National, Organizational, Individual and Cultural Correlates of Ethical and Socially Responsible Behaviour

Corruption in China - is it about Culture?

The 18th National Congress of the ruling Communist Party of China that was held in November 2012 again addressed the urgency and significance of fighting corruption. (China Daily, 2013, p. 7)

In a recent interview for China Daily, experts responded to the question as follows:.

Question: 'Some experts said that China’s Confucian culture and deeply rooted family ties make officials prone to corruption compared to their foreign counterparts. Do you think there is any relationship between traditional Chinese culture and corruption?’

In Western countries, people live by contracts - even if a father gives his son some property, there will be a contract. But in China, people trust family without a contract. Many corrupt officials buy apartments under the name of their children or their relatives, which is difficult for the antigraft authorities to investigate. (Zhou Shuzhen, Professor of Politics at Renmin University of China)

There are a large number of officials whose spouses, children and secretaries and drivers were found to be involved in corruption. That some officials’ family members have become part of corruption has caused great harm to society. This also makes it difficult for supervision agencies to collect evidence. China has traditional ideas, such as being loyal and righteous, which to some extent informs the relationship between corrupt officials and their staff. (Jiang Ming’an, Professor of Law at Peking University)

It is too simple to say some countries’ cultures are good or bad and it is not right to define East Asian culture, or Confucianism, as easily corrupted. Confucianism indeed has some old ideas that may harm efforts to stamp out corruption, which needs to change. Cultures must be updated and develop with society. (He Zengke, Researcher at the Central Compilation and Translation Bureau)

I don’t think there is any relationship between traditional Chinese culture and corruption and it is not necessary to put the two together. In the past, China had clean governance, so we cannot say corruption is caused or affected by a culture of Confucianism. If a country has good supervision system, corruption would be gready curbed. (Ma Huaide, Professor of Law at China University of Political Science and Law)

I know someone said the so-called ‘relation’ and ‘face’ issues in East Asian cultures may lead to corruption, but we should take note that other areas with similar culture, including Hong Kong and Singapore, have made achievements towards stamping out corruption. We cannot lose confidence. (Ren Jianming, Director of Beihang University’s Clean Governance Research and Education Center)

At the national level, unethical and socially irresponsible conduct is likely to occur in ‘weak governance’ zones. In such contexts, there are regulatory oversights, low levels of civil and criminal liabilities, inability of law enforcement and insufficient compliance and corporate governance systems (Huber-Grabenwarter and Boehm, 2009, p. 47). There is some evidence to link a high level of corruption to lower rates of economic growth, lower level of per capita income and smaller amounts of foreign direct investment (e.g., UNDP Report, 2001). There is also evidence to show that managers in wealthier countries are slighdy more likely to take CSR issues into account in their decision-making compared to those in poor countries (McWilliams and Siegel, 2001).

At the organizational level, there is a positive association between CSR activities and firm size and resources. Large and financially secure organizations are found to be more inclined to engage in CSR activities (Sotorrio and Sanchez, 2008; Zu and Song, 2009). However, organizations that put high pressure on their managers to enhance the bottom line by increasing profits and reducing costs are more likely to engage in unethical behaviour (McNett and Sondergaard, 2004; Schneider and Barsoux, 2003).

Some scholars argue that in the organizational life cycle, organizations go through stages of moral development (Reidenbach and Robin, 1991). The first stage is the amoral stage where the organization believes that a conduct is ethical as long as it is not caught. In such organizations there is no code of conduct. Organizations at the second stage are legalistic and play with the legal rules. The code of ethics in such organizations is an internal document guiding people not to do anything to harm the organization. The responsive organization in the next stage acts not only on a legal basis, but also on a basis that would satisfy other corporate stakeholders. There is concern for economic output and a belief that 'ethics pays’. Organizations at the fourth stage have an emerging ethical orientation. They want to do the right thing but lack long-term strategic planning for that. At the most advanced stage, organizations are ethical. They develop strategic plans based on SWOT analyses - strenghts, weaknesses, opportunities, threats - that anticipate ethical problems and produce alternative outcomes accordingly. Organizational documents at all levels focus on ethical profile and reflect core values.

At the individual level, managers’ values and cognitive moral development (the mental process of deciding what is right or wrong) are considered as factors associated with the likelihood of ethical and socially responsible behaviour. Some authors argue that managerial values are more important than organizational and national-level factors. For example, high integrity as a personal value and vision as a managerial trait are positively associated with ethical and socially responsible behaviour (e.g., Waldman et al., 2006). As apdy put by McNett and Sondergaard (2004, p. 166) ethical decision-making for global managers require ‘traits of integrity, humility, inquisitiveness and hardiness; the attitudes and orientations of cognitive complexity and cosmopolitanism; the interpersonal skills of mindful communication and creating and building trust; and the systems skills of boundary spanning and building community through change’.

At the cultural level, there is a growing body of literature associating ethics and social responsibility with cultural values.

  • • A recent excellent meta-analysis found that individualism and uncertainty avoidance are associated with high likelihood of avoiding unethical behaviour, whereas power distance and masculinity are associated with low likelihood of the same (Taras et al., 2010). That is, people avoid unethical behaviour to a greater extent in cultures that value individualism and certainty. People avoid unethical behaviour to a lesser extent in cultures that value hierarchical social order and achievement and affluence.
  • • Cultural tightness-looseness, defined as the strength of social norms and tolerance for deviant behaviour, is also associated with tolerance for immoral behaviour (Gelfand et al., 2011). Tight societies tend to adhere to moral conventions and rules and have criminal justice institutions with higher monitoring and more severe sanctioning. Gelfand and colleagues (2011) found that people in tight societies considered morally charged behaviour (e.g., cheating) less justifiable.
  • • In particularistic cultures, application of ethical rules depends on the person, situation, task, urgency and so on, whereas in universalistic cultures, application of ethical rules depends less on the circumstances. For example, in an experiment Chinese executives’ level of ethical reasoning depended on the nature of the dilemma, while this was not the case for US executives (Fleming et al., 2010).
  • High-context cultures prefer ethical rules to be stated explicitly (e.g., a book on codes of conduct, lists of principles posted on the company walls), while low-context cultures resent such explicit statements and consider them unnecessary or rude:

I resent having notions of right or wrong boiled down to a checklist. I come from a nation whose ethical traditions date back hundreds of years. Its values have been transmitted to me by my church and through my family. I don’t need to be told by some American lawyer how I should conduct myself in my business activity. (Schneider and Barsoux, 2003, p. 305)

• High power-distance is associated with less concern for CSR, whereas high institutional collectivism is associated with more concern for CSR (Waldman et al., 2006). Managers in cultures valuing collectivism at the institutional level tolerate delaying of gratification (e.g., profits) for the well-being of the society. Managers in cultures valuing high power-distance seem to focus on self-promotion and satisfaction for shareholders, but lack concern for multiple stakeholders including the larger society.

 
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