dimensions
They isons, will and also advance
will
facilitate our
facilitate
discussion,
applying
enable of
such tools.
compar codes of
include classi investigation data and fication, collection, quantification, the testing of hypotheses statistical by applying to empirical methods data. These processes pervade sciences, to codes tary used in research scholarly but tend to be absent of business and and some ethics. in the in articles physical devoted rudimen have been studies
understanding
Although
counts
among
shape, introduces dimensions.
codes of ethics:
thematic metrics content, that
length,
and can be
focus,
tone. used
level of detail,
The paper also the to measure
categorizations
KEY WORDS:
of ethics, ethical
business
comparisons,
ethics,
classification,
ethical issues,
codes
ethics,
Preble,
professional
ethics
and 1992; Miesing Singh, and Richard, 1985; Montoya 1994; Oz, and Hoffman, 1993; Preble 1999; Wiley, 2000), the ability to comprehensively capture the com in most inherent codes of business ethics plexities in its infancy. remains For the most part, even generally attributes accepted terminology of codes of ethics to try to measure wish that the that identifies the a researcher These of of
Kaye, Lefebvre
descriptive/exploratory Lere, 2002; Jamal and Bowie, and 1992; Langlois Schlegelmilch, and
might difficulties Bruce R. Gaumnitz is Professor ofAccounting at St. Cloud State University in St. Cloud, Minnesota, U.S.A. His research has been published in a variety of professional
and academic journals.
is lacking.
the
virtually preclude application to studies scientific method of codes ethics. paper introduces classification and discusses that
a robust
is Professor ofAccounting at St. Cloud State in St. Cloud, Minnesota, U.S.A. He is the two books, Pricing Techniques for the Executive and Managerial Accounting:
and Framework,
can be system powerful to summarize the structural applied concisely form and topical of codes of business emphasis ethics. An concepts and which example contained illustrates is provided in the that reinforces the the classification Although scheme
its efficiency.
^g. **
2004. Journal of Business Ethics 49: 329-335, ? 2004 Kluwer Academic Publishers. Printed in theNetherlands.
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Gaumnitz
and John
ments
C. Lere
on another theme.
appears simple to apply, any the content of a code of ethics of non-trivial issues that the of these A number
Once
again,
informa
tion
or more
Here,
a code
spread
of ethics
across
containing
nine topic
nine
areas.
address. issues
implementation
are discussed
in the paper.
of for
themes
could code
the nine-theme limited light on the in the code. All the nine-theme
from
to indicate
focus,
shape,
statistic is that at least nine statements summary must be present. The actual number of statements could be nine, 90, 900, or more. This presenta tion also fails to allow one to form a compre hensive ethics. understanding of a code of business
Length Level examina easy starting point for a systematic tion of a code of ethics is to count the number or ideas that it contains. statements of distinct can range from the count to This single digits To illustrate much this measure larger numbers.1 An of length, statements The all that item or distinct a code of ethics that contains nine code. is that is described as a nine-statement of this measure What measure of detail is needed that but This is also some not form of composite the number of
involves
sounds
is the This
state
limitation
number
count
is the length of the code. An to address the content nothing statements themselves. Each counts as one more in is an impor loss occurs
as a is easily theme, per interpreted of the code's level of detail. A code with statements of five than a code with is more per theme a mean of two state
nature
the
simply total. Although length tant dimension, serious information if this measure is all that is used. the overall
statement
theme. this while per Unfortunately, statistic has considerable immediate appeal, if told that the mean number of statements per theme for a particular code is three, one can determine the number of statements. across two of themes There 10 themes themes. if told three code that a particular statements per theme, and contains nine separate still have rather limited nature has been about of the said the code. in the nor the present state 30 be might or six statements
neither Focus Another tions a code of ethics to examining approach nature is to concentrate of the obliga the upon and number ments
to arrange them by "theme" imposed or topic area.2 Unlike the preceding approach, counts this technique the number of topics con ameasure of focus (few themes sidered, providing or topics) or breadth (many themes or topics).3 A shortcoming if used by itself of this measure is that it ignores the level of detail that charac on one theme statement terizes the code. One is reported no differently than multiple state
spread even Moreover, has an average of addresses statements, information For one three
spread across
the
thing, to
unclear.
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A Classification structure the overall however, code is now well defined. or shape
of Business
Ethics
331
Shape To that notion, dispel in Exhibit summarized consider 1. Each the three codes nine
levels of detail of three state average (a mean ments The essential difference here per theme). is that the authors of Code C and its affiliated are with Theme 1, organization preoccupied which is presumably to of crucial importance satisfactory industry. emphasis 2 or 3. behavior Their on Theme and performance code much places 1 than it does in their greater on Themes
contains
Thus, they have equal length. Each three themes. Hence, they are equally The mean of statements number per for each code. This means that
is three
are equal. What levels of detail average differs across the three codes presented in Exhibit 1 is their thematic Thematic emphasis. emphasis is a multi-variate that addresses the concept relative themes. Theme places followed Code C concentration Code A of statements across for displays equal emphasis 3. Code B 1, Theme 2, and Theme on the greatest Theme 1, emphasis 2 and Theme 3, respectively. by Theme is still more for Themes for Theme A, B, and C equal focus extreme, providing 2 and 3 but much 1. exhibit (three (nine length and equal themes), equal equal greater
In contrast, Code A exhibits equal across the B three and Code themes, emphasis an intermediate The reporting occupies position. of the number of statements, the number of and the mean number of statements themes, per theme fails to shed light on the relative disper across themes or the "shape" sion of statements of the code of business ethics. A of capturing "horizontal" the code An be What "shape" of ethics extreme one with themes. stresses entirely is needed of a code is one is a means of ethics. that stresses
distinct
statements),
"vertical" code of ethics is one that a particular or almost theme, entirely to the exclusion of others themes. An of a vertical code would be one with all of which of the same be used address theme or slightly dif
EXHIBIT 1
Sample code structures
CODE A:
Theme
statement statement statement
Theme
statement statement statement
separate tinguish to indicate how many each theme. Referring code code
topic. to capture shape. As is 1, columns may be used to dis are then used themes. Numbers statements back to appear within the horizontal
CODE
B:
Theme
statement statement statement statement statement
Theme
statement statement
Theme
statement statement
in the previous that example paragraph, as having a "1 1 1 1 1 could be described 1111" In contrast, the shape shape or structure. of the vertical code in the previous is paragraph
"9".
CODE C:
Theme
statement statement statement statement statement statement statement
Theme
statement
Theme
statement
Of course, not all multi-theme codes have just one statement It is also important to per theme. realize that themes (e.g., honesty, confidentiality, are In other classes. etc.) simply categorical no have natural order words, they (i.e., they are not ordinal groupings). without either Therefore, or information, loss of generality the numbers used within order. Exhibit 2", to indicate each theme statements many appear be in descending listed may this convention, Code C from is a "5 2 how
Adopting 1 has a "7 1 1" shape, Code B and Code A has a "3 3 3" shape.5
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Gaumnitz
C. Lere
are told
is reversible. Suppose process that an organization has a code of a "5 2 2" shape. The shape of the communicated this compact else can be determined from this that this code The It three or statements. communicated. code The has focus with
characteristic of (thou
of a code
ethics have
ethics
length of the code can be determined themes breadth Now ments (count of the the code
though both directing are present in most codes of business of business ethics with inspirational, or positive statements tones make
pro (thou statements. Even not) statements and prospecting ethics, codes
communicated.
having and
both the number of state computed of themes, the number the mean can statements of theme be per to be The three across (9 statements spread code's level of detail has been The "5 2 2" classification information.6 considerable
aspirational, use of directive greater than do codes of business ethics with or tones. negative legalistic, regulatory, to Tone reflects an overall emotional reaction subjective of a code impression tone may be more discussed behind or attribute of business
communicated concisely
as well.
conveys
ethics. closely
are more codes regulatory or discipli with enforcement codes whereas inspirational to the organization's purpose to use a code and tone is to represent For that are positive. 6 containing statements. to be 75% emotional
Thematic To of
content
terms theme content, incorporate descriptive can be appended to the numerical designation the code's shape. These additional modifiers
possible
metric of
statements
are arranged to themes in the same to correspond counts statement in which the theme order appear. a code means across
themes
of ethics
In other
words,
a "5
four
are
Because formal
tone
to overall
the
state
this metric
theme.
present,
(unspecified)
by
code
to a "5 1 1 comparable even though they have two codes differ with
of is only a crude measure area in the of analysis progresses more of tone refined measures and developed.
Discussion If researchers wish to systematically examine, or in some way process codes the scientific method, using of
the greatest respect to the theme with emphasis. con a "3 2 1 1 1, honesty, As a final example, fidentiality" statements, code has contains three five statements themes, eight that address
two statements related honesty, each themes and three more statement. themes notation, modifiers zation of is The also nature of these
to confidentiality, covered by one three additional into the list characteri the of
easily incorporated if desired, by extending the numerical that follows shape of the code.
to more clearly communi them both ethics, among to In addition, need selves and to others. they a set of characteristics be able to clearly identify ethics that can be measured, of codes of business able and summarized, are ethics business ments, these analyzed. Since qualitative may codes docu involve and add of inherently measurements
the
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of Business structure
Ethics
333 a framework may degrade about whether ethics for dis into and are
cussions,
to provide communication
summarized concepts I and the derived measures summarized Table a starting in Table II provide for the point fundamental systematic of business scheme discussion ethics. and The of codes investigation classification proposed notation add additional and no classifi
unproductive disagreements in what codes of business respects similar or different. Vague terminology
communication, measurement,
hampers
analysis.
and
Exhibit
an illustration 2 provides of the type of are and comparisons that discussion by supported to structured the proposed the study approach of business ethics.
terminology
TABLE I
Fundamental concepts
STATEMEMT:
idea or requirement.
Statements
ethics. Each
statement
represents
a separate
LENGTH: THEME:
of statements
The
ethics
is the number
of statements
A theme
present
of one or more
business ethics
statements
must always
number
themes.
FOCUS/BREADTH:
with few themes are
Focus
focused.
and breadth
Codes with
to the number
examples
of themes
are referred
addressed. Codes
to as "vertical"
Extreme
and "horizontal"
codes
(see Table
II).
TONE: Tone reflects a composite reaction to and subjective impression of a code of business ethics. emotional to Codes of business ethics may be classified along a tone continuum ranging from inspirational/aspirational
legal/regulatory.
TABLE II
Derived measures
DETAIL:
Detail
is measured
as
the
average
or mean
number
of
statements
per
theme.
It is a
single
measure
for
a code of business
EMPHASIS: The
ethics
number proportion themes, represents
taken as a whole.
of statements of not or of total
A higher(lower)
that address that a
mean
corresponds
theme theme
to a greater(lesser)
of that
level of detail.
emphasis. is a character
theme's
Emphasis
a code
taken
Shape to
captures
details
distribution
of
statements
across
themes.
It
may
zontal"
be expressed
"vertical."
using numbers
as being
a location
along
the continuum
from "hori
HORIZONTAL:
extreme example
A pure horizontal
of shape, representing
code
stresses theme
breadth
coverage.
for the
It has one
of
statement
statements
is an
ultimate
number
VERTICAL:
example of
A pure vertical
shape, representing
to emphasize
THEMATIC
a theme.
CONTENT:
of
Thematic
thematic content
content
characterizes
are
to the statements
and continuing
that comprise
professional
Examples
categories
development.
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334 Bruce R.
Gaumnitz
and John
C.
Lere
EXHIBIT 2
Communication
SCENARIO: A researcher asks another researcher to
illustration
comment the similarities, differences, and charac
upon
ethics for
two organizations.
This first code of ethics contains nine statements, each addressing a different RESPONSE: to virtually any employee at any theme. Thus it is a "1 1 1 1 1 1 1 1 1". It is equally applicable/inapplicable in any industry. As a result, this code appears to be a legal-compliance document level in any business organization
has a negative code or also regulatory contains tone. nine statements and is a "3 2 1 1 1 1, control, Two of the
and The
second
quality
honesty."
four
stand-alone
the
themes,
horse's
the ones
health its
about hoof
owner or
dipping
to communicate
related to being
significant
a Master
observations
Farrier (i.e.,
concerning
care-provider,
to in the horse shoeing industry). They are also directive or inspirational statements that contribute participant more nine is than six this code focused instead of this code's positive tone. Touching themes, upon narrowly an average of one is appreciably greater. With the first one, and its emphasis on quality control and honesty and a half statements per theme it is also more detailed than the first code.
the precision and effi improve In addition, of communication. orderly ciency or can serve as a starting classifications point measurements. The foundation for quantitative and classification notation, scheme, proposed allow for the appli associated may terminology ethics cation statistical business of systematic techniques ethics. methodologies to the study and/or of codes of
The ideas in other code sentences may not be as those in the sentence as clearly different above. and For example, I will not violate the privacy I obtain about information of my confidentiality as statement Is this one business. employer's or are there two obligations in this written sentence: information business tiality and of (1) I will I not not violate about violate I obtain the my privacy of obtain employer's the confiden about my
business?
Appendix Although a code in of statements the number counting have been is easy once the statements is not is and what what identified, determining a statement The judgment. requires professional of statements when do is not as the number ties relate encountered to sentences that code of sentences. necessarily Two major the same difficul ideas and include an
do not include an ethical an obligation that really no of An additional obligation. example imposes are important is: Ethics for the the first sentence such a of society. Because efficient functioning it is not sentence includes no specific obligation, considered classification A statement to be a statement scheme. that really is: Iwill behave could no additional imposes in an ethical manner. this by itself is the in a code included it adds nothing to for purposes of this
number
a statement
than one
statements also
a code might For example, obligation. sentence: I and obey be honest will the include I will be is really two statements: the law. This I will obey the law.
the Presumably, already present. an in ethical define behaving so satisfying of the other the obligations satisfies this statement. exist as to one would
honest.
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J.
Notes related to identifying difficulties Implementation are statements discussed in the appendix. 2 A theme is a collection of one or more related
statements. The theme "honesty," for example,
all of which the following statements, encompasses might be found in a single code of business ethics: (1) shall not mis Members shall be honest. (2)Members represent their educational backgrounds. (3)Members shall not misrepresent their professional certifications
or licenses. The number of statements present in a
Business Ethics of Professional in the United States', Journal of Organizations Business Ethics 35(1), 35-49. 'Theoretical 1995, Jamal, K. and N. E. Bowie: a Meaningful Considerations for Code of Professional Ethics', Journal of Business Ethics 14(9), 703-714. in Australian 'Codes of Ethics 1992, Kaye, B. N.: Business Corporations', Business Ethics Journal of 857-862. 11(11), 1990, 'Do Langlois, C. C. and B. B. Schlegelmilch: Codes Codes of Ethics Reflect National Evidence from Europe and the United States', Journal of International Business Studies 21(4), 519-539. and Lefebvre, M. and J. B. Singh: 1992, 'The Content Focus of Canadian Corporate Codes of Ethics', Journal of Business Ethics 11(3), 799-808. P. and J. F. Preble: 1985, 'A Comparison of Miesing, Five Business Business Philosophies', Journal of Corporate Character? Ethics 4(6), 465-476. I. D. and Montoya, A. J. Richard: of Codes of Ethics 'A 1994, in Health
of
code
or
of business
to the
ethics must
number of
always be greater
themes.
than set of
and
equal
Although
themes, some there themes
there
may such as
is no
be
generally
agreement conflict
accepted
of interest,
general honesty,
concerning
obeying the law. As when identifying statements, dis occur to is when agreement likely identifying themes in the early attempts to classify codes of ethics. Over
time the amount
of
disagreement
is apt
to
decline.
A more
over
focused
just one
code would
or two
ments
themes,
a broader
code would
statements.
themes with
It should
that some
to say, and
descriptions
confusing
tedious
to write,
to hear.
Was
that a "1 1 1 1 1 1 1 1 1" or a "1 1 1 1 1 1 1 can be overcome 111" code? These disadvantages For by using superscripts. example, alllllll 1 1 code might be described as a "l9" code and a 1111111111 code might described as a "l10"
code. Adopting this convention and omitting super
Comparative Study Care Facilities and Energy Companies', Journal of Business Ethics 13(9), 713-718. E.: 'Ethical Standards for Computer Oz, 1993, A Comparative Professionals: of Four Analysis Business Ethics Codes', 12(9), Major Journal of 709-726. Preble, J. F. and R. C. Hoffman: 1999, 'The Nature of Ethics Codes in Franchise Associations Around the Globe', Business Ethics 18(3), Journal of 239-253. C: 'Ethical Standards for Human 2000, Wiley,
Resource Management Professionals: A
1 has a scripts that equal one, Code C from Exhibit "7 1 1" or "7 l2" shape, Code B has a "5 22" shape,
and Code A
Codes', Journal
seem this paragraph or these computations B in 1 Exhibit has bewildering, recalling that Code a "5 2 2" shape may make things easier. 7 There may be interpersonal differences in how tone is perceived and even differences in perception by the Should
same person over time. In addition, cultural differ
is a "33."
Department of Accounting, St. Cloud State University, 120 4th Avenue South,
St. Cloud, MN
E-mail:
56301-4498,
U.S.A.
ences may play a role in determining how tone is per ceived. Therefore, the metric although suggested in the paper does capture aspects of tone, it should be used and interpreted with caution.
bgaumnitz@stcloudstate.
edu
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