Cultural variations and ethical business decision making: a study of individualistic and collective cultures

Abstract

Purpose This study aims to examine the ethical beliefs and moral philosophical typologies, the relative effect of religiosity on personal ethical beliefs and behavior of the collectivist and individualistic business executives. Design/methodology/approach This research assesses the relative impact of significant cultural factors on the business ethical decision-making process in a Western and individualistic cultural context (the USA) in comparison to a non-Western and collective cultural context (Morocco). To understand how cultural variations influence business ethical practices, this study adopts Hofstede’s cultural framework for comparison of business executives’ ethical decisions within a cross-cultural context. Hypotheses are tested on survey data on 172 business executives. Findings Results show that most collective business executives are “Situationists”. The findings reveal a strong, positive relationship between business managers’ religiosity and their idealism degrees. This study also reveals mixed findings in examining the correlation of religiosity with various components of ethical intentions. Research limitations/implications The link between religiosity and ethical intentions needs to be viewed with caution. This calls for expanding the scope of this study into other cultures and religions. Practical implications Differences of the findings in ethical typologies between collective and individualistic business executives may lead to different negotiation styles on ethical business decisions and issues. Managers from a collective culture are not as likely to exhibit much change in their initial ethical orientation(s). There is a strong positive relationship between a business manager’s religiosity and his/her degree of idealism. Thus, the more religious business managers are, the more Absolutist they are when making ethical and moral judgments. Originality/value This research works to fill the gap by examining the impact of culture on the business/marketing ethical decision-making processes within the contexts of a Western cultural and developed nation and a non-Western cultural, and developing/Mediterranean/North African nation. The findings clarify the influence of culture on business ethical decisions. Such an understanding can assist corporate managers in developing and successfully implementing business ethical codes that lead to enhanced moral conduct in their organizations.