Abstract

Purpose and aim: Ethical breaches have become a common phenomenon across the globe, especially by big companies and top level executives, and have resulted in major corporate blunders, accounting scandals ending up in bankruptcy and deception of the various stakeholders. There is a need to make an introspection of ethical values and its impact on businesses, so that the future corporate social re-sponsibility and ethical leadership of the executives can have a binding. The paper investigates the role of religion and culture on ethics & morals and how it can be applied towards betterment of busi-ness conduct. Also it attempts to explore the root causes of corporate scandals and from an ethical perspective.

Methodology: Literature review and case analysis of secondary data are the key sources of infor-mation in the study on a qualitative perspective. In the qualitative analysis of ethical contributions from religions and culture, the various themes are identified and grouped based on common grounds. Tabulation of the causal factors of corporate scandals, enables to clearly identify the root cause of unethical business practices and immoral leadership. The various findings are to be taken in a positive note for the future corporate businesses and ethical leadership of executives.

Findings and novelty: The various reflections from literature on global religions, cultures, Indian my-thology, classical Tamil literature on ethics, leadership and behavior, identify various morals, virtues and founding pillars for mankind, especially for business and nation governance perspective in these changing times of the Globalized world pestered with scandals and fraud. These moral values and ethical guides have passed the test of time, and fit enough to be reinstated in the mainstream of ethical and legal conduct of firms and Governments to serve the stakeholders and society at its best. From the pareto analysis of the various corporate scandals on an ethical perspective, it is inferred that 80% of the root causes of the corporate scandals could be attributed to the ethical dimension of abstaining from fraud (72.22%). The paper is very novel in exploring the ethical perspectives from various di-mensions of culture and religion across the globe. Also uniquely the paper identifies many common-alities from these ethical sources namely, transparency, trust, sustainability, justice and abstaining from fraud & corruption.

Conclusion and future research: The paper concludes that todays globalized businesses needs to look into ethical values and moral principles explored in the study from the various cultural and religious dimensions, and can aid in preventing ethical misconduct and improving corporate sustainability, brand image and reputation. The future researchers can explore the various global legislative frame-works, in assessing the ethical strengths and weaknesses, since legal loopholes pave way for many corporate blunders. Also the existing climate and culture of global organizations can be assessed for ethical training, moral code of conduct and ethical decsion making.

Keywords: ethics, values, religion, culture, scandals.

JEL Classification: M14, K20.

Cite as: Balaraman, P. (2017). Qualitative Review of Ethics from Religion, Culture and Corporate Scandals. SocioEconomic Challenges, 1(4), 82-94. DOI: 10.21272sec.1(4).82-94.2017

References

1. Abdurezak A. H. (2011). Islamic ethics: An outline of its principles and scope. Revelation and Science, 1(3), 122-130.
2. Acharya, G. (2012). India: Case Study on the Supreme Court Ruling on the 2G Spectrum Scam (February 27, 2012). Available at SSRN: https://ssrn.com/abstract=2048719 or http://dx.doi.org/10.2139/ssrn.2048719.
3. Agananooru (n.d.). Retrieved Online from: http://literature-comp.blogspot.com/2011/10/best-of-what-i-have-read-tamil-sangam_30.html.
4. Ajzen, Icek and Mark Fishbein (1975). Belief, Attitude, Intention and Behavior: An Introduction to Theory and Research. Reading, Mass: Addison-Wesley.
5. Amini, M., & Bienstock, C. C. (2014). Corporate sustainability: An integrative definition and framework to evaluate corporate practice and guide academic research. Journal of Cleaner Production, 76, 12–19. https://doi.org/10.1016/j.jclepro.2014.02.016.
6. Baker, J. (2015). The FIFA Scandal: Lessons for the Corporate World. ACFE Asia-Pacific Fraud Conference, 1, 1–25. https://doi.org/10.1017/CBO9781107415324.004.
7. BBC (2016). India’s corruption scandals. Retrieved (13th Nov 2017) from: http://www.bbc.com/news/world-south-asia-12769214.
8. Beekun, R. I. (1997). Islamic Business Ethics. Beltsville: The international Institute of Islamic Thought.
9. Beekun, R. I., & Badawi, J. A. (2005). Balancing Ethical Responsibility among Multiple Organizational Stakeholders: The Islamic Perspective. Journal of Business Ethics, 60(2), 131-145.
10. Benedek, P. (2012). Compliance management − A new response to legal and business challenges. Acta Polytechnica Hungarica, 9(3), 135–148.
11. Business-anti-corruption. (2017). India Corruption Report. Retrieved (15th Nov 2017) from: http://www.business-anti-corruption.com/country-profiles/india.
12. Carroll, A. B. (1991). The Pyramid of Corporate Social Responsibility: Toward the Morai Management of Organizational Stakeholders. Business Horizons, 39–48. https://doi.org/10.1016/0007-6813(91)90005-G.
13. Christoph, S., Cui, W., Teodorina, L., Wang, D., Liu, Y., Zhang, Y. (2016). Entrepreneurs with Christian Values, Handbook for 12 Modules. Geneva: Globethics.net.
14. Cipoletti, C. (2013). Three Steps in the Ethical Decision-Making Process. Retrieved February 8, 2013, from http://www.ehow.com/info_8752987_three-steps-ethical-decisionmakingprocess.html.
15. Colquitt, J. A., Scott, B. A. and LePine, J. A. (2007). Trust, Trustworthiness, and Trust Propensity: A Meta-Analytic Test of Their Unique Relationships with Risk Taking and Job Performance. Journal of Applied Psychology, 9(4), 909–927.
16. Di Lorenzo, V. (2007). Business ethics: Law as a determinant of business conduct. Journal of Business Ethics, 71(3), 275–299. http://doi.org/10.1007/s10551-006-9139-9
17. Di Miceli da Silveira, A. (2013). The Enron Scandal a Decade Later: Lessons learned? Homo Oeconomicus, 30(3), 315–347. https://doi.org/10.2139/ssrn.2310114.
18. Drucker, P. (1981). What is business ethics? National Affairs, 63, 18–36.
19. Feiser, J. (2003). Ethics. The internet encyclopedia of philosophy. http://www.utm.Edu/research/iep/e/ethics.htm/ (accessed November 7, 2017).
20. Fortune (2016). Nestlé’s Half-Billion-Dollar Noodle Debacle in India. Retrieved (15th Nov 2017) from: http://fortune.com/nestle-maggi-noodle-crisis/
21. Fortune (2016). The 5 Biggest Corporate Scandals of 2016: Retreived Online (3rd Nov 2017) from: http://fortune.com/2016/12/28/biggest-corporate-scandals-2016/
22. Ghazi-Tehrani, A. K., & Pontell, H. N. (2015). Corporate crime and state legitimacy: the 2008 Chinese melamine milk scandal. Crime, Law and Social Change, 63(5), 247–267. https://doi.org/10.1007/s10611-015-9567-5
23. Goergen, M. (2012). International corporate governance. Englewood Cliffs, NJ: Prentice-Hall.
24. Grebe, S. K. (2013). The importance of being genuinely sorry when organizations apologize: How the Australian Wheat Board (AWB Limited) was damaged even further by its response to a corporate scandal. Journal of Public Affairs, 13(1), 100–110. https://doi.org/10.1002/pa.1450.
25. Haniffa, R. & Hudaib, M. (2007). Exploring the Ethical Identity of Islamic Banks via Communication in Annual Reports. Journal of Business Ethics, 76(1), 97-116.
26. Hindery, R. (1978). Comparative Ethics in Hindu and Buddhist Traditions. New Delhi: Motilal Banarsidas.
27. Hotten, R. (2015). Volkswagen: The scandal explained. BBC News, pp. 1–14. Retrieved from http://www.bbc.com/news/business-34324772.
28. Iannaccone, Laurence R., Finke, R. and Stark, R. (1997). Deregulating Religion: The Economics of Church and State. Economic Inquiry, 35(2), 350-364.
29. Jamal A. B. (2001). Islamic Business Ethics. Saint Mary’s University, Halifax, N.S., Canada. DOI: 10.5840/spiritgds200127. Retreived (9th Nov 2017) from: https://www.researchgate.net/profile/Jamal_Badawi/publication/268002558_Islamic_Business_Ethics/links/5622edda08aed8dd19441573/Islamic-Business-Ethics.pdf?origin=publication_detail&ev=pub_int_prw_xdl&msrp=oel1h9beoV8dj_EqH-t4TTLquoILR2CYb9iH1EE9GzuEmSujpcBWA9d1ESw3ELbQ0sbvnyZATs_iLMhStirt8HudkoIevabUNuZo8D3FI-huk-34WE1BpDzC.nuZlvKNywXD6XyuVkg6PO2QahdGUJtmAkLQqlURZyIhp–z_SpiD5F9vBbyGeCMaQ2wtyWFprkHBI49WgdkuOhzYEoZSx_CAV8ZICA.-NRbbcWLbFRxSY6oNcMlmcYrR-dK9Ri9PSJeUPf4Fs6V66qPIIZbglGtBmiC-DlnpCJBuRbCCWEEfxseAIhWi_1PiArU1hJnJs89aw.01UtCJh5_J76vANzWniB0DVXY2MtjuygiOI8KjhVfGjo72xIClAFOm_39LK4a3YA-kYtCG3fGSUDoUErV2MbgAARbU-DAWGNeCL3zA.
30. Jawed, A. M. (2013). A Conceptual Framework of Business Ethics in Islam. Handbook of the Philosophical Foundations of Business Ethics. pp 899-932. DOI: 10.1007/978-94-007-1494-6_5
31. Jhingan, M. L., Girija, M., Manimekalai, A. & Sasikala, L. (2006). History of Economic Thought. Delhi: Vrinda Publications.
32. Jones, G. R. & George, J. M. (2009). Contemporary Management (6th Edition). New York: McGraw Hill.
33. Jong, A. de, DeJong, D. V., Mertens, G., & Roosenboom, P. (2005). Royal Ahold A Failure of Corporate Governance an Accounting Scandal. CentERO, 57, 1–57. https://doi.org/10.2139/ssrn.663504.
34. Kazuo, M. (2015). Toshiba Accounting Scandal Highlights Issues in Corporate Governance. Retrieved from http://www.nippon.com/en/in-depth/a04802/.
35. Keshavadass, S. (1978). Liberation from Karma and Rebirth. Bombay: Bharathiya Vidhya Bhavan.
36. Kural (n.d.). Project Madurai 1999. Retrieved from: http://www.projectmadurai.org/pm_etexts/pdf/pm0017.pdf.
37. Mews, C. J., & Abraham, I. (2006). Usury and Just Compensation: Religious and Financial Ethics in HIstoriacal Perspective. Journal of Business Ethics , 1-15.
38. Miwa, Y. (2006a). Institutional investors and corporate governance. In N. Demise, Y. Miwa, M. Nakabayashi, & Y. Nakoshi (Eds.). Corporate governance in Japan—From the viewpoints of management, accounting and the market pp. 31–38. Tokyo: Springer. http://dx.doi.org/10.1007/978-4-431-30920-8_4.
39. Mohammed B. Hemraj (2004). Preventing corporate scandals. Journal of Financial Crime, 11(3), 268-276. https://doi.org/10.1108/13590790410809202.
40. Muhammad, M. Z., Ilias, A., Ghazali, M. F., Abdullah, R. C., & Amin, H. (2008). An Analysis of Islamic Ethics in Small and Medium Enterprises (SMEs). UNITAR E-journal, 4, 46-58.
41. Mulki J. P., Jaramillo, J. F. and Locander, W. B. (2009). Critical Role of Leadership on Ethical Climate and Salesperson Behaviors. Journal of Business Ethics, 86(2), 125–141.
42. Papazafeiropoulou, A., & Spanaki, K. (2016). Understanding governance, risk and compliance information systems (GRC IS): The experts view. Information Systems Frontiers, 18(6), 1251–1263. https://doi.org/10.1007/s10796-015-9572-3.
43. Pavlovich, K., Sinha, P. N., & Rodrigues, M. (2016). A qualitative case study of MNE legitimacy: The Fonterra-Sanlu IJV corporate milk scandal in China. International Journal of Emerging Markets, 11(1), 42–56. https://doi.org/10.1108/IJoEM-02-2014-0018
44. Ranganathan, S. (2007). Ethics and the History of Indian Philosophy. Delhi: Motilal Banarsidass.
45. Rhodes, C. (2016). Democratic Business Ethics: Volkswagen’s Emissions Scandal and the Disruption of Corporate Sovereignty. Organization Studies, 37(10), 1501–1518. https://doi.org/10.1177/0170840616641984.
46. Rokeach .M. (1973). The Nature of Human Values, pp. 5-6. New York: The Free Press.
47. Russell, G. W. (2015). Will Toshiba’s scandal bring about the change needed in corporate governance? GAA Accounting. Retrieved from http://www.gaaaccounting.com/toshiba-scandal-corporate-governance.
48. Sammi, C. (2013). Corporate Social Responsibility: Definition and Examples. Www.Businessnewsdaily.Com. Retrieved from http://www.businessnewsdaily.com/4679-corporate-social-responsibility.html.
49. Shailer, G. (2004). An introduction to corporate governance in Australia. Sydney: Pearson Education Australia.
50. Simpson, J. A.(2007). Psychological Foundations of Trust. Current Directions in Psychological Science, 16(5), pp. 264–268.
51. Tayan, B. (2016). The Wells Fargo Cross-Selling Scandal. Stanford Closer Look Series. Retrieved from https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2879102.
52. Trak (2016). Top 10 Corruption Scams in India. Retrieved (13th Nov 2017) from: http://trak.in/2010/top-10-corruption-scams-scandals-india/.
53. Tricker, A. (2009). Essentials for board directors: An A-Z guide. New York: Bloomberg Press.
54. Walker, K. (2010). A Systematic Review of the Corporate Reputation Literature: Definition, Measurement, and Theory. Corporate Reputation Review, 12(4), 357–387. https://doi.org/10.1057/crr.2009.26.
55. Wolfgang, J. (2009). The Impact of Religion on Values and Behavior. Kwansei Gakuin University. Graduate School of Sociology, Nishinomiya, Japan. Accessed (6th Nov 2017) from: https://www.kwansei.ac.jp/s_sociology/attached/6511_53856_ref.pdf.
56. Yousri, A. R. (2005). Sustainable Development: An Evaluation of Conventional and Islamic Perspectives. In M. Iqbal, Islamic Perspectives on Sustainable Development, pp. 22-57. New York: Palgrave Macmillan.
57. Zingales, B. L. (2004). Want to Stop Corporate Fraud? Pay Off Those Whistle-Blowers. Business, pp. 2–4. Retrieved from http://savingcapital.server101.com/corpfraud.pdf.
58. Zona, F., Minoja, M., & Coda, V. (2013). Antecedents of Corporate Scandals: CEOs’ Personal Traits, Stakeholders’ Cohesion, Managerial Fraud, and Imbalanced Corporate Strategy. Journal of Business Ethics, 113(2), 265–283. https://doi.org/10.1007/s10551-012-1294-6.