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From Inaction to External Whistleblowing: The Influence of the Ethical Culture of Organizations on Employee Responses to Observed Wrongdoing

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  • Kaptein, S.P.

Abstract

Putting measures in place to prevent wrongdoing in organizations is important, but detecting and correcting wrongdoing is just as vital. Employees who observe wrongdoing should therefore be encouraged to respond in a manner that supports corrective action. This paper examines the influence of the ethical culture of organizations on employee responses to observed wrongdoing. The findings show that, contrary to transparency and congruency of management, many other dimensions of ethical culture were negatively related to inaction and external whistleblowing and positively related to direct interven-tion, reporting to management and calling an ethics hotline. The model used for ethical culture explained 27.5% of intended responses by employees.

Suggested Citation

  • Kaptein, S.P., 2009. "From Inaction to External Whistleblowing: The Influence of the Ethical Culture of Organizations on Employee Responses to Observed Wrongdoing," ERIM Report Series Research in Management ERS-2009-047-ORG, Erasmus Research Institute of Management (ERIM), ERIM is the joint research institute of the Rotterdam School of Management, Erasmus University and the Erasmus School of Economics (ESE) at Erasmus University Rotterdam.
    • Handle: RePEc:ems:eureri:16600
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    File URL: https://repub.eur.nl/pub/16600/ERS-2009-047-ORG.pdf
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    References listed on IDEAS

    as
    1. Gary Rothwell & J. Baldwin, 2007. "Ethical Climate Theory, Whistle-blowing, and the Code of Silence in Police Agencies in the State of Georgia," Journal of Business Ethics, Springer, vol. 70(4), pages 341-361, February.
    2. Karpoff, Jonathan M. & Lee, D. Scott & Martin, Gerald S., 2008. "The Cost to Firms of Cooking the Books," Journal of Financial and Quantitative Analysis, Cambridge University Press, vol. 43(3), pages 581-611, September.
    3. Marcia Miceli & Janet Near & Terry Dworkin, 2009. "A Word to the Wise: How Managers and Policy-Makers can Encourage Employees to Report Wrongdoing," Journal of Business Ethics, Springer, vol. 86(3), pages 379-396, May.
    4. Harold Hassink & Meinderd Vries & Laury Bollen, 2007. "A Content Analysis of Whistleblowing Policies of Leading European Companies," Journal of Business Ethics, Springer, vol. 75(1), pages 25-44, September.
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    More about this item

    Keywords

    ethical culture; ethics hotline; reporting; whistleblowing; wrongdoing;
    All these keywords.

    JEL classification:

    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • G3 - Financial Economics - - Corporate Finance and Governance
    • M - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics
    • M14 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Corporate Culture; Diversity; Social Responsibility

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