Ethical climate and its relationship to ethical behavior and ethical mechanisms

Authors: Jin- Feng Uen; Ting Wu; Hui-Chen Tsai

Journal: Chia Da Management Review. Dec. 2011, 31(2): 33-60.

Keywords: Ethical climate;Ethical behaviors;Ethical mechanisms;Multilevel analysis

Abstract:
Business ethics is widely perceived as a global issue, and ethical climate is considered to be a significant factor affecting employees' behavior. This study explores organizational ethical climate by: firstly, illustrating the theoretical and empirical basis, discussing the relationship between ethical climate and ethical behavior, as well as examining the relevant organizational ethical mechanisms regarding forming ethical climate; the implications for future research concerning ethical climate are introduced. This study applies multilevel analysis; samples are from Taiwanese financial consulting firms due to the significance concerning ethics in this industry. The results sugges that a ”rules, law and code” ethical climate has a significant influence on employees' ethical behavior because of institutionalized coercion, while other ethical climate dimensions affect certain limited ethical behaviors. Moreover, organizations with a code of ethics and enforcement systems will influence the formation of rules, law and code ethical climate.