Macroenvironmental factors affecting ethical behavior

Abstract

The purpose of this study is to take a macroethical perspective and study the relationships between various structural factors and ethical behavior of firms. Using the data obtained from the Global Competitiveness Network of the World Economic Forum-WEF, and through the Bayesian Causal Map (BCM) methodology, we study how ethical behaviors of firms in a given country group are shaped by how managers perceive the political, legislative, and protective environment of business in these countries. The unique design of our study allows us to compare these relationships based on the development level of countries. Results suggest that regardless of the development stage of a country, managers’ perceptions about judicial independence are one of the key indicators of ethical behaviors of firms.