Ethics in Budgetary Decision Making

Ethics in Budgetary Decision Making
Submitted by

By:
James Crowson, Christina Prejean,
Jason Watkins & Leslie VanBuskirk,

PSC 5950
Advanced Programs
The University of Oklahoma

To:
Dr. Aimee Franklin
November 19, 2010

1

Ethics in Budgetary Decision Making 2

Abstract

Untold public resources are inappropriately used every year due
to the budgetary decisions made by the personnel of public and
nonprofit agencies. These actions range across varying degrees
of unethical behavior. At times it is perceived harmless acts
undertaken for personnel convenience; and others it is a
conscience choice to obtain funds for personal gain. Public
administrators have an obligation to combat the unethical, and
often illegal, use of public monies by their staff.

The research project undertaken by this team seeks to determine
if formal ethics training causes individuals to adopt the
budgetary behavior prescribed by the organization which
employees them. This research was carried out as a part of a
larger study lead by Dr. Aimee Franklin at the University of
Oklahoma.

The ethics segment of the project included four Solomon groups.
The first group received a pre-test, intervention and post-test
(O E O).

The second group was surveyed using the pre-test and post-test
(O _ O).

The third group received the intervention and post-test (_ E O).

The fourth group was given the post-test only (_ _ O). Our
findings indicate that formal ethical training has little or no
impact on individual choices. In some instances statistical data
indicates a negative correlation.

The data suggest that individual ethical standards are a much
stronger predictor of ethical behavior than are other
independent variables.

Further research is warranted to discover and implement the most
effective means of guiding budgetary decisions along ethical
standards.


Introduction

Frequent newspaper headlines alert the public to the
inappropriate actions of employees of public or nonprofit
organizations. The resulting loss in public support erodes the
trust necessary for such organizations to effectively carry out
their missions. Effective means to guide ethical budgetary
decision making remains an elusive goal of many organizations.
Conversely, attempts to thwart such behavior can lead to
cumbersome procedures which hamper the attainment of mission
critical objectives within the organization.

These high profile cases are inflammatory to the public but are
carried out by a small percentage of the workforce of any
organization. Employees of public and nonprofit entities face
constant pressure to avoid headline making incidents. The
cumulative total of daily, problematic, budgetary decision
making procedures causes organizations to surrender significant
resources to the questionable choices of their employees.

Ongoing research seeks to find the most effective forms of
curbing inappropriate behavior and guiding the actions of
employees to the desired choices of the organization. Several
methodologies are suggested: appealing to the ethics of
individuals, developing an organizational culture where the
expectations are for employees to follow the desired path, and
punitive actions that deter the undesirable behavior. This
research seeks to add to the cumulative data on ethical
budgetary decision making.

The fundamental question we sought to answer through the
execution of this research study was, “Does organizational
ethics training and education change behavior and attitudes of
individuals in the workplace?”

The goal for this research was to discover if ethical
interventions cause employees of an organization to act in an
ethical manner when faced with budgetary questions in the course
of their official duties. A research study was undertaken to
measure the responses of survey participants to various
budgetary questions and rate their indicated conformation to
organizational expectations.

Additionally, groups were established to determine if the
ethical intervention administered positively impacted the
outcome of participant responses. Our goal for carrying out this
research was to identify effective means of guiding behavior to


adhere to organizationally desired courses of action. As a
result, organizations would be spared countless sums of
resources lost to unethical decisions made by their employees
and the public embarrassment caused by the headline making
incidents that occur as a consequence of those decisions.

Literature Review

Introduction

This chapter discusses background information to the study of
ethics and integrity. Next, we provide definitions of ethics and
integrity. Third, we define unethical behavior. Finally, we
review ethical training for ensuring ethical behavior. This
review provides some previous research in the large theoretical
framework of ethics and integrity, as well as narrowly tailoring
this vast field within the smaller context of public
organizational behavior.

The types of publications reviewed are numerous peer-reviewed
journal and academic magazine articles. These articles come from
an exhaustive systematic literature review (SLR) that involved
discovery and a series of decisions to find appropriate
literature. Several electronic sources accessed are as ERIC,
EBSCOhost, Social Science Research Network, ArticleFirst,
ABI/FORM, Google Scholar, et cetera. Only literature obtained
through these and similar sources were included.

Background

Just the mention of ethics and integrity communicates attitudes
and feelings ranging up and down a full spectrum of positive and
negative emotions. Perhaps positive emotions result because
people who keep their word honor themselves and their employers
with good, productive results on the job. On the other hand,
perhaps a manager feels the cringe of uneasiness when
recollecting an occasion when an employee stole inventory,
money, or something relatively benign as leaving just a little
early and fudging on their timesheets. Ethics and integrity are
two hugely important terms discussed and debated both by the
greatest philosophers of recorded history and employees around
the morning coffee pot.

In virtually any context, one may ask if attitudes toward the
propensity to engage in unethical behavior differ among those
who are ethical and those who are not. How is ethical or
unethical behavior understood? Is unethical behavior becoming


more acceptable? Is unethical behavior a reflection of one‟s
sex, race, class, and age? We reviewed the literature to learn
more about how to begin answering these questions.
Many times the values of today‟s society are not the same as
they were just a couple of years ago. Certainly, companies and
organizations struggle with these issues constantly. Because
employees are individuals with relative viewpoints on what is
right and wrong, they bring with them this relativity and may
behave in ways contrary to what the organization wants. Clearly,
what is at the center of the discussion on how to get people to
do what they is expected of them is differing views of larger
concepts of morality. Let us turn out attention to understanding
these issues within the larger framework of ethics.

Definitions

Ethics

Many people make the mistake of assuming that ethics and
integrity are one in the same. Actually, they are quite
different and the distinction is important. Jensen (2009)
defines ethics as societal standards of right and wrong both for
groups and individuals that are in a society (p. 16). This
rather simplistic definition does not explain how it might
tackle tasks or what “standards” might mean. According to
popular convention, just because something is right or wrong in
one society, does not necessarily require that it is right or
wrong in a different society.

Although one may agree with Jensen up to a point, it is
difficult to accept completely his definition of ethics because
it fails to develop a standard by which one may compare right
and wrong. Research by Stansbury (2009) shows practices
acceptable in one place and time in history morph into practices
outlawed after a period of struggle. One example is American
child labor practices in the early twentieth century. There was
a time when governments and businesses saw nothing wrong with
child labor and glossed over the problems that came with such
practices. Stansbury argues for discourse ethics, that branch of
ethics that provides a “framework for evaluating and resolving
moral claims that stem from differing normative bases” (p. 34).

Fieser (2009) goes further than Jensen (2009) and Stansbury
(2009) and offers a far more interesting, comprehensive, and
promising definition of ethics. He discusses ethics in terms of
meta-ethics, applied ethics, and normative ethics. Meta-ethics
is a quest to know the source of morality. For example, do


civilizations create codes of conduct to regulate behavior
within either the framework of an evolutionary worldview?
Alternatively, does morality originate in a Supreme Moral Law
Giver? Meta-ethics wrestles with these questions.
Applied ethics treats specific issues of moral grievances in
society. Particularly virulent and divisive societal problems
such as the moral issues surrounding abortion, the challenges of
taking care of the environment and being responsible stewards of
the planet, the rights of animals, the proliferation of nuclear
technology, infanticide and population control, homosexuality
and definitions of marriage, and capital punishment. According
to Fieser (2009), two ingredients are required for the applied
ethics definition: (1) controversy and (2) distinctly moral
issue.

Normative ethics, which is more in line with the intent of this
research, takes a more practical tact. Normative ethics means
coming to moral standards that regulate right and wrong values
and duties. It is the philosopher‟s ultimate search for an ideal
litmus test of proper behavior. This type of ethics incorporates
the Golden Rule concept that says, “Do unto others, as you would
have them do unto you”. Using this rule, an employee could infer
that they should do their work to the best of their ability,
because if the roles reversed, they would expect the same
(Fieser, 2009).

Integrity

Yukl and Van Fleet (1992) define integrity as a person's
behavior lining up seamlessly and consistently with espoused
values and that the person is honest and trustworthy (p. 151).
Becker (1998) says that this definition implies that integrity
and honesty are largely synonymous. A deeper analysis of
integrity will show that this is not necessarily so. He argues
that his colleagues have confused integrity with honesty and
conscientiousness.

Therefore, one of the most important contributions of Becker is
that integrity is not treated as a relativistic or neutral
phenomenon. He insists that integrity fits within a larger
framework of the philosophy of Objectivism (capital “O” by
Becker). His concept of integrity is extremely useful because it
sheds light on the difficult problem of understanding employee
behavior. He argues that integrity is clearly distinguished from
subjective ethical attitudes and opinions such as honesty and
conscientiousness and thus raises it to a higher level by
blending integrity into an objective moral code of values and


duties (Becker, p. 154).

Erhard, Jensen, and Zaffron (2009) demystify the confusion of
the meaning of integrity. They define integrity as “the
condition of being whole and complete and the necessary
condition for workability, and that the resultant level of
workability determines for an individual, group, or organization
the available opportunity set for performance” (p. 62). They
reduce their definition down to “keeping one‟s word”. In other
words, they assert that integrity is a person saying they will
do something by a certain time. In their view, integrity exists
apart from morality and ethics, and thus they make understanding
Becker‟s (1998) ideas easier. What is interesting about their
work is that they criticize the Golden Rule.

Recall from above that Fieser (2009) discussed normative ethics
in terms of the Golden Rule. Erhard et al. (2009) claim that the
Golden Rule falls short and has a lack-of-benefit track record.
They state that if people actually reciprocated, the world would
be a more peaceful and safer place. They explain its failure in
that people are reluctant to apply the rule without assurance of
reciprocity and perceived risks of being a “patsy”. While on the
surface, this definition may seem a bit elementary, the
advantages favor integrity over the Golden Rule. Erhard et al.
argue that integrity has no downside. Integrity is beneficial to
each person who behaves according to this standard and has a
tendency to propagate itself (p. 63).

When it comes to the topic of executive compensation, most of us
will readily agree that in many cases, at the very top, it tends
to appear exorbitant. In the recent work of the Ethics Resource
Fellows (2010), they offer harsh critiques of rewarding
integrity in the c-suite. They discuss this important aspect of
integrity when they write about the financial crisis in the fall
of 2008 highlighting the misconduct of top executives in the
private sector. Executives garnered bonus packages that enabled
pay minus the results. They argue that this sponsored unethical
behavior and produced an atmosphere of poor business strategies.
Companies that paid severance agreement bonuses created company
cultures devoid of integrity and instead decision-making based
on benefits incurred (p. 2).

Making decisions based on what the personal return on investment
(ROI) will be to oneself is certainly unethical behavior. Erhard
et al. (2009) strongly criticize the use of cost-benefit
analysis (CBA) to determining whether one will keep their word.
Using a CBA approach virtually guarantees that one will be


untrustworthy. Their analysis of this type of individual is at
the intersection of 1) honoring one‟s word and 2) unmitigated
opportunism. If Erhard et al. are correct, then we need to
reassess the popular assumption that lies at the heart of much
out-of-integrity and untrustworthy behavior in organizations (p.
2).

Defining Unethical Behavior

Jones‟ (1991) study defines unethical behavior as anything done
by a person within the larger framework of their society either
illegal or morally. Examples are lying, cheating, stealing,
assault, or battery, and any form of dishonesty or
unconscionable actions that go against mainstream societal
norms. Although some readers may object that intention is a
necessary component to any definition of unethical behavior,
Gino and Bazerman (2009) answer that intentionality is not
necessarily required for a definition to determine whether a
behavior is unethical.

Before we discuss intention in unethical behavior, let us look
briefly at Gino et al.‟s (2009: 1) research questions: 1) under
what conditions are people likely to ignore the unethical
behavior of others, and 2) where is the line between not
accepting any exception to ethicality and ignoring another
person‟s unethical behavior? Their answers are: 1) individuals
are more likely to accept unethical behavior if it occurs
gradually as opposed to abrupt unethical behavior; and 2) at
least a portion of the acceptance of unethical behavior is due
to in part to implicit bias (p. 708, 717).

Gino et al.‟s hypotheses are: 1) people are more likely to
accept the unethical behavior of others if the unethical
behavior develops gradually over time than if the unethical
behavior occurs abruptly; 2) people‟s propensity to accept
others‟ unethical behavior when ethical erosion occurs gradually
is partially the result of implicit biases that prevent
observers from noticing the erosion.

From their article, they offer a couple of stories about an
accountant to explain these hypotheses. In the first example, an
accountant audits the corporation‟s records for four years.
During the first three years, the accountant audits the records
without incident. Suddenly during the fourth year, there is
clear evidence of unethical and even illegal accounting
practices by the company. The accountant would not sign his name
to these practices. This is obviously the example about


abruptness.

In the second example, the scenario is more akin to Senge‟s
(1994) boiling frog syndrome. This is a matter of gradual
erosion in the accountant‟s recognition of his client‟s
unethical behavior because the corporation‟s unethical practices
occur over the span of four years (Gino et al., 2009, p. 717).

Figure 1 shows examples of abruptness and gradual erosion, which
explains these hypotheses. Their findings have important
implications for the broader domain of public and private
organizations in detecting, deterring, and reporting unethical
behavior.

4.5
4
3.5
3
2.5 Gradual Erosion
2
1.5 Abrupt Erosion
1
0.5
0
Year 1 Year 2 Year 3 Year 4

Fig. 1. The x-axis shows the number of years the accountant provides services. The y-axis measures the scale of
acceptability of erosion in others’ unethical behavior. The data are from “When misconduct goes unnoticed: The
acceptability of gradual erosion in others’ unethical behavior” by F. GinoEthical Behavior
Training and Controlling for and M. H. Bazerman, 2009, Journal of
Researchers have proposed several ways of ensuring sound
Experimental Social Psychology, 45, (4), 708-719.

ethical behavior in the workplace. These methods include ethics
training. West and Berman‟s (2004) posit the necessity of ethics
in public administrations. They say that the purpose of ethics
training is two-pronged: 1) to ensure that organizations avoid
embarrassing association with allegations of wrongdoing and 2)
to develop in employees tendencies and abilities to behave
morally and legally.

The method by which training occurs can be rudimentary or
consist of complex, progressive training modules. Their research
method was a 2002 national survey of cities. City managers and
chief administration officers in all 544 US cities having
populations of 50,000 or more residents received the survey.
They found that the mean amount of training was one-half day in
length. They also find that 43.5 percent of the cities surveyed
make ethics training mandatory. Finally, they find that usage
did not vary significantly by region or form of government, but


large cities were more likely to offer ethics training.

Conclusion

In summary, ethics and integrity has a place at any table of
academic discussion about public administration. We live in a
time when many people do not claim that there are any objective
standards of ethics and morality to which one may appeal.
Companies face serious problems head-on when employees who have
relative morale values and duties bring in their behaviors that
are inconsistent with the company‟s standards. This can manifest
itself as unethical behavior, and this is what many companies
today are trying to correct. They are implementing training
programs on ethics to try to affect the behavior that should be
innate and inherent in any employee already. Much more research
can be conducted to determine if training people to be ethical
and have integrity is effective.

Research Design

In the fall of 2010 several MPA students from the University of
Oklahoma researched the occurrence of ethical challenges with
regard to finances in public organizations. The intent was to
gain a better understanding of individual attitudes during
public budgetary decision-making. Public employees from across
the United States were surveyed to test the tendency of
employees to engage in unethical behavior in the workplace.
During the survey respondents were asked basic questions that
placed the respondent in a position to manipulate public funds
in some fashion. Several scenarios were setup that mimicked
common challenges that occur within public organizations.

The experiment setup is a Solomon 4 group project led by Dr.
Franklin at the University of Oklahoma. The project in general
consisted of 4 groups with three interventions: ethics, shared
values and deterrence. This segment of the Solomon 4 research
identifies the design of the „ethics‟ intervention component.
The four ethics related Solomon groups are:

Group 1: pre-test, intervention and post-test (O E O)
Group 2: pre-test and post-test (O _ O)
Group 3: intervention and post-test (_ E O)
Group 4: post-test only (_ _ O)

The pre-test gathers quantitative responses by asking the
participants to make a forced choice in three scenarios related
to complying with regulations governing the use of agency


provided credit cards. The topics of the three scenarios are:

1: Government credit card training
2: Misuse of government credit card
3: Travel expense management

Figure 1 is the ethics intervention that was utilized for groups
1 and 3.

Figure 1. ETHICS INTERVENTION

You work in the supply section of your unit, responsible for
purchasing inventory and maintaining records for all employee-
uniform items received. The uniform item inventory is valued at
$200,000.
Each employee in the supply section is required to attend a
training course. At the training course, they emphasize that the
supply officers are discouraged from taking items that they will
use personally; instead they should have another supply officer
fill their requests for personal uniform items. The reason that
supply officers do not get their own uniform items is to avoid
the appearance of special privileges.
At the end of the training, each supply officer signs a document
affirming their understanding of and willingness to comply with
the rules and regulations that pertain to the supply section.
The organization does this to make sure employees will keep an
accurate inventory of employee-uniform items and make sure they
are not given out inappropriately.

The post test contains five scenarios that asked respondents
what action they would take and why. These scenarios ranged from
easier to identify “right and wrong” choices to insidious “gray
area” right or wrong choices. The scenarios increased progressed
in severity and ambiguity with Sc5 being the clearest and Sc8
the most vague. The general topics of the scenarios are:

4: Unintentional purchase of personal items with
organization tax-exempt account
5: Personal procurement of work related clothing
(boots) without explicit need
6: Misuse of organizational trip fund for personal
benefit
7: Non-authorized emergency repair expenditures
8: Fiscal year closeout wasteful spending

The surveys were completed anonymously through use of “Survey
Monkey”, an online research tool. A consent waiver was provided


upon entry into the website. The participants in Solomon 1 & 2
completed the pretest, while 1 & 3 received the intervention,
and all groups completed the post test. Eighteen Likert response
questions were included at the end of the posttest to ascertain
participant‟s propensity to engage in immoral behavior. Finally,
basic demographic questions were asked of all the participants.

Researchers within the project were split up into groups
separated by the intervention and Solomon group (8 groups in
all). Again, the focus of this paper is on the ethics component.
The „ethics‟ component of group three consists of the following
documents: example email, pre-test consent form, ethics
intervention, and post test. Surveys including the pre-test,
ethics intervention and post-test were sent out electronically
utilizing the survey website www.surveymonkey.com. Surveys were
sent out with the following protocol:

1. All surveys were sent out via email so that the
respondents could reply anonymously.
2. No respondents were compensated for their
contribution.
3. An official email sent from Captain W. Jason Watkins
(william.watkins3@acc.af.mil), United States Air
Force (USAF) F-15E Weapon Systems Officer (WSO),
333rd Fighter Squadron, Seymour Johnson Air Force
Base (AFB), North Carolina containing the link to
surveymonkey.com and an attachment with the consent
form to two official email distribution lists:
a. The “all officers list” for the 389th Fighter
Squadron and the “all Instructors” list for the
333rd Fighter Squadron.
b. The 389th Fighter Squadron consists of
approximately 70 officers, (roughly 34 pilots,
34 WSO‟s, 1 doctor, and 1 intelligence officer).
They are an operational squadron that employs
the F-15E Strike Eagle stationed at Mountain
Home AFB, Idaho.
c. The next squadron surveyed was the 333rd Fighter
Squadron, consists of approximately 50 pilots
and WSO‟s. They train newly winged aviators
how to fly and operate the F-15E.
d. Fighter Squadrons are uniquely comprised of 95%
officers. No Air Force enlisted personnel were
contacted.
e. Officers from both squadrons frequently are in
a position to make budget decisions for their
sections.


f. Note: USAF guidelines permit the use of
government email for solicitation for active
duty officer graduate surveys. This survey was
specific to Solomon group 3 (_E O) with the
ethics intervention.
4. An unofficial email was sent out from Jason Watkins
to 55 current public employees utilizing
“facebook.com”. These employees varied from local,
state and federal employees.
a. The post test only survey was sent out ((_ _ O),
Solomon 4 group).
5. An official email containing the same link
previously identified was sent from James Crowson
(US Navy, Retired) to >30 military/civilian
coworkers at Tinker AFB, Oklahoma.
a. This survey was part of the Solomon 1 group ((O
E O) pre-test, intervention, and post test).
6. An official email was sent from Leslie VanBuskirk to
the professional staff and administrative assistants
of the First Baptist Church of Moore in Moore
Oklahoma.
a. Special permission was obtained from the Church
Administrator to survey >40 personnel. Though
not a public funded entity, the church is a
non-profit and thus shares similar financial
obligations as a public organization.
b. The surveys that were sent to this group were
the O E O Solomon 1 group.
7. Finally, approximately 20 other MPA students sent
out surveys to various government employees.

The anticipated return rate was >30% of those contacted. The
average completion time for the survey is 10 - 15 minutes: 1
minute to read the email, 2 minutes to read the consent form, 5
minutes for the pre-test (when applicable), 2 minutes to read
the ethics intervention (when applicable), and 10 minutes for
the post test. The completed test data was accessible to Dr.
Franklin at the University of Oklahoma.

As with any survey there are certain threats to validity and
reliability that make research a challenge. Threats to validity
in this survey may include the following:
1) Sincerity-some people may not have taken this survey
serious because of the amount of attention / time required
to complete the survey. These people may quickly complete
the survey without answering the questions honestly.


2) Integrity- some respondents may a) consider their own
morals questionable and may therefore lie on the DCI to
compensate; or b) try to impress the researcher or
themselves by overestimating their responses on the DCI;
3) Misinterpretation - Finally, some people may answer
inaccurately due to unclear understanding of what objective
moral standards are.

Finally, threats to reliability include the following: 1) lack
of oversight – this is required to achieve anonymity, but the
anonymous nature of the electronic survey allows for one person
to complete the survey multiple times. It is unlikely that
someone would do this due to the time and effort involve
required to complete this survey.

Results of the ethics subset of the Solomon 4 experiment are
listed below in Table 1. There were 395 total respondents
(ethics subset) for the four groups. Each group was roughly
equal in size ranging from 21.8% to 28.1% per group.

TABLE 1: Frequencies
Frequen Percen Valid Cumulativ
cy t Percent e Percent
Vali OEO 100 25.3 25.3 25.3
d _EO 111 28.1 28.1 53.4
O_O 98 24.8 24.8 78.2
_ _ 86 21.8 21.8 100.0
O
Tota 395 100.0 100.0
l

Analysis and Findings

This section begins with a description of the statistics and
variables that were utilized. That follows with an analysis and
test of the hypotheses and concludes with a discussion of the
pros and cons of the research design. The four hypotheses
analyzed here are:

1. Ha1: Do attitudes towards the propensity to engage in
unethical behavior differ among those who are ethical
and those who are not?
2. Ha2: Is unethical behavior becoming more acceptable?
3. Ha3: Is unethical behavior a reflection of one's race,
sex, and age?


4. Ha4: Does ethical training have any effect on one‟s
positive ethical decision making?

Table 2 lists the total responses for each of the 8 scenarios.

TABLE 2: Statistics
Sc TaxExem BootsSu HITra EmergRep EOYFur
1 Sc2 Sc3 pt pply vel air n
No.Val 19 198 198 364 362 361 361 359
id 7
No. 19 197 197 31 33 34 34 36
Missin 8
g
Mean 0. 0.3 0.8 2.89 2.54 3.83 2.44 1.89
77 7 4
Std. 0. 0.4 0.3 1.179 1.366 0.641 1.058 1.246
Deviat 42 84 69
ion 1
Minimu 0 0 0 0 0 0 0 0
m
Maximu 1 1 1 4 4 4 4 4
m

Recall that Scenarios 1, 2, and 3 were part of the Pre-test.
These groups represent roughly 50% of the respondents. The pre-
test dependent variables forced a dichotomous response and were
coded either 0 or 1. 1 represents a positive choice, 0
represents a negative or inappropriate response.

Thus Sc1 received a trend towards positive responses with 0.77,
Sc2 trended toward the negative at 0.37, and Sc3 had the highest
amount of positive responses at 0.84. Since one scenario leans
strongly toward inappropriate response (Sc2), then this
information suggests that there is no predisposition towards
correct or incorrect behavior before the intervention.

The post test dependent variable scenarios were coded
differently. Open ended questions were asked of each of the
respondents. Research group members independently categorized
the respondents‟ answers. A minimum of four researchers
categorized each respondent‟s answer to ensure validity. A score
of 0 through 4 was attached to each category. „1‟ represented
the least desirable score, while „4‟ represented a positive or
desirable response. A „0‟ score was attached to indecisive
responses.

A cursory look at Table 2 shows Sc6 generated a high percentage


of positive responses, while Sc8 leaned toward the least
desirable with a mean of 1.89. Sc4, 5, and 7 appear fairly
split. We‟ll take a closer look at why shortly.
The independent variables in this study were collect in the 18
Likert questions assessing attitudes and behaviors of the
respondents and demographics. The first 6 attitude questions
were given a score of 0 – 4, with „4‟ demonstrating an attitude
commensurate with positive choices, while „1‟ towards immoral
choices. Again „0‟ was left for undecided or neutral responses.
The second 12 behavior related questions and the last 9
demographic were assessed using the same methodology.

The first hypotheses can be analyzed by closely examining the
relationships between the 18 IVs and all 8 DVs. [Ha1: Do
attitudes towards the propensity to engage in unethical behavior
differ among those who are ethical and those who are not?]
Statistics relating to the first 12 IVs help one to determine
one‟s tendency in unethical relationship.

By examining responses the 5 post test scenarios vs. the IV the
following information can be suggested: Sc4 and 7 show no
statistical significance, but Sc5 shows statistical significance
versus attitudes at the .001 level and behaviors and socially
desirable actions at the .005 level.

Additionally, Sc6 (Hawaii travel) shows significance vs.
behaviors at the .001 level and socially desirable behavior at
the .005 level.

Finally, Sc 8 (EOYfurn) also shows significance vs. socially
desirable behavior at the .001 level. Recall that Sc8 high the
highest level of negative responses. From the statistics a link
can be drawn from socially undesirable actions to the negative
responses.
TABLE 3: Correlations
RAttit RBehav RSocD
Spearman's Sc4 Correlation 0.059 0.04 0.059
rho TaxExempt Coefficient
Sig. (1- 0.07 0.158 0.07
tailed)
N 629 628 627
**
Sc5 Correlation .112 .083* .070*
BootSupply Coefficient
Sig. (1- 0.003 0.019 0.04
tailed)
N 628 627 626


Sc6 Correlation 0.009 .097** .074*
HITravel Coefficient
Sig. (1- 0.406 0.008 0.033
tailed)
N 627 626 625
Sc7 Correlation -0.013 -0.023 0.058
EmergRepair Coefficient
Sig. (1- 0.374 0.284 0.072
tailed)
N 626 625 624
Sc8 EOYFurn Correlation 0.064 0.034 .098**
Coefficient
Sig. (1- 0.054 0.199 0.007
tailed)
N 622 621 620
**. Correlation is significant at the 0.01 level (1-tailed).
*. Correlation is significant at the 0.05 level (1-tailed).

TABLE 4: Coefficientsa
Model Standardi
zed
Unstandardized Coefficie
Coefficients nts
Std.
B Error Beta t Sig.
1 (Consta .622 .562 1.106 .269
nt)
Militar .067 .071 .063 .944 .346
y
Decade -.001 .003 -.035 -.580 .562
Gender -.054 .069 -.051 -.783 .434
Color .095 .069 .077 1.384 .168
RSocD .296 .108 .164 2.730 .007
RAttit .050 .051 .055 .978 .329
RBehav .268 .116 .136 2.315 .021
a. Dependent Variable: IndexPost

A quick glance at Table 4 also shows statistical significance
between socially desirable actions and behavior versus the 5
post test dependent variables. So what does this mean? Perhaps a
stronger indicator of ethical behavior can be ascertained from
screening versus on-the-job training. Let‟s take a look at how
the ethics intervention groups (_ E O and O E O) did in the post


test scenarios versus the non-intervention groups in the post
test scenarios (O_O and _ _ O).

TABLE 5: Crosstab Sc 8: EOYFurn

2-
0 - 1 - other
n/dec purch items 3 ask 4 wait Total
Solomon OEO Count 2 49 8 5 16 80
% 2.50% 61.30% 10.00% 6.30% 20.00% 100.00%
within
Solomon
_EO Count 1 70 14 6 16 107
% 0.90% 65.40% 13.10% 5.60% 15.00% 100.00%
within
Solomon
O_O Count 1 49 18 2 16 86
% 1.20% 57.00% 20.90% 2.30% 18.60% 100.00%
within
Solomon
_ _ O Count 2 35 14 4 31 86
% 2.30% 40.70% 16.30% 4.70% 36.00% 100.00%
within
Solomon
Total Count 22 349 90 28 146 635
% 3.50% 55.00% 14.20% 4.40% 23.00% 100.00%
within
Solomon

Prior to analyzing the data, one would expect the intervention
(i.e. the training) to have some positive effect on the
respondents, but this is not the case. In fact, it appears the
opposite effect occurred. If we take a look at Table 6 (Sc8),
both intervention groups combined had over 60% respondents do
the inappropriate action; purchase furniture with funds when
they explicitly knew the funds had been allocated for the
following year.

The pre-test post-test group posted close numbers but was
actually less at 57% and the post test only group, the group one
would expect to perform the worst because it had zero
forewarning, performed significantly better at just 41%
respondents choosing the inappropriate activity. How is this
possible? Perhaps, this can be explained by the nature of the
scenario. It could be argued that by making the purchase for the


company (the bad action) may have been misconstrued by many of
the respondents. This may be because one may feel like they are
partaking in an activity that benefits the organization. This
is the “gray area” in ethics that so often many people violate,
and at a minimum this data demonstrates at least that point. It
also highlights the fact that ethical training may not be as
useful as one would hope it would be.

This takes us to our next hypothesis: Ha2: Is unethical behavior
becoming more acceptable? For this test, we will simply analyze
the frequency of incorrect responses in scenarios 1-8. Sc1
should have been a relatively clear right vs. wrong decision,
yet only 77% of respondents chose the legal behavior. Sc2 was
less defined in terms of right vs. wrong and only had 36% of the
respondents choosing the financially legal action. Sc3 drew
only 83% of correct responses.

The post test data was equally baffling. Only one scenario, Sc5
(the Hawaii travel scenario) generated consistent data in which
the respondents chose the positive course of action. Perhaps,
business constraints which are present in the modern workforce
have driven a push toward generally accepted unethical behavior
in the workplace. The results of this study are inconclusive to
determine this hypothesis, but demonstrate the need that further
study is required here.

Next, let‟s examine our third hypothesis Ha3: Is unethical
behavior a reflection of one's race, sex, class and age? To
begin with let‟s take a look at whether race was a factor in the
results. This study classified respondents by either white or
non-white. Ninety-four of the 688 respondents did not answer the
demographic question on race. Of the respondents that answered
the results are as follows:

TABLE 7: Race response
Positive Negative
(4) (1)
Sc4 Tax Non-
Exempt White 43.50% 3.10%
White 38.80% 5.10%
Sc5 Non-
BootsSupply White 39.40% 23.10%
White 41.10% 18.70%
Sc6 HI Non-
Travel White 88.80% 3.10%


White 92.50% 0.50%
Sc7 Non-
EmergRepair White 25.20% 15.10%
White 18.70% 14.10%
Non-
Sc8 EOYfurn White 23.30% 53.50%
White 22.90% 55.80%

Note that in Sc4 and Sc7 non-white respondents appear to have a
higher rate of positive responses (43.5% vs. 38.8% and 25.2% vs.
18.7% respectively). Sc5 and Sc6 show white respondents with a
slight higher positive response rate. Sc8 appears approximately
equal. The regression analysis shows a relationship exists
between “color” and the DVs (reference Table 4) although at .168
it is not a very strong relationship.

Given the inconsistency in the results of the 5 post test
scenarios coupled with the missing data from 94 respondents, no
critical analysis based off of race can be inferred from this
study. If one were to make on observation based strictly off the
reported results however, it appears race really made no
difference here anyway.

Next let‟s take a look to see whether sex made a difference in
this study. Similar to the race question, 96 respondents (14%)
chose not to answer the sex question, rendering this data
inconclusive. However observations can still be made with the
available data. Reference Table 8 on the response differences
based on gender.

TABLE 8: Gender response
Positive Negative
(4) (1)
Sc4 Tax
Exempt Female 36.10% 3.60%
Male 43.00% 5.10%
Sc5 Boots
Supply Female 41.00% 13.10%
Male 41.50% 25.70%
Sc6 HI
Travel Female 93.60% 0.40%
Male 90.70% 1.50%
Sc7 Emerg
Repair Female 19.50% 13.50%
Male 20.40% 15.60%


Sc8 EOYfurn Female 19.80% 59.50%
Male 25.50% 51.70%

While the statistics appear close in the gender responses, there
are some distinct differences. In every scenario but Sc8 females
had a lower percentage of negative responses. Sc8 however drew a
large margin of negative responses over males (7.8% higher).
Recall that Sc8 had the highest propensity for unethical
response rates to begin with. Also recall that the scenarios
were setup such that the delineation between correct versus
inappropriate behavior increased in ambiguity with Sc8 the least
clear. Perhaps (based off of this data) that females are more
likely to make the socially preferred choice when ethical
guidelines are clear, but less likely when they are not clearly
defined.

Also of note is the higher rate of male negative responses and
positive responses in nearly everyone scenarios. Perhaps males
are more likely to side with one extreme or the other, while
females are more likely to look for other creative options (note:
the middle choices are not present on these tables).

Perhaps age played a role in the ethical dilemma presented here.
The independent variable we will analyze here is based off of
age by decade. The dependent variable we will look at here is
Sc5 Boots Supply.

TABLE 9: Sc5 Age by Decade Born
Response
Positive Negative
(4) (1)
Sc5
BootsSupply 1940s 26.90% 19.20%
1950s 45.30% 10.50%
1960s 47.70% 18.90%
1970s 39.80% 21.40%
1980s 37.40% 25.10%

Note that from 1950s era and on, each decade appeared to receive
fewer positive responses and greater negative responses. It
appears that as respondents born in earlier decades displayed at
propensity towards higher ethical standards. Perhaps this data
also supports Ha2.

Finally, let‟s take a look at our final hypothesis: Ha4: Does
ethical training have any effect on one‟s positive ethical


decision making? For this hypothesis we tested whether
respondents signed an ethics agreement and had frequent meetings
to discuss policies and procedures. Let‟s take a look at what we
found:

TABLE 10: Signed an ethics agreement
Positive Negative
(4) (1)
Sc4 Tax
Exempt No 37.90% 3.70%
Yes 41.50% 4.80%
Sc5
BootsSupply No 37.90% 21.90%
Yes 43.10% 18.90%
Sc6 HI
Travel No 92.30% 1.40%
Yes 90.90% 1.00%
Sc7
EmergRepair No 19.30% 17.40%
Yes 21.50% 12.90%
Sc8 EOYfurn No 23.50% 56.70%
Yes 22.10% 54.70%

The data shows marginal differences between those that signed an
“ethics” agreement and those that did not. Sc4 actually had a 1%
increase in negative responses with those that signed an ethics
agreement, but also had a 3.5% increase in positive responses.
Sc5,6,7 and 8 each saw a very slight decrease in negative
responses, with Sc7 (Emergency Repair) having a difference of
roughly 5%. Perhaps this may be attributed to the threat of a
high cost/high visibility financial issue associated with the
scenario itself.

It should also be noted that every scenario received a marginal
increase in positive responses, but Sc7 and Sc8 (more ethically
challenging scenarios) received fewer positive responses with
respondents that signed an ethics agreement. Perhaps employees
of today‟s workforce are more likely to knowingly break the
rules.

Millions of taxpayer dollars are spent training government
employees on ethical guidelines, but is the money going to good
use? In order to further test Ha4 we examined the frequency of
meetings which discussed organizational policies and procedures.
Reference Table 11 for the following discussion:


TABLE 11: Frequency of Policy Meetings
Positive Negative
(4) (1)
Sc4 Tax
Exempt Infrequent 37.10% 4.80%
Annual 31.30% 9.00%
Monthly 35.90% 2.80%
Weekly 47.50% 3.40%
Daily 45.80% 6.30%
Sc5
BootsSupply Infrequent 30.60% 22.60%
Annual 38.80% 19.40%
Monthly 43.30% 16.60%
Weekly 39.20% 24.40%
Daily 46.90% 18.80%
Sc6 HI
Travel Infrequent 95.20% 1.60%
Annual 86.60% 1.50%
Monthly 92.20% 0.50%
Weekly 93.20% 1.70%
Daily 88.40% 1.10%
Sc7
EmergRepair Infrequent 17.70% 21.00%
Annual 26.90% 14.90%
Monthly 18.10% 13.40%
Weekly 23.30% 14.80%
Daily 16.80% 12.60%
Sc8 EOYfurn Infrequent 15.00% 65.00%
Annual 19.40% 61.20%
Monthly 24.20% 54.40%
Weekly 23.90% 51.70%
Daily 23.40% 53.20%

The data collected on the frequency of policy reinforcement
shows some remarkable trends. Note that in nearly every scenario
a marked improvement in both positive responses along with a
decrease in negative responses occurs until a certain point then
gets slightly worse. Specifically, the respondents that had
“monthly” reinforcement of the rules appeared to outperform the
other groups in every scenario except for Sc6 where every group
performed well. The same proves true for positive responses as
well. This shows that training may be beneficial to an extent,


but then experiences diminishing returns when the frequency is
ramped up to greater than monthly exposure.

As with any study, there were certain strengths and weaknesses
particular with this study. The strengths of this study were in
the data pool itself. There was a strong cross section of
various employees in public and non-profit organizations across
the U.S. The respondents were representative of today‟s
workforce at all levels. This gave us strong insight into the
ethical values of public employees.

Another strength was the quality of responses that were
generated by the five post test questions. This allowed for one
to naturally answer the question without being forced into a
multiple choice or forced answer that may have been
inappropriate for the particular respondent. This provided for
honest open ended responses to the questions resulting in high
quality answers. Other strengths included anonymity, validity
tests, and data analysis capability with the Solomon 4
construct.

Weaknesses with this study included the following: 1) no control
measure for multiple completions 2) although there were 688
respondents, the sample size was not large enough to accurately
represent the modern workforce 3) a large number of military
respondents (roughly 50%) which may have skewed data on military
sensitive budget issues and 4) the intervention may not have
been reflective of actual ethics training or education in the
workplace.

Conclusion

Overall, the study looked into if formal ethics training had a
positive effect on desired behavior of workers in public
organizations.

Our first hypothesis looked at if attitudes towards the
propensity to engage in unethical behavior differed among those
who are ethical and those who are not. In scenarios four and
seven, no statistical significance was noted, yet scenario five
showed significance in attitudes and socially desirable
behavior. Not surprisingly, a high amount of participants from
the Hawaii travel scenario (a situation where the participant
would benefit greatly from unethical behavior), the participants
did choose the desired response. We gathered that there is a
definite connection and correlation between socially undesirable
actions and negative responses.


Although our research team expected the ethics training to have
a positive impact on the participants, we discovered the exact
opposite. In fact, over half of the respondents took part in
inappropriate action, showing that there are often gray areas in
ethics that cause people to justify their actions and
participate in unethical behavior.

For our second hypothesis, we discovered that much more study
needs to be made to determine whether or not unethical behavior
is becoming more acceptable in today‟s society.

In our third hypothesis, regarding whether or not unethical
behavior is a reflection of one‟s race, sex, class, and age, we
had some interesting findings. Males reported having a much
higher percentage of negative responses, showing that females
are more likely to participate in ethical behavior than males.

For hypothesis four, determining whether or not training has any
effect on one‟s positive ethical decision making, our study
showed that training was only beneficial to a certain extent,
and when training frequency exceeds a monthly basis, its effect
on those within the organization decreases.

Overall, we found that one‟s upbringing, morals, and prior
beliefs on ethical behavior are a much stronger predictor of
ethical behavior than any other independent variables that could
be used in research (such as ethics training). It is important
for organizations and public leaders to continue to strive for
more ethical behavior and conduct, yet more research should be
done on what age and level (i.e. elementary education), that
this type of ethical training should begin.


Annotated Bibliography
Anechiarico, F. & Goldstock, R. (2007). Monitoring integrity and
performance. Public Integrity, 9, (2), 117-132.

This article explores how the use of independent private sector
inspector general‟s (IPSIGs) can connect “corruption control
with performance management” in public organizations (118). The
authors begin the article with a literature review on corruption
in public agencies specifically focusing on the positive and
negative consequences of regulatory controls. The authors offer
IPSIG‟s as an efficient and effective way to increase
performance and integrity in public organizations. The IPSIG‟s
used in New York City to monitor the contractors that were
tasked with cleaning up Ground Zero.

Several benefits to using IPSIG‟s are listed but the main focus
is curbing corruption and increasing efficiencies in the
procurement process. The IPSIG‟s monitored the work, audited the
invoices, and created documentation standards that would
facilitate the auditing process. The IPSIG‟s oversight was not
only for corruption purposes but also for increased performance.

This article could be beneficial when discussing the importance
of audit processes in deterrence on undesirable/unethical
behavior.

Chen, Yuh-Jia and Tang, Thomas Li-Ping. (2006) “Attitude toward
and propensity to engage in unethical behavior: measurement
invariance across major among university students.” Journal
of Business Ethics, 69, (1), 77-93.

The central thesis of this article was the study of attitudes
toward unethical behavior and one‟s tendency to participate in
unethical behavior. The participants are measured in 1, their
attitude toward unethical behavior, 2, their propensity to
engage in unethical behavior, and 3, the propensity to engage in
unethical behavior among university students.

The purpose of the study is to investigate the “psychometric
properties of and the relationships among the measures so that
future researchers can apply these tools in testing…unethical
behavior” (78). The research focused on a few selected,
deliberate, intentional unethical behaviors in the finance
sector, which is related to white collar crime cases reported in
the news media. In the research, the participants were students
at a regional state university in southeastern U.S., with a
Major in Business or Psychology. The age of the participants


varied between 18 and 57 and years of education were between 13
and 18 years.

The results of the study reported that male students consider
theft, corruption, and deception as more ethical than female
students, and showed a higher tendency to act in unethical
behavior than their female peers. This study showed that females
are more ethical than males. The authors concluded that “some of
these students may have the intelligence to recognize whether
the issues are ethical or unethical”, yet, “they may not have
the smarts and wisdom to make a good and ethical decision”
(p.89). More Business students were reported as engaging in
unethical behavior than Psychology students.

The authors conclude that it is possible that this is due to the
fact that Business students receive training in the area of
social responsibility and managerial ethics, whereas psychology
students have not. This may be the reason for why Business
students have lowered their likelihood of participating in
unethical behavior.

Douglas, J.W. and Franklin, A.L. (2006) Putting the brakes on
the rush to spend down end of the year balances: carry
forward money in Oklahoma state agencies. Public Budgeting
& Finance, 26, (3), 46-64.

In this article, the authors describe the motivations behind
wasteful government spending at the end of fiscal years. The
most widely held reason for an agency‟s “rush to spend down end
of year balances” is the risk of receiving a budget cut in a
following year due to the perception that the agency could
operate on a smaller budget. The policy of allowing budget
surpluses to lapse back into the general fund can often be
attributed to such wasteful spending and the discouragement of
saving.

Using agency theory, the authors analyze the effects Oklahoma‟s
1997 policy of allowing government agencies to carry over and
reprogram year-end budget surpluses to their next fiscal year.
There is an obvious conflict between the interests of
legislators who allocate funds and the agencies that use those
funds. Legislators are politicians who try to appear fiscally
responsible while agencies simply want to provide their services
unhindered. By allowing agencies to retain its surpluses, the
legislature sends a positive signal to the agencies and better
aligns its interests to theirs.
The authors gathered data from face-to-face and telephone


interviews with chief finance officers from 45 state government
agencies in Oklahoma in 2001. The questions posed included why
they thought the 1997 Oklahoma law was implemented and what the
costs and benefits of the law were.

The authors found that respondents overwhelmingly found greater
benefits to the law than costs. For example, the majority
explained the benefits as allowing greater spending flexibility,
reducing wasteful end-of-year spending, and encouraging savings.
Many appreciated the ability to use their budget surplus as a
sort of contingency fund for unforeseen expenses in the early
stages of the next fiscal year. A minority complained about the
increased paperwork burden for reprogramming their funds and the
inherent potential of future budget cuts because of the mere
fact of having a surplus.

In the end, the authors do, in fact, find evidence that the 1997
Oklahoma law reduced end-of-year spending sprees, increased
agency saving, increased flexibility, and promoted better
planning. This article is extremely relevant to the current
research project regarding the misappropriation of government
funds. Specifically, the article provides an answer to the
ethical dilemma government employees face with regard to zeroing
out their agency‟s budget at the end of the fiscal year.

Egan, Vincent and Taylor, David. (2010) “Shoplifting, unethical
consumer behaviour, and personality.” Personality &
Individual Differences, 48 (8), 878-883.

The central thesis of this article was to study the
characteristics of shoplifters. The authors studied the
personality, attitudes in unethical consumer behavior, and
emotional status of the participants in the study.

The sample studied was of 114 shoppers in England, and broke up
the „emotional status‟ into categories of emotional stability
(ES), extraversion (E), agreeableness (A), conscientiousness
(C), and intellect (I). The research conducted involved the
division of participants into those that have never shoplifted,
those that shoplifted over a year ago, and those that shoplifted
within the past year of the study conducted. Egan and Vincent
describe how the criminal act of shoplifting are often
overlooked because they are seen as “victimless crimes”, which
are “often used to excuse offending, but become victim once one
considers persons involved in the criminal supply chains, and
may be driven by thoughtlessness, which underlies many criminal
cognitions” (p.882).


All participants completed four questionnaires. The first, the
International Personality Item Pool, required them to show on a
five point scale, how accurately ten statements applied to their
own personality. The second, “consumer ethical beliefs scale”,
was made up of 27 statements, which each addressed different
types of unethical consumer behavior. The third, “The
shoplifting attitudes scale”, included seven statements of how
participants felt about shoplifting, and the third,
“Demographics”, required the participants to state their age,
sex, occupation, income, and level of education.

The results of this study found that those lower in ES, high in
E, low on A, C, and I, were more tolerant of unethical consumer
behavior and shoplifting and more optimistic about shoplifting,
and more eager to report engaging in another type of unethical
consumer activity. These results “suggest that UCB reflects
transient opportunism possibly reducing with maturation and
education, whereas dishonest consumer behavior involves generic
predictors of anti-social tendencies” (p. 878). Exactly 40%
shoplifted, 14% were currently active, and shoplifters were all
male and younger than those not.

The authors concluded that “personality characteristics are a
more important predictor of attitudes to shoplifting and
unethical consumer behavior than low socio-economic class
itself, and that the underlying trait influencing both types of
offence is low A” (p. 882).

Ethics Resource Fellows . (2010, March). Ethical Leadership and
Executive Compensation: Rewarding Integrity in the C-Suite.
Retrieved Sep 1, 2010, from Ethics Resource Center:
www.ethics.org/fellows
This article identifies a contributing factor to the financial
crisis in the fall of 2008: ethical misconduct by the top
executives in the private sector. When economic times are good,
ethics violations appear to run amuck. These ethical problems
publicly reared their ugly head when financial markets hit
record lows in the fall of 08‟. Top executive pay went from an
average of $750,000 per annum to $10.9 million despite flawed
business strategies (pg. 2).

Executives garnered bonus packaged that fostered enabled pay
without results. This sponsored reckless CEO behavior and
inculcated an atmosphere of poor business strategy. This
resulted in heavy debt, failed business, and large losses of


jobs.

Additionally, organizations which paid excessive bonuses and
“golden parachute” severance packages instilled an atmosphere
that lacked integrity from the top down. Even mid-level workers
at Enron for example engaged in disreputable behavior (cheating,
fraud).

The excessive payouts to CEOs despite a failing economy have
ignited public outrage. Through Troubled Assist Relief Program
(TARP), the federal government stepped in to aid large financial
institutions, but despite receiving billions of taxpayer money,
top executives were still receiving multi-million dollar
severance packages, etc.

Some political leaders have argued for more government
intervention. This proposal has struck a heated philosophical
debate among many Americans. The Ethics Resource Center (ERC)
Fellows program proposes a different solution. A solution
centered on positive ethics practices. These are: 1) “establish
an ethics committee of the board” 2) “recruit knowledgeable
ethics professionals for board seats” 3) “call on internal
ethics and compliance personnel to develop metrics to measure
ethical culture” 4) “establish financial incentives for ethical
leadership by the CEO” 5) “insist on transparency by
communicating clearly about compensation packages” 6) consider
pay equity, limits on executive pay and CEO pay caps 7) prepare
for long term strategy that will last during feast and famine
(pg. 16).

Franklin, A.L. (2000) “An examination of bureaucratic reactions
to institutional controls.” Public Productivity and
Management Review, 24, (1), 8-21. Lead Article.

In this article, the author researches efforts by government
officials to improve bureaucratic operations and government
agencies‟ acceptance or rejection of those efforts. More
specifically, she analyzes the effect of institutional controls
on the behavior of government agencies. She considers the
success and failure of a new policy of “strategic planning” and
“performance measurement” in bureaucratic organizations in
Arizona and Texas.

The author considers the question of whether or not the
individuals who are responsible for the implementation of the
latest government “fads” in management are committed to reform
or simply complying with mandates, hoping they could wait long


enough for the policies and the legislators who enacted them to
disappear. As part of a comprehensive budget reform effort,
Arizona and Texas began requiring agencies to submit strategic
plans that included performance measures to executive and
legislative budget offices.

In her research, the author found that commitment towards the
implementation of this new policy increased when a strong
advocate in the agency identified with the policy and fostered
commitment throughout. Commitment also increased once the value
of the policy was realized, especially through its increased use
in the agency. However, commitment towards change decreased
when a “one size fits all” approach was used in the
implementation of the policy at different agencies.

Finally, the author found that agency reaction to institutional
controls can be categorized in two ways: (a) a commitment to the
policy based on perceived value, and (b) an attitude of simple
compliance based on the lack of perceived value. The attitude
of simple compliance can be changed to one of commitment if
perceived value is increased and greater flexibility in policy
implementation is allowed, leading to the later
institutionalization of the policy.

These findings can be utilized in the current research project
as the group focuses on how to implement controls against the
misuse of government funds. For example, controls that force
accountability may initially appear cumbersome and unnecessary,
but with the right actions, members‟ perceived value of the
controls will increase and attitudes will change toward
commitment to the new change.

Gino, Francesca and Bazerman, Max H. (2009). When misconduct
goes unnoticed: The acceptability of gradual erosion in
others‟ unethical behavior. Journal of Experimental Social
Psychology, 45, (4),708-719.

Gino and Bazerman carried out a series of four studies to
support their primary hypothesis that individuals are more
likely to accept unethical behavior if it occurs gradually than
if it presents abruptly. The slippery slope, as they label
behavior that slips from pressing the boundaries into illegal or
unethical, allows the observer to become accustomed to each
degradation of ethicality before it slips to the next
level. Abrupt presentation of unethical behavior was more
likely to be distinguished as such. The second hypothesis of
this research team was also supported through statistical


data. This hypothesis proposes that at least a portion of the
acceptance of unethical behavior in the slippery slope model was
due to implicit bias. The acceptance was neither intentional
nor conscious. The authors suggest multiple follow up studies
to further explain their findings.

Grasmick, H.; Tittle, C.; Bursik, Jr. R.; and Arneklev, B.
(1993) “Testing the core empirical implications of
Gottfredson and Hirschi‟s general theory of crime.” Journal
of Research in Crime and Delinquency, 30 (1), 5-29.

In their book, A General Theory of Crime, Michael Gottfredson
and Travis Hirschi propose that low self-control combined with
the opportunity to commit crime is the major cause of crime.
The authors of this article attempted to test this argument by
interviewing a random sample of 395 adults in Oklahoma City in
1991.

Gottfredson and Hirschi argued that problems during early
childhood socialization in the family (i.e., parents failing to
adequately monitor their children) can create a lasting criminal
disposition called low self-control. This trait can consist of
(1) impulsivity, (2) a preference for simple rather than complex
tasks, (3) risk seeking, (4) a preference for physical rather
than cerebral activities, (5) a self-centered orientation, and
(6) a volatile temper. However, this trait by itself is not the
primary determinant of crime; it must be combined with the
opportunity to commit crime.

Grasmick, et al. conducted face-to-face interviews with the
respondents and had the respondents fill out paper
questionnaires. The questionnaire contained 24 statements that
measured the six traits of low self-control. An example of one
statement is: “I often act on the spur of the moment without
stopping to think.” Interviewees were asked to respond using
the categories (4) strongly agree, (3) agree somewhat, (2)
disagree somewhat, or (1) strongly disagree.

From these answers, the researchers assigned a Low Self-Control
score to the individual. The respondents were then asked
questions regarding their criminal behavior over the past 5
years, such as: “used or threatened to use force against an
adult to accomplish your goals.”

Finally, they were asked questions regarding crime opportunity
over the past 5 years, such as “exposure to situations in which
committing an act of force or fraud would have been possible to


do easily.” After coding the respondents‟ answers, the
researchers found that Gottfredson and Hirschi were correct in
the prediction that low self-control combined with crime
opportunity will have a significant positive effect on self-
reported crime. However, inconsistent with Gottfredson‟s and
Hirshi‟s theory, the researchers found that criminal opportunity
by itself has a significant positive effect on self-reported
crime, beyond its interaction with low self-control.

The findings in this article are highly relevant to the study of
the misuse of government funds. First, knowing that a person of
low self-control has a higher propensity to engage in criminal
behavior given the opportunity to commit a crime, one can screen
against such people from entering the government work force.

Additionally, the research indicates that the simple opportunity
to commit a crime, such as fraud in the public sector, can lead
to such criminal behavior and can be guarded against by
minimizing such opportunities.

Halbesleben, Jonathon R.B., Buckley, Ronal, M., and Sauer,
Nicole, D. (2004). The role of pluralistic ignorance in
perceptions of unethical behavior: An investigation of
attorneys' and students' perception of ethical behavior.
Ethics & Behavior, 14 (1), 17-30.

The authors Halbesleben, Buckley, and Sauer of University of
Oklahoma, goal was to test the hypotheses originally established
by Buckley, Harvey, and Beu, regarding Pluralistic Ignorance.
The purpose of the study was to establish an accurate empirical
study of their research, to expand the research, in order to
show correlation between people attitudes, personal viewpoints,
and ethical dilemmas; also to determine if pluralistic ignorance
can somehow be reduced.
“Pluralistic ignorance is a social comparison error whereby an
individual holds an opinion but mistakenly believes that
others hold the opposite opinion” (Allport, 1924, 1933;
Halbesleben. 2000; Prentice & Miller. 1996).
The pluralistic ignorance fallacy that one own perception or
viewpoint is higher than that of his peers leads into a
misinterpretation of society as a whole.
The original study conducted by Buckley et al selected a group
of college students (for extra credit) and asked them three
questions relating to ethical behavior both good and bad. The


questions focused on the individual ethical standing, how they
viewed their fellow classmate‟s ethics, and those in the
business arena.
The results of this experiment concluded that the participants
felt that they were more ethically sound than their peers and
that the typical business person was considerably more unethical
than his peers. One can infer that this perception is due to
the un-relentless media that focuses on corrupt individuals
rather than those portraying positive examples of ethical
business practices. The authors take this pre-existing study
and conduct an altered experiment on attorneys. This was to
determine their opinion of themselves, their peers in state, and
those attorneys out-side of state.
The conclusion of the experiment was similar to that of the
students; Halbesleben, Buckley, and Sauer continued their
experiment to the next level. In the second part of the
experiment the authors attempted to verify that if more
experienced lawyers were less pluralistically ignorant. This
professional article is related to Ha4 of social conformity, it
describes how the opinion and norms of others can directly
affect the actions and attitudes of others.
Jensen, M. C. (2009, Fall). Integrity is a Matter of a Person's
Word. Rotman Magazine , pp. 16 -19.

This article articulates the importance of integrity within an
individual, organization, and systems or products. The author,
Michael Jensen, a Professor at Harvard Business School explains
the difference between integrity, ethics, and morality. He
explains the impact integrity has on individual and
organizational productivity.

Jensen explains that the concept of integrity is similar to the
concept of gravity. It is something that exists. There is not
good or bad integrity, there is just integrity. A person or
thing either possesses it or does not. Like gravity, integrity
simply exits.

In contrast, a positive and negative value can be applied to
morality and ethics. Morality, Jensen explains “refers to
society‟s standards of right and wrong behavior for individuals
and groups within that society” (pg.16). Ethics “refers to the
normative set of values that apply to all members of a group or
organization” (pg.16).
Jensen defines integrity and its vital importance in a concept


he coins as “workability”. He defines integrity as “a state or
condition of being or whole, complete, unbroken, unimpaired,
sound, and in perfect condition” (pg.17). A person or thing is
“complete or whole when they honor their word” (pg. 16). People
that cannot stick to their word will violate it by displaying
“out-of-integrity” behavior. This affects performance
capability of that person or object.

Jensen correlates the amount of integrity an object or person
possesses to the “workability” or performance capability of that
person or object. If a person possesses integrity then
workability is greatly enhanced. This is because the person is
reliable, predictable and can be trusted. This limits the
effort required in oversight and accountability measures.

Finally, Jensen explains that business models such as cost-
benefits analyses create an out-of-integrity behavior within
people and organizations. A cost-benefits analysis may create a
false justification to violate one‟s word. It potentially may
create the rationalization “I will not honor my word when it
comes down to do so if the costs of doing so are less than the
benefits” (pg.19). Jensen explains this type of philosophy is
the root cause for subprime mortgage crisis. The system lacked
integrity at every level.

Additionally, current political policies (like assisting
homeowners that can‟t pay their mortgage) are rewarding out-of-
integrity behavior. If people and organizations can start
sticking to their word, then perhaps our economy will improve.

Roberts, R. (2009). The rise of compliance-based ethics
management: Implications for organizational ethics. Public
Integrity , 11 (3), 261-271.

Author Robert Roberts delves into the theories behind compliance
and integrity-based approaches of the ethical programs in public
organizations. Citizens of various eras have been privy to some
form of corruption of public officials or organizations that
support the interest of the people. This breach of the
America's trust in big government and government officials have
diminished significantly over the past 50 years. Certain
sanctions and programs were deemed necessary in order to protect
the taxpayer‟s money and to restore the trust of the average
American Citizen in their government.

The author premise states that compliance-based programs relieve
the organization of miscreant behavior and places the blame on


the individuals who committed the offense. According to
Roberts, compliance-based programs are indeed a means to reduce
low-road violations in organizations; however it is not an
effective approach to enhance more positive ethical and
integrity based attitudes of organizations (Roberts, 2009).

Although the implementation of integrity-based programs are more
costly to the organization, it places a higher emphasis on
creating a more prudent and ethical institution overall. The
author gives various examples of how organizations that use
compliance-based programs, are actually creating more convoluted
bureaucracy; thereby enabling the corrupt organization to
absolve their corruption under the protection of compliance law.
This article is related to Ha2, whereas the various types of
controls used by organizations can alter inappropriate behavior.

Schweitzer, Maurice E.; Ordóñez, Lisa; and Douma, Bambi. (2004)
Goal setting as a motivator of unethical behavior. The
Academy of Management Journal, 47, (3), 422-432.

The main focus of the research done by Schweitzer, Ordonez, and
Douma was to determine the effects of goal setting on unethical
behavior. They carried out laboratory experiments evaluating
which subjects were most susceptible to overstating their
achievements which they surmised was a form of unethical
behavior. The subjects were divided into three categories:
those told to do your best, those with a set goal, and those
with a set goal who received a financial reward for meeting the
goal.

They found that setting a goal was more likely to lead to
unethical behavior than someone who was „trying their
best‟. There was little evidence that monetary gain in goal
setting changed the propensity to make false claims.

Additionally, the research demonstrated that the closer an
individual came to a goal the more likely they were to behave
unethically and lie about their attainment of that goal. The
individuals who set a goal but missed it by wide margins were
less likely to falsely claim to have attained the goal. The
author‟s believe the stress of just missing the mark was greater
than the psychological stress the individuals experienced as a
result of their overstatements. This is important research in
attempts to curb unethical behavior in public organizations
because it demonstrates times when individuals may be most
vulnerable to such actions.


Sekerka, Leslie E. and Zolin, Roxanne. (2007) Rule-bending.
Public Integrity, 9, (3), 225-243.

The study presented in this article investigates the
relationship between the application of prudential judgment,
which encompasses two components, practical deliberation and
consideration of others, and the willingness of subjects to
engage in rule bending. Rule bending occurs when part of the
rule is adhered to but other aspects are
circumvented. Generally respondents engaged in rule bending due
to a perceived organizational threat or for personal
convenience.

Research showed a correlation between the subjects‟ perceived
threat to the organization by rule bending practices and their
willingness to engage in such activities. Out of 10
respondents, 7 were ruled to have engaged in actions deemed to
be rule bending. The other 3 described work situations where
they used practical deliberation and consideration of others or
prudential judgment, to find an avenue of solving their
difficulty within the confines of the established rules.

There are limitations to the conclusions drawn by the
researchers due to the low number of subjects surveyed but
warrants further study.

Sims, Ronald R. (1992) Linking groupthink to unethical behavior
in organizations. Journal of Business Ethics, 11, (9), 651-
662.

This article discusses the importance of groupthink in
contributing to unethical behavior in organizations. Janis
(1972) wrote groupthink is “a mode of thinking that people
engage in when they are deeply involved in a cohesive in-group,
when the members‟ striving for unanimity override their
motivation to realistically appraise alternative courses of
action.” Janis and Mann (1977) added that groupthink is “a
collective pattern of defensive avoidance.”

Janis (1972) suggests that four groups of policy advisors were
dominated by concurrence thinking or groupthink and displayed
characteristic symptoms of defensive avoidance: Neville
Chamberlain‟s inner circle that supported an appeasement policy
when dealing with Hitler; President Truman‟s advisors who
supported escalating the war in Korea; President Kennedy‟s inner
circle which supported the Bay of Pigs invasion; and President
Johnson‟s advisors who supported escalating the war in Vietnam.


In each case, a group pushed a certain agenda although
intelligence given to the group had shown that the agenda would
lead to disastrous results.

The author reveals how groupthink contributed to unethical
behavior in three organizations: Beechnut, E.F. Hutton, and
Salomon Brothers. At Beechnut, senior management approved the
selling of cheap, adulterated concentrate in order to save
millions although the company‟s consistent marketing theme since
1891 was the company provided high quality, natural ingredients.
Beechnut management stonewalled government investigators in
order to unload $3.5 million of “fake” apple juice, which led to
criminal charges.

In the case of E.F. Hutton, due to a company money manager
knowingly writing bad checks to earn millions in interest
(a.k.a. check kiting), the company pleaded guilty to two
thousand counts of wire and mail fraud, repaid banks and
investors $9 million, and paid a fine of $3 million. At Salomon
Brothers, a group of top-level executives were involved in
illegal bond bidding in Treasury auctions.

Some of the country‟s most highly educated executives and money
managers became involved in unethical behavior due to groupthink
fostered by what Wolfe (1988) labels bottom-line mentality.
Financial success is the only value to be considered in such
line of thinking.

The author adds that groupthink occurs when arrogance, over-
commitment, and loyalty assist a group to excel above the
ethical interests of the organization. To mitigate unethical
behavior, Sims stresses that organizations must promote positive
and ethical cultures, encourage genuine debate, and program
conflict into decisions via the devil‟s advocate decision
program (Cosier and Schwenk, 1990) or the dialectic decision
method (Cosier and Schwenk, 1991). Janis (1972) offers four
prescriptions for reducing the probability of groupthink; each
of the four encourages group members to evaluate alternatives
critically and discourage unanimity.

Vance, N. R., &Trani, B. V. (2008). The ethical grounding to 21st
century public leadership. International Journal of
Organization Theory and Behavior, 11, (3), 372-380.

In this article the authors examine the three main ethical
approaches to decision-making used in public leadership.
Character-based ethics, rule-based ethics, and result-based


ethics are compared and contrasted, though the authors “support
a more demanding form of consequential thinking which includes
the considerations of Utilitarianism” (373). Therefore, not only
should elected and appointed officials consider maximizing
benefits, but also have “inclusive considerations” in their
decision-making approach (374-375).

Furthermore, the authors contend that “the ends justify the
means” is not a complete enough ethical consideration. The
authors use Abraham Lincoln as an exemplar to utilitarianism,
specifically examining ethical decision-making approach to the
Emancipation Proclamation. It is argued that Lincoln held off on
freeing the slaves until the proclamation could benefit the
Union the most. “In making the correct choice of action at the
right time, Lincoln demonstrated his firm grasp of results-based
ethics and his ability to understand the world in the long
term”(378).

The authors conclude the article addressing the globalization of
public policy and the possible benefit of public confidence in
officials that use a results-based/utilitarianism ethical
approach. This article is a good source for identifying basic
ethical approaches used by elected and appointed officials.

West, Jonathan P., Berman, Evan M. (2004). Ethics training in
U.S. cities: Content, pedagogy, and impact.” Public
Integrity, 6, (3), 189-206.

The writers of this article propose the necessity of ethics
training in public administration. The article says that the
purpose of ethics training is two-pronged: 1) to ensure that
organizations avoid embarrassing association with allegations of
legal wrongdoing and 2) to develop in employees tendencies and
abilities to behave morally and legally. The method by which
training occurs is can be rudimentary or consist or complex,
progressive training modules.

The research method use in this study was a 2002 national survey
of cities mailed to city managers and chief administration
officers (CAOs) in all 544 U.S. cities having populations of
50,000 or more. They find that the mean amount of training is
approximately one-half day. They also find that 43.5 percent of
the cities surveyed make ethics training mandatory. Finally,
they find that usage did not vary significantly by region or
form of government, but large cities were more likely to offer
ethics training.


Wilson, Barbara A. (2008). Predicting intended unethical
behavior of business students. Journal of Education for
Business, 83, (4), 187-195.

The objective of this study was to know the likelihood that
business students would intend to behave unethically given 4
hypothetical situations in their work environments. Thus, this
study measured students‟ intended behavior. A variation of the
theory of planned behavior is used as the model to research the
students‟ behavior. The dependent research variable was intended
unethical behavior, and the independent research variable was an
expanded definition of beliefs about behavior. Samples of
student behavior include decisions about a 3-day week, accepting
Lakers‟ tickets, doing homework on the job, and visiting one‟s
sister.

The results of the research indicate that belief toward one‟s
behavior was the most powerful predictor of intent in all four
situations. Subjective norms were the weakest predictor of
intent.

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