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Home Ideas Library Changing Attitudes to Business Ethics: Insights from South Africa

10.13007/319

Ideas for Leaders #319

Changing Attitudes to Business

Ethics: Insights from South Africa

Key Concept

The past 20 years or so have seen a marked change in attitudes towards

ethics among South African business-school students. Recent MBA graduates

have stronger opinions on what is ‘wrong’ and what is ‘right’ business

behaviour and are more likely to think in terms of moral absolutes. This has

significant implications for business schools and educators — and for

companies and employers.

Idea Summary

Recent decades have seen increased focus on corporate governance and

business ethics — and an increased number of ethics-based courses at

business schools. While this is true of countries across the world, South Africa

can be considered a special case.

In South Africa, dramatic changes to the corporate governance regime have

coincided with — and, indeed, reflected — dramatic political, social and

economic change. The seminal King Report on Corporate Governance, first

published in 1994, when South Africa was re-admitted to the global ‘economic

system’, and last revised in 2009, has been accompanied by Affirmative

Action and Broad Based Black Economic Empowerment (BBBEE) initiatives to

transform the demographic make-up of management teams.

Business ethics in South Africa are, then, worthy of special study.

A recent paper from the Gordon Institute of Business Science (GIBS)

addresses two key questions: “How have attitudes towards business ethics of

business students changed between the early 1990s and 2010?” and “What

aspects of business ethics need to be addressed the most urgently by

business schools and business practitioners?”

The authors, Gavin Price and Andries Johannes van der Walt, look at two

student cohorts, one from Rhodes University and one from GIBS, separated

by a gap of more than 16 years. Their main research instrument is the

Attitudes Towards Business Ethics Questionnaire (ATBEQ), an assessment

tool developed in 1989. Based on the Likert scale (the five-point scale that

usually ranges from ‘strongly agree’ to ‘strongly disagree’), ATBEQ includes

some 30 statements that test not only for attitudes towards business ethics in

general but also for personal moral values.

Comparing the two samples, they find significant changes in responses. The

‘centre of gravity’ shifts radically from ‘generally agree’ to ‘generally disagree’

for two key statements: “As a consumer when making an auto insurance

claim, I try to get as much as possible regardless of the extent of the damage”

and “Employee wages should be determined according to the laws of supply

Authors

Price, Gavin

Andries Johannes

Institutions

University of Pretoria Gordon Institute of

Business Science

Source

Journal of Business Ethics

Idea conceived

March 2013

Idea posted

February 2014

DOI number

Subject

Business Ethics

Emerging Leaders

Executive Development

Emerging Markets

Global Operations

and demand”.

Many other responses also show a strengthening of attitude: people from the

later sample, from GIBS, tended to agree more or disagree more with the

questions than people in the earlier sample of Rhodes graduates.

Underlying this shift, what’s more, is something more fundamental. Further

analysis finds evidence for two other changes: a move towards utilitarianism

(the belief in the ‘greatest good for the greatest number’) and a strong trend

towards teleological moral philosophy, which focuses on the end result of an

action, rather than its intrinsic virtue. Put very simply, the GIBS students

seemed more inclined towards absolutism and they also seemed to resist the

‘virtue-is-its-own-reward’ approach that characterises deontological (duty-

focused) philosophy.

The results may be described as ‘mixed news’. While they bode well for the

implementation of new business-oriented legislation and codes such as the

2009 King Code, which require companies, as corporate citizens, to commit to

and follow socially acceptable practices, they also point to potential risks. The

move towards utilitarianism could result in a compliance-driven approach in

which what’s legal is mistaken for what’s ethical. The move towards a more

absolutist attitude, meanwhile, could suggest a naive or simplistic approach to

complex and subtle moral issues and dilemmas.

Business Application

Answering their second research question, the authors say it is important for

business schools and educators to “reinforce their focus on two of their

goals”.

Firstly, they must ensure they “create an effective level of understanding of a

broad range of ethical philosophies and approaches, both relative and

absolute, that may be applied in the ever-changing complex business

context.”

Secondly, they must take what could be termed a ‘principles-based’ approach,

ensuring that the reasons for any rule or regulation are understood and

considered in the ethical decision-making process, and that students progress

beyond rudimentary levels of ‘cognitive moral development’.

From this, we can infer a golden rule for the design of business courses and

executive development programmes: know your students and the context they

work in. Companies will want to check that ethics courses offered by external

providers — and their own training and mentoring schemes — follow this rule.

More broadly, the research has implications for the recruitment and retention

of employees. It’s further evidence that the ‘brightest and the best’ won’t want

to work for a company that flouts best-practice codes or has a bad reputation.

The expectations of employees have been raised — and companies are

under increasing pressure to meet them.

Further Reading

Changes in Attitudes Towards Business Ethics Held by Former South

African Business Management Students. Gavin Price & Andries

Johannes van der Walt. Journal of Business Ethics (March 2013).

Further Relevant Resources

Gavin Price’s profile at The Gordon Institute of Business Science

Andries Johannes van der Walt’s profile on LinkedIn

The Gordon Institute of Business Science’s profile at IEDP

© Copyright IEDP Ideas for Leaders 2014

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