(Advances in the Study of Entrepreneurship, Innovation and Economic Growth) Sherry Hoskinson, Donald F. Kuratko (eds.) - The Challenges of Ethics and Entrepreneurship in the Global Environment-Emerald.pdf

THE CHALLENGES OF ETHICS
AND ENTREPRENEURSHIP IN THE

GLOBAL ENVIRONMENT
ADVANCES IN THE STUDY OF
ENTREPRENEURSHIP,
INNOVATION AND ECONOMIC
GROWTH
Series Editors: Sherry Hoskinson and
Donald F. Kuratko
Recent Volumes:
Volume 16: University Entrepreneurship and Technology Transfer,
Gary D. Libecap
Volume 17: The Cyclic Nature of Innovation: Connecting Hard Sciences
with Soft Values, Guus Berkhout, Patrick van der Duin,
Dap Hartmann and Roland Ortt
Volume 18: Technological Innovation: Generating Economic Results,
Gary D. Libecap and Marie Thursby
Volume 19: Measuring the Social Value of Innovation: A Link in the
University Technology Transfer and Entrepreneurship
Equation, Gary D. Libecap
Volume 20: Frontiers in Eco-Entrepreneurship Research,
Gary D. Libecap
Volume 21: Spanning Boundaries and Disciplines: University Technology
Commercialization in the Idea Age, Gary D. Libecap,
Marie Thursby and Sherry Hoskinson
Volume 22: Entrepreneurship and Global Competitiveness: Determinants
and Policy Implications, Gary D. Libecap and
Sherry Hoskinson
Volume 23: A Cross-Disciplinary Primer on the Meaning and Principles
of Innovation, Matthew M. Mars and Sherry Hoskinson
Volume 24: Innovative Pathways for University Entrepreneurship in the
21st Century, Sherry Hoskinson and Donald F. Kuratko
ADVANCES IN THE STUDY OF ENTREPRENEURSHIP,
INNOVATION AND ECONOMIC GROWTH VOLUME 25
THE CHALLENGES OF
ETHICS AND
ENTREPRENEURSHIP IN
THE GLOBAL
ENVIRONMENT
EDITED BY
SHERRY HOSKINSON
University of Arizona, Tucson, AZ, USA
DONALD F. KURATKO
Kelley School of Business, Indiana University Bloomington,
Bloomington, IN, USA
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CONTENTS
LIST OF CONTRIBUTORS vii
INTRODUCTION
Donald F. Kuratko and Sherry Hoskinson ix
ENTREPRENEURSHIP AND EXISTENTIALISM:

ESTABLISHING AUTHENTICITY IN A CROWDED
GLOBAL MARKETPLACE
Michael G. Goldsby and Robert Mathews 1
THE ENTREPRENEUR’S DILEMMA OF ETHICS

VERSUS PROFESSIONAL ACCEPTABILITY WITH
ONLINE REPUTATION MANAGEMENT SYSTEMS
Donald F. Kuratko, Travis J. Brown and Marcus Wadell 17
THE ETHICAL PITFALLS AND OPPORTUNITIES OF

INITIAL PUBLIC OFFERINGS
Abbey Stemler and Timothy L. Fort 39
THE ETHICS OF GUERILLA BEHAVIOR IN EARLY

STAGE FIRMS
Yongseok Jang and Michael H. Morris 57
QUESTIONING THE ETHICS OF UNIVERSITY

ENTREPRENEURSHIP CURRICULUM
Allan O’Connor 79
CURRICULAR AND PROGRAMMATIC INNOVATION

AT THE INTERSECTION OF BUSINESS ETHICS AND
ENTREPRENEURSHIP
Chris Fawson, Randy Simmons and Ryan Yonk 109
v
LIST OF CONTRIBUTORS
Travis J. Brown School of Informatics and Computing,

Indiana University Bloomington,
Chris Fawson Department of Economics and Finance,
Utah State University, Logan, UT, USA
Timothy L. Fort Department of Business Law & Ethics,
Kelley School of Business, Indiana
University Bloomington, Bloomington, IN,
USA
Michael G. Goldsby Entrepreneurship Center and Department
of Marketing and Management, Ball State
University, Muncie, IN, USA
Sherry Hoskinson Tech Launch Arizona, University of
Arizona, Tucson, AZ, USA
Yongseok Jang Department of Finance, Insurance, & Real
Estate, Warrington College of Business
Administration, University of Florida,
Gainesville, FL, USA
Donald F. Kuratko Johnson Center for Entrepreneurship and
Innovation, Kelley School of Business,
Indiana University Bloomington,
Robert Mathews Entrepreneurship Center and Department
of Marketing and Management, Ball State
University, Muncie, IN, USA
Michael H. Morris Department of Marketing, Center for
Entrepreneurship and Innovation,
Warrington College of Business
Administration, University of Florida,
Gainesville, FL, USA
vii
viii LIST OF CONTRIBUTORS
Allan O’Connor Entrepreneurship, Commercialisation and

Innovation Centre, The University of
Adelaide, Australia
Randy Simmons Department of Economics and Finance,
Abbey Stemler Department of Business Law & Ethics,
Kelley School of Business, Indiana
USA
Marcus Wadell Kelley School of Business, Indiana
USA
Ryan Yonk Department of Economics and Finance,
INTRODUCTION
Ethical issues in business are of great importance today for good reason.
The prevalence of scandals, fraud, and various forms of executive mis-
conduct in corporations has spurred the watchful eye of the public. As
Kuratko (2014) points out, ethics is not a new topic, because it figured
prominently in philosophical thought since the time of Socrates, Plato,
and Aristotle. Because society operates in a dynamic and ever-changing
environment, however, a consensus on ethical behavior does not exist
(Svensson & Wood, 2008). In fact, continual conflict over the ethical nat-
ure of decisions is quite prevalent. It is clear that entrepreneurial ethics
will always be extremely difficult to define, codify, and implement because
of the personal values and morality issues it surfaces. Yet the importance
of ethics and entrepreneurs with their new enterprises must be continually
examined.
The complex global environment for entrepreneurship and innovation
has experienced significant change during the past decade requiring a deeper
understanding of the ethical challenges due to economic, capital, technolo-
gical, environmental, and social forces that are confronting organizations.
Research in ethics and entrepreneurship may be critical for the discovery
and dissemination of the newest perspectives in this important domain
(Arend, 2013). This volume presents a body of scholarship with a multidi-
mensional view of ethics and entrepreneurship. Papers and discussion topics
range from curricular, philosophical, to a variety of situational perspectives.
Because of the core topic “Ethics and Entrepreneurship,” these are all clo-
sely connected and the works often span all three areas. The perspectives
are as interesting as entrepreneurship itself the potential of online reputa-
tion management systems utilized in ecommerce to impact entrepreneurs on
the ethics of both online and face-to-face business transactions and business
structures, ethics related to IPOs, guerrilla behavior and ethics, entrepre-
neurship and existentialism, and the role and presence of ethics in actual
entrepreneurship curriculum design. The combined body of work presented
in the volume can provide scholars and practitioners with unique insight
regarding ethical behaviors and frameworks for decision making in contexts
that reflect values deliberate values rather than default in today’s
rapidly changing entrepreneurial environment.
ix
x INTRODUCTION
Michael G. Goldsby and Robert Mathews present a compelling paper,

“Entrepreneurship and Existentialism: Establishing Authenticity in a
Crowded Global Marketplace,” illustrating that authentic companies exude
an essence that is appealing to key stakeholders (employees, customers,
management team). Existential philosophies can assist the entrepreneur in
establishing what they stand for and want to be in a growing and complex
global economy. Goldsby and Mathews discuss how decision models can
aid business people in making ethical decisions because they consistently
incorporate agreed upon and known values and beliefs. Ultimately, the
paper identifies key existential themes that, when embraced, can help the
entrepreneur to obtain authenticity and the competitive advantage authen-
ticity represents in the marketplace.
In an excellent consideration for scholars, students, and practitioners,
early in the paper, the authors point to literature as a useful vehicle to
demonstrate the humanization of ethical dilemmas, illuminating the full
contexts of situations and underlying conflicts.
In the next three papers, distinct situational discussions of entrepreneur-
ship and ethics are presented. Next, Donald F. Kuratko, Travis J. Brown,
and Marcus Wadell present their paper “The Entrepreneur’s Dilemma of
Ethics versus Professional Acceptability with Online Reputation Management
Systems.”
In this paper, the authors explore the standards current business profes-
sionals have for businesses conducting business online, regarding strategic
“manipulation” of reputation management systems. The results have the
potential of revealing how young professionals have been conditioned by
the prevalence of web-based interactions and the anonymity provided in
these transactions, as well as the degree to which they rationalize the misre-
presentation of information by business professionals for the purpose of
manipulating consumers’ purchasing decisions in order to drive sales. The
authors contend that the prevalence of ecommerce in today’s economy
could serve to transition society’s tolerance of what is deemed ethical as a
standard online business practice to a broader acceptance of unethical
behavior in all business activities. Kuratko, Brown, and Wadell also pre-
sent convincing discussion of the lack of attention to shifting perceptions of
acceptable online business behavior and the likely significant impact for
entrepreneurs in gauging ethics in conducting their business. In other
words, tacit acceptance by society of unscrupulous business practices online
could result in less ethical business practices in general.
Similarly, in their paper, “The Ethical Pitfalls and Opportunities of
Initial Public Offerings,” authors Abbey Stemler and Timothy L. Fort
Introduction xi
discuss and attempt to quantify the impact of the IPO process on a com-
pany’s ethical culture, informing pre- and post-IPO culture management.
When founded, companies create business through collaborative engage-
ment with customers and other stakeholders. The relationships at the basis
of those collaborations accentuate the importance of trust, thereby making
the trustworthiness of corporate behavior more important than ever
before.
In a post-IPO company, unlike a private company, cash flow of a public
company is public, creating little room for failure. As a result, public firms
tend to take on conventional, safe projects. At the other end of the spec-
trum, incentives in private entrepreneurial firms tend to be biased toward
innovative projects.
Culture is a system of shared values, which define what is important and
which define appropriate attitudes and behaviors. The authors draw on
leading scholars of corporate culture to explore four main types of corpo-
rate cultures: Clan, Hierarchy, Adhocracy, and Market. Ultimately, market
pressures for performance and the collaborative pressures for trustworthi-
ness create a real need for companies to thoughtfully address their ethical
cultures. Stemler and Fort pose that exploring the impact of the IPO pro-
cess will lead to a better understanding of how entrepreneurs can lead their
company in a manner that promotes good trust (Good Trust, Real Trust,
and Hard Trust discussed in the paper) in both financial performance and
mitigation of risk.
The next paper, “The Ethics of Guerilla Behavior in Early Stage Firms,”
continues with situational analysis and strongly drawing on philosophical
dimensions with Yongseok Jang and Michael H. Morris. In this paper, the
authors establish an assessment framework that provides guidance to entre-
preneurs engaged in “guerrilla” marketing behaviors, examining entrepre-
neurial contexts, and how they might give rise to the perceived need for
guerrilla actions. The concept, drawing on guerilla “marketing” warfare, is
drawn on instances when smaller, less-resourced entrepreneurs scale a cam-
paign and defeat more imposing opponents through clever tactics that
draw on stealth, surprise, and highly, effectively executed customer access
and awareness campaigns (drawing on imagination, energy, and timing),
rather than large budgets and extended resources.
The authors suggest and present five primary ethical dimensions to be
considered in evaluating a given guerrilla approach, and go on to introduce
an integrated, virtue-based framework for use in evaluating guerrilla cam-
paigns that consider ethical dimensions together with leading theoretical
perspectives on ethical action. The matrix can be used by entrepreneurs in
xii INTRODUCTION
decision-making processes and is consistent with the Hunt Vitell model of

ethical decision-making (Hunt & Vitell, 1986). Finally, implications are
drawn for theory and practice, and suggestions made for ongoing research.
In the final two papers, curriculum models and recommendations for
scholars are outlined. The paper, “Questioning the Ethics of University
Entrepreneurship Curriculum,” by Allan O’Connor proposes an ethics fra-
mework to assist in reconciling the wide range of stakeholder interests in
entrepreneurship education. The paper clearly addresses the different stake-
holder expectations and obligations for those related to entrepreneurship
education curriculum that to date, although discussed informally, have not
been fully addressed by entrepreneurship curriculum literature. The author
addresses regulatory, professional body, student, parent, lecturer, economic
growth, alumni, and university administration anticipation of entrepreneur-
ship curriculum outcomes and how those might impact ethics behaviors
and decisions in the design of curriculum. O’Connor addresses rights in the
form of automatic, invited, and no-rights defined to represent regulatory
and organizational ethics, normative ethics, and (duty of care) virtues
ethics, respectively as they relate to these populations. Examples of differ-
ing expectations include students expecting to start a business, community
leaders’ expectation of new business starts to drive economic growth, and
alumni expectations of educational leadership to sustain or increase per-
ceived value of entrepreneurship education from a given institution. The
authors pose important questions and recommendations about ethically
reconciling entrepreneurship curriculum.
The final paper, “Curricular and Programmatic Innovation at the
Intersection of Business Ethics and Entrepreneurship,” authored by Chris
Fawson, Randy Simmons, and Ryan Yonk, provides a contextual analysis
of statements of strategic focus for AACSB-accredited business schools to
evaluate alignment with course offerings and program structure in the areas
of business ethics and entrepreneurship. The authors discuss that being a
successful entrepreneur means “making other people better off potential
customers do not have to purchase your service or product; they only pur-
chase it because they believe doing so will make them better off. Producing
value for others, as they define value, is wholly ethical and just. Successful
entrepreneurial actions produce benefits as opposed to the hand-outs
offered under the banner of corporate social responsibility.”
Fawson, Simmons, and Yonk go on to state that entrepreneurship com-
prises business in all its forms. However, business schools tend to work
from a perspective that emphasizes “management” and may marginalize
entrepreneurship. The authors discuss their curriculum development
Introduction xiii
experiences and potential for reconciling management and entrepreneurship

teaching and thereby shoring up ethical dilemmas presented by lack of
attention to entrepreneurship in widespread general business education.
In entrepreneurial ventures, the ethical influence of the entrepreneur is
more powerful than in larger corporations because his or her leadership is
not diffused through layers of management. Owners are easily identified,
and employees usually can observe them on a regular basis in a small busi-
ness. Therefore, entrepreneurs possess a strong potential to establish high
ethical standards in all business decisions. Therefore, the impact of display-
ing the highest ethical behavior is critical to the long-term survival of these
ventures (Solymossy & Masters, 2002).
The impetus of this special volume on ethics and entrepreneurship was
the recognition of the enormous changes taking place in society and the
economy that effect entrepreneurial ventures. It was our hope to present
some of the latest research within the domain of ethics and entrepreneurship.
We believe that this collection of papers and research represent an important
statement regarding entrepreneurship in practice and teaching and how
attention to ethics is not disregarded in either at the core, but should be
attended to more closely in broader educational and practice contexts.
Donald F. Kuratko
Sherry Hoskinson
Editors
REFERENCES
Arend, R. J. (2013). Ethics-focused dynamic capabilities: A small business perspective. Small

Business Economics, 41(1), 1 24.
Hunt, S., & Vitell, S. (1986). A general theory of marketing ethics. Journal of Macromarketing,
6(1), 5 15.
Kuratko, D. F. (2014). Entrepreneurship: Theory, process, practice (9th ed.). Mason, OH:
Cengage Publishing.
Solymossy, E., & Masters, J. K. (2002). Ethics through an entrepreneurial lens: Theory and
observation. Journal of Business Ethics, 38(3), 227 240.
Svensson, G., & Wood, G. (2008). A model of business ethics. Journal of Business Ethics, 77,
303 323.
ENTREPRENEURSHIP AND
EXISTENTIALISM: ESTABLISHING
AUTHENTICITY IN A CROWDED
GLOBAL MARKETPLACE
Michael G. Goldsby and Robert Mathews
ABSTRACT
Entrepreneurial pursuits are all situational and relative. Business oppor-

tunities come and go based on many fluid factors. Those factors are also
multidimensional, as market pressures and demands, skills of entrepre-
neurs, resources of entrepreneurs, and environmental factors make each
opportunity and execution strategy unique. Since every entrepreneurial
venture is essentially a one-of-a-kind enterprise, each startup is a chance
for the entrepreneur to express their unique vision, values, and goals.
Philosophers would recognize this exercise as existential in nature. This
paper explains how reading existential literature provides inspirational
heroes for entrepreneurs seeking to build companies that stand out from
their peers. The paper provides an overview and history of existentialism
and then applies it to entrepreneurship. The paper is conceptual and pro-
vides a brief overview of existentialism and explains how it relates to
entrepreneurship. It provides a collection of existential writings that
The Challenges of Ethics and Entrepreneurship in the Global Environment

Advances in the Study of Entrepreneurship, Innovation and Economic Growth, Volume 25, 1 15
Copyright r 2015 by Emerald Group Publishing Limited
All rights of reproduction in any form reserved
ISSN: 1048-4736/doi:10.1108/S1048-473620150000025001
1
2 MICHAEL G. GOLDSBY AND ROBERT MATHEWS
relate to entrepreneurship. Guidance for reading and applying the litera-

ture is given. Existentialism is a subject that has not been covered in the
entrepreneurship literature. Thus, the paper introduces this popular phi-
losophical perspective to the entrepreneurship literature. The authors
hope to create interesting discussions between philosophy and entrepre-
neurship scholars.
Keywords: Entrepreneurship; existentialism; opportunity recognition;
business ethics
INTRODUCTION
Entrepreneurship is first and foremost about capitalizing on opportunity.

However, a debate exists among two philosophical schools regarding the
nature of opportunity. Positivists believe that opportunities exist in the
world waiting to be discovered, while social constructionists hold that
opportunities are the creative results of individual agents and do not exist
until an entrepreneur creates one. One particular theory that supports
social constructionism is structuration theory. Sarason, Dean, and Dillard
(2006, p. 286) state, “A structuration theory representation of the process
can enlighten and empower entrepreneurs. Opportunities do not exist a
priori waiting to be discovered, but become manifested to the entrepreneur
and to others as they are conceptualized and developed by the actor as part
of the venturing process.” This sentiment is similar to existentialism, a phi-
losophical perspective that maintains that individuals are responsible for
establishing their own identity and purpose in the world. Since entrepre-
neurship is about the “new,” doing, and taking risks (entrepreneurial orien-
tation), an understanding and application of existential principles can assist
an entrepreneur in creating a unique and authentic company that repre-
sents their values and ideals. Authentic companies exude an essence that is
appealing to many stakeholders, such as employees, customers, and the
management team. Existential philosophies can assist the entrepreneur in
establishing what they stand for and want to be in a growing and complex
global economy. It is now more imperative than ever that companies distin-
guish themselves from the influx of competition from around the world.
This paper explains how existentialism can aid the entrepreneur in building
a company that stands out from its peers. The paper provides an overview
and history of existentialism and then applies it to entrepreneurship.
Suggestions for future research are also provided. In order to lay the
Entrepreneurship and Existentialism 3
philosophical foundation for existentialism in entrepreneurship, we first

provide an overview of relevant views on reality and knowledge.
REALITY AND KNOWLEDGE
A movement in entrepreneurship is taking place that identifies an entrepre-

neur’s main challenge as the building and execution of successful business
models (Blank, 2012; Osterwalder, 2013; Reis, 2011). This approach is
based on gaining relevant knowledge about people, such as their procliv-
ities and behaviors, and contextual factors, such as location and industry
specifics. The entrepreneur must gain an immense amount of knowledge on
the consumer, key purchasing decision-maker, and other stakeholders who
will impact the success of the business model. This approach is heavily
influenced by design schools of practice. Design utilizes an immense
amount of qualitative research to understand the unique needs and wants
of customers and the particular factors relevant in an industry. Despite this
reality, the entrepreneurship domain has often relied on quantitative mea-
sures to explain business opportunity and follow-through activity.
Given the predominant use of qualitative methods, such as interviews,
observations, focus groups, and questionnaires, among others, to drive
initial entrepreneurial decisions, it should be no surprise that grounded the-
ory, phenomenology, and ethnography are the research basis for many
radical innovations. All three are research methodologies that directly sup-
port chosen methods of inquiry, such as the ones listed above (Crotty,
1998). Obviously, most entrepreneurs and business researchers in the prac-
tical world do not speak in these terms, but their activity points to these
frameworks. Further, their actual uses of these methodologies vary widely
based on their circumstances.
The very nature of entrepreneurship is situational and relative. Business
opportunities come and go based on many fluid factors. Those factors are
also multidimensional, as market pressures and demands, skills of entrepre-
neurs, resources of entrepreneurs, and environmental factors make each
opportunity and execution strategy unique. Every entrepreneurial venture
is essentially one-of-a-kind.
This undermines the very core of quantitative research and its basis for
entrepreneurial practice. Positionality guides knowledge in the qualitative
world. That is where this discussion turns to overarching principles of rea-
lity. First, ontology addresses views on reality, and is at the very center of
existence. Realism, or objectivism, holds that a reality exists and humans

may or may not know it. According to Broido and Manning (2002), reality
is predicted and true until disproven. On the other hand, idealism, or sub-
jectivism, asserts that reality is mentally constructed (Savin-Baden &
Major, 2013).
Epistemology underpins the foundation of knowledge (Savin-Baden &
Major, 2013) and drives the way humans view and cognitively process the
world around them. Epistemologies are philosophical stances on how rea-
lity is defined. Crotty (1998) takes a simple stance on epistemology, identi-
fying three basic forms: objectivism, constructionism, and subjectivism.
Objectivism posits that reality exists apart from human cognition.
Constructionism argues that a defined reality does not await humans, but
instead is co-created, or constructed, by people as they interact with the
world in which they live. In other words, reality is socially constructed.
Subjectivism often confused with constructionism contends that mean-
ing is not derived from interplays between objects and subjects, but is
instead imposed on the object by humans.
However, Savin-Baden and Major (2013) envision epistemology as being
more complex. They identified empiricism, rationalism, historicism, instru-
mentalism, experientialism, structuralism, and existentialism as all falling
under the epistemological umbrella. Empiricism contends that knowledge is
driven through sensory perception. Rationalism asserts that knowledge is
developed by reason. Historicism states that knowledge is developed
through context. Instrumentalism holds that knowledge is borne by con-
necting theory and phenomenon. Experientialism ascribes that experiences
drive knowledge, which is always changing. Structuralism asserts that
higher cognitive and socially interactive structures are continually evolving.
Finally, existentialism stands on the ground that knowledge starts with the
human mind, despite its limitations and fallibility.
Theoretical perspectives (Crotty, 1998), or paradigms (Savin-Baden &
Major, 2013), provide even more insight to views of reality and knowledge.
They offer philosophical stances as context for methodological decisions in
research. Theoretical perspectives include positivism and postpositivism,
interpretivism, constructivism, critical theory, feminism, and postmodern-
ism, among others (Crotty, 1998; Denzin & Lincoln, 2011). Positivism is
rooted in the belief that reality exists and can be identified. In other words,
it is merely waiting to be discovered by humans. Postpositivism strays only
slightly, as it asserts that knowledge cannot be fully defined, but rather is
researched, tested, and theorized (Creswell, 2013). Interpretivism, based on
the initial work of Max Weber, loosely asserts that natural sciences and
social constructs represent different realities, particularly in the human

mind (Crotty, 1998). Constructivism differs from constructionism in that it
posits reality and knowledge are driven by the individual mind instead of
among social constructs (Savin-Baden & Major, 2013). Critical theory and
feminism are centered on knowledge construction as it relates to curing
social ills (Crotty, 1998). While modernism is grounded in the quest to find
absolute truth, postmodernism, though very loosely defined and disagreed
upon by scholars, unravels modernism by claiming knowledge is fragmen-
ted, relative, and ambiguous (Savin-Baden & Major, 2013).
In effect, postmodernism seems to reflect much of entrepreneurial prac-
tice. Entrepreneurs operate in a state of uncertainty and ambiguity, and
seek to mitigate risk by learning more about their potential opportunities.
They gather knowledge on a problem space and market by piecing together
information regarding a wide range of factors, such as target customer
demographics, attitudes, and behaviors, technologies, industry practices,
financial dynamics, and supply chain possibilities. In this pursuit for knowl-
edge, the entrepreneur must be very proactive in putting the picture
together of what they choose to pursue. Unlike traditional business roles in
which the manager tracks and controls well-defined tasks and responsibil-
ities, entrepreneurs define the work and create the strategy of their com-
pany. It is an act of sheer creation.
While some people avoid such responsibility, others are drawn to
entrepreneurship because of the autonomy and risk inherent in it.
Entrepreneurship as a field has a well-established research literature
regarding its nature. However, philosophy may serve a helpful role in pre-
paring potential entrepreneurs for the self-determination inherent in their
pursuit. Philosophy provides a set of values and principles to guide
decision-making, to define one’s place in their world and how they oper-
ate in that world, and as psychological comfort for one’s approach to life.
The arts often provide a vehicle for evidencing philosophies utilized by
agents in the world. With regard to entrepreneurship, Ayn Rand’s books
have been selling over a million copies per year since the economic reces-
sion of 2008. Rand died in 1982, but her work has gained a renewal of
interest, mostly due to the philosophy found in her books. The protago-
nists are often heroic figures who stand by their principles and live on
their own terms. When economic times are stable, people are often more
content with their situation; however, when a recession or other econom-
ically distressful situations occur, people turn to stories that give them
strength to endure their challenges. The Rand stories about Howard
Roark and Dagny Taggart resonated with people who decided that they
wanted to take control of their situations rather than live as victims of

tough economic times.
While Rand’s books are popular in modern times, existentialism is
another philosophy that played a strong role in giving people determina-
tion during tough moments in history. Existentialism gained immense
popularity in European literary circles during the World War II and post-
World War II eras. The philosophy soon migrated to the United States as
well. It was a response to the sociological factors its adherents thought
brought on the war. Many of its writers also lived through German occu-
pation and created their works as a rebellious statement to their living
conditions.
In pre-World War II Europe, the church and cultural traditions defined
the way most people lived. However, intellectuals of the era decided they
never wanted to see people endure such hardships again as those experi-
enced during World War II, and they blamed their cultural heritage for the
crisis. Thus, they developed a philosophy based solely on self-determination
and self-definition, which was completely the opposite of prior sociological
frameworks. No longer would theologians and government officials define
how one should live. Existentialism stated that if a person was honest and
authentic, they would decide for themselves what they should do day to
day. The philosophical movement resonated with the world at that time.
Literature can indeed change the way people live on a mass scale. In the
following section, we explain why literature can have such an impact on a
person’s attitudes and behaviors.
THE VALUE OF LITERATURE IN CREATING

A BUSINESS PHILOSOPHY
As explained in the previous section, literature can have immense sway

inside a society. However, its transformative power is also possible in
the business world as well. Therefore, for the purposes of this paper’s audi-
ence, we will focus on the impact of literature on business practices. The
use of literature in business philosophy is relatively new (Coles, 1989;
Dooley, 1980; Kennedy & Lawton, 1992; McAdams, 1993; McAdams &
Koppensteiner, 1992; Ward, 1982). There are several advantages to the use
of novels, plays, and short stories for exploring ethical theories and busi-
ness philosophies.
First, literature is multifaceted in nature. A novel, play, or short story
presents a variety of characters with radically different beliefs, desires, and
behaviors. The interaction of these characters, of course, reflects the com-

plexity of life. The reader cannot easily conclude what the protagonist’s
solution is because the situations of various characters must be considered.
The use of respected literature provides sufficient information to put the
reader in the place of the story’s decision-makers.
Second, because of this complexity, the use of literature tempers the
typical bottom-line mentality found in traditional business books. It is no
longer just the interests of the organization that are at stake. The characters
in a literary work come closer to being real people who are making deci-
sions and being affected by their own decisions and the decisions of others.
Third, despite being fictional, the interests of fully developed literary
characters cannot be easily dismissed as the more cardboard characters
found in business trade books. Literature humanizes ethical dilemmas in
business. Thus, fiction more nearly maps reality even though corporate bio-
graphies are actually based on real-life situations. Literature illuminates the
full context of a situation, revealing the underlying conflicts and stressors.
As Kennedy and Lawton put it: “stories will stimulate the experience of
recognizing and experiencing moral dilemmas” (Kennedy & Lawton, 1992,
p. 194).
Fourth, literature stimulates the imagination. Literature can penetrate
deeply and pervasively into the way we think about the needs and desires
of others and about our place in the lives of others. Robert Coles,
renowned Harvard professor and psychiatrist, writes of the capacity of a
play, novel, or short story to “… work its way well into one’s thinking life,
yes, but also ones’ reveries or idle thoughts, even one’s moods and dreams”
(Coles, 1989, p. 204).
Fifth, the use of literature provides a rich backdrop from which one
views the place of morality in business, social, and personal life.
Organizational decisions have ramifications beyond the organization, and
events outside the organization affect organizational decisions. Standard
business books often do not adequately portray this complex (and real)
interaction. Novels, plays, and short stories provide information on charac-
ters as employees, managers, community members, spouses, parents, chil-
dren, and other fallible human beings with conflicting desires, drives, and
ambitions.
Finally, literature permits the posing of much more complex questions
than do traditional business books. How does a philosophy illustrate the
inner guidelines of a businessperson? What are the ethical orientations of
particular characters? How do these orientations conflict with and comple-
ment one another? Which characters are exhibiting the use of the
philosophy in the face of difficult situations? Do the ethical orientations of

characters change as events unfold? With this understanding of the impact
philosophy and literature can have on a reader, we now turn our attention
to existentialism. The following section provides the basic principles of exis-
tentialism and a few of its more noted literary works.
EXISTENTIALISM
Existentialism is a school of thought that is not well defined. Many of the
philosophers identified with the tradition did not label themselves as exis-
tentialists. The philosophy’s roots are typically said to have started with
Soren Kierkegaard in the 19th century. Kierkegaard identified a state of
dread that people find themselves in when they confront the void of exis-
tence. In other words, people feel a deep longing for something that they
cannot identify. They have consciousness but are confused and feel alie-
nated, so they’re searching for something to soothe the angst. Kierkegaard
stated that Christianity was the solution to addressing this psychological
state of dread. The human condition coupled with the responsibility of the
individual to choose their response to the void of existence lays the founda-
tion for later existential writers.
Two other seminal writers in the 19th century that focused their attention
on the decisions of individuals are Friedrich Nietzsche and Fyodor
Dostoyevsky. If a person is interested in learning how a fully authentic and
responsible person lives, he or she should read Thus Spoke Zarathustra. In
the novel, a teacher named Zarathustra leaves a cave on a mountain he has
been in for 10 years. He journeys down to the town below with a message of
joy and gives lessons to the townsfolk. He is very assertive and explains that
people can become truly happy when they quit their blind allegiance to tra-
ditions and beliefs that have been handed to them by others. Zarathustra
instructs the townspeople to come to their own conclusions about how they
should live and what they should believe in; only then would they be fully
human and fully alive. Nietzsche expanded on these themes in other books,
but one concept that has drawn much attention and is related to Thus
Spoke Zarathustra is the idea of the Ubermensch. The Ubermensch, also
known as the Overman or Superman, does not play by the rules of society,
but rather identifies their purpose for existence and devotes themselves to
this cause. Unlike Kierkegaard who embraced Christianity, Nietzsche
over his lifetime wrote against religion. Dostoyevsky, on the other hand,
was religious, but he did recognize the responsibility in choosing the

type of life to live. His novels are dense, and yet engaging. Notes from
the Underground, The Idiot, Crime and Punishment, and The Brothers
Karamazov present characters that have hard choices to make. Dostoyevsky
puts the reader in situations to consider how they would decide to act.
Thus, Dostoyevsky is considered to be in the existential tradition due to the
responsibility placed on the characters in his books and reflects hard choices
real world agents must face every day.
However, the two authors most identified with the existential movement
are found in the 20th century. Jean Paul Sartre and Albert Camus were
two French writers who inspired millions of people to take responsibility
for their own happiness and well-being. Sartre did not believe in God, and
from that position he reasoned that it is the responsibility for each person
to determine what they should do. He summed up this position as “exis-
tence precedes essence.” Essentially, you are not born with any God-given
purpose, but instead you have to decide your purpose for living. Once you
decide what that is, you are to move in the direction of that idea, or else
you live in “bad faith.” This approach is authentic for the individual, and
by living this way the person demonstrates their essence to themselves and
others. In other words, everyone is a self-creation; however, people who do
not recognize this are doomed to live by others expectations. Only when a
person recognizes the reality of their existence can they create a full life.
Thus, while existentialism is often seen as a depressing philosophy, Sartre
believed his views were life affirming once someone understood how the
world actually works. Until that reality is embraced, people cannot create
situations that work for them. As Sartre (1946) sums up this position in
Existentialism and Humanism:
Man is nothing else but what he makes of himself. That is the first principle of existenti-
alism. Until recently philosophers were attacked only by other philosophers. The public
understood nothing of it and cared less. Now, however, they have made philosophy
come right down into the marketplace.
Thus, existentialism was written for the masses at a time when people
were struggling with the world they were left with after a major world cri-
sis. Albert Camus was very much in the marketplace of ideas along with
Sartre. Camus is known for his wide range of novels and short stories. The
common theme in Camus’ work is that our existence is absurd. We have a
short time on this planet, and we do not know why we are here or what we
are supposed to do. People could look to others or traditions for guidance,
but those ways are based on ideas no more grounded in truth than their
own. Thus, what are people to do? His response is to embrace this reality
and make the most of it. People are to recognize that existence is absurd,
but also to know that there is a dignity in facing up to it and making the
most of it. In fact, there is nobility in facing the struggle in spite of the
absurdity. His most famous example of this is found in The Myth of
Sisyphus. The first part of the book is a reflection of the human condition.
The last part, however, tells the story of Sisyphus. Sisyphus was a man who
was condemned by the gods for all eternity to push a boulder up a hill.
Once the boulder was near the top, it would roll back down, and Sisyphus
would go to work rolling it up again. While most people would see this as
futile, Camus believes Sisyphus might actually be happy with his struggle.
Sisyphus has pride in himself for facing the struggle and not giving up.
Camus encourages the reader to do the same. Again, like Sartre and other
existentialist writers, he is optimistic about life when seen through realistic
eyes. As Rodgers and Thompson (2010, p. 2) explain:
Existentialists confronted the pressing issues of their age and attempted to find answers
drawn from experience, not abstract reason … Existentialism sees life not as coming
ready-programmed by some higher power (God, history, evolution, a divine playwright)
with meaning and purpose, but being what we ourselves make of it as individuals. It is
a philosophy for the brave, the independently-minded.
One can imagine replacing the word “existentialist” with “entrepreneur”

and “existentialism” with “entrepreneurship” in this observation and find-
ing it reading accurately as well. How many times has an entrepreneur felt
like Sisyphus struggling to keep a business in existence? How many entre-
preneurs take responsibility for their own success without relying on the
paycheck of an employer? As we explore existentialism further in this
paper, we believe the reader will recognize the entrepreneur in this
philosophy.
With the key thought leaders of the existential movement identified,
let’s now turn to commonly identified ideas that embody this group. In
the Encyclopedia of Philosophy, MacIntyre (1967) states that the key
themes are:
(1) The individual and systems. Most people live by concepts developed by other peo-
ple and handed down to them. Existentialists, whether they are religious, atheistic,
or agnostic, choose their belief systems on their own. They come to their own con-
clusions and accept responsibility for their choices and the quality of their lives.
(2) Intentionality. A person’s view of the world is the result of their perceptions, emo-
tions, and beliefs. Once a person is aware of these elements they can examine them
and decide if they are warranted. Thus, a person can approach the world in an
intentional way rather than being passive.
(3) Being and absurdity. All a person can fully know is that they exist. They may not
know why, but they have the freedom to live that life as they choose.
(4) The nature and significance of choice. Mankind does not have a fixed nature. We
do not have to live like other generations have or as other people do. People must
accept full responsibility for their choices.
(5) The role of extreme experiences. Anxiety, dread, and death are common human
experiences that make a person extremely aware of their existence. While the
experiences can be seen as negative, they can also serve as a reminder that
our choices can have a large impact on the quality of life we have while we
exist.
(6) The nature of communication. While people have the obligation to decide for
themselves how they choose to live, communication can serve as a tool to
help people think through their choices. Many of the existential writers used
stories to explain their philosophy to the general population. However, other
art forms have been used to express existential philosophy as well, such as
films and paintings. For example, Edvard Munch’s The Scream is a picture
that captures the anxiety one feels when they recognize the void of existence,
and the Coen Brothers’ No Country for Old Men captures the absurdity of life
theme.
Now that we have examined the key existential thinkers and themes,
let’s turn to its similarities with entrepreneurial pursuits. Entrepreneurship
is an activity in which a person chooses to strike out their own and cre-
ates their own version of a business. In the following section, we provide
more detail how existential philosophy can assist the entrepreneur in
doing this.
CREATING AUTHENTICITY FOR ENTREPRENEURS
Earlier in this paper we discussed the positions of positivism and construc-

tionism. Some entrepreneurs believe opportunities are sitting in the world
waiting to be discovered, while others hold that opportunities are con-
structed in their mind and then acted on. Reasonable arguments can be
made for each position, as evidenced by the success of both quantitative
and qualitative approaches toward market research. However, with the
increasing application of lean startup strategies and design methodologies,
we believe qualitative research methods are gaining increasing presence in
entrepreneurship. Concurrently, it would make sense that more practi-
tioners and scholars would view opportunity with a constructionist per-
spective as well. If this is the case, existential philosophy may help
entrepreneurs in gaining motivation for enduring the struggles of starting a
business. In concluding this paper, we adapt an existentialist decision-making
model developed by West (2008) to entrepreneurship. West contends that

decision-making models help businesspeople make more ethical decisions
because they incorporate the values and beliefs in a consistent fashion. His
model comprises the following six sequential steps. We will explain how these
steps are relevant for an entrepreneur.
1. Acknowledge and identify my freedom to act. The entrepreneur faces

many choices regarding how they will build their business. The product,
brand, organization, target market, and supply chain are just a few com-
ponents of any business. While best practices may exist in an industry
and are well worth considering, the company that merely copies others
will not develop unique value in the marketplace.
2. Accept my responsibility. It is incumbent on entrepreneurs to recognize
that they, and they alone, are responsible for the success of their busi-
nesses. The entrepreneur’s stakeholders are looking for leadership that
accepts this responsibility. In fact, a key factor in whether a company
receives financing is based on the confidence exuded by the entrepreneur
in their idea.
3. Consider my prior choices, projects, and goals. An entrepreneur is
constantly weighing his or her past decisions and commitments with
ever-changing conditions and needs. While stakeholders respect an entre-
preneur who holds to their vision, they also recognize that goals may
conflict with each other. Entrepreneurs must always be honest with
themselves about the situation their company is in. In other words,
strong entrepreneurial leadership often requires making the tough
choices to change direction when they believe it is warranted. In
the startup world, this maneuver is called “pivoting,” and is a sign of
entrepreneurial expertise. In fact, some investors are curious to test an
entrepreneur’s merit by asking about the pivots that were involved in
starting the business.
4. Consider the pressures and expectations of others. Society often places
expectations on others. People are expected to play the roles they are in.
However, this is not leading an authentic life. If a person chooses to
embody certain preconceived ideas of what an entrepreneur can be, they
can still be considered authentic if they are aware they are doing it.
However, if they choose their business to reflect a different lifestyle or
philosophy than others in the marketplace, that is authentic as well. A
good example of this is the changing image of Steve Jobs over the years
at Apple. Early in his Apple days he embodied the image of a hippie.

Then, after Apple’s growth, he wore a bow tie and suit. However, in his
second run in the company, he looked the part of a designer in his blue
jeans and mock turtlenecks. Steve Jobs demonstrated his authenticity as
an entrepreneur, and the company appeared to thrive off that example.
Steve Jobs and Apple created a very unique brand and stable of pro-
ducts that led it to attaining the top market value upon his death in
2010.
5. Consider the practical constraints of the situation. While this article has
emphasized the constructionist nature of opportunity identification and
development, we recognize that one cannot will just any business into
existence. Businesses operate in complex environments comprised of
many players and factors. Thus, existential entrepreneurs consider the
limiting factors possibly placed on their enterprises. While one may
choose to ignore regulations, licensing requirements, and other societal
expectations, it would not be wise from a business standpoint.
Additionally, customers and other stakeholders may have their own
ideas on what warrants ongoing business operations in the community.
Signs of authenticity that do not exhibit good stewardship of resources
and that have a negative impact on the community are less likely to
succeed.
6. Proceed with the choice that best reflects my awareness of freedom, my
acceptance of personal responsibility, and is most consistent with the goals
and projects that I freely choose. This step requires the entrepreneur to
act in “good faith” with those they interact with. An entrepreneur acting
in good faith evidences their values in how they interact with customers
and other stakeholders. They operate in a transparent fashion and exude
honesty in all their interactions. Operating this way may not lead to sup-
port from everyone, as some will oppose their values; however, for those
who hold the same values or believe the entrepreneur to be honest in
their actions, they will likely receive more support from those parties. In
the long run, the company will run in a very efficient and effective fash-
ion as it focuses on activities that are consistent with its values.
Gamesmanship and posturing will be kept to a minimum, as execution
of the company’s mission will be the driver of decisions. The entrepre-
neur leading in this way will build a strong brand outside the company
and strong culture inside the company, which are both key in many suc-
cessful businesses.
CONCLUSION
Most people work in companies where they execute well-defined tasks. For
managers with performance expectations, decisions are often within the
policies and procedural guidelines of the parent company. However, entre-
preneurs face an entirely different challenge. They decide what the primary
tasks inside the company will be. They decide what policies and procedures
will guide the organizational culture. And more so, they decide what mar-
kets the business will be in and what will be sold. These decisions bring an
immense amount of responsibility with them. Some people may find
this situation daunting. However, there is a philosophical tradition that
provides heroic figures who make even larger decisions in their lives.
Existential heroes found in the books of Nietzsche, Dostoyevsky, Camus,
and Sartre face decisions regarding life and death. Grounded in intense
situations filled with psychological depth and heavy moods, the reader
works through the dilemmas with the protagonists. Great literature moves
us to action. We are not only entertained but are also motivated to reflect
on how we should live our own lives. We contend that reading the existen-
tial classics can help the entrepreneur to face their own self-defining deci-
sions when they build and run their companies.
We believe that entrepreneurs who embrace existential themes have the
opportunity to attain a key source of competitive advantage in the market-
place: authenticity. Entrepreneurs who express their essence in authentic
ways in the marketplace stand out from monolithic corporations. Business,
after all, is a human enterprise. One need only think of Steve Jobs’ Apple
campaign “Think Different” and Oprah Winfrey’s “Be the Best You” to
see prime exemplars of the success authentic entrepreneurs can have in the
marketplace. Their campaigns resonated in the marketplace and inside a
company, and as a result, they built very valuable brands and high per-
forming culture. The key lesson here is that entrepreneurs who convey their
essence in running their companies will connect more deeply with constitu-
encies in the outside world. After all, with many successful companies, the
market is not only buying the idea of the product but also the idea of the
entrepreneur. With this perspective in mind, perhaps it is time for aspiring
entrepreneurs to put Atlas Shrugged back on the shelf and open up Camus’
The Stranger instead.
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THE ENTREPRENEUR’S DILEMMA
OF ETHICS VERSUS
PROFESSIONAL ACCEPTABILITY
WITH ONLINE REPUTATION
MANAGEMENT SYSTEMS
Donald F. Kuratko, Travis J. Brown and

Marcus Wadell
ABSTRACT
In e-commerce, consumers have begun to rely on the opinions of fellow

consumers who posted through online consumer reviews to a reputation
management system. An ethical concern has arisen in the use and abuse
of these new systems. We examine the underlying ethical issues that
entrepreneurs are confronting in this time of surging e-commerce. Using
32 vignettes, one for each cross-section of our research construct frame-
work, followed by two Likert scales for respondents to indicate their
agreement with the action described from both the perspective of ethical-
ity and professional acceptability, we received responses for 1,252 vign-
ettes, which generated a dataset of 2,504 data points. The results of
our pilot study suggest that the ethical considerations for business

ISSN: 1048-4736/doi:10.1108/S1048-473620150000025002
17
18 DONALD F. KURATKO ET AL.
professionals conducting business online are more nuanced and complex

than conventional wisdom on the subject might suggest. While 60
research subjects are small, the use of paired vignettes in our survey
allowed us to measure at least 1,000 paired responses for each research
construct. The results have the potential of revealing how young profes-
sionals have been conditioned by the prevalence of web-based interactions
and the anonymity they afford participants, as well as the degree to
which they rationalize the misrepresentation of information by business
professionals for the purpose of manipulating consumers’ purchasing
decisions in order to drive sales. If consumers’ trust in reputation man-
agement systems erodes, the result could be a collapse of the entire sys-
tem as a meaningful source of information. We also demonstrate the
tolerance of what is deemed ethical versus professionally acceptable with
online business practices.
Keywords: Ethics; entrepreneurs; reputation management systems;
online practices
INTRODUCTION
Since the advent of the Internet, e-commerce has been gaining in popularity
and the shift toward online purchases has redefined the social norms inher-
ent in commerce. With the slow demise of opportunities such as face-to-
face interactions, the question of how to establish trust (Lee & Turban,
2001) becomes a priority as consumers tend to consider purchases made
online to be riskier than those made offline (Ha, 2002). Contributing to
consumers’ concerns is the fact that unethical behavior is more likely to
take place through online transactions than through offline ones (Citera,
Beauregard, & Mitsuya, 2005) due to the ease in which businesses can
deceive consumers online (Xiao & Benbasat, 2011). In addition, social
interactions are markedly different than those occurring offline, with anti-
social behaviors such as the use of “rude language, harsh criticisms, anger,
hatred, even threats” occurring with greater frequency, a phenomenon
known as the disinhibition effect (Suler, 2004, p. 321). “In essence, consu-
mers simply do not trust most Web providers enough to engage in ‘rela-
tionship exchanges’ involving money and personal information with them.”
(Hoffman, Novak, & Peralta, 1998, p. 80). As a result, consumers have
begun to rely on the opinions of fellow consumers posted through online
consumer reviews to inform their own purchasing decisions (Chevalier &
Mayzlin, 2006; Hung & Li, 2007; Otterbacher, Hemphill, & Dekker, 2011;
Entrepreneur’s Dilemma of Ethics versus Professional Acceptability 19
Zhu & Zhang, 2010). These online consumer reviews are posted to a
reputation management system (Malaga, 2001) or simply a reputation
system (Jøsang, Ismail, & Boyd, 2007; Resnick, Kuwabara, Zeckhauser, &
Friedman, 2000). These systems now play an integral role in e-commerce as
they are commonly used on popular sites such as Amazon and Yelp, with
the purpose of the latter being solely for gathering and disseminating online
consumer reviews of businesses. However, a new ethical concern has arisen
in regard to the use and sometimes abuse of these new systems. In this
paper, we examine the underlying ethical issues that entrepreneurs are con-
fronting in this time of surging e-commerce.
THE CHALLENGE OF ONLINE REPUTATION

MANAGEMENT
As noted by Jøsang et al. (2007, p. 619), “trust plays a crucial role in com-
puter mediated transactions and processes,” as does reputation. Consumers
rely on online consumer reviews posted through reputation management
systems based on the notion that they were completed by fellow consumers
with direct knowledge of a business, product, or service, who have no
vested interest in the success of the business, product, or service they are
reviewing (Bickart & Schindler, 2001; Willemsen, Neijens, Bronner, &
de Ridder, 2011). Research has shown that online consumer reviews have a
direct impact on online sales (Anderson & Magruder, 2012), making the
valence of the online consumer reviews posted regarding a business,
product, or service important to the associated business’s bottom line.
According to Gartner, Inc., “[c]onsumers’ increased reliance on social
media ratings and reviews will see enterprise spending on paid social media
ratings and reviews increase, making up 10 to 15 percent of all reviews by
2014” (Gartner, Inc., 2012). While businesses have used online consumer
reviews as a mechanism for better understanding customers and their pre-
ferences, the high cost of damage to their online reputation and loss of sales
resulting from receiving negative online consumer reviews has led busi-
nesses to strategically manipulate reputation management systems
(Dellarocas, 2006; Mayzlin, Dover, & Chevalier, 2012).
The online reputation of a business has been determined to be an impor-
tant driver of consumers’ willingness to complete online transactions with
that business (Jøsang et al., 2007). In addition, research has shown that
negative reviews have a greater impact on consumers’ perceptions of a
brand than do positive ones (Lee, Rodgers, & Kim, 2009). Although there
are straightforward and open methods for improving a business’s online
reputation, such as public relations campaigns and direct consumer out-
reach, there are also less transparent tactics being exploited which might be
deemed less ethical. While “Internet companies can promote trust by allow-
ing consumers to post reviews of products offered through a website”
(Koehn, 2003, p. 10), a “[l]ack of voluntary transparency [by businesses
transacting business online] can turn trust into distrust among stake-
holders” (Radin, Calkins, & Predmore, 2007, p. 84). Even though the
importance of consumer trust in e-commerce has been well-documented
(Grabner-Kraeuter, 2002; Hemphill, 2002; Porter & Donthu, 2008), the
pressures faced by businesses to protect their online reputation has resulted
in some businesses resorting to tactics that betray that trust, specifically
posting online consumer reviews in order to strategically manipulate the
reputation management systems (Dellarocas, 2006; Mayzlin et al., 2012).
Interestingly, it was discovered through the current pilot study that some
individuals deem businesses’ attempts to combat negative reviews by ensur-
ing that their customers post equally positive reviews (whether truthful or
not) as professionally acceptable, although not necessarily ethical.
The New Terminology
Specific terminology has arisen that is now associated with the strategic
manipulation of a firm’s online reputation. For example, astroturfing is the
act of using front groups or pseudonyms to give the false impression that
there is broader support for an issue than truly exists (Lee, 2010). Using
informational websites to spread false information online is rising as studies
have shown it to be an effective tactic for influencing public opinion, rais-
ing concerns about the ethicality of it as a business tool (Apollonio & Bero,
2007; Cho, Martens, Kim, & Rodrigue, 2011; Fitzpatrick & Palenchar,
2006). Another online form of astroturfing, known as sockpuppetry, has
become increasingly prevalent as e-commerce has gained in popularity
(Johansson, Kaati, & Shrestha, 2013; Zheng, Lai, Chow, Hui, & Yiu,
2011). Given that sockpuppetry involves posting online content under the
guise of an impartial individual, the only characteristic distinguishing con-
tent posted by a sockpuppet from legitimate content is its source, making
attempts to identify and filter out fraudulently posted content difficult, if
not impossible (Hu, Bose, Gao, & Liu, 2011). Equally difficult to detect is
meatpuppetry, a form of sockpuppetry which involves individuals, using
either pseudonyms or their actual names but without disclosing their con-
nection to the individual, business, product, service, or cause they are tar-
geting, post content either for or against their target (Burke & Kraut, 2008;
Landbeck, 2007).
Thus, the author of an online consumer review who conceals his/her
true identity as well as his/her relationship to the target of the online consu-
mer review is known as a sockpuppet if the author is the primary driver of
the online consumer review (Johansson et al., 2013; Zheng et al., 2011) and
a meatpuppet if the author is working on behalf of another individual
(Burke & Kraut, 2008; Landbeck, 2007). Either situation is considered to
be fraudulent strategic manipulation of reputation management systems in
an attempt to influence consumers’ purchasing decisions.
Strategic Manipulation of Reputation Management Systems
As noted by Calkins (2002), technological advances, specifically techniques

such as web-based file sharing, Internet portals, and web-based profiling,
“suggest that business ethicists have a rare opportunity to help users,
e-tailers, and others advance in an understanding of the moral aspects of a
web-based world that is confused, confusing, and sorely in need of direc-
tion” (p. 73). In addition, the notion that online business norms regarding
what is deemed ethical might eventually influence offline business norms is
not inconceivable and, based on some of the unscrupulous behavior that
has already been observed online, gives reason for concern. Research has
been conducted regarding businesses’ evolving ethical responsibility when it
involves web-based interactions with consumers (Chen, 2009), which draws
attention to the unique challenges businesses face when conducting business
online ethically. In this particular study, we are interested in how society,
specifically young professionals preparing to enter the workforce, perceives
attempts by businesses to influence consumers online by strategically
manipulating reputation management systems.
Given the degree to which online consumer reviews posted through
reputation management systems influence consumers’ purchasing decisions
(Chen & Xie, 2008; Hu, Bose et al., 2011) as well as their pervasiveness, we
consider it an ideal medium for studying individuals’ perception of busi-
nesses strategically manipulating these systems. To the extent consumers
begin to doubt that the online consumer reviews they read are being posted
by the reported source, they will, in turn, question the entire institution of
reputation management systems. Once that happens, it will cease to be a
useful tool for consumers when making purchasing decisions. Given that
research has shown that consumers are twice as likely to purchase a pro-
duct recommended through online consumer reviews (Senecal & Nantel,
2004), the loss of consumer trust in online consumer reviews could have a
significant impact on e-commerce. While those businesses with products or
services receiving negative online consumer reviews might not consider that
outcome as particularly worrisome, conditioning consumers to be distrust-
ful of online consumer reviews could arguably carry over to general distrust
of e-commerce as well as a reduced willingness to purchase products and
services from merchants with whom they have yet to develop trust, given
the importance of trust for consumers when making purchases online
(Gefen, 2000).
Another consideration which receives far less attention when discussing
attempts by businesses to influence consumers’ purchasing decisions is the
impact on social norms as consumers are conditioned to believe that busi-
nesses lying to them is socially acceptable as a standard business practice.
Not only does such acceptance serve as an affirmation for existing business
owners that such behavior is tolerated, but it also moves the bar for what is
considered ethical (Morris, Schindehutte, Walton, & Allen, 2002). While
such behavior could be confined to online customer interactions given peo-
ple’s general willingness to behave in ways that they would otherwise not
when interacting with people offline (Suler, 2004), it is not difficult to ima-
gine social behavior currently restricted to online interactions bleeding into
offline interactions. Moreover, consumers’ behavior would likely reflect
their newly established values when conducting their own business.
The fraudulency of the strategic manipulation of a reputation manage-
ment system is not as simple as judging online consumer reviews posted by
an author concealing his/her identity to be fraudulent and those by an
author revealing his/her identity as genuine. Studies have shown that con-
sumers are not capable of determining the fraudulency of an online consu-
mer review, suggesting that calculating the impact of a single online
consumer review’s rating on the average rating of a product or service
would prove exceedingly difficult for a consumer (David & Pinch, 2005).
Therefore, should any online consumer review posted by a business be
deemed fraudulent, given that the action creates the possibility of influen-
cing the purchasing decisions of consumers, even if the intent of the busi-
ness posting the online consumer review was merely to inform consumers?
Can we reasonably expect that consumers will painstakingly comb through
potentially hundreds if not thousands of online consumer reviews to deter-
mine which ones were fraudulent and what impact they had on the average
rating of a business, product, or service? Since young professionals are so

accustomed to online reviews, do they perceive the ethicality or acceptabil-
ity of these practices in any different sense? Indeed, the surge of social
media has caused many emerging entrepreneurs to confront serious ethical
questions regarding the appropriateness of borderline fraudulent activities.
THE ENTREPRENEUR’S ETHICAL DILEMMA

If, in fact, an entrepreneur’s venture success is at stake in the hands of the
social media reputation management sites, how exactly should he/she pro-
ceed? Are we actually reverting back to the age old questions of managerial
ethics? In fact, it was Gellerman (1986) who suggested that unethical beha-
vior may be due to one of four rationalizations managers use to justify
questionable conduct. The four rationalizations are: the activity is not
“really” illegal or immoral; it is in the venture’s best interest; it will never
be found out; or because it helps the business, the activity is condoned.
In any examination of the realm of managerial rationalizations, the idea
of questionable practices in social media could become a major concern for
understanding contemporary ethical conduct. Again, in the past it was
shown by Waters and Bird (1989) that questionable acts could be consid-
ered either “against the firm” or “on behalf of the firm.” They described
role distortion acts and role assertion acts being rationalized for the firm.
These acts could involve entrepreneurs rationalizing that the long-run inter-
ests of the venture are foremost. Role distortion is the behavior of an entre-
preneur who thinks he/she is acting in the best interests of the firm, so their
roles are “distorted.” Role assertion is the behavior of entrepreneurs who
assert their roles beyond what they should be, thinking (falsely) that they
are helping the firm. Could this now be the domain in which entrepreneurs
fall prey amidst the social media pressures?
As Kuratko (2014) points out, the ethical influence of an owner in the
smaller entrepreneurial venture is more powerful than in larger corpora-
tions because his or her leadership is not diffused through layers of man-
agement. Owners are easily identified, and employees usually can observe
them on a regular basis in a smaller venture. Therefore, entrepreneurs pos-
sess a strong potential to establish high ethical standards in all business
decisions. One research study found that an owner’s value system was a cri-
tical component of the ethical considerations that surround a business deci-
sion. This study also had implications for entrepreneurs who are seeking to
establish an ethical environment within which employees and other consti-

tuents can work (Kuratko, Goldsby, & Hornsby, 2004).
These questions concerning the ethical challenges that now confront
entrepreneurs in the social media age were the impetus behind the current
pilot study that we conducted.
METHODOLOGY
In an attempt to determine whether the current assessment of concealed

versus revealed source is a sufficient measure of the fraudulency of the stra-
tegic manipulation of a reputation management system, we chose to study
the impact of not only the author’s identity being concealed versus
revealed, but also the impact of the author’s intent being to deceive versus
inform, the impetus for the author posting the online consumer review
being unprovoked versus provoked, the platform on which the online con-
sumer review was posted being Amazon versus Yelp, the author’s agenda
for posting the online consumer review being pro-firm versus anti-firm, and
the source of the online consumer review being endogenous versus exogen-
ous. Following is an in-depth discussion of these additional constructs, our
rationale for including them, the meaning of the values we have measured,
and how we measured them.
Research Construct Framework
Table 1 presents the research construct framework we used as a guide in

order to ensure that we developed a sufficient set of vignettes to effectively
measure the research constructs of interest.
Survey
Our survey consists of a total of 32 vignettes, one for each cross-section of

the research construct framework (see Table 1), followed by two Likert
scales to allow survey respondents to indicate their agreement with the
action described in the vignette from both the perspective of ethicality and
professional acceptability. By structuring our survey in this manner, we
were able to measure every construct in all 32 vignettes. In addition, given
that each construct in our study is binary, we were able to measure
responses based on one value for each construct in half of the vignettes
Table 1. Strategic Manipulation of Reputation Management Systems

Research Construct Framework.
Identity: Concealed or C R
Revealed
Intent: Deceive or D I D I
Inform
Impetus: Provoked or U P U P U P U P
Unprovoked
Platform: Amazon or A Y A Y A Y A Y A Y A Y A Y A Y
Yelp
Endogenous Pro-Firm
Anti-Firm
Exogenous Pro-Firm 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16
Anti-Firm 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32
while measuring responses based on the other value in the other half of
vignettes. This technique allowed us to limit our survey instrument to the
minimum number of vignettes required for measuring the research con-
structs of interest. As an example, the only difference between Vignette 1
and Vignette 17 is that the content of the online consumer review described
is pro-firm rather than anti-firm, respectively (see Table 2). As another
example, the only difference between Vignette 1 and Vignette 9 is that the
business agent concealed his/her identity rather than revealed it, respec-
tively (see Table 2). Given that research has shown ratings alone have little
influence on consumers’ purchasing decisions while content has a signifi-
cant impact (Hu, Bose, Koh, & Liu, 2012), we wrote each vignette in a
manner that described the content of the online consumer review but sim-
ply categorized the online consumer review rating as “positive” or “nega-
tive” rather than open an explicitly stated rating to the survey respondents’
interpretation (e.g., a 2.5-star rating on a 5-star scale could be considered
as a “positive” or a “negative” rating).
Pilot Study Sample Population
As representatives of future young professionals, students enrolled at a

major Midwestern university were solicited to complete the survey. Sixty
research subjects participated in the pilot study. Respondents were allowed
Table 2. Sample of Study Vignettes.

1 An author who recently launched a self-published book on Amazon noticed that several
negative reviews were being posted, resulting in a low overall rating. He then had his
friends and family use pseudonyms to post positive reviews about his book.
5 The owner of a cell phone case manufacturer noticed negative reviews on Amazon stating
that his cases did not fit properly. Realizing from the comments that the customers were
simply installing the cases without reading the instructions, the owner had several of his
employees use pseudonyms to post positive reviews stating that the cases were actually
easy to install if you follow the instructions given in the installation video in the product
description section.
9 A kitchen product designer released his first product on Amazon. He then had his family
post positive reviews, revealing their familial ties to the product’s designer.
13 A food supplier launched a new line of nutritional supplements. The manager used his real
name and presented himself as the firm manager to post the following positive review
on each product page: “All of our nutritional supplements are made using cutting-edge,
FDA-approved processes to ensure that our customers receive the most nutritious
supplements possible.”
17 An electronics manufacturer launched a new video game console on Amazon. A
competing manufacturer hired a reputation management company to post negative
reviews on the console’s Amazon page using pseudonyms.
21 The CEO of a sporting goods manufacturer discovered that a competitor had been
keeping prices artificially low by outsourcing its manufacturing while continuing to
report that its products were “Made in America.” The CEO used a pseudonym and
posted a negative Amazon review on the competitor’s product pages in which he
included a reference to an article discussing the competitor’s outsourcing practices.
25 A fertilizer company launched a new fertilizer on Amazon. The CEO of a competitor
posted a negative Amazon review on the fertilizer’s product page using his real name
and revealing that he is CEO of another fertilizer company.
29 The owner of a probiotic supplement manufacturer noticed that a new competitor was
using a cheaper source of probiotics with a much shorter shelf-life than that of his
product, as determined by the Food & Drug Administration. Using his real name and
presenting himself as owner of another manufacturer, he then posted negative reviews
on the competitor’s Amazon product pages which included a reference to the FDA
study showing the shelf-life of the products as inferior to others on the market.
to complete the survey without providing their perceptions of the actions

described in every vignette, which resulted in some partial submissions. Of
the 60 respondents, 38 provided their perceptions, both in respect to the
ethicality and the professional acceptability of the actions described, for all
32 vignettes. Including partial submissions, we received responses for 1,252
vignettes, which generated a dataset of 2,504 data points. See Table 3 for
the sample population’s descriptive statistics.
Table 3. Pilot Study Sample Population Descriptive Statistics.

Sample Population Size: 60
Gender Female: 17 (28.33%) Male: 43 (71.67%)

Age 16 19: 10 (16.67%) 20 24: 24 (40.00%)
25 34: 24 (40.00%) 35 44: 2 (3.33%)
RESULTS
Identity: Concealed versus Revealed
For the author of an online consumer review to fully reveal his/her identity,
he/she cannot simply use his/her real name; he/she must also report any
conflict of interest which exists that might serve to bias his/her opinion as
reflected in the content of the online consumer review. Still, the assumption
is that as long as consumers know the author of an online consumer review,
they are able to judge for themselves whether to take that online consumer
review into account when making a purchasing decision; yet, studies have
shown that not to be the case (David & Pinch, 2005). Therefore, other fac-
tors must be considered when measuring perceptions of the fraudulency of
strategically manipulating reputation management systems beyond the pre-
sentation of the author’s identity.
Although not sufficient, we still contend that the degree of disclosure by
the author of an online consumer review of his/her identity influences a
consumer’s perception of the fraudulency of the posting of the online con-
sumer review in an attempt to strategically manipulate the reputation man-
agement system; therefore, we are interested in young professionals’
perceptions of the manner by which an author reveals his/her identity when
posting online consumer reviews, whether that author be the owner of a
business or an employee acting on behalf of the owner or of his/her own
accord. In order to measure this construct, we have included a set of vign-
ettes which describe business agents as the authors of online consumer
reviews who reveal their identity, making their relationship to the target of
their online consumer review clear to the reader, and an equal number of
vignettes which describe business agents as the author of an online consu-
mer review who conceal their identity, obfuscating their relationship to the
target of their online consumer review. See Table 4 for the means, var-
iances, and p-values for the identity construct by professional acceptability,
ethicality, and overall.
Table 4. Pilot Study Statistics: Identity.

Concealed Revealed p-Value
Two-tail
Mean Variance Mean Variance
Professional acceptability 2.663 1.883 3.417 1.980 7.204E-30

Ethicality 2.191 1.431 3.269 2.096 8.347E-53
Overall 2.427 1.711 3.343 2.042 1.824E-79
Intent: Deceive versus Inform
Techniques have been developed to analyze the content of online consumer

reviews, and researchers have had success with fraud detection using such
techniques (David & Pinch, 2005; Ott, Cardie, & Hancock, 2012;
Ratkiewicz et al., 2011); however, these methods rely on computers and
complex algorithms to detect anomalous posts, making them of little prac-
tical use for consumers hoping to separate the genuine online consumer
reviews from the fraudulent ones. Of course, such techniques could be used
to refine the reputation management systems themselves to prevent fraudu-
lent activity in the first place, and some researchers have proposed such
modifications (Dellarocas, 2000; Malaga, 2001). However, our interest is
not in how to prevent fraudulent strategic manipulation of reputation man-
agement systems but rather how young professionals perceive the strategic
manipulation, in many cases violating the terms of use of the sites hosting
the reputation management systems. Because of the eventual ethical chal-
lenge confronting entrepreneurs in the social media age, we are interested
in knowing whether the strategic manipulation of reputation management
systems with the intent of informing consumers rather than deceiving them
has any bearing on young professionals’ perception of the fraudulency of
the activity.
In order to measure this construct, we have included a set of vignettes
which describe business agents as the author of an online consumer review
posting content with an intent to inform consumers regarding their busi-
ness, product, or service and an equal number of vignettes which describe
business agents as the author of an online consumer review posting content
with an intent to deceive consumers. Given the subjectivity inherent in hav-
ing a survey respondent who is provided nothing more than an online con-
sumer review’s content determine the author’s intent, we have opted to
instead make clear that the purpose of the author for posting the online
consumer review in all vignettes is self-serving (i.e., to boost the online
Table 5. Pilot Study Statistics: Intent.

Deceive Inform p-Value
Two-tail

Ethicality 2.358 1.850 3.093 1.977 2.496E-33
Overall 2.513 1.920 3.248 1.974 2.694E-63
reputation for his/her business, product, or service), which ensures that the
activities described in every vignette will be evaluated in that context. In
this sense, all vignettes are, by default, describing online consumer reviews
written with the intent to deceive. The exception is when we make the
intent of an online consumer review’s author to inform by explicitly stating
in the vignette what information is being conveyed (e.g., a business owner
has his employees “post positive reviews reminding everyone that the pro-
ducts come with a lifetime warranty”). See Table 5 for the means, var-
iances, and p-values for the intent construct by professional acceptability,
ethicality, and overall.
Impetus: Unprovoked versus Provoked
By adding this construct, our objective is to see to what extent young pro-
fessionals rationalize the strategic manipulation of reputation management
systems as fraudulent when the posting of online consumer reviews is in
response to provocation from another party. Research has shown that cus-
tomer retaliation is a common occurrence (Funches, Markley, & Davis,
2009), which suggests consumers would be more accepting of a business
strategically manipulating a reputation management system if provoked by
another party’s action. This phenomenon is of particular interest when
dealing with systems that depend on trust given that any action taken,
whether provoked or not, might still serve to undermine the integrity of the
system. We seek to determine whether young professionals’ natural ten-
dency to be more forgiving of provoked actions will be influenced by con-
sideration of the potential damage to consumers’ trust of reputation
management systems in general caused by those actions.
In our vignettes, we made no attempt to make the initial action provoca-
tive to the degree we considered necessary to warrant a response that might
be deemed justifiable within the context presented. The reason for us not
Table 6. Pilot Study Statistics: Impetus.

Unprovoked Provoked p-Value
Two-tail
Professional acceptability 3.127 2.166 2.953 1.967 0.002

Ethicality 2.805 2.186 2.648 1.907 0.004
Overall 2.966 2.200 2.800 1.958 2.677E-05
doing so is that the justification for a response is too subjective to hope for
any consensus concerning sufficient provocation. Instead, we have simply
provided an action from another party, without any commentary on the
impetus or rationale for that action, to which the author in the vignette
reacted by posting an online consumer review. We made no attempt to
state the intent of the other actor responsible for the initial action in order
to avoid inadvertently guiding the survey respondents’ interpretation of the
author’s reaction. See Table 6 for the means, variances, and p-values for
the impetus construct by professional acceptability, ethicality, and overall.
Platform: Amazon versus Yelp
Given the popularity of Amazon as an e-commerce site and Yelp as a busi-

ness review site, we chose to split our vignettes evenly between the two by
writing the actions taken in the vignettes according to how the sites func-
tion. Although Citysearch and Yahoo Local are also popular business
review sites, Yelp encourages reviewers to build a public profile while the
other two sites allow reviewers to remain anonymous (Wang, 2010), sug-
gesting that the norms established by Yelp require greater effort on the
part of a business professional when attempting to strategically manipulate
Yelp’s reputation management system. Beyond their popularity, we chose
Amazon and Yelp because they both have a reputation management sys-
tem at the core of their business model. In Yelp’s case, its reputation man-
agement system is its primary business, while Amazon is mainly in the
business of selling products, the sales of which are influenced by the online
consumer reviews posted through its reputation management system. The
posting of fraudulent online consumer reviews to both sites has been well-
documented (Hu, Liu, & Sambamurthy, 2011; Luca & Zervas, 2013). Our
purpose for including the platform as a construct in our study is to rule out
the possibility that young professionals are more tolerant of the strategic
manipulation of one site’s reputation management system than that of the

other’s reputation management system.
We included a set of vignettes which describe business agents as authors
of online consumer reviews posted through Amazon’s reputation manage-
ment system and an equal number of vignettes which describe business
agent as authors of online consumer reviews posted through Yelp’s reputa-
tion management system. Since the sites serve different purposes
Amazon as a platform for selling products and Yelp as a platform for
reviewing businesses we had to ensure that our vignettes described activ-
ities that would realistically be completed by users of the sites. Therefore,
the vignettes which describe actions completed on Amazon describe busi-
ness agents reviewing a product, whether it be one of theirs or one of their
competitors, while the vignettes which describe actions completed on Yelp
describe business agents rating a business, whether it be theirs or one of
their competitors. While we do not predict that young professionals distin-
guish between the two sites when considering the fraudulency of the strate-
gic manipulation of the reputation management systems, we decided that
omitting this construct could result in speculation concerning the plat-
form’s role in shaping the perceptions of the survey respondents. Of course,
there are more than two sites which allow consumers to post online consu-
mer reviews, and in the event that the platform proves to impact the survey
respondents’ perceptions of the strategic manipulation of reputation man-
agement systems, a follow-up study including a broader set of platforms
could be conducted. See Table 7 for the means, variances, and p-values for
the platform construct by professional acceptability, ethicality, and overall.
Agenda: Pro-Firm versus Anti-Firm
An online consumer review posted by a business agent in response to an

action taken by an agent acting on behalf of a competitor might logically
Table 7. Pilot Study Statistics: Platform.

Amazon Yelp p-Value
Two-tail
Professional acceptability 3.060 2.096 3.018 2.050 0.408

Ethicality 2.741 2.036 2.719 2.071 0.685
Overall 2.900 2.090 2.869 2.082 0.385
be assumed to be anti-firm, meaning written with the intent of discrediting

the competitor; however, it is plausible that the business agent reacting by
posting an online consumer review could write content that was instead
pro-firm, meaning written with the intent of bolstering the online reputa-
tion of his/her business. Therefore, we included agenda as a construct in
our study in order to measure the impact, if any, of an online consumer
review being pro-firm versus anti-firm on young professionals’ assessment
of the fraudulency of the strategic manipulation of the reputation manage-
ment system. An online consumer review, whether it be positive or nega-
tive, pro-firm or anti-firm, posted by a business agent still serves to
compromise the integrity of the system, potentially resulting in reduced
consumer trust in reputation management systems in general. In turn, we
are interested in the degree to which young professionals take such reper-
cussions into consideration when assessing the fraudulency of the strategic
manipulation of reputation management systems as well as its ethicality
and professional acceptability.
To measure the impact of agenda on young professionals’ perception of
the strategic manipulation of reputation management systems, we devel-
oped a set of vignettes that describe business agents as an author of an
online consumer review written in support of a business, product, or service
and an equal number of vignettes describing business agents as an author
of an online consumer review written against a business, product, or ser-
vice. Since the valence of an online consumer review defines whether it is
pro-firm or anti-firm, we did not need to explicitly state the author’s
agenda. Theoretically, a business agent could write a negative online consu-
mer review about his/her own business, product, or service as well as a
positive review about his/her competitors’ businesses, products, or services,
but there would be no logical business motive for doing so; therefore, we
did not include vignettes describing such activities. See Table 8 for the
means, variances, and p-values for the agenda construct by professional
acceptability, ethicality, and overall.
Table 8. Pilot Study Statistics: Agenda.

Pro-Firm Anti-Firm p-Value
Two-tail

Ethicality 3.087 2.109 2.364 1.710 1.738E-31
Overall 3.239 2.043 2.520 1.851 1.917E-60
Source: Endogenous versus Exogenous
Online consumer reviews afford consumers the opportunity to report their

experience with a business, product, or service, which, in turn, serves to
provide feedback to the business or businesses involved as well as to assist
other consumers in making their own purchasing decisions. As such, when
studying online consumer reviews, activities endogenous to the creation of
an online consumer review are businesses selling a product or service, a
consumer purchasing that product or service, a site hosting a reputation
management system that allows consumers to post online consumer
reviews, and the consumer who purchased the product or service from the
business posting an online consumer review of the product or service as
well as the business in general. Activities driving the creation of an online
consumer review outside of this sequence are exogenous (Godes &
Mayzlin, 2009). Therefore, in practical terms, we consider a consumer post-
ing an online consumer review as endogenous and a business agent posting
an online consumer review as exogenous.
A consumer could post an online consumer review of a business, pro-
duct, or service with no direct knowledge of it, which would be in opposi-
tion to the intended purpose of reputation management systems. Such an
activity could then be considered exogenous rather than endogenous given
that it would fall outside of the aforementioned endogenous activities; how-
ever, the consumer would not be acting on behalf of a business, and activ-
ities that are not related to strengthening or weakening the online
reputation of a business, product, or service for the benefit of a business
fall outside the scope of our study. Moreover, we still consider the action
endogenous given that the consumer would be acting of their own volition,
albeit with no clear motive, although one could imagine personal motives a
consumer might have for fraudulently posting an online consumer review.
In the event that a business hired a consumer for the purpose of posting
online consumer reviews, for our purposes, the consumer would then be
considered an agent of the business, in turn making the activity exogenous.
Given that the focus of our study is on young professionals’ perception
of what constitutes fraud when business professionals strategically manipu-
late reputation management systems as well as the ethicality and profes-
sional acceptability of such activity, we determined that providing vignettes
describing endogenous activities (i.e., consumers posting online consumer
reviews regarding businesses, products, or services with which they had
direct experience) did not serve the purpose of our study. Therefore, all of
our vignettes describe exogenous activities (i.e., business agents posting
online consumer reviews regarding their businesses, products, or services or

those of their competitors). For the purpose of our study, we consider any
agent, whether it be an employee or any other individual, directed by a
business to post an online consumer review, whether it be for or against a
business, to constitute an exogenous activity.
DISCUSSION
As online commerce becomes more prevalent, developing an appreciation
for the connection between online and offline commerce and the potential
for the migration of online social norms to offline social interactions is
imperative when discussing how to maintain and improve business ethics.
Through this study, we have explored the ethical dilemma faced by entre-
preneurs when traversing between online and offline commerce, and the
results of our pilot study suggest that the ethical considerations for business
professionals conducting business online are more nuanced and complex
than conventional wisdom on the subject might suggest.
As researchers have cautioned (Hu, Liu et al., 2011), if the strategic
manipulation of reputation management systems by businesses becomes
accepted as a standard business practice, consumers’ trust in reputation
management systems in general will erode. This could result in the collapse
of the system as a meaningful source of information for consumers seeking
guidance regarding their purchasing decisions. Through this study, we have
further argued that the prevalence of e-commerce in today’s economy could
serve to transition society’s tolerance of what is deemed ethical as a stan-
dard online business practice to a broader acceptance of unethical behavior
in all business activities. While studies have shown that people have differ-
ent standards for online versus offline behavior (Suler, 2004), the impact of
shifting perceptions of acceptable online business activities to perceptions
of acceptable offline business activities has been given far less attention and
could have a significant impact for entrepreneurs on the ethics of conduct-
ing their business.
Given the ethical challenges confronting entrepreneurs if consumers
become conditioned to accept fraudulent online behavior, we chose to
focus our study on what standards young professionals have when deter-
mining what online business practices (specifically manipulation of reputa-
tion management systems) are considered fraudulent, both in respect to
their ethicality and their professional acceptability. Vignettes allow for
studying “how meanings, beliefs, judgments and actions are situationally
positioned” (Barter & Renold, 2000, p. 308), and they “allow a range of
situational or contextual factors to be considered in making judgments
about whether or not certain behavior is ethical” (Robertson, 1993, p. 592).
Taking these considerations into account, we deemed it appropriate to use
vignettes to convey the rich context necessary for survey respondents to
judge the fraudulency, ethicality, and professional acceptability of the
instances of strategic manipulation of reputation management systems
described. As advised by Weber (1992), we were mindful of the importance
of limiting the length of our survey to the greatest degree possible while still
allowing us to measure the research constructs of interest. While our sam-
ple population of 60 research subjects is small, the use of paired vignettes
allowed us to measure at least 1,000 paired responses for each research
construct.
FINAL THOUGHTS
As research has shown, people’s behavior online differs from their offline
behavior, a phenomenon known as the disinhibition effect (Suler, 2004),
and while the causes of this phenomenon, such as anonymity, lack of eye
contact, and invisibility, have been studied (Lapidot-Lefler & Barak, 2012),
the potential for online social norms to be adopted for offline social inter-
actions has been given far less attention. We are particularly interested in
how the adoption of business practices in e-commerce that would be
deemed unethical in traditional commerce might affect business profes-
sionals’ use of such business practices when operating offline. The argu-
ment could be made that a tacit acceptance by society of unscrupulous
business practices online could result in less ethical business practices in
general.
Through our study, we explored what standards young professionals
have for businesses conducting business online, specifically in respect to the
strategic manipulation of reputation management systems by posting
online consumer reviews, both in respect to the ethicality and the profes-
sional acceptability of those business practices. The results have the poten-
tial of revealing how young professionals have been conditioned by the
prevalence of web-based interactions and the anonymity they afford parti-
cipants, as well as the degree to which they rationalize the misrepresenta-
tion of information by business professionals for the purpose of
manipulating consumers’ purchasing decisions in order to drive sales.
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THE ETHICAL PITFALLS AND
OPPORTUNITIES OF INITIAL
PUBLIC OFFERINGS
Abbey Stemler and Timothy L. Fort
ABSTRACT
Initial public offerings (IPOs) have been a focus of qualitative and quan-
titative research since the 1960s. However, the majority of research ema-
nates from the fields of finance and management, with very little coming
from the field of ethics. In this paper, we attempt to fill this gap by
answering the question: Does the IPO process change a company’s ethi-
cal culture? In order to answer this question we examined S-1 filings
made by companies before they went public. We used text-mining techni-
ques to identify words that are uniquely related to corporate social
responsibility (CSR) in those filings. We then used linear regression to
compare those word counts to data produced by CSRHub. Companies
that include words related to CSR tend to score better on various CSR
measures. This evidence can support several explanatory theories, such
as companies that take the time and effort to discuss CSR concepts in
their S-1s make ethics a priority and therefore score higher on CSR rat-
ings. Similarly, companies that had never formally thought about their
ethical culture might feel, under the pressure of an IPO, to think about

ISSN: 1048-4736/doi:10.1108/S1048-473620150000025003
39
40 ABBEY STEMLER AND TIMOTHY L. FORT
what kind of company the owners and leadership want it to be in the long
run. Our study only analyzed companies three years post-IPO and did
not control for certain variables. This paper is the first of its kind to dis-
cuss and, more importantly, attempt to quantify the impact of the IPO
process on a company’s ethical culture. We hope that by understanding
how the IPO process influences companies in terms of ethics, companies
can more easily develop and maintain ethical cultures pre- and post-IPO.
Keywords: Ethics; IPOs; corporate social responsibility; S-1 filings
INTRODUCTION
An initial public offering (IPO) is a transformational event for any cor-

poration. After an IPO, a public company has access to more, and often
deeper, sources of capital, and founders and pre-IPO stockholders become
the new owners of highly liquid assets. The excitement surrounding an IPO
can also bring prestige and awareness to a company that cannot be gener-
ated through traditional public relations channels. On the downside, new
shareholders’ expectations can create pressure on management to focus on
profits and short-term goals.
IPOs have been a focus of qualitative and quantitative research since the
1960s (Reilly & Hatfield, 1969). However, the majority of research ema-
nates from the fields of finance and management (Daily et al., 2003), with
very little coming from the field of ethics (Dalton, Certo, & Daily, 2003). In
this paper, we attempt to fill this gap. We use an empirical approach to
look at the effect the IPO process has on a company’s business culture, and
we pose the question: Does the IPO process change a company’s ethical
culture?
This paper is the first of its kind to discuss and, more importantly,
attempt to quantify the impact of the IPO process on a company’s ethical
culture. We hope that by understanding how the IPO process influences
companies in terms of ethics, companies can more easily develop and main-
tain ethical cultures pre- and post-IPO. This issue is timely as the 2012
JOBS (Jumpstart Our Business Startups) Act goes into effect and makes it
easier for private companies to raise capital through the IPO process.1 It is
also timely because with the help of technology, more and more companies
create businesses through collaborative engagement with customers and
other stakeholders. The relationships at the basis of those collaborations
Ethical Pitfalls and Opportunities of Initial Public Offerings 41
accentuate the importance of trust, thereby making the trustworthiness of

corporate behavior more important than ever before. Thus, the market
pressures for performance and the collaborative pressures for trustworthi-
ness create a real need for companies to thoughtfully address their ethical
cultures.
We have organized this paper into four sections. Section “The IPO
Process and Its Impact” reviews the literature on the IPO process and
the impact it has on corporations generally. Section “Definitions and
Methodology” defines an ethical culture and outlines the methodology
used to assess the impact of the IPO process on a corporation’s ethical cul-
ture. The last two sections discuss and analyze the study’s results and short-
comings. The paper concludes with recommendations and a call for further
research into best practice for all parties involved in a company pre- and
post-IPO: the entrepreneur, employees, and shareholders.
THE IPO PROCESS AND ITS IMPACT

The decision to “go public” and sell a company’s unissued securities to the
masses is one of the most important decisions a company will make. It
requires at least a year of planning, intense review, and preparation by con-
sultants and investment banks, and approval by the Securities and
Exchange Commission (SEC) (PWC, 2011). In order to obtain SEC
approval, a company must prepare and file an S-1 document, which is, in
most cases, a detailed prospectus describing what the company is doing
and why. The purpose of the S-1 is to provide reliable information to the
public about the securities that will soon be for sale. It provides a glimpse
into what the company values, its strategy, and potential risks and oppor-
tunities. The SEC reads the company’s S-1 and, typically, asks the com-
pany to revise various parts. After revisions, the SEC either approves or
denies the application (PWC, 2011).
Once a company receives SEC approval, company officers complete a
“road show,” where they market the IPO by distributing the prospectus
and making presentations to potential investors, typically institutional
investors. Institutional investors include mutual funds, hedge funds, banks,
insurance companies, pension funds, money management funds, larger cor-
porate issuers, and other corporate finance intermediaries. These institu-
tional investors tend to drive stock prices because they typically receive
70 80% of shares sold in an IPO (PWC, 2011).
The last step in an IPO requires the company and the investment bank2
underwriting the sale to establish the offer price and the number of shares
to be sold. Once everyone settles on the terms, the company and the invest-
ment bank issue a formal underwriting agreement and a final prospectus is
prepared. The shares can then be sold (Dalton et al., 2003).
While the process appears to be relatively simple, it is quite complicated
and associated with a number of costs and risks (Fischer & Pollock, 2004).
Transitioning from private to public impacts every aspect of the company.
First, it may well require a change in company goals, as management must
deal with new kinds of investors who have different objectives and time
horizons than founders, early investors, and employees. New investors
often focus on short-term performance since market prices of public securi-
ties react quickly to good news (Fischer & Pollock, 2004). Likewise, they
typically have less tolerance for negative press and performance volatility
(Waterhouse, 1995).
Second, unlike a private company, cash flow of a public company is
observable, thereby creating little to no room for failure. As a result, public
firms tend to take on conventional, safe projects, whereas incentives in
private firms are biased toward innovative projects (Ferreira, Manso, &
Silva, 2014). Management post-IPO will be forced to deal with this reduced
flexibility, especially with increased oversight from the firm’s board of
directors.
A third way an IPO impacts a firm relates to changes in leadership. When
a firm goes public, venture capitalists, angels, and other early owners can
exit or reduce their interests in the firm. Some, including key executives,
may leave the company, while others may be less willing to continue making
the personal sacrifices that were required to get the firm through the IPO
stage (Fischer & Pollock, 2004). Furthermore, managers have an additional
incentive to relinquish control and equity, because the more they plan to
have post-IPO, the greater the risk of underpricing (Smart & Zutter, 2003).
Lastly, the influx of financial resources post-IPO will force management
to expand existing strategies or implement new strategies in markets or pro-
duct areas (Husick & Arrington, 1998). As a result, management will need
to restructure the company as new executives are hired, more formal gov-
ernance procedures are put in place, and additional staff are added to com-
municate with investors and satisfy the SEC’s reporting requirements
(Fischer & Pollock, 2004).
Given all of these changes, it would not be surprisingly for the culture of
the organization to changes as well; the question then becomes: how will the
culture change? We know based on anecdotal evidence that companies can
remain true to their values pre- and post-IPO, but over time they might
change. For example, a year before its IPO, Johnson & Johnson (“J&J”)
adopted one of the first codes of conduct. The credo was adopted after
General Robert Wood Johnson urged his fellow industrialists to embrace
corporate responsibility to customers, employees, the community, and
stockholders.3 While J&J is by no means perfect (Santoro, 2013), it has long
kept true to its credo. Most notably, in the mid-1980s, the credo helped J&J
remain true to its values when a series of deadly tampering incidents invol-
ving Tylenol capsules led the company to undertake a massive recall to
maintain public trust (LRN, 2006). Company executives pointed to the
credo and its importance to the company as the pole star for its decision.4
Yet, J&J also provides an example of how difficult it is to maintain a
values-driven culture. In 2010, after a number of product recalls and reg-
ulatory investigations, J&J shareholders brought a derivative suit against
the Board of Directors for failing to maintain an effective compliance
program.5 Among the demands of the shareholders, which were later
agreed to by the board in a settlement agreement, was a recommitment
to the values that had long-guided the company.6 While, J&J’s difficulties
occurred 65 years after its IPO, the point remains that companies face
market (and legal) pressures after an IPO that, inspiring S-1 language
and credos aside, makes it difficult to maintain a values-driven culture
after an IPO.
Indeed, anecdotally, companies can change for the better or worse pre-
and post-IPO. Companies such as Whole Foods Market and Timberland,
adopted strong values-driven missions to guide them pre-IPO and have
upheld those values post-IPO.7 Like any company (or person) these compa-
nies have received their fair share of criticism (e.g., Sheppard, 2010; Swartz,
2010), but on the whole, an objective assessment of each company would
reasonably conclude that these companies possess unique cultures driven
by missions that influence the way in which the companies operate their
businesses and treat their stakeholders.8
At the same time, both Google and Facebook touted their ethical values
before their IPOs. Google famously adopted a motto of “don’t be evil,”
and Facebook claimed it was on a “social mission” to “make the world
more open.”9 Both companies, however, have come under considerable
scrutiny for various issues concerning privacy (see, e.g., Hull, Lipford, &
Latulipe, 2011; IBTimes, 2013) and censorship (Dann & Haddow, 2008).
Unlike Whole Foods and Timberland, it would seem that the jury is out as
to whether these Internet-based companies have established an ethical iden-
tity of the kind that sustained J&J for a half century.
These anecdotal ambiguities raise two questions we address for the

remainder of the paper. The first question is how we define a term such as
“ethical culture?” Meaning, how might we even know whether or not a
company has one or needs to develop one? If we can provide an answer to
that question, the second question is does the IPO process change a com-
pany’s ethical culture.
DEFINITIONS AND METHODOLOGY

To answer the question “Does the IPO process change a company’s ethical
culture?” we must establish a working definition of an “ethical culture.”
We do this by relying on previous research on business cultures and notions
of trust.
Culture is a system of shared values, which define what is important,
and norms, which define appropriate attitudes and behaviors (Kimberly,
Miles, & Associates, 1980). The leading scholars of corporate culture, Kim
Cameron and Robert Quinn, demonstrate that there are four main types of
corporate cultures: Clan, Hierarchy, Adhocracy, and Market. Exploring
each of these types of cultures helps shed light on how culture can influence
a company.10
The Clan culture is one that might often be seen in a pre-IPO, closely
held business because it features a strong feeling of an extended family. The
leaders of the firm are often seen as mentors or even parents; indeed, some-
times that is exactly the case (see OCAIonline, 2010). There are often loose
boundaries separating personal and professional life, which can lead to a
context-rich workplace environment that is often complicated. The atten-
tion to personal dimensions of work can also result in sensitivity to custo-
mers and their needs (OCAIonline, 2010). The work of human resources
officers pertains to long-term development with resulting aspects of loyalty,
cohesion, morale, teamwork, participation, and consensus (OCAIonline,
2010). Employee empowerment and open communications become crucial
in this familial environment (OCAIonline, 2010).
A good example of a company with a strong Clan culture is Costco
Wholesale Corporation. It has one of the highest employee satisfaction rat-
ings of any Fortune 500 company, and has a high-performance culture
where the employees have fun and feel excited by their work (Bort, 2014).
Costco leaders believe that success comes from a long-range plan and colla-
borative “family” effort rather than a short-term focus and internal compe-
tition (Stone, 2013).
The Hierarchical culture is far more formal and structured (Kimberly

et al., 1980 at 7). Unlike the Clan culture, leaders are perceived more as
coordinators and organizers, and success is measured in terms of depend-
ability delivery, smooth scheduling, and efficiency (Kimberly et al., 1980
at 7). Hierarchical cultures have a strong legal feel to them with emphasis
on procedures, formal rules, and policies. Employees gain security and ben-
efit by predictability (Kimberly et al., 1980 at 7). A Hierarchical structure
has served the military for millennia, producing men and women of great
rectitude, honor, and discipline.
The Market culture is competitive and results-oriented. Leaders and
employees in the Market culture are tough, demanding, hard-driven, and
competitive (Kimberly et al., 1980 at 6). The emphasis is on winning
and success is defined according to performance and market penetration
(Kimberly et al., 1980 at 6). General Electric, under the leadership of
former CEO, Jack Welch, was a good example of a Market culture. Jack
Welch famously announced that if businesses divisions were not first or sec-
ond in their markets then, simply, they would be sold (Tharp, n.d.).
Cameron and Quinn’s final cultural mode is Adhocracy. This kind of
culture is entrepreneurial and creative (Tharp, n.d.). Leaders and employees
emphasize innovation and risk-taking (Tharp, n.d.). Innovation is cham-
pioned (Tharp, n.d.). In an innovative culture, creating new standards and
finding creative new approaches becomes hallmark strategies (Tharp, n.d.).
High-tech companies, like Google, are prototypical Adhocracy cultures.
Google develops innovative web tools, taking advantage of entrepreneurial
software engineers and cutting-edge processes and technologies. Their abil-
ity to quickly develop new services and capture market share has made
them leaders in the marketplace and forced less-nimble competition to play
catch-up (Kimberly et al., 1980 at 6).
Any particular company will likely have a mix of these attributes and we
do not claim that any particular form is necessarily preferable to another
(see Fig. 1). Instead, each form can be appropriate for a given organization
and its needs at a particular time:
At those times when a company has spun out of control with many ethical or legal viola-
tions, it may well be that a hierarchical structures is necessary to impose the needed con-
trols. An outside, market focus may be called for when a company’s outlook has become
too insular without regard for the variety of values existing outside the firm; this could
be true when a company has failed to keep up with changes in the economic market, but
so too when it has failed to keep up with changes in the social or political market with
issues pertaining to diversity. A family-oriented business one that is family owned for
example may have been able to create an organization like an extended family, but
such an organization may find it difficult to sustain that atmosphere as it grows and
FLEXIBILITY
Clan Adhocracy
INTERNAL EXTERNAL
FOCUS FOCUS
Hierarchy Market
CONTROL
Fig. 1. Four Main Types of Corporate Culture. Source: Adapted from

Schimmoeller (2010).
expands. An entrepreneurial firm may reach the point where it can become so entrepre-
neurial that it consistently eschews structure or bonds of relationship, creating a self-
centered environment that may not even have a market payoff. We believe that this is
one reason why Cameron and Quinn, simply identify their cultural change model as one
of moving from an existing structure to a preferred structure.11
If there is a perception that culture needs to change, then issues of moti-

vation, leadership, and organization capability to change become crucial
(Cameron & Quinn, 2011 at 2). Logically, this elevates affective/adhocracy
as the primary engines for change. Yet, the very actions of becoming larger
and more public work against both Adhocracy and Clan structures. As
Cameron and Quinn state that:
Over time, companies tend to gravitate toward an emphasis on hierarchy and market
culture types. Once their culture profiles become dominated by those lower two quad-
rants, it seems difficult for them to develop cultures dominated by the upper two quad-
rants. It’s almost as if a law of gravity takes over. The lower quadrants have a tendency
to remain dominant the longest. It takes a great deal of effort and leadership to make
the change to a clan or adhocracy culture. (Cameron & Quinn, 2011 at 79)
Put otherwise, as a company goes public, the legal regulations that apply
to it increase. This also necessitates more attention to corporate policies
and procedures to assure compliance with this increased regulation.12
Because the company will be subject to the pressures of the stock market,
as well as the consumer, labor, and other markets it has already had to
navigate, a publicly held company will have plenty of pressure to attend to
the market dimension of its culture. Yet, we suspect that when stakeholders
advocate for corporate responsibility and business ethics, they are looking
for something in addition to being law-abiding and making money. They
are looking for a deeper commitment to ethical practices that will be pre-
sent even when law and money are not primary incentives.
Now that we have described “culture,” we turn to our definition of
“ethical.” In other writings, one of the authors has divided ethics into three
types of trust: Hard Trust, Real Trust, and Good Trust. Hard Trust is
about the coercive pressures placed on companies by the law and, to a sig-
nificant extent, via public opinion and then internally articulated in corpo-
rate policies. Hard Trust is very closely aligned with Cameron and Quinn’s
Hierarchical Culture. Real Trust is when companies align their operational
rewards with their strategic rhetoric. No company is going to champion its
criminality or neglectfulness of its responsibilities. However, does its hiring,
firing, compensation, and other practices encourage employees to match
the rhetoric? Ample evidence shows that good ethics tends to be a reason-
able strategy for business.13 Integrity virtues such as truth-telling, promise-
keeping, and production of high-quality goods and services are crucial to
Real Trust to making ethics pay off (Fort, 2007).
Interestingly, free market economists such as F. A. Hayek argued that it
is most efficient for businesses to claim the benefits of good ethics when
those ethics are perceived to have their own independent value apart from
their profit correlation (Hayek, 1988). This is the territory of Good Trust.
Good Trust is when individuals are trusted because they sincerely seek to
practice ethics because of the independent value those ethics hold apart
from whether they help one avoiding getting into legal trouble and apart
from whether or not they are instrumentally valuable (Fort, 2007).
The difference between Real Trust and Good Trust is primarily a matter
of intent. Is the person or company sincere in pursuing ethical value or do
they practice virtues simply to make greater profit? The same can be said
for the difference between Hard Trust and Good Trust. Is the person sin-
cerely practicing ethics or do they simply wish to stay out of (legal) harm’s
way? We believe that other factors are necessary to evaluate the cognitive
differences between these aspects, and that those evaluations are best made
over a long-term time span. For our present purposes though, a starting
point is to determine the Good Trust words that indicate an ethical orienta-
tion. We will leave questions of sincerity for another day.
In order to test for the presence of Good Trust before and after the IPO
process, we first examined S-1 filings. The S-1 requires companies to pro-
vide information on the planned use of capital proceeds, detail the current
business model and competition, as well provide a brief prospectus of the
planned security itself, offering price methodology, and any dilution that
will occur to other listed securities.
The S-1 filings are a good indicator of a company’s commitment to a
values-driven culture for several reasons. First, there is absolutely no
requirement for companies to describe their culture or values in the S-1,
so if they do mention them, it is likely because the company finds them
important. Second, research shows that the content of the prospectus
“sends signals, intentionally or otherwise, to potential investors” that can
dramatically affect the demand for IPO shares and thus the share price
(Chen & Shen, 2014). By making statements about ethics, the company is
essentially saying: If you want to invest in us, here is how we play the
game; if you don’t like the way we play the game, don’t invest in us.
We used text-mining techniques to identify words that are uniquely
related to Good Trust (see Table 1). The words we examined are aspira-
tional and generally reflect organizational values such as fairness, hon-
esty, integrity, environmental responsibility, etc.14
RESULTS
A simple linear regression analysis was conducted to determine if post-IPO

CSR scores (dependent variables) could be predicted from value-driven
Table 1. Good Trust-Oriented Words.

Good Trust Oriented Words
Authenticity Promise-keeping
Culture (excluding scientific terms) Respectfully
Ethic(s), ethical Responsibility (to community, environment,
stakeholders, etc.)
Governance Sustainability (environmental)
Quality Trust (but not anti-trust or legal trusts)
Honest, honesty Truth, truthfully (excluding statements made in the
auditor report and disclaimers), truth-telling
Integrity Values (not valuation)
Mission (related to the
organization’s goals)
words in the S-1s (independent variables). See Table 2 for an analysis on

the influence the word “ethic(s)” on a company’s one-year overall CSR
score and its three-year overall CSR score.
We then compared the word counts to data produced by CSRHub, a
company that benchmarks company performance based on corporate
social responsibility (CSR) and sustainability ratings. CSRHub rates 12
indicators of employee, environment, community, and governance perfor-
mance issues. Data come from nine socially responsible investing research
firms, well-known indexes, publications, “best of” or “worst of” lists,
NGOs, crowd sources, and government agencies. By aggregating and nor-
malizing these sources, CSRHub has created a broad, consistent rating sys-
tem and a searchable database that links each rating point back to its
source.
CSR ratings, while not a perfect indication of ethical behavior, shed
light on a company’s treatment of employees, the environment, etc.
Presumably, if a company embraces notions of Good Trust, it will perform
well on the CSR ratings. The CSRHub community rating, for example,
covers the company’s commitment and effectiveness within the local,
national, and global communities in which it does business. It reflects a
company’s citizenship, charitable giving, and volunteerism. This category
also covers the company’s human rights record, treatment of its supply
chain, environmental and social impacts of the company’s products and
services, and the development of sustainable products, processes, and tech-
nologies (CSRHub).
Our sample is based on all industrial firms that went public on the New
York Stock Exchange and NASDAQ markets from 2010 to 2013. To be
Table 2. The Relationship Between the Word “Ethics” and CSR Ratings.
Model Unstandardized Standardized t Sig.
Coefficients Coefficients
Beta
B Std.
error
1 (Constant) 54.290 1.655 32.578 .000

Ethic(s), ethical .765a .304 .321 2.516 .015
1 (Constant) 51.110 1.125 45.441 .000
Ethic(s), ethical .457b .171 .274 2.670 .009
a
Dependent variable: post-IPO CSR rating overall (one-year out).
b
Dependent variable: post-IPO CSR rating overall (three-year out).
included in our sample, the IPO must involve common stock offered at a
minimum price of $1.00 per share and issued through a firm-commitment
underwriting agreement.15 In addition, the firm must be incorporated in
the United States at the offer date and be identified on the Center
for Research in Security Prices (CRSP) daily tap as having been listed
within three months of the offer date. These criteria yield a sample of
approximately 700 IPOs, which explicitly excludes IPOs by financial institu-
tions, real estate investment trusts, and closed-end mutual funds. Out of
those approximately 700 companies, CSRHub provided scores for 290
companies.16
Table 3 reports descriptive statistics, including the frequency of good
trust terms and the average CSR scores for various points in time after an
Table 3. Descriptive Statistics Related to Good Trust Words.

S-1 Terms N Mean Std. Post-IPO Ratings N Mean Std.
Deviation Deviation
Authenticity 338 0.1 1.3 CSR overall 57 57.4 7.3

(one-year out)
Culture 338 3.5 5.4 Community 213 58.2 12.7
(one-year out)
Ethic(s), ethical 338 4.4 3.8 Employees 216 53.5 10.1
(one-year out)
Governance 338 16.2 8.3 Environment 133 52.4 15.9
(one-year out)
Quality 338 20.8 19.4 Governance 206 54.4 14.1
(one-year out)
Honest, honesty 338 0.2 0.5 CSR rating overall 90 53.4 7.1
(three-years out)
Integrity 338 0.8 1.5 Community 125 46.2 10.8
(three-years out)
Mission 338 1.0 2.7 Employees 124 53.5 9.9
(three-years out)
Promise-keeping 338 0.0 0.5 Environment 104 55.9 13.3
(three-years out)
Respectful, Respectfully 338 0.1 1.2 Post-IPO 124 46.1 12.4
governance
(three-years out)
Responsibility 338 0.2 0.9
Sustainability 338 0.1 0.5
Trust (but not anti-trust 338 0.4 1.9
and legal trust)
Truth, truthfully 338 0.0 0.1
IPO. As shown in this table, the CSRHub scores for companies, overall, go
down slightly over time (57.4 for companies one-year out compared to 53.4
for companies three-years out).
The results of the simple linear regression suggest that a significant por-
tion of the total variation in some CSR scores was predicted by inclusion
of “ethic(s)” or “ethical” (ethic words). Meaning, there is a positive and sig-
nificant relationship between ethic words and overall CSR scores one-year
(β = .765, p < .05) and three-years (β = .457, p < .01) after an IPO. Put in a
different way, for each ethic word included, the overall CSR score after one
year increases by .765 and the overall CSR score after three years increases
by .457.
Inclusion of ethic words is also predictive of one-year community ratings
(β = .409, p < .05) and three-year community ratings (β = .511, p < .05),
and one-year environment ratings (β = .1.154, p < .05) and three-year gov-
ernance ratings (β = .692, p < .05).
Other terms besides ethic words also were statistically significant pre-
dictors of CSR ratings. For example, the inclusion of the word “respon-
sibility” strongly influenced the post-IPO community rating one-year out
(β = 1.779, p < .05), the post-IPO employee rating one-year out (β =
1.321, p < .05), and the post-IPO environment rating one-year out (β =
2.489, p < .05). Likewise, the inclusion of the word “sustainability”
strongly influenced the one-year environment rating (β = 8.257, p < .05).
There were not any statistically significant negative relationships between
good trust related terms and the CSR scores, except for the word “qual-
ity,” which in a small way negatively influenced one-year overall CSR rat-
ings (β = −.162, p < .05).
DISCUSSION
The results of this study for the first time show that companies that include
Good Trust related words tend to score better on various CSR mea-
sures.17 This evidence can support several explanatory theories; the simplest
of which is that companies that take the time and effort to discuss Good
Trust concepts in their S-1s make ethics a priority and therefore score
higher on CSR ratings. Similarly, companies that had never formally
thought about their ethical culture might feel, under the pressure of an
IPO, to think about what kind of company the owners and leadership want
it to be in the long run. That thought could then encourage companies to
include Good Trust related words and follow through with their commit-
ment to ethics post-IPO.
These explanations, however, are not without problems. It is possible
that inclusion of ethics-related words is just for show, and that the com-
panies that tout their ethical cultures on S-1s are just jump-starting their
public relationships campaign to be known as an “ethical company.” For
example, PWC in a recent publication instructed companies to include
sustainability concepts “early in the deal planning as a component of
setting the right course for a successful offering.” PWC suggests that the
public is beginning to care more about sustainability and corporate
responsibility; therefore, investors want to see those things discussed
in reports. PWC, however, says nothing about the sincerity of the
commitment.
Having acknowledged this, it is still telling that, even if just for show,
companies believe they need to spend time for such a show. This suggests
that, even if companies would rather not think about ethics, they realize
that they must in today’s market. That need may be enhanced even more if
the business model for a company is dependent in any significant way on
collaborate engagement with stakeholders especially customers in the
development of the product, something technology has made much more
possible in recent years.
Another criticism of our study is that it only observes a company for
a maximum of three years post-IPO. We may need more time post-IPO
to really understand the impact the IPO process has on ethics. A study
out of the University of California suggests that a critical consequence of
CSR is, perversely, corporate social irresponsibility (Ormiston & Wong,
2013). The study focused on Fortune 500 companies and found that
firms that engage in socially responsible behavior toward their stake-
holders are subsequently more likely to engage in socially irresponsible
behavior toward their same stakeholders at a later point (Ormiston &
Wong, 2013).
While the results of this study could simply be caused by regression to
the mean companies rarely tend to default to a position of outstanding
corporate citizenship the study does give a plausible alternative explana-
tion. It suggests that moral behavior is like a monetary currency, and
CEOs with a track record of taking care of their stakeholders are more
likely to feel justified in breaking with that record at a later date because of
a sense that they have accrued “moral credits” from their prior ethical
behavior (Ormiston & Wong, 2013). So perhaps the good CSR scores we
have highlighted in this study will decline because companies will have
“banked” enough credits to act unethically in the future. As previously

described in the results section, overall CSR scores go down slightly over
time (57.4 for companies one-year out compared to 53.4 for companies
three-years out).
CONCLUSION
The decision to go public typically engenders a range of emotions for the

leaders and owners of a company from excitement to anxiety and from
enthusiasm about the benefits of going public to concerns about the bur-
dens it brings. In this paper, we have both described the IPO landscape and
provided insight into the predictive nature of ethics-related words in IPO
filings. In future research, we would like to refine our current analysis by
controlling for things like the life span of a company pre-IPO, company
size, IPO size, and industry. Furthermore, we would like to explore other
ways to measure the impact of ethics-orientated behavior on the CSR rat-
ings, for example, by analyzing news stories, corporate announcements,
mission statements, etc. Lastly, we would like to continue to track the com-
panies who filed in 2010 2013 and see how their CSR performance
changes over time.
We believe that exploring the impact of the IPO process will lead to a
better understanding of how business leaders can steer their companies on
a path that promotes Good Trust, bearing in mind that Good Trust may
not only have its own independent value, but that its connection to Real
and Hard Trust suggests that incorporating it into an IPO strategy may
have strategic and legal significance as well. These possible connections
further up the ante for future research that clarifies the connections
between Good, Real, and Hard Trusts including both financial perfor-
mance and mitigation of legal risks.
NOTES
1. The Act creates a five-year “IPO on-ramp” for emerging growth companies
(EGCs), which will allow such companies more time to comply with certain disclo-
sures and regulatory requirements. EGCs are defined as companies with less than
$1 billion in annual revenues in their most recent full fiscal year and less than $1 bil-
lion in nonconvertible debt issuances within the past three years, and who are not
currently large accelerated filers with public floats in excess of $700 million.
2. Many IPOs have more than investment bank (Lannotta, 2010).

3. Johnson & Johnson, Our credo values. Available at www.jnj.com/our_
company/our_credo_history/index.htm
4. Knowledge@Wharton, Tylenol and the Legacy of J&J’s James Burke. Time.
com. Available at http://business.time.com/2012/10/05/tylenol-and-the-legacy-of-jjs-
james-burke/
5. In re Johnson & Johnson Derivative Litigation, 2010 WL 9476179 (D.N.J.
December 17, 2010).
6. Stipulation and Agreement of Settlement, in re Johnson & Johnson, 900 F.
Supp. 2d 467 (No. 11-2511), available at http://www.sec.gov/Archives/edgar/data/
200406/000020040612000115/a201207168-kexhibit992stip.htm
7. See Whole Foods Market, Mission & Values. Available at http://www.whole-
foodsmarket.com/mission-values; Timberland, Living our values, available at http://
responsibility.timberland.com/service/living-our-values/
8. http://media.wholefoodsmarket.com/news/whole-foods-market-named-to-wo
rlds-most-ethical-companies-list. Timberland scores well above CSRHub’s average
overall rating (65 vs. 55).
9. See Google, Code of conduct. Available at https://investor.google.com/
corporate/code-of-conduct.html; Facebook, FAQ, http://investor.fb.com/faq.cfm
10. See Countess Alexandra and Timothy L. Fort (2015). Catalyst, obstacle, or
something in between: Dealing with the law in building corporate culture.
____Notre Dame Journal of Law, Ethics, & Public Policy for a full analysis of
Cameron and Quinn’s corporate culture. The following discussion draws heavily on
that analysis.
11. Countess Alexandra and Timothy L. Fort (2015). Catalyst, obstacle, or some-
thing in between: Dealing with the law in building corporate culture. Notre Dame
Journal of Law, Ethics, & Public Policy citing Cameron and Quinn (2011) at 8
and 67.
12. Supra cites to increase regulation … also to federal sentencing guidelines.
13. Sometimes this is articulated as corporate financial performance correlating
with corporate social performance and other times linking good business and good
ethics. The research shows that there is a weak correlation between these aspects
suggesting that while one can be profitable by being unethical, one can also be ethi-
cal and be profitable (and it may be slightly easier to do business in this regard).
This research thus demonstrates that ethical business conduct is a viable business
strategy.
14. We are indebted to Susan Willey, Kelly Grace, Nancy Mansfield, and
Margaret Sherman for the ideas and methodologies developed in their paper, which
was presented at the 2014 Academy of Legal Studies in Business Conference in
Seattle, WA, entitled “Language of the Codes: Comparing the Frequency of Ethics
Compliance Terms in Corporate Codes of Conduct.”
15. An underwriting in which an investment banking firm commits to buy and
sell an entire issue of stock and assumes all financial responsibility for any unsold
shares.
16. CSRHub collects data from 339 sources, if a company does not have enough
information to create a valid rating, CSRHub will not rate it. CSRHub currently
does not rate about 90,000 companies (CSRHub).
17. Because we don’t have data from CSRHub pre-IPO in most cases, we cannot
determine for certain whether or not companies become “more” ethical, but we can
at least say, they perform better than their peers on ethic ratings.
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THE ETHICS OF GUERILLA
BEHAVIOR IN EARLY STAGE
FIRMS
Yongseok Jang and Michael H. Morris
ABSTRACT
The need for entrepreneurs to engage in guerrilla behavior is heavily

emphasized by entrepreneurship educators and practitioners. Yet such
behavior often has serious ethical implications. The purpose of this study
is to establish an assessment framework that provides ethical guidance to
entrepreneurs engaged in guerrilla behaviors. A theoretical foundation
for assessing the ethics of guerrilla behavior is established. The entrepre-
neurial context and how it gives rise to the need for guerrilla actions are
examined. The guerilla concept is explored and criteria are outlined for
labeling a given action or approach as being guerrilla in nature. Different
forms or types of guerrilla approaches are introduced. Five primary ethi-
cal dimensions to be considered in evaluating a given guerrilla approach
are identified. Examples are provided of how these dimensions can be
applied to assess the ethics of three different successful guerrilla cam-
paigns. An integrated matrix is introduced for use in evaluating guerrilla
campaigns that consider our ethical dimensions together with leading the-
oretical perspectives on ethical action. Based on how a given guerrilla

ISSN: 1048-4736/doi:10.1108/S1048-473620150000025004
57
58 YONGSEOK JANG AND MICHAEL H. MORRIS
approach is scored when using the assessment matrix, conclusions are

drawn for its appropriateness. By using a mix of the deontological, utili-
tarian and virtue-based frameworks, it becomes possible to determine the
relative ethics of any given guerrilla action once implemented, and
actions can be taken to either modify or abandon the action. Further, the
concepts developed in this paper can be useful in ensuring new guerrilla
actions are more ethical when they are first conceptualized or designed.
Four design elements can be systematically applied to decisions that
unfold as the guerrilla action is being formulated: resources and provi-
ders, disclosure, stakeholder effects, and inferences/conclusions. A num-
ber of suggestions for ongoing research are provided based on the work
presented here.
Keywords: Ethics; guerrilla; deontology; utilitarian; virtue-based
INTRODUCTION
Entrepreneurship has been defined as “the pursuit of opportunity regard-
less of resources controlled” (Stevenson & Gumpert, 1985). Yet, such a per-
spective leaves unanswered the question of how one pursues opportunity
when he or she has insufficient resources. The answer to such a question is
that one must learn to “act entrepreneurially,” and this is generally con-
strued to mean that one must bootstrap, leverage resources, and engage in
bricolage (Baker & Nelson, 2005; Winborg & Landström, 2001).
One of the more prevalent perspectives on how entrepreneurs can pursue
opportunity when faced with severe resource constraints is termed guerrilla
behavior (Morris, Schindehutte, & LaForge, 2002). Here, the analogy of
guerrilla warfare is employed, where the smaller, less-resourced party man-
ages to defeat a more imposing opponent through clever tactics that take
advantage of the surroundings, are unexpected, mobile and executed
quickly, and often involve stealth (Hutter & Hoffmann, 2011; Levinson,
1984). In a new venture context, guerrilla behavior is most often applied to
selling and marketing. It refers to an unconventional system of tactics that
relies on time, energy, and imagination rather than a large budget. The
efforts are novel and unconventional, potentially interactive and consumers
are targeted in unexpected places.
Consider the case of the new pizza restaurant in an urban area that deci-
des to feed and pay homeless people to hold up hand-scrawled messages at
locations throughout the city attesting to the fact that they are homeless,
The Ethics of Guerilla Behavior in Early Stage Firms 59
have tried every kind of pizza, and believe this restaurant offers the best
pizza. Such a tactic is certainly clever, non-conventional, and utilizes as a
resource something that most others would not view as a resource. The
entrepreneur in this case is lauded for creatively overcoming their resource
limitations to achieve results in short, for “acting entrepreneurially.” Yet
such behaviors have important ethical dimensions, the implications of
which warrant further investigation. The ethical aspects of guerrilla actions
can be complex, with little guidance on when it is appropriate to rely on a
given approach.
The purpose of this study is to establish an assessment framework that
provides such guidance to entrepreneurs engaged in guerrilla behaviors. We
begin by establishing a theoretical foundation for assessing the ethics of
guerrilla behavior. We then examine the entrepreneurial context and how it
gives rise to the need for guerrilla actions. The guerilla concept is then
explored and criteria are outlined for labeling a given action or approach
as being guerrilla in nature. Different forms or types of guerrilla
approaches are then introduced. Five primary ethical dimensions to be con-
sidered in evaluating a given guerrilla approach are then identified.
Examples are provided of how these dimensions can be applied to assess
the ethics of three different successful guerrilla campaigns. We next intro-
duce an integrated matrix for use in evaluating guerrilla campaigns that
considers our ethical dimensions together with leading theoretical perspec-
tives on ethical action. Based on how a given guerrilla approach is scored
when using the assessment matrix, conclusions are drawn for its appropri-
ateness. Finally, implications are drawn for theory and practice, and sug-
gestions made for ongoing research.
THEORETICAL FOUNDATIONS
Business ethicists have developed a variety of frameworks for assessing

business decision-making using differing foundational principles (e.g.,
motives, virtue, rights, rules, utility, justice, duty, social obligations). These
frameworks are characterized as being either deontological or teleological
(Brady & Dunn, 1995), where the former focus on the righteousness of
specific actions or behaviors, and the latter examine the net positives
and negatives embedded in the consequence of an action. Approaches
based on legality, duties, and special obligations have their philosophical
bases in deontology, while those emphasizing consequence and net-utility
are teleological in nature. Let us consider three of the leading frameworks

(see also Table 1 for a summary of characteristics and limitations of the
each framework).
Based on Kant’s theory of ethics, the basic deontological framework
focuses on the motives of the person who makes a decision regarding some
courses of action. Here, emphasis is placed on a person’s goodwill in quali-
fying an action as “righteous,” where morally just actions are those carried
out with a sense of duty (Lahdesmaki, 2005). The deontological framework
defines ethical behaviors in terms of obligations, rights, principles, rules, or
codes (Whetstone, 2001), with fulfilling one’s moral duty (Weisberg,
Pfleiger, & Friedberg, 2007). The individual places living up to one’s duty
before his/her self-interest (Weisberg et al., 2007). Therefore, rights are sub-
ordinate to the notion of obligation (Weil, 2003). There may be duties to
fulfill independent of any individual’s rights, but one’s duty generally obli-
gates one to act in observance of those rights (Brady & Dunn, 1995).
Kantian morality suggests both the autonomy and universality of moral
decisions, where everyone is treated as a free person. Action should be
based on unconditional judgments in terms of righteousness. Potential
Table 1. Characteristics of Major Ethical Frameworks.

Deontological Utilitarian Framework Virtue-Based Framework
Framework
Focus Individual action, Consequences, outcomes Relational acts, motives,

motives context
Ethicality Unethical if action Unethical if action results Unethical if action is
judged violates code of in negative consequence absent of virtue
by conduct, rules, moral
principles
Standard Objective; rule of moral Objective; net benefit of Relational; choose best
principles consequence action depending on the
context
Limitation Context-free, naiveté, Ethics are situational Ethics situational
dogmatic; inability to depending on depending on the
handle a situation consequence; less context; lack of clear
where conflicting effective with hidden, guidance given that
universal rules of subtle, or hard-to- individuals use different
morality are present; measure consequence; mechanisms to interpret
degree of ethical limited in handling ethics in a given
violation harder to multiple and mixed situation; power
discern positive and negative differences can influence
consequences ethical judgments
benefits, achieving an objective, or having a positive consequence should

not be considered. Rather, duty is defined in terms of actions that are con-
sistent with moral laws embraced by nearly every society in certain situa-
tions (Weisberg et al., 2007).
While the concept of moral duty is correlated with “moral rights,” the
framework falls short in explaining specific moral rights (Lahdesmaki,
2005). In the context of marketing, Laczniak (1983) listed such relevant
duties as fidelity, gratitude, justice, beneficence, self-improvement, and non-
injury. Also, the perspective does not provide guidance on how to resolve
or balance conflicting rights (Velasquez, 2002). It thus becomes problematic
to build a system to guide action, given innumerable cases of conflict
among universal rules of morality. As illustrated by Hunt and Vitell (1986),
telling a lie is unethical in terms of deontology as it is a violation of univer-
sal moral standard, yet it could be argued that such behavior could in cer-
tain cases protect people from being hurt.
A second framework, utilitarianism, adopts a teleological perspective.
The primary focus here is the value of consequences of an act, such that an
action is beneficial based on its ends, rather than its means (Bradburn,
2001). Thus, an act becomes righteous when it produces the greatest net
benefits. One is therefore allowing for situational ethics, where contribu-
tions of an action in particular circumstances are important considerations
for assessing the utility of the action. Unequal treatment of the same action
is justified if it maximizes general welfare (Airaksinen, 1987). The maxi-
mized benefit is not that of the actor, but of the individuals affected by the
actor’s action (Lahdesmaki, 2005), giving rise to the notion of altruism.
For its part, the benefit is defined in various forms, such as absence of pain
or presence of pleasure.
Drawbacks to the utilitarian framework include difficulties in objectively
measuring the relative benefits of a consequence (Lahdesmaki, 2005). While
the utilitarianist would attempt to capture both the intensity and duration
of each benefit associated with an action (Häyry, 1999), in reality conse-
quences are usually nuanced, hybrid, contain a mixture of good and bad,
and require subjective interpretation. Where situations contain negative
consequences mixed with positive ones, ethical judgment is likely to reflect
the meaning of a partial aspect of the consequence, and fail to capture the
holistic character of the outcome. Utilitarianism can thus provide guidance
and justification that actually leads to morally precarious situations
(Lahdesmaki, 2005). Utilitarian views tend to remain blind to the clearly
unethical actions posed by companies when negative consequence is not
clearly perceived or properly weighted. Also, they show a certain level of
naı̈veté by assuming actions with malicious intent may result in largely posi-
tive consequences. Due to heavy emphasis on the outcome, utilitarianism
seems to be biased toward visibility of a consequence. Yet, less-visible out-
comes can often have significant implications for those who are impacted,
especially those who are marginalized (Reidenbach & Robin, 1990). As a
result, beyond the direct impact of a practice on the financial performance
of a company, utilitarianism can prove somewhat general and abstract
when it comes to providing tangible direction for managers (Stark, 1992).
A third perspective is provided by the virtue-based framework (VBF).
Here, attention centers on personal moral virtues (courage, honesty, fair-
ness, fidelity, goodwill, etc.) in different contexts. The focal point of ethical
assessment becomes whether a particular action promotes development of
good moral character, and so leads to a better kind of life (Duncan, 1995;
Katz, 2011). VBF builds on the notion of “dwelling,” a phenomenological
notion of Heidegger (1975). Dwelling is a quality of engagement; it implies
“being with” which enables entities to co-exist peacefully (Ladkin, 2006).
VBF stresses engagement enabled by a mutual willingness to influence and
be influenced by the other, with moral virtue serving as a highly valued
human trait (Beauchamp & Childress, 2001). A high degree of transparency
is necessary for such relations to operate. Moral practice thus involves
“attending both to one’s own values and responses to a situation” (Ladkin,
2006, p. 87). Virtues and vices are only understood as the choice of right
actions in a given context that enables the flourishing of entities. Righteous
action is not predefined based on objective measures, but rather, emerges
from engagements where individuals are willing to influence one another in
finding virtuous ways that fit the context they share (Ladkin, 2006).
Ethicality is judged by the extent to which a chosen action contributes to
the promotion of virtuous human character.
Virtue-based ethics also has shortcomings. Different individuals may not
use the same mechanisms to interpret the ethics of a given action. As such,
specific linkages between virtues and ethics can be difficult to establish. For
instance, courageousness is a virtue, but individuals can be courageous in
committing a crime (Airaksinen, 1987). In addition, the importance and
interpretation of a given virtue can vary based on one’s cultural back-
ground, and this can be problematic when individuals from different cul-
tural milieus work together and are judging some action (Velasquez, 2000).
Further, there are dangers in adopting the ethics of virtue from a leadership
context perspective. The reliance on engagement based on the principle of
transparency ignores potential power differences between entities (Ladkin,
2006). If combined with consequential teleology, the strong potential for
subjective interpretation can produce tyrannical styles of leadership

(Whetstone, 2003). Virtue ethics embraces the premise that there is, in nat-
ure, some desired end for life. In the context of business, such a philosophi-
cal viewpoint is likely to motivate individuals to be their best in achieving
the vision of the leader. According to Duncan (1995), virtue-based ethics is
therefore non-rule-governed teleological theory, requiring a deontological
standard of right or wrong. For their part, strong leaders have the potential
to manipulate concepts of ethics in decisions meant to achieve the vision.
In conclusion, deontology bases ethical assessments of an action on
whether it complies with rules in accomplishing a moral duty, while utilitar-
ianism asserts that ethical judgment should be conducted based on the net
benefit of a consequence, and the VBF draws attention to the motivation
for action and how such an action affects the flourishing of entities.
Where deontology and utilitarianism are based on objectivity and univers-
ality of morality (obedience to moral absolute for deontology, and objec-
tive agreement/measurement of happiness for utilitarianism), the VBF
adopts a relational concept of morality.
THE ENTREPRENEURIAL CONTEXT AND THE

MOTIVATION FOR GUERRILLA BEHAVIOR
Entrepreneurial ventures are ones small enough in size, as reflected in rev-

enues, employees, or amount of infrastructure, that they continue to
suffer meaningfully from the liabilities of newness and smallness. The
liability of newness concerns the vulnerabilities of the firm based on its lack
of market identity, reputation, legitimacy, established routines, and an
accumulated body of relevant tacit knowledge (Freeman, Carroll, &
Hannan, 1983). Liability of smallness refers to disadvantages the firm
experiences in achieving visibility given its size, its relatively weak position
in bargaining with suppliers, distributors and customers, and the lack of
scale economies in production and distribution (Rauch, Unger, &
Rosenbusch, 2007).
The liabilities of newness and smallness reflect relatively severe resource
constraints in early stage ventures. As a result, the entrepreneur is often
forced to rely on creativity to address critical human, physical, social, and
financial needs (Klyver & Schenkel, 2013). The challenges of organizing
operations, reaching customers, and creating value while confronting
entrenched competitors require resources most entrepreneurs do not have.
The analogy of David and Goliath has been used to capture the challenges
of the new entrant taking on incumbent firms (Gladwell, 2013). Like
David, the entrepreneur must use ingenuity to overcome obstacles and turn
disadvantages into advantages.
The question is how one creates and grows a venture under such circum-
stances. The generic answer would seem that one must learn to “act entre-
preneurially,” which means developing the ability to bootstrap, leverage,
practice bricolage, and engage in effectual reasoning. Bootstrapping
refers to starting a venture with minimal financial resources by using
ploys such as selling on consignment, using supplier credit, and accelerating
receivables (Winborg & Landström, 2001). Leveraging involves accessing
resources one does not own, and using resources in creative ways (Morris
et al., 2013). Bricolage is a do-it-yourself process of going from means to
goals, where one makes things from whatever materials are at hand (Lévi-
Strauss, 1966). Effectual reasoning is concerned with using a set of heuris-
tics to creatively combine and deploy the emerging set of means at hand to
achieve evolving goals (Sarasvathy, 2001).
Consistent with such approaches to resource scarcity is the guerrilla con-
cept. Popularized by Levinson (1982) who applied the concept to marketing
decisions, the principles of guerrilla warfare are utilized within an entrepre-
neurial context. The history of warfare is replete with examples of smaller,
weaker, under-resourced combatants defeating more powerful foes by
engaging in unconventional tactics, utilizing the unexpected ambush, taking
advantage of environmental conditions, and relying on speed and the ele-
ment of surprise (Beckett, 1999). In spite of its prevalent use, the term
“guerrilla” remains a rather vague concept. Entrepreneurs can find them-
selves engaged in guerrilla actions without necessarily recognizing them as
such. For our purpose, we will argue that a guerrilla action is being taken
when the entrepreneur attempts to accomplish marketplace results through
one or more of the following principles:
• Using resources not under his/her ownership or control;
• Doing more with fewer resources;
• Mobilizing resources that others do not typically recognize as resources;
• Utilizing resources in ways they have not traditionally been used;
• Stretching resources beyond their conventional capabilities;
• Playing resources off of one another to accomplish results;
• Combining resources in novel ways.
Given its reliance on creativity and ingenuity, guerrilla behavior can
take a wide variety of forms. Box 1 summarizes 11 of these forms. Here we
Box 1. Examples of Guerrilla Marketing Forms.

Bartering: Trading out goods or services for a marketing resource.
Example: printing company gives free services to radio station in
exchange for on-air promotions.
Relying on reciprocity: Different companies are directly helping one
another. Example: two marketers mention one another in their
advertising.
Sharing: Different companies going in together to acquire a resource
that one could not afford and then share it. Example: two companies
share a salesperson.
Using opinion leaders: Placing products with opinion leaders and
incentivizing them to use the products in public contexts. Example:
fashion clothing company has popular high school students wear
their clothing at school.
Taking advantage of surroundings: Turning things surrounding the
business into resources. Example: pizza restaurant uses homeless peo-
ple to market its pizza.
Disguising agents: Having people pretend to not work for you and
have them effectively endorse your product. Example: maker of cam-
eras has employees pretend to be tourists asking other tourists to
take pictures of them using the company’s product.
Finding underutilized resources: Placing promotional messages in pub-
lic venues where they do not typically appear. Example: advertising
on floors, bathroom stalls, or in elevator doors as they open.
Placing products: Having products featured in movies, songs, video
games. Example: Harley Davidson offers motorcycles at no cost to
the organizers of the Super Bowl halftime show.
Creating news: Doing something newsworthy and getting media cov-
erage. Example: local computer store offers free training courses to
disadvantaged or at-risk individuals from the inner city and gets local
newspaper to publish story on the program.
Leveraging networks: By belonging to various groups or organiza-
tions, the entrepreneur is able to effectively promote his/her business.
Example: membership or sponsorship by an entrepreneur of an orga-

nization that supports stopping spousal abuse, which results in other
members/supporters using the entrepreneur’s services.
Co-creating: Using customers to help produce products or services.
Example: YouTube does not create the content that is the essence of
its value proposition.
see a range of approaches where the entrepreneur is able to do more with

less by relying on the principles of resource leveraging, bootstrapping, bri-
colage, and effectuation.
Within marketing, the guerrilla concept is today being manifested under
a number of different labels. Examples include viral marketing (Leskovec,
Adamic, & Huberman, 2007), buzz marketing (Carl, 2006), subversive mar-
keting (Morris et al., 2002), stealth marketing (Roy & Chattopadhyay,
2010), and ambush marketing (Meenaghan, 1998), among others. While
each has unique characteristics (e.g., viral efforts involve campaigns expli-
citly designed to exponentially expand the communication of one’s mes-
sage, often via the internet, while buzz marketing centers on some unusual,
unexpected public event or activity that generates free media coverage and/
or stimulates considerable word-of-mouth communication), at their core
are the guerrilla principles. Notably, these various approaches can demon-
strate significant overlaps, such as where a buzz marketing effort that
employs stealth elements, goes viral.
THE ETHICS OF GUERRILLA MARKETING
Ethical issues surround any business action, but the pursuit of guerrilla
actions has particular ethical implications. At least five major ethical
dimensions should be considered in reviewing a given guerrilla opportunity.
These include:
1. Deception: Failing to provide relevant, complete, and accurate informa-

tion about aspects of the guerrilla campaign to any stakeholder involved
with or exposed to the campaign.
2. Violation of privacy: Engaging in guerrilla efforts that are intrusive or

communicate with audiences at times and places that they do not desire
or perceive to be inappropriate.
3. Exploitation of resources: Guerrilla campaigns that utilize resources of
the entrepreneur has no right to use, or does not have permission to use,
or in ways that demean or undermine the resource, fail to properly
acknowledge, compensate or reward a given resource, or make associa-
tions that the resource or its owners do not endorse.
4. Misleading customers: Using the guerrilla campaign to get customers to
draw conclusions, make associations, or take actions about which they
might otherwise have reservations were they given better information.
5. Causing personal harm or damage: Guerrilla actions that result in psy-
chological, emotional, or physical harm or damage to someone exposed
to them.
We can see potential violations of these ethical dimensions when consid-

ering three classic examples of guerrilla behavior. Consider first a pizza res-
taurant in an urban area where there are lots of homeless people. The
entrepreneur implements a creative program where he feeds and pays the
homeless, and in turn they stand on street corners hold hand-scrawled signs
that indicate how they have tried every kind of pizza in town and the entre-
preneur’s is the best. The use of the homeless as an advertising medium
would seem, on the surface, to be a relatively ethical practice, as the people
involved are giving their permission and being compensated for their
efforts. And one could argue they are being assisted in dealing with their
dire circumstances.
Yet, it could also be argued that their plight as unemployed, poor and
hungry is being taken advantage of to generate pizza sales. Were they not
desperate for food and money, they might not hold the signs, as they may
feel it is demeaning or beneath their dignity. Such feelings may be even
more pronounced among the homeless not taking part in the campaign.
Further, there is a potentially misleading element involved, as the pizza res-
taurant may, because of the campaign, be seen as a real champion of the
homeless and needy, when in fact they do nothing else for these individuals
and are principally interested in selling pizza. Privacy violations are also
possible here, as the homeless individual may actually prefer to remain
anonymous, while the consumer exposed to the campaign is not expecting
and may not want to be disturbed with such messages when moving about
the city.
Alternatively, consider the well-known stealth marketing campaigns of

Sony with cameras or Vespa with scooters. Here, the company has paid
employees pretend to be consumers or tourists in public places. These
individuals then engage with prospective customers in ways that effec-
tively endorse the product. Hence, with the Sony campaign, the stealth
employee asks another tourist to snap their picture using the Sony cam-
era so that this unaware individual is exposed to the unique features of
the camera. Clear deception is involved, as representatives of the com-
pany are pretending to be something they are not, or are not disclosing
who they actually represent. Such deception can serve to mislead custo-
mers such that they draw conclusions about the products they would not
had they been given more information. Privacy is being violated as a
marketing message is being conveyed at a time and place and under con-
ditions that the prospective customer would not normally expect or
desire. And of course employees are being exploited to effectively lie or
misrepresent themselves.
Finally, consider the buzz marketing campaign of Honest Tea. The
company ran a national program attempting to identify the most “hon-
est” city in America. Unattended displays were set up in prominent
downtown areas where bottles of the company’s products were available.
A person could simply take one or more bottles or could “do the right
thing” by putting a dollar into a designated box. A hidden camera
recorded people’s behavior, and a city is rated based on how many peo-
ple actually pay. Tremendous buzz was created as local media were
informed of the event and sent crews to do television and radio stories,
and significant word-of-mouth activity was stimulated. While highly effec-
tive, and potentially fun and amusing, deception is present as the pre-
sence of the cameras is disguised. Exploitation is involved, as people are
effectively being coerced into participating in a social experiment without
their knowledge or approval. Further, one could argue that the effort is
misleading and potential harm is involved. Some members of the public
may conclude that fellow citizens are inherently dishonest. Those living in
cities that score more poorly may take a more negative view of the place
where they reside, while those living in other places may form stereotypes
regarding a given city.
As some of these examples make clear, even seemingly innocuous or
well-intentioned guerrilla efforts can raise issues on our ethical dimensions.
Yet, are the ethical questions they raise enough to suggest a given tactic
should either be modified or abandoned? To address this question, we
return to our theoretical foundation.
AN INTEGRATED ASSESSMENT MATRIX

FOR GUERRILLA ACTIONS
If we integrate the five ethical dimensions most involved with guerrilla pro-
grams with the three theoretical frameworks discussed earlier, an assess-
ment matrix is produced. This matrix can be used by entrepreneurs in their
decision-making processes and is consistent with the Hunt Vitell model of
ethical decision-making (Hunt & Vitell, 1986). Tables 2(a) (c) present the
matrix, which we can demonstrate using three guerrilla campaigns.
Pizza and the Homeless
Our earlier example of the entrepreneur at a pizza restaurant using the

homeless as a marketing vehicle suggested a couple of possible ethical
breaches in what is ostensibly a low-cost and effective initiative. Yet, the
extent to which these issues are sufficiently problematic and suggests the
behavior represents an unethical action that should not have been imple-
mented depends on the theoretical framework one adopts. We have
attempted to judge the potential ethical breaches on the five dimensions
using the three theoretical frameworks. Hence, we consider the deception
involved with a given guerrilla approach using the deontological, utilitar-
ian, and VBFs, noting the key ethical conclusion in each cell. We then
summarize the assessments across each ethical dimension and across each
ethical framework. We use a √− (meaningful ethical concern) or √+ (lit-
tle to no ethical concern) to capture the individual assessments. The
matrix reflects the case of the use of the homeless to promote pizza (see
Table 2(a)) suggests the greatest ethical concerns are in the areas of intru-
sion of privacy and exploitation of a resource. It also reveals the least
ethical concern using the utilitarian framework and the greatest using the
VBF. On balance, however, the matrix suggests this to be a more ethi-
cally acceptable practice.
Pretending to Be a Tourist
Applying the matrix to Sony-Ericsson’s use of fake tourists may lead to a

different conclusion. Here, the guerrilla practice raises questions across
all of the ethical dimensions, most notably deception, exploitation (of
Table 2a. Assessment of Pizza Restaurant and the Homeless.
70
Dimension Framework
Deontological framework Utilitarian framework Virtue-based framework Summary

score for
dimension
Deception No rule or principle violated No deceptive outcomes No human virtue impacted based +++
on deception
Intrusion of Violation of rights of pedestrians Insignificant outcome from Lack of respect for fellow human −+−
privacy and homeless to be not intrusion beings (the privacy of the
disturbed homeless)
YONGSEOK JANG AND MICHAEL H. MORRIS

Misleading Potential (but nominal) perception Any misperceptions have nominal Exploiting people’s sense of ++−
inferences by public that company seeks to impact on the public goodwill regarding helping
support homeless versus sell others in order to sell pizza
pizza
Exploitation of Intentional exploitation of Homeless are receiving food and Taking advantage of the weak −+−
resource vulnerable people payment in exchange for their position of fellow human beings
voluntary services in a particular context
Harmful/ Some homeless people may feel Dignity may be enhanced based on No intention to harm, may −/+ + +
Disturbing to demeaned and stereotyped; receiving food and pay; some actually intend to help those
people others may feel they are being minor emotional or more disadvantaged than
recognized psychological harm; pizza sales oneself
went up, creating employment
Summary score + − + − −/+ +++++ +−−−+ Overall
for the assessment:
framework tends more
toward
being
ethically
acceptable
Table 2b. Assessment of Sony’s Fake Tourist.
The Ethics of Guerilla Behavior in Early Stage Firms

Dimension Framework
Deontological framework Utilitarian framework Virtue-based framework Summary score

for dimension
Deception Non-disclosure of commercial Deception has little measurable Compromising people’s sense of −+−
purpose and hiding identity of negative impact honesty and goodwill
marketers as tourists concerning those asking for help
Intrusion of Intrusion of pedestrians’ Privacy violation has little impact Compromising the value of mutual −+−
privacy autonomy of travel as pedestrians are routinely agreement regarding
asked to take someone’s picture autonomous and genuine
engagement
Misleading Pedestrian is being misled to Any misperceptions have nominal Conveying a paid-for message as −+−
inferences conclude many tourists are impact on the public being objective compromising
using this camera honest engagement
Exploitation of Exploiting employee by forcing Exploitation of employees could Promoting non-virtuous −+−
resource them to lie, violating a moral lead them to believe it is okay to motivation for agents to exploit
rule misrepresent themselves a virtuous character of
pedestrians
Harmful/ No real negative pedestrian Nominal waste of pedestrian time No intention to harm −/+ + +
Disturbing to impact; employees reinforced to for unwanted pedestrian targets
people believe it is okay to lie
Summary score − − − − −/+ +++−+ −−−−+ Overall
for the assessment:
framework would appear
to have serious
ethical
shortcomings
71
Table 2c. Assessment of Honest Tea’s Most Honest Cities.
72
Dimension Framework
Deontological framework Utilitarian framework Virtue-based framework Summary score

for dimension
Deception Non-disclosure of actual purpose Ignorable deceptive outcomes Unavoidable to create an objective −++
of campaign; deceptive through scenario, but intended to
use of hidden camera promote flourishing life
Intrusion of Violation of privacy if media Insignificant outcome from Intended to create fun; −++
privacy broadcasts individuals as they intrusion demonstrated respect on the
decide whether to pay rights of participants who did
YONGSEOK JANG AND MICHAEL H. MORRIS

not agree on the use of
information
Misleading Members of public may conclude Any misperceptions have nominal While potentially misleading, seeks −++
inferences fellow citizens are inherently impact on the public to promote a virtuous character,
dishonest honesty
Exploitation of Exploits participants by forcing Insignificant outcome from Benefitting the company through −+−
resource them to make artificial ethical exploiting people with offer of the bad behavior of random
choice bottle of Honest Tea citizens
Harmful/ Little potential for upsetting Potential for distorting the images No intention to harm, while some + −/+ +
Disturbing to people who are “tested” without of the cities involved; some may may find campaign reinforces
people their consent find initiative to be fun; tea sales the virtue of honesty
went up, adding jobs
Summary score −−−−+ + + + + −/+ +++−+ Overall
for the assessment:
framework tends more
toward being
ethically
acceptable
employees), conveyance of a misleading message, and reinforcement of

lying or misrepresentation on the part of employees. The initiative pro-
duces a very negative assessment using both the deontological and VBFs.
A number of ethical rules or universal principles are being compromised,
while little that is virtuous is being facilitated. However, the action out-
comes or net effects of this deceptive practice are nominal at best, leading
to a fairly positive assessment using the utilitarian framework. On bal-
ance, then, such a guerrilla approach would appear to have some serious
ethical shortcomings.
Most Honest City in America
With Honest Tea, the greatest concerns on the ethical dimensions center
around use of a hidden camera, the media coverage of people unknowingly
thrust into making an ethical choice. As a result, application of the univer-
sal rights and principles of the deontological framework finds the guerrilla
practice to have shortcomings. Yet the degree of these shortcomings may
be relatively small. This is born out when considering the other frame-
works. The practice does well on both the utilitarian and VBFs most nota-
bly because it does little to no harm, is fun and humorous, and reinforces
the virtue of honesty. On balance, then, while acknowledging ethical issues
exist, the practice would appear to be ethically acceptable.
CONCLUSIONS AND IMPLICATIONS
The creativity and imagination that go into guerrilla campaigns, as well as

their potential to create awareness and generate sales for a company or
product at relatively low cost, may lead the entrepreneur (and others) to
overlook critical ethical aspects of such campaigns. In this paper, we have
proposed an approach for assessing these ethical elements. While the
assessment remains subjective, it does offer the entrepreneur guidance in
determining when a given guerrilla approach may be inappropriate from an
ethical vantage point.
The application of our proposed assessment matrix produced a couple
of patterns. First, the deontological framework tends to produce the most
rigorous assessment of guerrilla practices. It is helpful in establishing the
key moral principles being brought into question by a given guerrilla
approach. Yet, the relative severity of a given ethical violation becomes less
clear with this framework, and in fact many of the ethical principle or rule
violations cited using the deontological lens in Tables 2(a) (c) would seem
moderate to low in their severity. So this framework is a good first hurdle.
Alternatively, the utilitarian framework provided the most tolerant
assessment of our three guerrilla examples. Particularly within a given
resource-constrained context, entrepreneurial firms are less likely to cause a
massive impact with their guerrilla campaigns. These campaigns also tend
to be fairly short-lived. And there is mixed evidence regarding the actual
impact of many of these campaigns on the creation of market awareness or
the generation of revenues (Crain, 2007). The challenge here is that one
may be too quick to conclude that the ends justify the means. The ends in
this case tend less negative impact more so than evidence of high positive
impact, although clearly there are guerrilla campaigns that greatly benefit
the companies that implement them.
With the VBF, it is interesting that our results suggested a parallel
between it and the deontological framework in the first two examples, but
then it generated different results with the third guerrilla example. The
VBF is more contextual. Even if an action violates a moral principle or
rule, if that action promotes a virtue in a given situation, the action quali-
fies as ethical. This point is best seen with the Honest Tea example, where
there are clear deontological violations, but a virtue is being promoted.
While it is important to critique the ethics of guerrilla programs, the
concepts developed in this paper can also be useful when such programs
are first being designed. By considering our five ethical dimensions coupled
with the various forms of guerrilla marketing (see Box 1), a number of
design elements emerge. A set of these design elements is illustrated in
Table 3.
The design elements can be demonstrated if we examine the guerrilla
approach of a car rental agency in its early days. Let’s assume that the
company distinguishes itself by offering to pick up drivers or bring cars to
them, but that sales have not taken off. Consideration of the design ele-
ments in Table 3 might begin by asking whether to leverage external or
internal resources. Let us assume the company decides to leverage its own
assets, particularly underutilized employees and unrented cars. We then
consider which stakeholders will be involved, and decide to focus on
employees, auto repair shops (because their clients may need rental cars
and our pick up service may be especially attractive to them), and these
prospective customers, while also potentially affecting competitors. We
assess the potential for exploitation, and decide to ask for volunteers from
Table 3. Design Elements for Building Ethical Guerrilla Campaigns.

Design Element Sample Ethical Questions
Resources and 1. Will we have permission to use the resource?

providers 2. Will the resource provider know we are using the resource?
3. Is the resource provider being coerced?
4. Are we using the resource in a manner that in any way compromises or
negatively exploits the resource?
Disclosure 1. Are agents of our company disclosing their relationship with us?
2. Are these agents pretending to be something they are not?
3. Are all participants aware of their actual role in the activity?
4. If we paid to have our products featured, is the audience aware of this?
5. If people’s words or actions are being recorded, are they aware of this?
Stakeholder 1. Have we identified all of the potential stakeholders affected by a
effects guerrilla program?
2. What are all the possible emotional, physical, or psychological impacts
the guerrilla program can have on each stakeholder group?
3. For the target audience of the campaign, in what possible ways are we
infringing upon their privacy?
Inferences/ 1. Based on our guerrilla activity, what possible inferences or conclusions
conclusions could a stakeholder draw?
2. Are the inferences or conclusions accurate or fair, or are they in any
way misleading?
3. Might the stakeholder draw different inferences or conclusions were
they not exposed to our guerrilla campaign?
our employee base. Next we consider whether the approach should employ
stealth or be overt, and we opt for an overt approach. We will ask employ-
ees to take some of the rental cars, go out early in the morning and buy
boxes of donuts, and deliver the donuts to auto repair and body shops
throughout the city. Our employees will enter the auto repair shops with a
friendly greeting, wish the people working there a very good day, and leave
a dozen donuts together with some of their business cards. We also evalu-
ate what sort of conclusions stakeholders might be led to make based on
our approach. We are not suggesting that they must recommend our rental
car services to their clients in exchange for the donuts, but clearly encoura-
ging them to do so. There do not appear to be any potentially misleading
elements in the approach we have chosen. Assume the approach proves
effective, with large numbers of customers who were having work done on
their cars referred to the car rental agency by their auto mechanic. Beyond
its effectiveness, however, approached in this manner the entrepreneur is
better able to anticipate ethical shortcomings before they can occur.
Finally, we can identify a number of directions for future research based

on the work here. While we have selected three general ethical frameworks,
others approaches exist (Brady & Dunn, 1995). The value of such frame-
works as justice, egoism, and social contracts should be assessed within a
guerrilla context, as they may help clarify some of the conflicting conclu-
sions generated when our three frameworks are applied to a given guerrilla
approach. While here we have relied on a subjective assessment that was
dichotomous in nature, measurement issues warrant more attention. There
is a need for validated scales for use in measuring how a guerrilla action
performs on each of our ethical dimensions and within each of our theoreti-
cal frameworks (e.g., Reidenbach & Robin, 1990).
Another question concerns public perceptions of guerrilla marketing
activities. Evidence is needed concerning how different consumers react to
guerrilla marketing approaches. With which approaches do consumers
experience positive communication? Rigsby (2004) found that younger gen-
erations perceive street viral marketing as a desirable method of marketing
communication, preferring it because it is a less obvious approach. This
study implies an increased level of acceptance of some level of deception
and that the younger people accept viral marketing as a part of life, even
though they understand the approach involves deception. Such variations
should be also studied from the perspective of descriptive ethics, consider-
ing differences across cultural milieus. Moral ecology provides an interest-
ing framework that allows for different levels of ethical toleration by
society.
Lastly, researchers might consider temporal effects in assessing the
ethics of guerrilla efforts, especially given the rate at which technologies
produce new vehicles for guerrilla marketing initiatives. Phones or
watches with cameras, the ability to easily imbed images in photos or
videos, the increasingly small size and ease of disguising recording
devices, new database manipulation capabilities, apps that enable one to
reach customers in particular contexts at particular times, hacking skills
that allow one access people’s personal records and communications, and
dozens of other emerging capabilities are continually opening up whole
new guerrilla possibilities. As these capabilities accelerate, how are ethical
standards and expectations affected? A related temporal issue concerns
the “guerrilla literacy” of audiences. Do audiences over time become bet-
ter able to see through or compensate for whatever deception or poten-
tially misleading elements lie behind a guerrilla campaign (e.g., Rotfeld,
2008)?
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QUESTIONING THE ETHICS OF
UNIVERSITY ENTREPRENEURSHIP
CURRICULUM
Allan O’Connor
ABSTRACT
The task of this paper is to critique the ethics of an university entrepre-

neurship curriculum. For what purpose is entrepreneurship curriculum
designed? Who decides what is to be included in an entrepreneurship cur-
riculum? Ethics has a plurality and implies moral judgment informed by
any individual’s values. In applying entrepreneurship education the ratio-
nale and justification of what is offered and why should be clear. The
paper provides a synthesis conducted on an extant literature review on
the ethics of an entrepreneurship curriculum, entrepreneurship education
stakeholders, and stakeholder rights and obligations. An ethics enquiry
framework is concluded that entrepreneurship education curriculum
designers can apply to surface the assumptions underpinning the curricu-
lum and assist educators to be clear and explicit about the intent and
ambitions for an entrepreneurship education curriculum design. While
this paper develops a framework, it has yet to be tested. Further research
can examine specific sets of stakeholder expectations, variations in obli-
gations among regulatory or institutional settings, explicitly examine the

ISSN: 1048-4736/doi:10.1108/S1048-473620150000025005
79
80 ALLAN O’CONNOR
range of effects of an entrepreneurship curriculum, and report the usabil-

ity and practical relevance of such an evaluative framework. Ethics in
entrepreneurship education is under-researched and more particularly the
ethics of the entrepreneurship curriculum appears to have rarely been
questioned. Entrepreneurship education lays the foundation for the future
actions of those who shape and socially structure entrepreneurship.
Therefore, as educators, there is a greater responsibility for ensuring
that the education provided meets certain expectations of and obligations
to various stakeholder groups.
Keywords: Ethics; entrepreneurship education curriculum; curriculum
evaluation framework; entrepreneurship education stakeholders
INTRODUCTION
Entrepreneurship education is still a relatively young field. The roots of the

scholarly examination of entrepreneurship lay with economics, although
many other disciplines including psychology and the social sciences have
also taken an interest in the subject (Audretsch, 2004; Hart, 2003). The
multiple interests in entrepreneurship education also cause a number of
paradoxes. There is the paradox of academic studies of entrepreneurship
that converge many disciplines onto a single, distinctive discipline
(Audretsch, 2004; Hart, 2003). This contrasts with entrepreneurship in
practice that resides in multiple disciplines and manifests itself in a multi-
tude of ways (O’Connor, Cherry, & Buckley, 2007). There is the paradoxi-
cal notion that entrepreneurship responds to economic issues of global
competitiveness (Acs, 2006; Audretsch, 1999; Begley & Tan, 2001; Van
Praag, 1999) but is simultaneously grounded in local and community
dynamics (Organisation for Economic Co-operation and Development,
2001). Another paradox occurs when one considers the positive broad
social implications of entrepreneurship that are embodied in narrowly
defined capabilities and capacities of individuals (Cécora, 2000; Hytti &
O’Gorman, 2004), primed by self-interest (Foster, 2006). These paradoxes
are embedded in the motivations and expectations about entrepreneurship
in both policy and educational environments.
A paradox has two extremes with both extremes holding an unambiguous
position, neither of which is a resolvable problem relative to the other
(Bohm, 1996). Inevitably the contrasted extremes coexist. Given the para-
doxes in entrepreneurship, it implies that at the heart of an entrepreneurship
Questioning the Ethics of University Entrepreneurship Curriculum 81
curriculum there may be the seeds of conflict and therefore ethical issues are
also likely to be found. The aim of this paper is to bring to the surface the
ethics embodied in an entrepreneurship education curriculum and propose
the considerations required to construct an ethics framework that will assist
in reconciling a diverse range of interests in entrepreneurship education.
Shane and Venkataraman’s (2000) popular definition of entrepreneur-
ship research, “the scholarly examination of how, by whom and with what
effects opportunities to create future goods and services are discovered,
evaluated and exploited,” also embodies the view that many disciplines are
able to shed light on the topic. The field holds multilevel interests among
individuals, firms, social, and economic actors that all hold keys to unlock-
ing the entrepreneurship puzzle. However, also inherent in this definition is
the examination of past or current events and actions of entrepreneurs and
their firms in order to relate these to the observable effects at individual,
firm, and socioeconomic levels.
Entrepreneurs and entrepreneurial behaviors have (most likely) existed
ever since humans started to socially organize and trade. From this posi-
tion, entrepreneurship research can take comfort in the examination of the
activities of entrepreneurs and entrepreneurial ventures that have already
occurred or are in current development. However, entrepreneurship educa-
tion cannot be afforded the same luxury. Entrepreneurship education lays
the foundation for the future actions of those who shape and socially struc-
ture entrepreneurship that eventually entrepreneurship researchers will
study for social and/or economic effect. Therefore, as educators, there is a
greater responsibility for ensuring that the education provided meets cer-
tain expectations of and obligations to various stakeholder groups.
Regrettably, there is little by way of support for entrepreneurship educa-
tors in the construction of curriculum particularly as related to ethical
questions. An extant review of the entrepreneurship literature finds that
ethics is often left unattended. For instance, there is a reported void of
entrepreneurship textbooks that raise the questions and issues of ethics and
social responsibility (Mason & Siqueira, 2014; Tesfayohannes & Driscoll,
2010). Furthermore, with particular respect to the ethics of an entrepre-
neurship curriculum, it appears to be unquestioned.
The fundamental task of this paper is to critique the ethics of an entre-
preneurship curriculum rather than the ethical issues encountered by entre-
preneurs in practice. A distinction is made between the ethical questions
raised in the entrepreneurial behaviors of individuals and/or their firms and
the ethical aspects of designing curriculum with respect to meeting the
responsibilities of the educator.
82 ALLAN O’CONNOR
Entrepreneurship curriculum in this paper refers to the range of entre-

preneurship courses provided by an institution, the general content of these
courses and how the courses are coordinated to deliver a program of learn-
ing outcome. To achieve this task, the ethical underpinnings of entrepre-
neurship curriculum will be examined: Who are the potential stakeholders
of an entrepreneurship curriculum and what interests do they hold? What
are the obligations to these stakeholders when one considers an entrepre-
neurship curriculum design? An equally important question is who decides
what is to be included in an entrepreneurship curriculum and for what
reason?
Entrepreneurship educators are in a unique position to be able to design
curriculum but are the design choices informed by personal preference
and/or experience, an economic or social doctrine, an institutional objec-
tive, or a blind determination to shape students in the image of the
educator?
This paper is constructed with reference to an Australian case where the
author has been involved with curriculum design and development over the
past seven years. From this context, examples are constructed, informed by
practice, but are purely for illustrative purposes and do not necessarily
reflect actual situations or circumstances.
The paper concludes by offering a set of questions to act as a framework
to acid test the ethical framework of an entrepreneurship curriculum. It is
acknowledged that ethics has a plurality and implies moral judgment that
will be informed by any individual’s values. However, in applying entrepre-
neurship education, the rationale and justification of what is offered, and
why, should be clear. The ethics enquiry framework will assist entrepre-
neurship education curriculum designers to surface the assumptions under-
pinning the curriculum and assist them to be explicit about the intent and
ambitions for any particular entrepreneurship education curriculum design.
THE TASK OF QUESTIONING THE ETHICS OF AN

ENTREPRENEURSHIP CURRICULUM
In examining the ethics of an entrepreneurship curriculum it draws atten-

tion to two primary issues to be resolved. The first is; who is an entrepre-
neurship curriculum for? This question precedes the more obvious question
of what an entrepreneurship curriculum contains and whether the curricu-
lum itself meets the expectation of its stakeholders. There are quite useful
resources available that outline the content of an entrepreneurship curricu-

lum (see, for instance, Benson, 1993; Morris & Kuratko, 2014), but the
challenge does not lay there. Rather, the challenge is to answer the question
with respect to the ethics of the curriculum. In this case, the content of the
curriculum itself is a second-order matter. The challenge of the curriculum
question here resides in knowing who the stakeholders are who hold a
moral stance over the curriculum and therefore define its ethics. It is not
until the purpose of the curriculum is defined, relative to the stakeholder(s),
that one can make an assessment on whether the curriculum is ethical, that
is, morally right and in accordance with the obligations to stakeholders.
The second issue is to address how we evaluate the ethics of an entrepre-
neurship curriculum? This question is also not so easy to answer. Ethics
relates to a moral stance and a moral stance is subject to different
perspectives.
To get to the ethics question we first must understand the motivations
and reasons that an entrepreneurial curriculum exists. Examining “ethics”
in any field invites reflection upon one’s values and their justification. We
must examine how we behave and/or misbehave “according to a complex
and continually changing set of rules, customs, and expectations”
(Solomon, 2007, p. 12). This implies human judgment and reason. Of
course, an education curriculum of any form is inert; it cannot exercise
reason and judgment. This task falls to those who create the curriculum
who can and will embed the curriculum with human reason and judg-
ment of their own and/or of others. Therefore, the question of the ethics
embodied in a curriculum calls upon educators to justify their judgments,
reasons and actions in creating and formulating the curriculum, and, if
need be, revise it if it fails acceptable moral or values judgment and
reason.
As noted previously, there is no shortage of direction on what should be
taught as an entrepreneurship curriculum. However, this is not the major
concern of this paper. What is at issue is the question; to what outcome
should an entrepreneurial curriculum be designed? Responding to this
question will lead to the obligations of the curriculum from which the
material content of an entrepreneurial curriculum can be determined.
The task of this paper is to develop an analytical framework, designed
for entrepreneurship educators to consider the ethics of an entrepreneur-
ship curriculum with respect to the relevant stakeholders who may have
legitimate claims on it. Therefore, we proceed first to differentiate the entre-
preneurial curriculum stakeholders who define its purpose and then sec-
ondly we move to define what we mean by ethics in this context.
84 ALLAN O’CONNOR
WHO ARE THE STAKEHOLDERS FOR AN

ENTREPRENEURSHIP CURRICULUM?
Matlay (2009) asserted that a stakeholder view of entrepreneurship was

relatively untapped with respect to research. From this perspective he set
about to analyze the stakeholder involvement in and their expectations of
entrepreneurship education. Matlay (2009) considered a stakeholder defini-
tion through the lens of strategic management and higher education.
Although a specific definition of a stakeholder in entrepreneurship educa-
tion was not concluded, the contrast between these viewpoints does high-
light the common elements and some subtle differences that are useful to
defining who might fall into the category of a stakeholder in entrepreneur-
ship education.
Matlay draws up Freeman (cited in Matlay, 2009, p. 357), who defines a
stakeholder in the context of strategic management theory as “… any
group or individuals who can affect or are affected by the achievement of
the organisation’s objectives.” By contrast, Amaral and Magalhaes (cited
in Matlay, 2009, p. 357) are referred to for a higher education perspective
that defines a stakeholder as “… a person or entity with a legitimate inter-
est in higher education and who, as such, acquires the right to intervene.”
In common between these definitions is the suggestion of a multiplicity
in that groups, individuals, or entities may be defined as stakeholders.
Further, to be defined as stakeholders, they must hold some influence or
effect or be affected by, or have some legitimate interest in, the object in
common among them. The last parts of both definitions discussed differ
in the suggestion of how that object in common may be defined. The
strategy viewpoint targets the “achievement of the organization’s objec-
tives” while the education stance broadly states “higher education” with
the caveat that a “right” to intervention must also be held by the
stakeholder.
Adopting these views does imply a difference with respect to the ethics
involved. The contrast between the objects (with the associated caveat of a
right to intervention) in common among the stakeholders distinguishes the
rights that may be attached to the object. In the case of the strategic man-
agement definition, having some effect on or being affected by the achieve-
ments of the organization does not necessarily or automatically apply a
right to an intervention in formulating the statement of an intended set of
organizational achievements. Therefore, in the strategic management defi-
nition, it implies two types of stakeholders; first, those who have a vested
interest in the achievements of the organization with a direct right to
intervention and second, the group of those who hold a vested interest
without the direct right of intervention. The ethics for the first type of sta-
keholders stems from a justice bound by some form of moral obligation to
the rights of the stakeholder. The ethics for the second group flows from a
justice defined by a moral duty of care meaning the obligation remains with
the organization to take care of those who may have rights affected by the
organization’s actions.
The stakeholder definition drawn from the higher education example
however defines clearly a stakeholder as those with a right to intervention.
If this definition were to hold with respect to ethics, it implies that a curri-
culum would only hold a moral obligation toward those who have the right
to intervene in the management, planning, and implementation of higher
education. We will test this narrower definition of a stakeholder on the
defined stakeholders that Matlay (2009) uses for the basis of his research.
Matlay (2009, p. 360) defines two types of stakeholders for entrepreneur-
ship education:
• Internal; students, teaching and research staff, administrators, and

managers.
• External; parents, alumni, entrepreneurs, various representatives of busi-
ness, commerce, professional bodies, government, and the community.
If we sort these among those who have or are likely to have a right to inter-
vene in the management, planning, and implementation of entrepreneur-
ship education, we establish the details as given in Table 1. Notably, we
end up with three columns. The first of those with the automatic right to
intervention, the second of those who may have an invited right to inter-
vention, and a third group who may not hold a right to intervention but do
attract a duty of care. Although there may be some quibbling about which
Table 1. The “Intervention Rights” Holders of a Curriculum Design.

Automatic Invited Rights No Rights (Duty of Care)
Rights
Internal Teaching staff, Students, research staff Students

administrators,
and managers
External Government Alumni, entrepreneurs, Parents, alumni, entrepreneurs,
business, commerce, business, commerce,
professional bodies, and professional bodies, and the
the community community
86 ALLAN O’CONNOR
stakeholder may belong to which category and equally some stakeholders

may belong to more than one category but the essence here is to establish
the types of claims that may be laid on the higher education curriculum,
where those claims may come from and/or who may lay them.
From this perspective, it becomes apparent that the higher education
definition of stakeholder, with respect to defining the ethical structures,
does not go far enough and instead the strategic management definition is
far more relevant. The Amaral and Magalhaes (cited in Matlay, 2009,
p. 357) definition excludes those that may be affected by a curriculum but
who may have no explicit right to intervention. In which case the definition
of stakeholders for an entrepreneurship education curriculum may be better
stated from the strategic management perspective as:
Any group, individual or entity who, or that, can affect or are affected by the design
and implementation of an entrepreneurship education curriculum.
WHAT DO WE MEAN BY THE ETHICS OF

CURRICULUM?
An extant review of the entrepreneurship literature appears to leave the

question of what we mean by the ethics of an entrepreneurship curriculum
unattended. It is acknowledged by many that ethics in entrepreneurship is
an important element of study and research (see for instance the Journal of
Business Venturing special issue on ethics and entrepreneurship; Harris,
Sapienza, & Bowie, 2009). It is also claimed that entrepreneurs need to be
alert to their behavioral tendencies and intuitions to improve ethical
decision-making (Zhang & Arvey, 2009). Examinations of entrepreneurship
textbooks also raise the issue of how important ethics in the curriculum is
and the fact that there is insufficient attention paid to it (Mason &
Siqueira, 2014; Tesfayohannes & Driscoll, 2010). Ethics has also recently
been considered from a standpoint of religion and how the confluence of
entrepreneurship, ethics, and religion may lead to issues of social and eco-
nomic development (Emami & Nazari, 2012). The idea of social and eco-
nomic development raises questions regarding whether morals and virtue in
bringing about or causing change induce ethical questions and dilemmas
(Brenkert, 2009). The ethics of profit and the distribution of profit between
a company and an intrapreneur have also been raised (Vranceanu, 2014).
However, in none of these cases, the very fundamental idea of what
constitutes a framework for entrepreneurship scholars to describe, critique,

and/or debate its ethics directly is considered or elaborated. More particu-
larly, the question of the ethics of the curriculum is not apparent.
Perhaps, a starting point for considering the ethics of an entrepreneur-
ship curriculum is to turn to something familiar to at least doctoral trained
academics in the field, that is, human research ethics. Universities impose
ethical standards on research as a matter of course to comply with expected
institutional standards. From this perspective, the Australian standard on
research ethics suggests a framework for ethical human research includes
an examination of the values of respect, research merit and integrity, jus-
tice, and beneficence (National Health and Medical Research Council,
2007/2014).
The standard holds that respect is central to the ethical framework. That
is, in order to appreciate the other dimensions of the framework, a
researcher must hold respect for the research process and the stakeholders
involved. From that point the research merit can be examined to determine
if the research will actually add value and be beneficial in its outcomes. Put
another way, is it worth the cost and does the research hold integrity to that
aim? The next dimension asks the researcher to take into account whether
the research is just. This raises the question of fairness and whether both the
benefits and burdens of the research are fairly distributed and whether the
procedure of the research is fair to the participant. The fourth dimension,
beneficence, causes the researcher to pay attention to the risks of harm, con-
sidering the welfare and interests of those involved in the research and the
broader social and cultural implications for the community. Fig. 1 sum-
marizes the dimensions of this framework which may be useful in consider-
ing an ethical framework when examining entrepreneurship curriculum.
Approaching the ethics of curriculum through the lens of research and
from an institutional perspective also brings into focus that the ethics of
research is not purely determinable at the institutional level. Research,
within the university institution, is carried out by individuals and there is
an acknowledged divide between the institutional ethics boundaries and the
participatory ethics of those who are in contact with and conducting the
research through daily and personal interaction (Elwood, 2007).
The view of institutional ethics adopts a stance that is preemptive and
assumes universal rules can be applied to manage the potential harm of
and benefits for all stakeholders. Participatory ethics by contrast is
grounded in the situation with specific contexts and relationships present-
ing possibly unique problems and dilemmas that require responsive, parti-
cular, and perhaps peculiar decisions to manage the issues of harm and
88 ALLAN O’CONNOR
Merit
Respect
Beneficence Justice
Fig. 1. The Foundational Elements of Research Ethics. Source: Author (Adapted

from National Health and Medical Research Council, 2007/2014).
benefit on an individual basis. This suggests as we consider the ethics of

curriculum we may be confronted by institutional demands that may be at
odds with the individual practical demands of an ethical curriculum design.
Furthermore, participatory ethics suggests a framework for examining cur-
riculum that stresses different dimensions that bring the participant into
the ethical rationale through dialogue, mutuality, and agreement that may
at times require some compromise as the ethical concerns of one may not
be equal to the concerns of another.
One might expect that other educational disciplines may have explored
the same or similar question of the ethics of a curriculum. However, search-
ing the term “ethics of curriculum” surprisingly yielded very little relevant
to this enquiry and suggests this topic is under-represented in the literature.
A few exceptions came from educational philosophy and leadership, curri-
culum evaluation, engineering, health, and economics.
Educational philosophy brought up the ethics of teaching, but not of
curriculum specifically, although it did reinforce the argument of participa-
tory ethics whereby the teacher is embedded in the situation and needs to
draw upon a personal and negotiated ethics framework (Taubman, 2010).
Similar notions are encountered in works on curriculum leadership that dis-
cuss the ethical paradoxes confronting the curriculum leader between insti-
tutional, social, and student demands (Keeson & Henderson, 2010).
The literature on curriculum evaluation turned up a possible lead; how-
ever, while issues of process that define the need for stakeholder
engagement are clear, the ethical consideration in this context addresses

only the aspect of fairness and equity (or justice) with respect to maintain-
ing the humanity of the subject matter (Irungu & Mercy, 2013). It high-
lights the issue of relevance to the student stakeholder.
From the engineering field, the question of the ethics of curriculum
turned out to be a passing reference to the shifting temporal dimensions
encountered in developing economies that should trigger a reevaluation of
the curriculum needs and content. The ethics question related to the issues
of fairness with respect to how well the curriculum responds to the needs of
community in light of the fact that the dynamics of the industry shifts.
All-in-all, while these references highlighted aspects of the ethical ques-
tion in focus nothing dealt with the topic holistically or surpassed the
research lens on ethics discussed above. However, the final two areas,
health and economics, have greater relevance to the inquiry and will be dis-
cussed in more detail.
From the field of health sciences we encounter a framework for the ana-
lysis of ethics in public health programs (Kass, 2001) that specify six ques-
tions designed to surface ethical issues (see Box 1). This work addresses
the tensions between the twin goals to advance traditional public health
while simultaneously maximizing individual liberties and furthering social
justice. The analytical tool was developed to “help public health profes-
sionals consider the ethics implications of proposed interventions, policy
proposals, research initiatives, and programs” (p. 1777). While the aim of
the analysis tool appears in accordance with the ambitions of this paper,
the basis of its development needs to be considered.
Kass (2001) points out that the work is grounded on bioethics and speci-
fically the work of two authors Beauchamp and Childress (cited in Kass,
2001). More particularly Kass makes reference to alternate frames for
Box 1. An Ethics Analytical Tool. Source: Author (adapted from

Kass, 2001).
1. What are the public health goals of the proposed program?
2. How effective is the program in achieving its stated goals?
3. What are the known or potential burdens of the program?
4. Can burdens be minimized? Are there alternative approaches?
5. Is the program implemented fairly?
6. How can the benefits and burdens of a program be fairly balanced?
90 ALLAN O’CONNOR
ethics that could be used that include ethics of care, casuistry, and virtue-
based ethics.
Notably, differences in ethics theories have been discussed with reference
to entrepreneurship and business ethics that highlights virtue ethics as a
theory receiving increased attention (Zhang, 2013). This suggests that while
the Kass analytical framework may be informative for the task of develop-
ing a framework to examine the ethics of entrepreneurship curriculum, it
may also not serve the purpose well, given the differences between the ethi-
cal theoretical groundings. This warrants further exploration.
The bioethics theory adopted by Kass (2001) is grounded in the issues
of fairness in resource allocation, moral issues raised by new technologies,
and a lack of oversight in research on human subjects. Virtue ethics in
the business world is motivated by challenges to understand “what is
considered as ethical business conduct, what drives such conduct, and
how business should understand as well as act upon its place in society
in aligning with evolving social moral and ethical values” (Zhang, 2013,
p. 132). Zhang continues by drawing attention to the tension between
individual agency and social normative order. The agency view accounts
for the drive for change, either progressive or otherwise, that underpins a
motivation to stay in business, attract more and/or new customers, and
compete in the market place. The issues of social normative order finds
that change is resisted possibly both internally and externally. The
bioethics framework centers on the idea of respect for individuals to limit
harm, burden, and ensure fairness and equity in the context of maintain-
ing individual and public health that suggests an institutional frame of
reference. Virtue ethics by contrast, while embracing respect, is based on
confronting the different challenges of individual agency and social nor-
mative behaviors that follow the participatory ethics dilemma discussed
earlier. Thus, this difference in ethical base draws attention to the need
that one must consider the context within which the ethical dilemmas
and issues arise to shape the particular structure and focus of the ethics
evaluative framework.
The remaining approach to ethics to review is proposed by Ulrich
(2008) that covers the ground of ethics in economics to produce an inte-
grative framework. Ulrich provides some interesting perspectives that
stretch to include the socioeconomic viewpoint with respect to economic
ethics (Ulrich, 2013). The primary difference between the economic and
the socioeconomic is that the economic view, in Ulrich’s writing, will
always favor the entrepreneur who will continually strive and expend
energy for economic gain at the expense of a personal, social,
noneconomic life. The socioeconomic view is more socially inclusive and

adopts a stance that economics is part of satisfying a social life but not
something that should consume it. A socioeconomic viewpoint holds an
objective to balance a social life with an economic life.
While this view may not appear directly relevant to the question of
the ethics of curriculum, on the contrary, it raises the question of a moral
stance that is highly pertinent to the question of the ethics of an entrepre-
neurship curriculum. To put it plainly, it raises the moral question of
whether an entrepreneurship curriculum is right to promote and encou-
rage an economic actor at the expense of that actor’s social life? Is the
product of the entrepreneurship curriculum defined by its count of eco-
nomic actors exiting the program who are being primed as economic
actors perhaps at the deliberate expense of their personal social life? If
so, is this fair on the individuals? This is the type of question a frame-
work that questions the ethics of curriculum will force one to confront.
Moving more specifically to Ulrich’s (2008) framework of ethics in
economics, one unearths another interesting point that deserves airing for
the purpose of this paper. This is the typology of sites of morality that
define the integrative perspectives that need to be accounted for in mak-
ing rational judgment of the ethics of economics. Some of this we have
already touched upon. For instance, Ulrich (2008) outlines the institu-
tional ethic perspective within his framework. This is the site that defines
the rules of ethical behavior for individual actors within the boundaries
of law, regulation, and/or codes of practice. These are designed to be pre-
emptive to avoid harm, treat fairly, share benefit among and maintain
respect for individual actors. In the context of economics, these define
rules for the market and the actions individual companies can take while
operating in these markets.
Ulrich (2008) also defines the site of individual ethics and maintains as
we have discussed previously that at the level of the individual there is a
transgression from regulatory ethics to virtue-based ethics. This occurs as
individuals encounter situations that do not fit or are not defined by or
within the limits of the regulatory frameworks. This plays out in econom-
ics with respect to the individual economic actors. But Ulrich goes one
step further defining a site of normative ethics. This is a site that harmo-
nizes the regulatory with a general and/or dominant sociocultural view of
ethical norms. Of course, as individuals we all contribute to the norma-
tive view of our communities but the normative view may not be identi-
cal in every aspect (or to any aspect) to anyone’s individual ethical
frame. Again, in economics this normative view is defined by general
92 ALLAN O’CONNOR
acceptable firm and individual level behaviors. It is from within these dif-
ferent viewpoints that a curriculum must also refer to derive its ethical
stance.
At this juncture we have covered a fair terrain to attempt to arrive at
some form of view about what we mean by the ethics of curriculum. We
have discovered that ethics comes into question when there is judgment
to be made about the “right” thing when confronted with dialectical posi-
tions or viewpoints. In research it is the tension between public good and
safe-guarding the individual research participants from harm. In health it
is the division between public health needs and the rights of individual
freedoms and justice. An example of this tension in health arises in the
consideration of vaccinations of children whereby public health may be
placed at risk when enough of a minority of individuals refuses vaccina-
tion which can potentially breakdown the community isolating effect on
the virus, gained from vaccinations. By the same token, the public health
policy of vaccination is considered an intrusion of individual rights by
some. This raises an ethical dilemma and the ethics of the health policy
comes into question.
The ethics of economics comes into focus when one considers the ten-
sion between the public contribution of firms to grow and sustain an econ-
omy and the rights and protections for individuals who may be exploited
by these firms. This gives rise to institutional and regulatory measures to
address the ethics of conflicting interests between the firms and their custo-
mers and employees. For instance, in Australia, there is the Australian
Competition and Consumer Commission (ACCC) to ensure fair treatment
of consumers in the competitive practices of business. Similarly, there
is the Fair Work Commission that is responsible for overseeing work-
place regulation and maintaining minimum wage levels and employment
conditions.
Seeing this perspective may explain why little has been done more
broadly on the ethics of education curricula. In most cases, the curriculum
of a university degree is designed to lead students into employment.
Consider law, education, science, architecture, or engineering. While some
students may end up owning a business, the curriculum is not concerned
with preparing them to be business owners but instead the emphasis is on
acquiring the skills and knowledge to do a job. While there almost certainly
are ethical questions and issues to be raised within the curriculum, the
ethics of the curriculum is not broadly exposed to tensions between public
and private goals but instead professions curricula are faced with ethical
questions in the curriculum encountered by professionals performing a task
or job. The ethics behind whether the professional career confronts tensions
between private and public good are shifted to the employers and business
owners who pay their employees for their services. The businesses are then
exposed to the ethical tensions of economics as discussed earlier. Most cur-
ricula are endowed with a responsibility to employers and individuals who
are not greatly in conflict. However, the ethics of an entrepreneurship curri-
culum can be somewhat different and we next move to explore more specifi-
cally, why.
WHAT ARE THE OBLIGATIONS TO

STAKEHOLDERS?
From the discussion thus far it can be observed that there are a number of
stakeholders that may have an interest in the outcomes of an entrepreneur-
ship curriculum. These include teaching staff, research staff, administrators
and managers, students, government, parents, alumni, entrepreneurs, busi-
ness and commerce professional bodies, and the broader community. We
have also exposed a number of different ethical stances being institutional,
organizational, regulatory, participatory, virtues, and normative. We can
also now synthesize these perspectives along two dimensions.
The first dimension recognizes the entity stakeholders through an institu-
tional ethics framework that places regulatory claims (common to all provi-
ders of an entrepreneurship curriculum in any particular state-bound
jurisdiction) at one extreme and organizational claims (common only to
curriculum providers that are guided by the same organization) at the
other. The second dimension acknowledges the social demands viewed
through a participatory ethics lens that are neither regulatory nor organiza-
tional but instead are imposed by individuals at one extreme and groups of
individuals who share similar ideals at the other. Together these two dimen-
sions bear pressure on the ethics of an entrepreneurship curriculum from
four directions, and the designer of the curriculum will draw upon a combi-
nation of virtues and normative ethical responses to resolve the tensions
between institutional and participatory pressures. Fig. 2 illustrates these
pressures and tensions.
From this perspective it is apparent that an entrepreneurship curriculum
is exposed to the tensions of both institutional and participatory ethical
considerations. This tension is heightened by the fact that the students of
the curriculum may not be primarily destined to be employees where the
94 ALLAN O’CONNOR
Regulatory:
Government,
professional
bodies
Institutional
Tensions
Individuals: Organizational:
Entrepreneurship
Student, parent, University
Curriculum
lecturer administration,
Design
management
Participatory
Tensions
Group: Alumni,
researchers, broad
(general)
community
Fig. 2. Four Pressures that Bear on an Entrepreneurship Curriculum Design.

Source: Author.
business that employs them becomes responsible for handling the public/
private conflicts. Instead an entrepreneurship curriculum is preparing stu-
dents to take responsibility as employers for the public and private conflicts
and take on the personal risks associated with business start-up and growth
which can, potentially, have detrimental short- and/or long-term effects on
the private wealth and health of an individual in the name of creating a
broader public benefit to the economy. This characteristic may be unique
to entrepreneurship given that with most students in other forms of higher
education there is very little consideration given to those who may be the
employers of the future rather than the employees. This leaves us with a
question; can the designer of an entrepreneurship curriculum take all care
but no responsibility for the outcomes of the curriculum they design with
respect to their student’s welfare?
WHAT THEN ARE THE EXPECTED OUTCOMES FROM

THE DIFFERENT PERSPECTIVES OF THE VARIOUS
STAKEHOLDERS AND WHAT RESPONSIBILITIES
DOES THIS LEAVE THE CURRICULUM DESIGNER?
Table 2 lists the various stakeholders and provides examples of how the
expectations among these differing perspectives may impose different
obligations upon the curriculum. We know from the previous discussion
on research and teaching that the ethics at participatory levels is shaped,
informed, and guided by the institutional boundaries designed to antici-
pate the ethical issues. The curriculum designer therefore is faced with
first satisfying the claims made upon the curriculum by the institutional
setting and within that, then make allowances for the negotiated and
engagement of those who are invited to participate to create claims on
the curriculum and/or the recipients of the curriculum to whom a duty of
care is obliged. Table 2 is set up with an indicative hierarchy from top to
bottom of stakeholders who may have a priority, either automatic,
invited rights or a duty of care to claims on the curriculum. As this list is
indicative and suggestive of an illustrative case, each curriculum designer
should consider the hierarchy of this list and adjust to their own particu-
lar circumstances.
The perspective of each of the stakeholders should be taken into account
and there will be variation among each. First we will consider the institu-
tional claims that will need to be prioritized in developing the curriculum.
Government will hold regulatory rights that an entrepreneurship curricu-
lum will need to follow but then too universities will individually as organi-
zations provide a set of ground rules that will affect the curriculum
development. We discuss each in turn.
Government is not one-size-fits-all. For example, in Australia there are
three levels of government that may have an interest in the curriculum of
entrepreneurship local, state, and federal. However, in terms of funding,
it is only the federal government that has a majority stake in the claims on
the curriculum of university programs. Universities are federally funded to
the tune of 44% of their revenues while state and local funding is as little
as 3% (Universities Australia, 2014). The origin of funding will of course
influence the right to claim on university curriculum. Furthermore, the
Australian federal government has established the Tertiary Education
Quality and Standards Agency (TEQSA) and the Higher Education
Standards Panel (HESP) that both form part of the regulatory environment
96 ALLAN O’CONNOR
Table 2. Hierarchical Examples of Expectations and Obligations.

Example 1 Example 2 Example 3
Automatic rights: regulatory and organizational ethics
Government Compliance with Contributions to To stimulate local

regulations and national economic economies
national standards objectives
University Deliver strategic Differentiate the Fulfill community
management objectives university among commitments to the
the competition local region
University Compliance of Contribution to Generate income
administrators regulatory and organizational
organizational strategic goals
requirements
Invited rights: normative ethics
Teaching staff Entrepreneurial students Dedicated students to Students who establish

entrepreneurship innovative ventures
studies
Research staff Demonstrate the latest Students that seek a Graduates capable of
(community) theories research career engaging research in
their profession
Broad (general) Responsible business Entrepreneurs who Emergence of growth-
community people are innovative oriented new
businesses
No rights defined (duty of care): virtue ethics
Students To be an entrepreneur To be successful in To contribute to social

business goals
Entrepreneurs Development of the Graduates that may A curriculum that
“profession” be employees benefits their career
Alumni Maintain standing of Opportunities to Ensure curriculum
the degree contribute to the remains
curriculum contemporary
Professional Adherence to relevant Promotion of Opportunities to
bodies codes of practice membership contribute to the
curriculum
Parents Security for their For their children For their children to be
children to excel happy
Source: Author.
for curriculum design. By contrast, the United States of America provides

a state-based university system that reduces the boundaries of claims and
demands that may be placed on any particular university. In designing cur-
riculum these institutional based regulatory frameworks need to be taken
into account in achieving a curriculum that ethically meets its regulatory

and organizational responsibilities.
University administration and management will vary from university to
university. There will be some entrepreneurship curriculum prepared by
dedicated centers to entrepreneurship. Others may be formulated by mixed
discipline schools. The academic teams may be supported by teaching rev-
enue, research revenue, or even philanthropy which will influence the
claims made on the curriculum. Some universities may be technology cen-
tered; others may have substantial commitments to support their regional
location and yet others may seek to uphold international research reputa-
tions. At the same time, there are also private universities and faith-based
universities all which will create different types of institutional dynamics
for any particular university. Each of these perspectives will alter the way
the entrepreneurship curriculum is perceived and the priority it is given. In
addition universities may subscribe to accreditation bodies such as the
Association to Advance Collegiate Schools of Business (AACSB) or the
European Consortium of Innovative Universities (ECIU) that also will
impose certain standards and obligations.
Aligning the curriculum to institutional requirements should maximize
the ethical commitment from the perspective of regulations and organiza-
tional demands. Assuming that moral obligations underpin these institu-
tional positions this should also prepare the curriculum to account for the
dimensions of merit, justice, and beneficence, provided the curriculum
designer holds respect for both the process and the participants’ in the cur-
riculum program. Taking into account the extent to which this may be the
case, the curriculum designer then may define a set of stakeholders that
may be allocated a right to claim on the curriculum through the choice of
the designer (or perhaps by policy of the organization). These groups may
be highly influential on how the structure, content, and pedagogy of the
curriculum is designed and therefore should be chosen carefully to maxi-
mize the directions and outcomes established by the institutional settings.
In engaging this group of stakeholders, a normative view of ethics will
need to be negotiated as the perspectives may shift depending upon the
composition of the faculty groups (Mars, 2007). For instance, the recruit-
ment of teaching staff may vary in terms of qualifications and/or the
expected contributions to the overall curriculum. Staff may be research
oriented or practice oriented. There may be a bias toward preparing stu-
dents to be entrepreneurs or conversely to preparing students to be entre-
preneurial regardless of the career they enter. There may be a focus on
starting small businesses or an emphasis instead toward innovation and
98 ALLAN O’CONNOR
potential high growth businesses. Depending on how the teaching team are
recruited or engaged, this will influence the way their claims will be made
on the curriculum and consequently how the design of the curriculum may
satisfy those claims.
Another group that may be invited to contribute to the curriculum
development is research staff. This group may be discipline specific or mul-
tidisciplinary depending upon where the entrepreneurship curriculum has
its home within the university. There may be subdiscipline specializations
in perhaps areas such as entrepreneurship psychology or strategy, entrepre-
neurship process, or at broader levels perhaps social entrepreneurship or
corporate entrepreneurship. Each of these viewpoints may shape the curri-
culum offering although the curriculum designer holds the responsibility of
the central theme and direction of the curriculum and may need to negoti-
ate the extent of input or dominance of any research stream on the
curriculum.
Depending on the circumstances that govern the development of the cur-
riculum, a broader community engagement may be warranted. There may
be a need to temper negative sentiment among the community about entre-
preneurs as was the case in Australia especially during the 1980s and 1990s
brought about by unscrupulous behaviors by those who were labeled entre-
preneurs in public media. The economic and/or geographic context of the
program may place a larger emphasis on the needs for innovation or com-
mercialization which may create expectations that will tilt the program
toward a specific set of technology-driven outcomes. Similarly, there may
be a need for industrial transitions in a region and the entrepreneurship
curriculum may be influenced by those seeking to stimulate new dimensions
within an economy. Universities with greater commitment toward commu-
nity engagement and/or regional development matters may seek to draw in
sectors of the community through representation on a curriculum’s advi-
sory board.
Moving through the hierarchy, the next group of stakeholders may have
no formal claim on the development of the program but may nonetheless
have a moral claim on the curriculum as it is presented as a product to the
market. Assuming this group of stakeholders has not been provided the
option of invited rights, they will be encountered through the day-to-day
activities of the curriculum designer, teaching staff, administration, and
management teams of the university. Subsequently, the curriculum designer
may be called upon to justify, defend, or be asked to alter the focus of the
curriculum. This is the domain of participatory ethics and the curriculum
designer must stand on solid ground with respect to the stance of the curri-
culum design (meaning that the institutional and normative ethics of the
curriculum are accounted for and openly demonstrated in the design and
marketing) and remain flexible enough to acknowledge and bend with spe-
cific demands from this group of stakeholders or individuals who may be
unaccounted for and at risk of harm through the curriculum design. On a
day-to-day basis the principles of respect, justice, merit, and beneficence
designed into the curriculum through the institutional and normative ethics
processes may be tested and found inadequate in specific circumstances and
in individual cases.
Some examples of how this may play out could include the student who
enrolls in the curriculum believing they can be an entrepreneur but through
the learning confronts issues or circumstances that alters their view and
hence turns to the curriculum to seek an avenue that completes their educa-
tion but allows them access to an alternate career path. Given the personal
demands placed on an entrepreneur, is it just to expect a student to con-
tinue on a path that could be self-destructive? Therefore, the curriculum
under this circumstance may need some adjustments to accommodate the
personal circumstance.
A group of entrepreneurs may form a membership organization and
decide through their committee that their group represents the “real” form
of entrepreneurship being the birth and rapid growth of business ventures.
The entrepreneurship curriculum design however may be geared toward
business start-up although not necessarily for businesses that fit the descrip-
tion of the entrepreneurship membership organization. Demands are hence
made on the curriculum to match the expectations of the “true” entrepre-
neurship by this group. Clearly having the backing of the entrepreneurship
organization would be ideal but the ethical question here is; whether the
curriculum may cause harm to the entrepreneurship member organization
by not complying with their request and vice versa can the entrepreneurship
organization being misaligned with the curriculum cause harm to the curri-
culum and those stakeholders participating in it? To resolve this position
reference, one would need to go back to the normative groups and the ori-
ginal intent of the curriculum design and a negotiation may need to take
place that finds a resolution to protect the affected stakeholders.
These couple of examples provide short cases of how the ethics of a cur-
riculum may come under pressure from stakeholders who are outside of the
design process of the entrepreneurship curriculum and yet may be affected
by it. Other examples may be the alumni group who are affected by
100 ALLAN O’CONNOR
changes in the curriculum that they believe devalues the degree they have
earned or the parent who is supporting their child through the curriculum
but is concerned that the curriculum does not provide sufficient social bal-
ance to capitalist ideals. Perhaps, there are the professional bodies that
operate under a code of ethics say in marketing or accounting that find
their conservative practices are at odds with the unconventional flair with
which entrepreneurs may behave. The basis here for the negotiated ethics
at the participatory level will draw support from the normative and institu-
tional levels. However, an imperative for the curriculum design to maintain
an ethical stance is that of transparency to all stakeholders as to why the
curriculum stands as it does. From this position the participatory ethics
should be negotiated from a position of strength in the core of the program
but also be a fundamental driver of feedback and potential change to the
curriculum design.
NAVIGATING THE ETHICS OF CURRICULUM: AN

ETHICS EVALUATION FRAMEWORK
Examining the ethics of the entrepreneurship curriculum forces one to

pause and ask whether the curriculum is meeting certain objectives and
whether these objectives are explicit and relevant to the context within
which the education is being provided. Another key question emerges
through this enquiry that asks; are the objectives of a curriculum respectful
of the needs of the students or are the needs of the students secondary to
the curriculum objectives? The ethical dilemma that can arise through this
questioning relates to issues of social and economic justices or injustices
and whether students are clearly informed and aware of the consequences
of their entrepreneurial actions. For instance, does an entrepreneurship cur-
riculum equip students to make informed decisions or does it bias decision-
making toward economic rationalism without regard to social (or personal)
consequence?
To conclude this paper, we take reference from Kass (2001) on the ana-
lytical tool for assessing the ethics within public health programs to pro-
pose a similar model that may act as a framework to question the ethics
within an entrepreneurship curriculum. We articulate this framework by
recreating the avenues of enquiry in this paper and focusing on the issues
of respect, merit, justice, and beneficence. And we summarize these steps in
Box 2 and discuss the implications of each question.
Box 2. An Evaluative Framework for Entrepreneurship Curriculum

Ethics. Source: Author.
1. Who are the stakeholders in priority from regulatory to
participant?
2. What are the claims on the curriculum by each set of identifiable
stakeholders and how do their priorities each influence the struc-
ture, content, and pedagogy?
3. What are the burdens created by the institutional demands on the
participant stakeholders and are they at odds or run counter to
the expectations of participant stakeholders? Can these be mini-
mized through alternate strategies?
4. Does the rationalized entrepreneurship curriculum justly merit the
range of stakeholder demands without imposing an unnecessary
cost or burden on any particular stakeholder group(s)?
5. Does the curriculum make clear the intended outcomes for partici-
pants especially where there may be differences between institu-
tional and participant expectations?
6. Does the rationalized curriculum highlight any risk of harm
to any stakeholder group and if so what strategies are in place
to minimize the risks and manage potential digression of any
stakeholder(s)?
Question 1: Who are the stakeholders in priority from regulatory to

participant?
This question seeks to identify the potential stakeholders who may have
claims on the entrepreneurship curriculum as is possible to identify at
the time of designing the curriculum. Table 2 may provide a useful guide
to making the distinctions between the institutional and participatory
groups that need to be considered in the design. Not all groups may
come under consideration however the important thing is the immediate
stakeholders that are identifiable are considered along with the priorities
that may be attached to their identification. This task creates the back-
bone for resolving ethical issues from among stakeholder groups that
may emerge later.
Question 2: What are the claims on the curriculum by each set of identifi-
able stakeholders and how do their priorities each influence the structure,
content, and pedagogy?
Placing effort on identifying the priority claims serves two purposes. The
first is the obvious in that these claims will be the basis of the curriculum
design process highlighting content, structure, and pedagogy. The sec-
ond may be less obvious at this point but it will provide focus for any
contrary feedback received, when the curriculum is in practice, to be
turned back onto the core assumptions that are embedded in the curricu-
lum. This will provide ready reference back to the prioritized stake-
holders to confirm or to adjust to counter claims encountered in
participation of the curriculum or amend the curriculum to minimize
potential harm as may be needed.
Question 3: What are the burdens created by the institutional demands on
the participant stakeholders and are they at odds or run counter to the
expectations of participant stakeholders? Can these be minimized through
alternate strategies?
Through these questions we are attempting to identify the less-flexible
parts of the curriculum design, governed primarily through the institu-
tional claims and particularly the regulatory claims on the curriculum,
and identify what impact they may have on the participants in a curri-
culum. The key task is to check whether there are strategies that can
be put into place to minimize or eliminate harm or burden. This may
mean adjustments to curriculum, lobbying for regulatory or organiza-
tional change, or raising awareness of the in-built hazard in the curri-
culum to participants.
Question 4: Does the rationalized entrepreneurship curriculum justly merit
the range of stakeholder demands without imposing an unnecessary cost or
burden on any particular stakeholder group(s)?
The aim of this question is to draw out the merits of the curriculum and
test the equity or justice of it across the range of stakeholder groups.
Where there may be potential costs or burdens identified there will be an
increased need for attention to minimization strategies and/or transpar-
ency to the potential harm.
Question 5: Does the curriculum make clear the intended outcomes for
participants especially where there may be differences between institutional
and participant expectations?
As noted previously, transparency is critical if harm is to be minimized

and participants should have all the available information they need to
aid critical decisions about the curriculum and whether it is fit for
their purpose. The heightened responsibility of an entrepreneurship
curriculum in preparing employers that take risks with private capital
and personal reputation, wealth and/or health in the name of public
needs to improve and/or grow local or national economies increases
the ethical tensions that may be encountered and hence the demands
for transparency.
Question 6: Does the rationalized curriculum highlight any risk of harm to
any stakeholder group and if so what strategies are in place to minimize
the risks and manage potential digression of any stakeholder(s)?
This final question invites documentation of the strategies and the over-
all ethics of the curriculum. Identifying the stakeholder groups and how
each group is considered within the curriculum should be specific. The
curriculum outcomes should be clarified that highlights the specific tar-
get market for the curriculum and how strategies are in place to mini-
mize the burden or avoid engagement by those for whom the curriculum
may be unsuitable. The marketing strategies should be clear and the nat-
ure of the program should be transparent for intending students.
The process of evaluating the curriculum could work hand in hand with
the development of the curriculum. However, equally this framework
may be useful for an established curriculum and used to reexamine the
rationality of the ethics and rethink where and how the curriculum may
be adjusted to respect the range of stakeholders.
CONCLUSION
This paper set out to examine the unquestioned ethics of an entrepreneur-

ship curriculum. Through it, a lack of attention to matters of ethics gener-
ally can be observed and particularly the question raised by this paper
appeared unattended in the literature. To approach the enquiry therefore
some guidance was needed in order to shape an ethics evaluation frame-
work for an entrepreneurship curriculum which prompted a general cast
across the available literature to identify specific approaches. Little was
found, which prompted a stepped approach to structure a suitable response
to the focus of the enquiry and provide the groundwork for others to
extend this neglected area of research.
The first step required identification of who the stakeholders may be for
an entrepreneurship curriculum and the work of Matlay (2009) was useful
in this task. However, there was a lack of definition of the term stakeholder
directed toward an entrepreneurship curriculum. Returning to the basis of
Matlay’s work provided two contrasting definitions, one from the strategy
literature and the other from works in higher education. From these start-
ing points a stakeholder definition was derived that could be considered
relevant to the task of this paper. The key observation from this work was
the distinction between three sets of stakeholders where one group has
direct involvement with the curriculum design and development, a second
group that may have invited rights to contribute to the curriculum design
and development, and a third group that may be affected by the design and
development but may have had no enabled rights to its design and
development.
From this point an exploration of ethics more specifically was required
in order to provide a structure through which an evaluative framework
may be applied to the stakeholders that now could be identified. Distilling
this work highlighted four principles that underpin an evaluation of ethics
being respect, merit, justice, and beneficence. Moreover, it was revealed
that the stakeholders could be divided among the four different types of
pressures that may bear on an entrepreneurship curriculum that ranged
from the regulatory and organizational stances falling under an institu-
tional frame of reference and individual and normative ethical stances that
appeared in the participatory frame of reference to the curriculum.
Articulated examples are then used to expose how the claims on the curri-
culum differ among these four positions to reveal the particular pressures
that give rise to ethical dilemmas.
The last task of this work was to bring together a set of evaluative ques-
tions that may be applied to question the ethics of an entrepreneurship cur-
riculum. Using a model drawn from the health industry, a series of six
questions have been derived to step through and expose the ethical con-
cerns that may be hidden within the agenda of an entrepreneurship
curriculum.
While it may not be immediately apparent, the enquiry of this task sur-
faced a particular distinguishing feature of an entrepreneurship curriculum
that may well differentiate it from most, if not all, other forms of university
education curricula. That is, the participant students in entrepreneurship
are being prepared to take on the responsibilities of ownership and
leadership of various types of profit and nonprofit organizations and be

employers. Most other curricula prepare participants for employment
within businesses owned by others. This distinction places the participants
in the study of entrepreneurship in a unique position that may place them
at risk with respect to their personal wealth, health, and reputation in pur-
suit of a public cause that may drive a curriculum but not be apparent to
the participant; that is, the establishment, growth, and perhaps transitions
of local and/or national economies. This tension between private and pub-
lic good drives a careful consideration of ethics in such sectors as health
and, as we discovered, increasingly in economics. Entrepreneurship should
not be exempt from taking due care with participants who may be naı̈ve to
the hidden public pressure of the curriculum and yet who are quite vulner-
able to the lure of new ideas, opportunities, and the pursuit of achievement
which may impose personal costs. It is hoped that this paper can provide
the basis for a broad ranging examination of the ethics of the entrepreneur-
ship curriculum.
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CURRICULAR AND
PROGRAMMATIC INNOVATION AT
THE INTERSECTION OF BUSINESS
ETHICS AND ENTREPRENEURSHIP
Chris Fawson, Randy Simmons and Ryan Yonk
ABSTRACT
We explore the current landscape of business ethics and entrepreneurship

within the undergraduate business school curricula and programmatic
structure. We then present a couple of approaches we have used to
advance the understanding and teaching of business ethics and entrepre-
neurship as a set of foundational principles.
As contextual framing for our analysis we convened eight colloquia/
workshops over the past three years that bring a wide-ranging group of
business school faculty, scholars in complementary disciplines, and busi-
ness practitioners into a small-group setting to have in-depth conversa-
tions about the role of business ethics and entrepreneurship within the
business school. Data used in our analysis catalog the ways and the
degree to which AACSB-accredited business schools focus their under-
graduate curricula and degree program structure on ethics and entrepre-
neurship. Working through publically available data, primarily from

ISSN: 1048-4736/doi:10.1108/S1048-473620150000025006
109
110 CHRIS FAWSON ET AL.
business school websites, we use content analysis as a framework for sta-

tistical analysis of the alignment between how a business school articu-
lates strategic focus (mission, vision, and purpose statements) and how
it structures its curricular offerings and degree programs. Most business
schools continue to operationalize their approach to business ethics and
entrepreneurship as programmatic appendages rather than a founda-
tional set of knowledge and skills that are central to the school’s teaching
mission. In general, business schools are missing an opportunity to teach
practical business ethics and principled entrepreneurship as the central
driving force in value-creating activities within all organizations.
Keywords: Principled entrepreneurship; practical business ethics
INTRODUCTION
Although the authors of this paper are faculty in a business school, our pri-
mary research and teaching assignments are outside the conventional disci-
plinary boundaries of business ethics and entrepreneurship. Our broad
interests in the nature of human interaction and the institutions that arise
to govern that interaction, however, have frequently drawn us to the fuzzy
edge of business ethics and entrepreneurship. In fact, in the courses we
teach, we have innovated on curricular and pedagogical margins that allow
us to integrate business ethics and entrepreneurship into course structures
and into mentoring relationships. In this paper, we present an overview of
our efforts to better understand and apply the principles of entrepreneur-
ship and business ethics as integral elements of the human experience
in our role as faculty within the business school. We explore the current
landscape of ethics and entrepreneurship inside business school curricula
and training, finding that in many cases they continue to be programmatic
appendages rather than a foundational set of knowledge and skills that are
central to the school’s teaching mission. We then present examples of
approaches we have used to advance the understanding and teaching of
business ethics and entrepreneurship as a set of foundational principles,
rather than simply additional programs offered as part of the expanding
menu of degree or program options.
During our work to integrate business ethics and entrepreneurship into
our courses, we have visited with other faculty who teach those topics.
This has happened both through the informal interaction that naturally
Curricular and Programmatic Innovation 111
arises around the “water-cooler” and through a set of strategic initiatives

designed to purposefully draw together a broad cross-section of academic
and practitioner colleagues who have disciplinary expertise in these areas.
As a general rule, we found that academic colleagues and practitioners with
disciplinary expertise in both entrepreneurship and business ethics have an
interest in a broader discourse about how these topics are strategically
placed and taught within the business school curriculum.
Innovations at the core of our classes and how we are beginning to con-
ceptualize opportunities to contribute to the literature have evolved from
conversations designed to explore the role and scope of ethics and entrepre-
neurship in the wider business school culture. Over the past several years
(2012 2015), our group has convened eight colloquia that bring a wide-
ranging group of business school faculty into a small-group setting to have
in-depth conversations about ethics, entrepreneurship, and how these
topics can be better integrated into business school curricula and courses.
These colloquia, which typically bring together 14 18 business school
faculty members, scholars in complementary disciplines, and business prac-
titioners, have focused on a cross-section of the foundational arguments,
authors, and approaches to business ethics and entrepreneurship.1
The literature that has framed the conversations in entrepreneurship
includes Schumpeter (2008), Kirzner (1985) and Knight (1921) as well as a
broad set of readings drawn from contemporary journal articles and discus-
sions that have appeared in the entrepreneurship literature. Our discussions
around business ethics have likewise sought perspective on a set of histori-
cal and contemporary contributions to the literature. Increasingly, we have
found a growing body of academic literature at the intersection of both
entrepreneurship and business ethics these contributions have also been
used to fuel our conversations. The goal in convening these colloquia has
been to foster a robust discussion of business ethics and entrepreneurship
as we seek a broader understanding of their role in the business school cur-
ricula and structure of programmatic offerings.
The emergence of entrepreneurship and business ethics as separate and
well-defined disciplines within conventional business school curricular
offerings has a fairly recent history. Business ethics largely evolved from a
study of the philosophical foundations of moral sentiment applied to
anecdotal case content in systems of human interaction within and among
business institutions (see De George, 2013; Ferrell & Ferrell, n.d.). The
study of entrepreneurship emerged as a framework for describing innova-
tion as a catalyst for value-creating transformation within market systems
(see Katz, 2003). In both cases, the disciplinary focus narrowed over time
as academics sought independent legitimacy for targeted research and ana-

lysis. In its curricular form, business ethics ultimately evolved into a set of
foundational courses that focused primarily on business law (ethics from a
legalistic point of view), or a historical smorgasbord of introductions to
philosophers and philosophies designed to expose business students to the
broadest possible context for understanding their own ethical motivations,
and most recently to a focus on questions of corporate social responsibility.
Entrepreneurship ultimately evolved as a discipline focused on new ven-
ture creation and the institutions and cultural contexts that created the
most opportunity to leverage individual tolerance for risk in starting new
ventures. In both cases, the record suggests that these newly created disci-
plines cultivated support from extensive networks of public and private
donors and affinity groups that wanted to exert influence on the disciplin-
ary innovations that were starting to emerge within business schools. It is
becoming more common for schools to have dedicated centers in entrepre-
neurship and, while less common than in entrepreneurship, centers focused
on business ethics. Interestingly, in our sample of business schools it is
more common for them to articulate their strategic focus within the lan-
guage of business ethics than entrepreneurship.
The historical record reflects a perceived need within the academy for
specialized knowledge and expertise circumscribed by a set of principles,
models, systems, and mind-sets that govern demonstrative mastery of a
well-defined collection of foundational knowledge (see Benson, 2004). It
also documents the power of specialization and division of labor as aca-
demics seek to create a sustainable platform for contributions to curricu-
lum and research. Both business ethics and entrepreneurship languished as
ancillary appendages to departments of philosophy or economics, respec-
tively, prior to their emergence as more narrowly defined independent man-
agement disciplines with their own independent academic legitimacy.
Our conversations suggest an emerging sense that the narrowing of disci-
plinary focus in business ethics and entrepreneurship has diverted resources
away from inculcating thinking skills at the intersection of business ethics
and entrepreneurship. This emerging perspective suggests that mental mod-
els and professional mind-sets at the intersection of business ethics and
entrepreneurship are foundational, timeless, and self-evident, and must be
more broadly integrated into every dimension of the business curriculum.
Further, it presents a challenge to explore how these principles might be
effectively integrated into all courses taught in the business curriculum in a
way that complements a broad commitment to foster the mastery of
practice-based skill sets.
THE CURRENT LANDSCAPE
As part of our ongoing desire to better understand the current state of

teaching in ethics and entrepreneurship, the team cataloged the ways and
the degree to which The Association to Advance Collegiate Schools of
Business (AACSB)-accredited business schools focus their undergraduate
curricula and degree program structure on ethics and entrepreneurship. We
began with all 504 AACSB-accredited business schools in the United States
(http://www.aacsb.edu/accreditation/accredited-members/global-listing/).
Working through publically available data, primarily from business school
websites, we cataloged the activities of these schools using a consistent
methodology and approach. Our final data set contains information from
488 of the 504 AACSB-accredited business schools in the United States. Of
the total, 16 business schools are excluded from these data due to one of
three reasons: (1) unusable website, (2) nontraditional major classifications,
or (3) the school offers only graduate degree programs. Thus, our final
data include 488 of the schools, or 96.8% of accredited schools.
Our core research questions are: (1) How far have the concepts of busi-
ness ethics and entrepreneurship penetrated? (2) Do schools with a mission,
which articulates ethics and/or entrepreneurship as a core focus, exhibit
greater focus on them in their curriculum? (3) Is the primary focus of their
approach to business ethics and entrepreneurship focused on a narrow
vision rather than holistic approach to teaching business ethics and
entrepreneurship?
Our approach in categorizing these schools was three-fold. First, we
explored each school’s website to identify degrees (including majors, min-
ors, tracks, concentrations, and certificates) in either business ethics or
entrepreneurship, to determine whether classes in either ethics or entrepre-
neurship were required for at least one other major within the business
school, and to find whether ethics or entrepreneurship were mentioned in
each business school’s mission/vision statement. For each field, a 1 or 0
was recorded in order to document our findings. An “n/a” entry was used
rarely and only when websites did not provide information regarding a par-
ticular field.
Second, we conducted a content analysis of the programming from
syllabi, publically listed missions and visions, as well as other readily avail-
able documentation. Two evaluative frameworks framed the content ana-
lysis. For business ethics, we sought to assess whether the school
articulated narratives for ethical conduct within the taxonomy of con-
strained or unconstrained views of human nature as argued by Sowell
(1987). According to Sowell, a constrained vision of human nature

assumes that humans are essentially self-seeking and unchanging. Ethics
courses that accept the constrained vision teach about incentives, pro-
cesses, and rules. The unconstrained vision assumes that humans are quite
malleable and that teaching can change behavior. Thus, an ethics class
relying on an unconstrained vision would be primarily an exhortation to
moral action. For entrepreneurship, we assessed whether the business
school mission narrative was narrowly focused on the sets of skills, tools,
and institutions designed to support new venture start-ups, or whether it
encompassed a broader view of the entrepreneurial mind-set as reflected in
an Austrian view of “all individual action is entrepreneurial” (see Kirzner,
1985, p. 25). Further, as part of this content analysis of schools that listed
ethics or entrepreneurship in their particular mission, we used a text analy-
zer to find recurring words or phrases that could help us evaluate the inte-
gration of business ethics and entrepreneurship into their curricula and
programs.2
Third, using school websites, Google searches, and other publically
available information, we identified whether an ethics or entrepreneurship
center existed in each respective business school.
RESULTS
Using these data we calculated raw percentages to indicate what percentage

of schools exhibited the characteristics we sought to identify. These raw
percentages are presented in Table 1.3
Table 1. Summary of Business School Characteristics.

Variable Observations Percent
Business Ethics Center 488 16.6

Entrepreneurship Center 488 62.1
Business Ethics Degree 488 3.3
Entrepreneurship Degree 488 52.5
Ethics Courses in Other Degrees 479 65.3
Entrepreneurship Courses in Other Degrees 479 49.7
Entrepreneurship in Mission 479 14.6
Ethics in Mission 479 39.5
Mission Alignment
Within our data we first looked at the mission statements of the 488 schools
with workable websites to identify their articulated mission statements. We
were able to locate mission statements for only 479 of the 488 schools of
business. Among those mission statements we found that just fewer than
15% had a clearly articulated focus on entrepreneurship in their mission
statement while nearly 40% had an articulated focus on business ethics.
Our analysis of the mission statements of business schools is telling in the
relatively small number of programs that clearly articulate either ethics or
entrepreneurship as being core to their mission. Only 40 of the 479 pro-
grams (8.35%) clearly articulated both ethics and entrepreneurship in their
mission statement.
As part of our analysis we were further interested in the context of ethics
and entrepreneurship when they were included in mission statements.
Using text analysis software we explored the words that were most com-
monly colocated with both terms in mission statements. The words that
most commonly surrounded entrepreneurship included “leadership,” “glo-
bal,” “management,” and “develop.” The words most typically colocated
with ethics are “leadership” and “develop” as well as “integrity,” “learn-
ing,” and “knowledge.” “Develop,” when used in conjunction with entre-
preneurship or ethics, often precedes a list of desirable characteristics that
schools seek to have students develop rather than entrepreneurship or
ethics being a foundational principle that underlies business school teach-
ing. Our analysis suggests that context in which mission statements
included ethics or entrepreneurship is not one of foundational principles
but rather programmatic outcomes.
These findings illustrate that despite increasing emphasis on and discus-
sion around both ethics and entrepreneurship, a relatively small number of
business schools have chosen to focus on them as a core part of their mis-
sion. Among those that have, it seems that business ethics and entrepre-
neurship are generally presented as desirable characteristics not as
foundational principles.
Driving Ethics and Entrepreneurship into the Curriculum
In addition to identifying a relative lack of mission-level narratives that

reference ethics and entrepreneurship, we drilled deeper into the program-
matic actions of business schools that claimed a focus on subject areas.
We used three variables both for ethics and entrepreneurship as markers

of programmatic depth. First, is there a full degree available in the disci-
plines? Second, are courses in ethics or entrepreneurship required as part
of another degree’s coursework? Finally, does the school have a center
devoted to the study or practice of ethics or entrepreneurship?
Among the AACSB-accredited schools with available data we found
that just over 3% of schools have a degree option focused specifically on
the study or practice of business ethics. This result is not terribly surprising
as degrees in ethics are most commonly found within departments of philo-
sophy rather than business schools. But, we note that this is despite nearly
40% of schools having ethics as part of their mission. Entrepreneurship
degrees are substantially more common with nearly 53% of schools offer-
ing a full-degree program.
One of the places where the influence of ethics or entrepreneurship can
most easily be identified is in the requirements for their inclusion in the
coursework of other degrees. Although relatively few schools have full
degree programs in ethics, nearly two thirds require the completion of
ethics specific coursework in the completion of other degree programs.
Further, nearly 50% require some coursework in entrepreneurship as a pre-
requisite to the completion of other business school degrees. Only 173
(36.5%) require both in their degree programs.4
Our final marker of the programmatic influence is the presence of cen-
ters devoted to the study or practice of business ethics or entrepreneurship
on campus. We found that nearly 17% of the schools had a center devoted
to business ethics while 62% of schools have a center focused on the study
or practice of entrepreneurship. Only 67 (13.7%) schools had readily identi-
fiable centers in both areas.
Our analysis included a review of the programmatic and curricular offer-
ings in ethics and entrepreneurship relative to a broad assessment of con-
tent focus. We find that entrepreneurship teaching among business schools
is split nearly 50 50 between broad and narrow understandings entrepre-
neurship. Business ethics training is five times more likely to be delivered as
an unconstrained idea than a constrained one. We also found that most of
those teaching an unconstrained vision of ethics do so with a strong reli-
ance on a corporate social responsibility framework.
These findings lead us to consider how best to challenge the existing set
of interests and institutional structures that govern the teaching and learn-
ing of ethics and entrepreneurship within the business school. Solving these
types of problems in higher education is often attempted using a top-down
approach where senior leadership attempts to drive change at the mission
level. We find strong indications that the inclusion of ethics or entrepre-

neurship in the overarching mission of the school has been done in part by
administrators who have attempted to drive these areas into the identity of
the schools they lead. We explore whether this has been a successful strat-
egy using the data described above. Using correlative statistics we found lit-
tle evidence that the inclusion of ethics or entrepreneurship in a school’s
mission had an influence on the markers we identified.
Ethics, Entrepreneurship, and Mission
Our attempt to understand the relationship between mission narratives that

referenced ethics and programmatic structure relied on a series of correla-
tive statistics between the language used in the mission narrative and each
of our other programmatic variables. The results of these correlations are
included in Table 2.
We find no evidence of a strong correlation between including ethics in
the mission statement of the business school and programmatic adoption
of ethics in degree programs. While the correlation value is small, and
negative, the relationship between the business ethics degree and mission
narrative exhibits a reasonable level of statistical significance. However,
the direction of the relationship would indicate that including ethics in the
mission statement would be negatively associated with having a degree pro-
gram in ethics.
As with ethics, we wanted to understand the relationship between mis-
sion narratives that included reference to entrepreneurship and program-
matic structure. We ran a series of correlative statistics between mission
inclusion and each of our other programmatic variables. The results of
these correlations are included in Table 3.
Table 2. Correlation between Ethics Language in the Mission Narrative

and Programmatic Structure.
Variable Observations R p-Value
Business Ethics Degree 479 −.0788 .085

Business Ethics Courses in Other Degrees 464a .0092 .843
Business Ethics Centers 479 −.0065 .887
a
Only 464 of the schools in our data had information about both their mission and full course
information available online.
Table 3. Correlation between Entrepreneurship Language in the Mission

Narrative and Programmatic Structure.
Variable Observations R p-Value
Entrepreneurship Degree 479 .0139 .762

Entrepreneurship Courses in Other Degrees 464a .0835 .072
Entrepreneurship Centers 479 .0786 .086
a
Only 464 of the schools in our data had information about both their mission and full course
information available online.
Again we find little evidence of strong correlative relationships between

the inclusion of entrepreneurship narratives in the mission statement of a
business school and the programs we identified. While there is some evi-
dence of weak statistical significance, the small absolute values for the cal-
culated correlation coefficients at most suggest very weak relationships.
Taken together the results of both sets of correlations provide some
evidence that business schools desiring to increase their focus on ethics
and entrepreneurship might experience more success by using some
mechanism other than a top-down mission-based approach. These data-
driven results are consistent with the expectations that have emerged from
our ongoing discussions with our colleagues, among the faculty at the col-
loquia we have sponsored, and our own experience. Effective and sus-
tained change is unlikely to be driven by grand visions reflected in mission
statement narratives, but rather by a broad base of faculty engaging with
the ideas that undergird ethics and entrepreneurship as foundational prin-
ciples in business education. To illustrate one way in which we believe this
is possible, we share our experience in what we call the Disruptive
Innovation Workshop (DIW).
DISRUPTIVE INNOVATION WORKSHOP

Our analysis suggests that mission statements have only marginal impact
on the programmatic realities inside business schools. As additional contex-
tual framing for this result, we conducted a workshop experiment in how
professors might go about conceptualizing a role for business ethics and
entrepreneurship within the broad set of discipline-specific elements that
comprise the conventional business school curricula. In the summer of
2013 we ran a workshop called the Disruptive Innovation Workshop

(DIW). The DIW convened a collaborative group of academics to explore
emerging innovations in teaching business ethics and entrepreneurship as
foundational tools sets that all business graduates need to master to be suc-
cessful in the practice of business. In the DIW we explored business ethics
not in its philosophical context, but in its practical application to everyday
decision-making processes. In addition, the DIW explored the role of entre-
preneurship as a universal mind-set that underpins all strategic and opera-
tional business decision-making processes and as a set of practical tools
that can be applied broadly to all human relationships where value is cre-
ated and captured.
The group of workshop participants included faculty from a diverse set
of disciplinary interests including finance, accounting, marketing, opera-
tions, economics, entrepreneurship, and ethics. They also represented a
diverse set of academic experiences as we included senior scholars and
experienced administrators as well as newly minted PhDs in their first aca-
demic assignment.
The workshop was focused on the following objectives:
• Promote critical inquiry into business school curricula, business faculty

research, and professional practice.
• Explore a broad disciplinary framework for introducing the moral
foundations of markets and entrepreneurship into business school
curricula.
• Examine participant experience in using entrepreneurship and business
ethics as a way to bridge the disciplinary balkanization that exists in con-
ventional business curricula.
• Explore opportunities and challenges for developing innovative instruc-
tional materials that are easily integrated into highly prescriptive and nar-
rowly focused discipline-specific/practitioner-oriented business courses.
• Explore ways to more fully involve students in an entrepreneurship and
business ethics learning experience.
In order to stimulate creative collaboration and participant engage-

ment, each workshop participant was invited to share a journal article or
set of readings that best reflected their perspectives on the role of entre-
preneurship and business ethics in the business curriculum.5 These were
posted to a Facebook page that was created to foster collaborative
engagement and sharing prior to convening the actual workshop. In addi-
tion, participants were given a broad overview of the workshop objectives
in a letter of invitation that included the following language for contex-

tual framing:
Our purpose is to challenge contemporary models for teaching and learning. Our focus
is on business ethics and entrepreneurship in business schools. We plan to seed our con-
versation with questions such as: What is entrepreneurship? What are the foundational
values/virtues and actions embedded in entrepreneurship that extend its application
beyond formal management and business start-up contexts? Is a propensity for “taking
action” even a good way to think about entrepreneurship? Are there approaches to
teaching and learning business ethics that reach across business curricula and program-
matic structures in meaningful ways? What do we mean by business ethics? Can we talk
about ethics and entrepreneurship as being distinct? Is ethics a value and entrepreneur-
ship an action or are they each values and actions?
Participant interaction during the workshop was designed to help focus

new light on a pathway toward answering some of these questions and set
a context for raising new questions that are relevant to the workshop objec-
tives. We hoped to create an experience that would promote serendipity,
unpredictability, and even capricious whims of fate as we talked about
ideas, thought about ideas, and played with ideas. We hoped to challenge
workshop participants to consider how to integrate ethics and entrepre-
neurship into their own courses, whether they be in economics, manage-
ment, finance, accounting, strategy, marketing, operations, information
systems, or whatever their specific narrowly defined disciplinary interests
might be. Additionally, we hoped that workshop-stimulated conversations
would act as a catalyst to challenge participants to action.
The following are the insights that emerged from the workshop. They
are organized into five general classifications: (1) insights at the intersection
of business ethics and entrepreneurship; (2) insights that had a primary
focus on business ethics; (3) insights that had a primary focus on entrepre-
neurship; (4) insights that focused on business school structure and pro-
cesses; and (5) insights that focused on market processes and system
complexity. These key insights shared by DIW participants organized
according to the general taxonomy outlined above are summarized as
follows.
Insights at the Intersection of Business Ethics and Entrepreneurship
The intersection of business ethics and entrepreneurship is where cognitive

rules and procedures are broken within the constraints of ethical rules (see
Baumol, 1990). Entrepreneurship is a discovery process, a process where
old insights are ignored, forgotten, or leaped over. The rules that cannot be
ignored, forgotten, or leaped over are the ethical ones. These rules can be
formal or informal and they are guides to moral behavior.
Ethics is about character, while entrepreneurship is about taking action.
Professors may not be able to teach character, but they can teach students
to understand ethical behavior. And if they teach students the importance
of ethical behavior in entrepreneurial endeavors, they will have accom-
plished a great deal. They might even help to build character.
Business is inherently an ethical activity. Far too often students are
taught that there is something negative about profit and that the appropri-
ate ethical standard is to “give back” to the community, however commu-
nity is defined. Being a successful entrepreneur means making other people
better off. Those others do not have to purchase your service or product;
they only purchase it because they believe doing so will make them better
off. Producing value for others, as they define value, is wholly ethical and
just. Successful entrepreneurial actions produce benefits as opposed to the
handouts offered under the banner of corporate social responsibility.
Insights that Had a Primary Focus on Business Ethics
The capacity for ethical choice is a state of being that is best fostered
through the attribute of self-awareness and is reflected in the practice of
business. Teaching business ethics without the benefit of practical applica-
tion and experience is usually devoid of meaningful context. Many business
schools maintain a culture of hostility toward the idea that the practice of
business ethics can be taught. The lowest common denominator for teach-
ing business ethics is within the formal structure of law what is legal is
ethical. Ethics is an output not an input.
Insights that Had a Primary Focus on Entrepreneurship
The way entrepreneurship is presented in an academic setting creates an

exclusive domain that creates barriers to communication. Entrepreneurship
can be equilibrating as it seeks to reconcile market inefficiency through
arbitrage. Business school students lack a broad understanding of entrepre-
neurship as a mind-set rather it is seen as a set of narrowly focused busi-
ness tools relevant to new venture start-up. Management explores “what
is” while entrepreneurship should focus on “what is possible.”
Insights that Focused on Business School Structure and Processes
We need to find what is common to all business. Big corporations are out-
liers, yet are the focal point for the majority of conventional business
school curricula and research. Entrepreneurship is the model of business in
all of its forms, but business schools work from a corporate perspective
that emphasizes “management” and marginalizes entrepreneurship.
Business schools should work to cultivate more of a “learning by doing”
pedagogy as it relates to business ethics and entrepreneurship. Practice-
oriented business schools have the potential to be a bridge between knowl-
edge and practice. Business schools in general lack clarity about their role
in being an agent of transformation for students who are interested in the
practice of business. Do we need a stronger apprenticeship model that
encourages learning by doing?
Insights that Focused on Market Processes and System Complexity
Making entrepreneurship and business ethics central to the teaching of

business can help the business school focus on the role of failure (in a mor-
alistic sense) and how failure might be seen as a critical marker of system
complexity. A stronger orientation on the information, experimentation,
and learning mechanisms embedded in markets might be a fruitful avenue
for teaching about system complexity. Failure not necessarily moral fail-
ure is a natural part of the healthy creative process of markets.
Destruction is visible creation is invisible. There is a need to embrace the
concept that long-term value can only be created when the broader system
of exchange engenders trust.
CONCLUSION
As we have noted and our data analysis confirmed, most business schools
have courses on business ethics. Ostensibly, these courses teach students
how to handle ethical problems that arise in any career in the business
world. The sad reality is, as one DIW participant lamented, “such courses
can be little more than a form of hazing, a side-trip to an isolated ghetto
within a four year course of study, in which ethics is an academic exercise
presented by an adjunct professor who has no particular experience in the
business world, who lacks credibility, and who can hardly begin to convey
what an ethically entrepreneurial life in the business world would be like.”
Likewise, most business schools approach entrepreneurship as a narrow

disciplinary inquiry into the functional elements of new venture start-up.
From our perspective, this approach ignores the rich literature we touched
on that places alertness to opportunity and transformational insight as the
central driving force in value-creating activities within all organizations.
If ethics and an entrepreneurial mind-set are going to be an everyday
part of a student’s life after graduation, then they should be an everyday
part of their course of study. It could be, and arguably should be, the rule
rather than the exception that professors of management, accounting, or
marketing courses take time to discuss problems in their field as ethical
problems and value-creation challenges.
In addition, the most important career problems students ever are likely
to face likely will be ethical problems to some extent. Students need to
understand the significance of that life challenge, which means they need to
hear about it from a variety of respected disciplinary perspectives. Students
need to be taught about reputations and how to earn them. They need to be
taught about social pressure and how their ability to handle it will make or
break their career. They need to see the rule of law as a critically important
yet woefully incomplete framework for guiding decisions they will need to
make, and the responsibility they will need to take, in order to flourish.
What if business schools embraced value-driven students who are crea-
tive, critical thinkers? Yes, students need to understand the functional and
operational tools of business, like accounting, but a curriculum that empha-
sized ethically driven entrepreneurship has the potential to cultivate more
passion and value. There are many constraints to such a vision, including all
the constituents of traditional business schools. We believe, however, that
opportunities exist for creative business school faculty to develop new con-
stituencies as they emphasize entrepreneurship and ethics across the curricu-
lum. In so doing, it is also possible that opportunities exist to change the
minds of current constituencies convincing them of the value of this new
approach. There is an entrepreneurial niche for the right business school
filled with entrepreneurial faculty members who value an interdisciplinary
education over what is gotten from traditional academic silos.
NOTES
1. Appendix A lists each colloquium’s title and the readings that structured our
discussions.
2. The text analyzer algorithm we used is publically available at http://www.
online-utility.org/text/analyzer.jsp
3. In Table 1, several schools we analyzed had websites that provided mission

and vision information but no information on either courses or mission. Thus, for
some analysis less than the full 488 schools had readily available information. For
each evaluative measure we include all of the schools for which information was
available.
4. It is possible, although we believe unlikely based on our own experience and
our discussion with the faculty at the colloquia we have held, that ethics has been
fully integrated into every course and that would account for a lack of course
requirements in ethics.
5. Appendix B presents the list of readings suggested by each workshop
participant.
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APPENDIX B: FOUNDATIONAL LITERATURE

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THE CHALLENGES OF ETHICS

AND ENTREPRENEURSHIP IN THE

United Kingdom North America Japan

First edition 2015

Copyright r 2015 Emerald Group Publishing Limited

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No part of this book may be reproduced, stored in a retrieval system, transmitted in

British Library Cataloguing in Publication Data

Certificate Number 1985

LIST OF CONTRIBUTORS vii

ENTREPRENEURSHIP AND EXISTENTIALISM:

THE ENTREPRENEUR’S DILEMMA OF ETHICS

THE ETHICAL PITFALLS AND OPPORTUNITIES OF

THE ETHICS OF GUERILLA BEHAVIOR IN EARLY

QUESTIONING THE ETHICS OF UNIVERSITY

CURRICULAR AND PROGRAMMATIC INNOVATION

Travis J. Brown School of Informatics and Computing,

Allan O’Connor Entrepreneurship, Commercialisation and

Michael G. Goldsby and Robert Mathews present a compelling paper,

decision-making processes and is consistent with the Hunt Vitell model of

experiences and potential for reconciling management and entrepreneurship

Arend, R. J. (2013). Ethics-focused dynamic capabilities: A small business perspective. Small

Michael G. Goldsby and Robert Mathews

Entrepreneurial pursuits are all situational and relative. Business oppor-

The Challenges of Ethics and Entrepreneurship in the Global Environment

relate to entrepreneurship. Guidance for reading and applying the litera-

Entrepreneurship is first and foremost about capitalizing on opportunity.

philosophical foundation for existentialism in entrepreneurship, we first

REALITY AND KNOWLEDGE

A movement in entrepreneurship is taking place that identifies an entrepre-

existence. Realism, or objectivism, holds that a reality exists and humans

social constructs represent different realities, particularly in the human

wanted to take control of their situations rather than live as victims of

THE VALUE OF LITERATURE IN CREATING

As explained in the previous section, literature can have immense sway

behaviors. The interaction of these characters, of course, reflects the com-

philosophy in the face of difficult situations? Do the ethical orientations of

was religious, but he did recognize the responsibility in choosing the

One can imagine replacing the word “existentialist” with “entrepreneur”

CREATING AUTHENTICITY FOR ENTREPRENEURS

Earlier in this paper we discussed the positions of positivism and construc-

model developed by West (2008) to entrepreneurship. West contends that

1. Acknowledge and identify my freedom to act. The entrepreneur faces

at Apple. Early in his Apple days he embodied the image of a hippie.

Donald F. Kuratko, Travis J. Brown and

In e-commerce, consumers have begun to rely on the opinions of fellow

The Challenges of Ethics and Entrepreneurship in the Global Environment

professionals conducting business online are more nuanced and complex

THE CHALLENGE OF ONLINE REPUTATION

The New Terminology

Strategic Manipulation of Reputation Management Systems

As noted by Calkins (2002), technological advances, specifically techniques

rating of a business, product, or service? Since young professionals are so

THE ENTREPRENEUR’S ETHICAL DILEMMA

establish an ethical environment within which employees and other consti-

In an attempt to determine whether the current assessment of concealed

Research Construct Framework

Table 1 presents the research construct framework we used as a guide in

Our survey consists of a total of 32 vignettes, one for each cross-section of

Table 1. Strategic Manipulation of Reputation Management Systems

Pilot Study Sample Population

As representatives of future young professionals, students enrolled at a

Table 2. Sample of Study Vignettes.

to complete the survey without providing their perceptions of the actions