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Ethics in Declining Organizations

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  • Lemke, Dwight K.
  • Schminke, Marshall

Abstract

This paper explores the relationship between declining organizations and unethical behavior. Data from a four month long management simulation indicate that declining organizations demonstrate a greater propensity for unethical activities than do more successful companies. The results indicate that: 1) organizations in decline are more likely to be involved in unethical activities; 2) the more severe the decline is, the more unethical the behavior is likely to be; and 3) it is organizational decline and not initial propensities toward unethical conduct that explains the unethical behavior. The paper also discusses the implications of these findings and outlines future streams of research.Honesty is the best policy - When there is money in it. - Mark Twain

Suggested Citation

  • Lemke, Dwight K. & Schminke, Marshall, 1991. "Ethics in Declining Organizations," Business Ethics Quarterly, Cambridge University Press, vol. 1(3), pages 235-248, July.
    • Handle: RePEc:cup:buetqu:v:1:y:1991:i:03:p:235-248_00
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    Cited by:

    1. Justin Davis & G. Tyge Payne & Gary McMahan, 2007. "A Few Bad Apples? Scandalous Behavior of Mutual Fund Managers," Journal of Business Ethics, Springer, vol. 76(3), pages 319-334, December.
    2. Kevin J. Johnson & Joé T. Martineau & Saouré Kouamé & Gokhan Turgut & Serge Poisson-de-Haro, 2018. "On the Unethical Use of Privileged Information in Strategic Decision-Making: The Effects of Peers’ Ethicality, Perceived Cohesion, and Team Performance," Journal of Business Ethics, Springer, vol. 152(4), pages 917-929, November.
    3. Chanhoo Song & Seung Hun Han, 2017. "Stock Market Reaction to Corporate Crime: Evidence from South Korea," Journal of Business Ethics, Springer, vol. 143(2), pages 323-351, June.

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