Business Ethics and the Moral Reasoning of
Individual Managers
Almerinda Forte, Division of
Administration and Economics, College of Professional Studies
Abstract
Business ethics, especially among top managers, has become a topic
of concern to the public and business community. As a result, much
attention has focused on the development of moral reasoning in
corporate individuals. Past research examining individual and
business decision behavior, indicates that organizational-level
variables have a significant impact on individual decisions. Since
managers’ decisions impact organizational goals and organizational
ethical behavior, this researcher investigated the degree to which
there are differences in the moral reasoning ability of business
managers of selected industries and whether there are significant
differences between top, middle, and first-line management
levels.
To determine the relationship between managers’ locus of control
and their moral reasoning ability, this study considered three
independent variables: reported organizational ethical climate,
locus of control and selected demographic and institutional
variables. For a foundation, this researcher relied on Kohlberg’s
theory of moral development, Victor and Cullen’s ethical work
climate theory, and Rotter’s theory of internal-external locus of
control (which evolved from Carl Jung). The short form of Rest’s
DIT instrument measured the moral reasoning abilities of the
participants. The selected demographic and institutional variables
(age, work tenure, education, gender, management level and industry
category) provided the useful information to investigate these
relationships of moral reasoning ability of individual
managers.
A survey questionnaire was sent to 400 managerial and executive
level companies at a random sample of Fortune 500 firms throughout
the United States. Dun and Bradstreet provided the researcher with
a proportional stratified random sample of those 400 managerial and
executive level employees at a variety of organizations. The
researcher received 214 usable, completed surveys, which resulted
in a response rate of 55%. The researcher conducted statistical
analysis utilizing SPSS Base 9.0 for Windows, and Pearson’s
Correlation Coefficient ®, two tail t-tests, analysis of variance
(ANOVA) and multiple regression analysis.
The researcher found a number of statistically significant
relationships. For instance, a statistically significant
relationship between age and organizational ethical climate types
(Caring, Law and Code, Rule, Instrumental and Independence) was
found as well as a statistically significant relationship between
management levels and organizational ethical climate. In addition,
other statistically significant relationships were revealed,
including that between the manufacturing industry’s “P” scores and
the service industry’s “P” scores, tenure and ethical climate
types, education and ethical climate types, and selected
demographics (industry types and gender) and moral reasoning.